It's a fact of life in the fast-paced world of Silicon Valley that marketing is often little more than a series of reactions to market events and short-term, tactical needs (ex: "we need to hit our numbers"). Nonetheless, we continue to preach to our clients the values of planning, if only to give your company's demand generation activity a strategic foundation that can be adjusted as circumstances merit.

The following is a question posted recently on a software industry marketing forum, along with my response. To some of you, the approach described here may seem remarkably basic, yet we find that even the most sophisticated marketers, who understand these fundamentals only too well, too often find themselves trapped in a never-ending cycle of reactive, tactical programs.

Sometimes it just pays to step back and say: "what are we trying to achieve here?"

First, the question:

"I am looking for reports, articles etc that would give me an idea of how many leads should be generated according to the budget spent. I am also looking for reports that would give me an indication of how many leads I should generate for my sales team per month per quarter. Also, what is the accepted % of response for a DM?"

"A good place to start is to compile the following metrics:

• your sales team's quarterly revenue goal
• average deal size
• close or conversion rates (in your business, how many raw leads it typically takes to close a deal)

20 deals x 25% close rate = 80 qualified leads
80 qualified leads x 20% qualification rate = 400 raw inquiries

How much you should spend to generate those leads is a tougher question. Your cost per lead might be $20, it might be $200. It depends entirely on your product, your market, your audience, and economies of scale (the larger the goal and your budget, the lower your cost per lead tends to be). I could tell you a reasonable average might be $50, but your situation might suggest something considerably lower OR higher, it's tough to tell.

There is no one response rate that you can use in this situation. The DMA (Marketing Sherpa ( http://www.sherpastore.com/benchmark-guides.html) is another good source for this kind of report) can give you typical rates for e-mail, direct mail, etc. but your best lead generation vehicle may be neither of those. You might find that paid search or content syndication works well in your space, in which case response rates are simply not applicable."