None of the fourteen (14) car manufacturers today make the brake systems deployed in their cars. As critical as brake systems are to the safety of cars, car manufacturers outsource this vital component to other companies. There are good reasons why companies practice outsourcing:
- A brake system is sufficiently different from all other systems in a car so that the technologies employed are not transferable to other systems. Therefore, the R&D expenditure can only be amortized on brake systems.
- Brake system makers, on the other hand, can spend the R&D to build products that will be purchased by more than one car manufacturer. In other words, they can leverage the R&D on brake technology better than a carmaker can.
- Even brake systems are complex systems, and some parts are made by very specialized vendors that make nothing but those parts.
This focus on outsourcing enables these companies to bring to market superior products at a faster rate and much lower costs than car manufacturers ever could.
If car manufacturers can build strategic partnerships with brake system makers and trust that they will be provided with high quality, 100% reliable brake systems, B2B companies can build strategic partnerships with High Quality Lead generation providers.
As with car brake systems, Sellers can never amortize the cost of generating High Quality Leads to the extent that companies that specialize in HQLs can. The lack of cost effectiveness will always put a ceiling on either the quality or the quantity of the leads they can produce internally.
A research study provides some insights as to outsourcing is helpful.
A 2016 Lead Generation study of 600 B2B businesses found that the top two strategies for generating quality and quantity leads is the generation and distribution of email and content marketing. Of those B2B companies surveyed, 59% named white papers and eBook downloads as the biggest producer of leads. Emails followed in second place with 22% crediting them as the best generator of quality leads.
Despite content marketing being named as the top lead generator, it was overwhelmingly identified as the hardest marketing strategy for companies to implement. This discrepancy occurs because businesses often attempt to deploy these resource-intensive marketing strategies in-house, rather than outsourcing.
Effective content marketing requires a deep, intensive dive into the industries of potential leads. In the presence of a saturated market, B2B buyers tend to only pay attention to Sellers who are aware of the challenges that plague their industries. Acquiring such a thorough understanding of the buyers’ industry requires a massive in-house expenditure from companies, and therefore your company should consider outsourcing. These efforts take away time and money from other avenues such as the innovation of new products and services. By outsourcing marketing practices and procedures, B2B sellers are able to produce effective marketing while saving resources toward developing new products to remain competitive. Through outsourced marketing, B2B sellers achieve maximum quality and quantity leads while preserving essential assets to invest and allocate in-house.
Read about the first and second components of the Build or Buy Decision in Lead Generation.