Inbound & Digital Marketing Blog

What Makes a Number Crucial?

Posted by Clarke Bishop

May 6, 2016

Lately, we've been looking at the importance of your Crucial Number and Inbound Sales.

The Crucial Number is your company's cost to acquire a new customer. But what makes it crucial?

cru·cial
kro͞oSHəl
adjective
  1. decisive or critical, especially in the success or failure of something.
  2. life-and-death

Crucial means decisive or life and death. It's crucial because this one number determines the level of success for most companies. 

Read on to learn why. 

What-Makes-a-Number-Crucial.png

Predictable Sales Process

Is your sales process predictable or more hit or miss?

Smaller companies often depend on referrals for new business. Referrals are great—we love them and you should have them. But, they aren't predictable. Predictable sales are essential to scale and grow.

Or, your company may depend on a superstar salesperson. That can be good, too. It's just not very safe or predictable. What do you do when a competitor bribes your superstar to leave, or your superstar decides to work on their golf game for a few months?

Without a predictable sales process, you can't even calculate your Crucial Number, much less make improvements.

Knowing your Crucial Number means having a predictable process.

Lifetime Customer Value

There's a balance between the cost of acquiring a customer and the lifetime value of that customer. 

Think of it like a vending machine that dispenses new customers. You deposit the cost to acquire a customer and a new customer pops out of the chute. 

But is that new customer good for your business? Will they help your company thrive? When the Crucial Number is low enough and the Lifetime Value is high enough, you're in great shape.

If not, you've got two huge levers to improve your prospects:

  • Reduce the cost to acquire a customer

    Examine everything from marketing through sales to the final close to find bottlenecks and places you can improve efficiency.

  • Increase lifetime customer value

    Increase prices or add more products and services to maximize customer value.

Map Your Sales Process

You can get a ballpark estimate of your Crucial Number by adding up all the cost of marketing, advertising, and sales. Everything. The total cost. Then, divide by the number of new customers.

Most people who do this for themselves leave out costs and come up with a number that's only a fraction of the real cost. Don't make this mistake.

Now, you've got a number. But, you don't know where to start optimizing, where to look for efficiencies and improvements.

To make real changes, you'll want to map out your sales process step-by-step. All the way from advertising or initial contact through to receiving payment from your new customer.

  • What happens in each step?
  • What is the conversion rate for each step?
  • What does each step cost?
  • Should the step be broken down into several sub-steps?

Look for places where the conversion rate drops off. That's where there's the best opportunity to make changes. If there's a step where 80% of prospects move forward, there may not be much room for improvement. If only 5% move forward, that step is a bottleneck and you can make a real impact.

The best way to compute your Crucial Number is to calculate the cost for each step, then add up the total cost. Now you really know how your business works, and can confidently initiate change.

I'll warn you that for B2B sales, it's not uncommon to have 30 steps or more. And larger companies may have multiple funnels that should be analyzed. 

Takeaways

I realize that really understanding your Crucial Number and mapping your sales process takes some work. If you can come up with a better use of your time ... I dare you ... Leave a comment and tell us how!

If you want to review the specifics for your company, schedule a Crucial Number review. We’ll focus exclusively on your crucial number, sales process and opportunities to unblock your growth.

Schedule a Crucial Number Review

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Topics: Sales & CRM


Is Your Company Ready for Inbound Sales?

Posted by Clarke Bishop

April 29, 2016

Inbound Sales requires companies to know their Crucial Number—what it cost to acquire a new customer. Otherwise you’re trying to optimize something that isn’t measurable. That’s a waste of time. More on this in a minute.

Recently, I wrote about how important it is to know your Crucial Number. Some of you may be wondering if it’s worth the effort.

“My Crucial Number is $834.” So what? Is that good or bad?

Will Inbound Sales Improve My Crucial Number?

What's a new customer worth to you? Suppose an average customer has a lifetime value of $80,000. If it only cost you $834 to get this customer, do it again as early and often as you can!

If an average customer lifetime value is $8,000, then $834 may still be good as long as you have decent margins and a predictable sales process.

If a new customer only brings you $600, you’ve clearly got a big problem and need to make some major changes.

What does this have to do with Inbound Sales?

After we help clients determine their Crucial Number, the next step is usually to document their sales process and analyze each step.

You can think of the overall marketing and sales process like an oil refinery. In the beginning you start with crude prospects that barely seem like potential customers. Then, you warm them up and filter them to see which ones are qualified and are good fits.

After a while, sales starts working the leads. There’s more filtering as the relationship builds. At the end, refined customers are the result—the jet fuel that propels your company.

Here’s what you may not have considered. Each step in the process adds value. The further you go into the process the more expensive it is to lose a customer.

When we analyze a process, we look for the steps that have a big drop off. That’s where you’re leaking money. Look at the example below. Between Step 15 and Step 16, there’s a big drop. That’s expensive. (Yes, a typical business-to-business sales process will have 16 or more steps.)

Inbound Sales Process Analysis

We frequently see that there’s a gap in the handoff from marketing to sales. Marketing worked hard and spent $200 or more to get the lead. Then it goes nowhere.

I can hear some of our sales readers screaming, “That’s because the leads are lousy.” Maybe so. Or, it could be that key steps are missing and marketing is passing off the leads too soon.

Or … The handoff creates a disconnect for the buyer. This is a big problem—especially for companies that have been investing in Inbound Marketing.

Inbound marketing is very friendly, educational, and buyer-focused. What happens too often is that information learned during the marketing phase does not get passed through or used by sales.

The buyer exits the marketing phase feeling like they know the company and the company knows them. Then, the salesperson starts asking repetitive, basic questions all over again and doesn’t seem as helpful. It breaks the relationship and feels wrong for the buyer.

To know if your company is ready for Inbound Sales, consider:

  • Do you know your Crucial Number—the cost to acquire a new customer?
  • Have you laid out your sales process?
  • Do you need to add steps or content to have a smooth transition from marketing to sales?
  • Are your salespeople trained and expected to maintain the helpful vibe you created through Inbound Marketing?

It’s all about creating new customers who love your company and can’t wait to buy again. Do this efficiently and smoothly, and you’ll have a low Crucial Number and a thriving company.

If you want to review how all this applies to your company, schedule a Crucial Number review. We’ll focus exclusively on your crucial number, sales process and opportunities to unblock your growth.

Schedule a Crucial Number Review

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Topics: Sales & CRM


What's Your Crucial Number?

Posted by Clarke Bishop

April 22, 2016

Most companies and CEOs can easily tell you about their revenues and bottom-line profits. Some even know what a lead costs or other specific business metrics.

In my experience, though, few know their most crucial number—the cost to acquire a new customer. 

I learned about the crucial number from John Paul Mendocha. He's a turnaround expert, and he always focuses on the cost of customer acquisition. Why? Because it's a key leverage point. 

Crucial-Number.png

Lets use a specialized medical clinic as an example. When asked about their customer acquisition cost, they confidently stated it costs $104 to get a new customer. Average customer revenue was $500, so a new customer was expected to deliver almost $400 in margin (500 - 104).

Unfortunately, a more accurate analysis revealed that the actual cost to get a new customer was $416. The cost to serve that new customer was more than $100, so the company actually lost money every time they got a new customer. Now you see why they needed a turnaround.

Even worse is the situation where customer acquisition cost vary from one customer to the next. There's no way a company can be sustainable if customer acquisition is not predictable. Too many small businesses bump along hopeing they'll some how trip over a new customer. The costs are all over the place.

How to Learn Your Crucial Number

So, what is your crucial number?

It's not on any of the reports your CFO or CPA deliver each quarter. That's one reason the crucial number is often unknown.

And, it's not in the marketing reports you may see. I recently saw a presentation where a marketing guy was talking about his 500% "ROI" from Facebook. He was dividing revenue by the cost for a click. That's not ROI. He completely ignored the cost to deliver the product, the costs of managing Facebook, and many other costs.

Your real Crucial Number is the total cost it takes to acquire a new customer. All the marketing costs. All the sales costs. All the advertising costs. Any other costs that go into acquiring a customer. Everything must be considered.

The best way to do the analysis is to map out the entire sales process—all the way from marketing to sales to close. Then, calculate the cost for each step. Not only will you learn your crucial number, but you'll also see which steps are adding the most cost. That's where you get leverage. Improve the expensive steps and you lower your crucial number while improving overall profitability.

 Too many companies get this wrong, and I don't want you to be one of those. Calculate your Crucial Number, then schedule a crucial number review to make sure you've nailed it.

Schedule a Crucial Number Review

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Topics: Sales & CRM


Inbound Sales:  The Effective Inbound Sales Process

Posted by Kami Valdez

December 1, 2015

Content plays a key role during the sales process. It’s not just for the marketing phase. Content gives you an excuse to be in touch and multiple touch points means more rapport.

The more a lead engages with your business, the deeper that connection grows. 

In complex sales, use your content to sell across the prospect’s company. Continue providing content after the sale to maximize customer delight.

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Also, to make this process run smoothly, you need a good CRM that captures pre-sales qualified lead data and informs the salesperson. Use this data to target content to the right individuals. Identify key pain points an individual is facing, and use that information to formulate your pitches.

Finally, analyze your prospects’ marketing actions to decide the best way to close the sale, or to continue building a connection until those leads are ready to buy.

Build your inbound selling skills using the Inbound Sales Super Guide. Download the guide and make the shift to Inbound Sales today. 

Inbound Sales Super Guide

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Topics: Inbound Marketing, Sales & CRM, Content Marketing


How to Quickly Boost B2B Sales

Posted by Clarke Bishop

November 24, 2015

All business owners want more leads, and I’m going to teach you how to Quickly Boost B2B sales. Watch the video or scroll down and read  ...


Download Your Precise Prospect Profile Kit.

I'm going to give you all the specifics, but first there's something you need to understand:

Buyers Have Changed

Buyers have changed and they don’t behave like they used to.
That’s why it seems like marketing and sales keep getting harder.

For the specifics, read the CEO's 2016 Guide to Marketing.

Everybody, today, has unlimited infomation at their fingertips. Through their browser, their smartphone, their social networks. We’re all surrounded by data.

Buyers have changed

Because of this, Buyers have gotten control over the sales process. Many refuse to engage with salespeople except on their terms.

What does this mean for you? You can’t keep doing the same old sales and marketing techniques and expect good results.

Instead, give buyers what they want! Provide useful and educational information to help buyers do their job, answer their questions, and help them feel good about your company.

All these technology changes mean we have to come at sales and marketing differently.

Still, there’s some really good news. Prospects are more reachable than ever. Over 90% of working age Americans are on the Internet. They’re only one click away from becoming a lead.

Quickly Boost B2B Sales—the Secret

The key is to have very precise targeting and really know your prospects.

Why? Knowing your prospects makes finding them and building rapport much, much easier and faster.

I work with many small businesses. Most of them know their prospects at a surface level. But, they don't know their prospects well enough to accellerate their sales and marketing.

Let's fix that for you. Here are the steps. Start by thinking about the best customers you already have. What are they like?

Consider things like:

  • What characteristics do they share?
    • Are they around the same age
    • Do they have life situations in common like young kids
  • How do they talk about their pains and problems?
  • What questions do they ask?
  • What words do they use? The words matter.
  • What triggers them to buy?
  • Where do they hang out?
  • What else do they care about?

Now you know exactly who you’re looking for. We call it a Precise Prospect Profile.

Precise Prospect Profile Kit

More great customers—the ones that are more profitable and
just more fun. The fastest way to boost your B2B sales results.

Download Your Precise Prospect Profile Kit.

Whatever you do, don’t get caught up in chasing marketing tactics. Know your ideal prospect, and use that knowledge to pick the most effective tactics.

Because you know your precise target, you know their problems and questions. So, you know exactly what content to create. There’s simply no such thing as writer's block when you really know your ideal prospect.

Even better. You’ll also know the best ways to connect with your top prospects because you know where they hang out.

Do they search on Google? Then optimize your pages to attract search visitors.

Are they on Facebook, or Twitter, or LinkedIn? OK, connect with prospects via Social sites.

Do you get your best prospects through referrals or targeted outreach? Great! They’ll want to check out your website anyway.

All the ways you create content and get visitors. These are all tactics.

Just know that everything gets faster and easier when you have a Precise Prospect Profile.

So, I’m going to help you profile your top prospects. Click Free Download, and I’ll send you our Precise Prospect Profile Kit. It’s everything needed to boost your sales and start creating great leads.

Precise Prospect Profile Kit

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Topics: Lead Generation, Sales & CRM


Inbound Sales: How To Align Sales & Marketing

Posted by Kami Valdez

November 24, 2015

When shifting to Inbound Sales make sure your marketing and sales teams are on the same page. They should have the same goals in mind, be working together, and understand each other’s role in the process.

Inbound Sales: How To Align Sales & Marketing 

Your teams can do this in three main ways:

  1. Decide on definitions.
  2. Keep Marketing and Sales accountable.
  3. Survey Sales to help Marketing create more targeted content.

Let’s break them down:

1. Decide on Definitions

Your teams need to agree on four main definitions:

  1. Leads
  2. Inbound Leads
  3. Marketing Qualified Leads (MQLs)
  4. Sales Qualified Leads (SQLs)

Regular leads are shots in the dark. Your team doesn’t have any background information on them, and you don’t know where they are in the buying process. These are the “leads of old.” They come from buying email lists, random outreach, etc.

Inbound leads, on the other hand, are backed by information. You know where they are in the buying process and your team knows how to reach out to them.

Next up are Marketing Qualified Leads. These leads are in the right industry for your business and have pain points and goals that your business can cater to. 

Finally, your teams need to decide what characteristics determine a Sales Qualified Lead. SQLs are all about the right actions like call requests, downloading bottom-of-the-funnel content and visiting sales pages. Through the actions they take, your sales team knows exactly which people are more likely to buy.

2. Keep Marketing and Sales Accountable

To align Sales and Marketing, you want to eliminate as much friction between them as possible. One way is to establish lead transfer metrics and and other processes that keep both of your teams accountable. 

First, determine how many leads Marketing will deliver in a given time period. This could be each day, in a week, a month — whatever works best for your business.

Make sure you’re also doing quarterly, monthly, and yearly reviews to help your team track their progress and plan future growth.

Finally, Marketing should be open about sharing lead intelligence with Sales:

  • The content your leads have downloaded
  • What types of emails they’ve engaged with
  • The pages they’ve visited

This information is vital to your sales team’s ability to do their jobs effectively.

3. Help Marketing Create More Targeted Content by Surveying Sales

This is how you establish a feedback loop that makes the entire process run more smoothly.

Just like Marketing should relay lead intelligence to Sales, Sales should relay how leads are reacting to their content back to Marketing.

Your marketing team should then find out what their sales process entails, what characterizes a high and low quality lead, and the top reasons a lead doesn’t close.

Marketing can use this information to create more targeted content, which will make Sales more effective (and happier).

In the end, if your sales and marketing team are fully knowledgeable about the process and the lead, the customer will feel valued at every stage of the conversion process. 

To learn more about aligning your sales and marketing teams, download the Inbound Sales Super Guide and make the shift to Inbound Sales today. 

Inbound Sales Super Guide

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Topics: Inbound Marketing, Sales & CRM, Content Marketing


Inbound Sales: Buyers Hold The Power

Posted by Kami Valdez

November 18, 2015

Salespeople used to hold most of the knowledge about their products and services. They were the educators. These days, buyers do their own research, read online reviews, and talk to their peers before ever speaking to a salesperson.

Inbound Sales: Buyers Hold The Power

Buyers hold the power, and today’s business to business buyers respond best to a consultative sales process.

Companies, marketers, and salespeople have to adapt to this change in consumer behavior. Marketing has made major shifts through Inbound Marketing. Salespeople are now charged with making the shift to Inbound Sales.

Inbound Sales focuses on aligning Sales and Marketing so they are both focused on increasing sales and working together in an inbound world.

Instead of overpowering buyers with your pitch about how great your company or product is, you need to ask questions and listen to better understand your prospect’s “pain”. Then, use the information you gather to present your services as the solution.

Think about how a doctor asks questions and allows patients to discuss what they feel and then follows up with more questions. It’s best to listen to your prospect so you can gather vital information needed to solve their problems.

It’s about teaching sales people to use content and buyer intelligence so they can structure sales conversations to reflect the buyer’s situation and interests. This helps them know which topics and types of content prospects are interested in and which ones are doing the best job of closing sales. Using this information helps you develop a sales conversation that focuses on the buyer’s issues.

In a consultative sales process, listening to prospects and being focused on helping them is of utmost importance. It’s about their needs, their issues, and the help they need from you to become educated buyers who trust your business and are comfortable making a purchase.

Inbound Sales is based around this premise: 

Each prospect has a unique journey to follow in their buying process. 

It’s the inbound salesperson’s job to facilitate this journey.

Build your inbound selling skills using the Inbound Sales Super Guide. Download the guide and make the shift to Inbound Sales today. 

Inbound Sales Super Guide

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Topics: Inbound Marketing, Sales & CRM, Content Marketing


Inbound Marketing Checklist for Your Next Trade Show

Posted by Kami Valdez

October 29, 2015

Recently, we compared inbound marketing with trade shows. Then, I came across a great article from our friends at Square2 Marketing about how to maximize trade show success with inbound marketing.

If you attend your industry's top trade show, you may invest $10,000, $20,000, or more. Do you want to spend that money for your people to stand around in a booth and collect business cards? Or, would you actually like to get some real leads and have that event pay off?

Trade_Shows_Inbound_Marketing

Inbound marketing can help you have a completely different experience at your next tradeshow. If you take an inbound approach, it will be money well spent.

Planning is key for your event to be considered a real success. You need to start planning for your event 8-12 weeks in advance.

Create your schedule first. Start backwards from the day of the event, and plan your pre-show, in-show, and post-show marketing tactics. Once the plan is complete, assign the individual tasks to your team.

Inspired by the Square2 article, I made a handy checklist you can use for your next trade show. If you need help with any of this, don't hesitate to call and talk to us—inbound marketing is our passion!Trade Show Marketing Checklist

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Topics: Lead Generation, Inbound Marketing, Sales & CRM, Content Marketing


Secrets of Successful Inbound Out Marketing

Posted by Kami Valdez

July 11, 2015

What kind of leads do you want? The kind of leads that seem qualified or the kind of leads that actually turn into buyers? 

Inbound Out Marketing combines inbound marketing with targeted outreach. It is the one, two punch your business needs. When you combine inbound marketing with targeted outreach, you reach more prospects, find more leads, and close more deals.

How do you know what will generate leads for your business? Keep reading and I will help you. If you still have questions, schedule a Lead Boost Review

Combining-Inbound-and-Outbound-Marketing-Successfully-InboundTeam

Inbound Out Marketing is not about getting likes or followers. It is a methodology to start conversations with qualified prospects and generate more leads.

Let's get started!

1. Plan your strategy.

If you haven't already, look at your ideal clients and develop a persona for them. Make sure you know the company size, type, job title, etc. that you want to target.

If you want to really develop your personas, use the Precise Prospect Profile Kit. The worksheet and template will help you discover everything you need to know about the ideal personas for your business. 

2. Develop marketing content.

If you don't have it already, develop content for each segment of your sales funnel. Create content that builds awareness--pulling your audience towards you, and content that compels your audience to act--building trust.

For top of the funnel prospects, write list posts. For middle of the funnel prospects, write "how to" posts. For bottom of the funnel prospects write posts that help answer your top sales questions.

3. Put together a targeted prospect list.

Find the appropriate prospects for your business. If you are not talking to qualified prospects, the chances of anyone turning into a customer are very minimal. 

Do an Advanced Search on LinkedIn by job title, location, company size, etc. to find your target prospects. Tag these prospects in LinkedIn and add them to your CRM.

4. Establish a meaningful connection.

Building meaningful relationships takes time. However, there are definitely some things you can do to save time. 

Once you have your list of target prospects created, and you are certain you want to connect with them, there are a few things you can do to make a good first impression:

  1. Look at which LinkedIn Groups they are a part of, join these groups and join in on the discussion. Be helpful by answering any questions you can or commenting on posts in those groups. This will help make you known to this prospect, and others as well.
  2. Most people that use LinkedIn will have a link to their website and Twitter profile. If they have a Twitter account, follow them and retweet some of their content. If they write a blog, share some of their content. 

Once you have done this a few times, send them a message through a group you share and let them know you are interested in connecting on LinkedIn.

5. Reach out to those prospects.

Once you have a list of prospects put together, and your prospect has accepted your connection request,  it is time to reach out. Targeted outreach gets your quality content directly to the right audience.

Send your new prospect helpful information and you will build the relationship. You will become a trusted advisor before they are ready to buy.

Send emails with links to content you have created--things they would find educational and helpful. Use your CRM and automate follow up tasks to stay top of mind. Remember, persistence pays off!

Still have questions? We love a good marketing challenge. Schedule a Lead Boost Review.

Schedule Lead Boost Review

Takeaways:

  • Inbound Out Marketing generates leads faster and reduces the cost per lead.
  • Combining inbound marketing with targeted outreach helps your team reach more prospects, find more leads, and close more deals.
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Topics: Lead Generation, Inbound Marketing, Sales & CRM, Content Marketing


3 Ways Targeted Outreach Boosts Your Sales Team

Posted by Michael Karp

June 23, 2015

Targeted outreach is part of a new inbound marketing philosophy — Inbound Out marketing

This philosophy takes the best parts of sales and incorporates them into marketing for a more effective approach.

Why is this approach more effective? Well, that’s what you’re going to learn in this article.

Specifically, you’ll learn how targeted outreach through inbound marketing helps your sales team become more effective.

 3-Ways-Targeted-Outreach-Boosts-Your-Sales-Team-InboundTeam

Here we go:

1) Leads Are Warmer When They Reach Sales

Targeted outreach involves your marketing team reaching out to prospects and establishing initial contact. The goals of this contact are to:

  • Establish trust

  • Build a relationship

  • Develop micro-rapport

  • Introduce your content

Through this process, these prospects become accustomed to interacting with your business. They get to know your expertise and what you can do for them.

They also get introduced to your products and services, while building an interpersonal relationship with someone at your company.

By the time these prospects reach your sales team, they already know, like, and trust your business. Your sales team doesn’t have to shoulder the burden of achieving this anymore. It’s taken care of before a representative even picks up the phone.

2) Your Sales Team Becomes a Guide

Targeted outreach leads to warmer prospects interacting with your sales team. This means your sales team doesn’t have to “sell” and pitch your services as hard as they used to.

(Hint: Today’s prospects aren’t as receptive to this anymore, anyway.)

Your sales team is still an expert on your products and services. This is where their true selling power lies.

They become a guide. When speaking to prospects, their job is to uncover problems that your leads are having. They then use their expertise to determine how your products and services can help.

Your sales team doesn’t have to pitch. They can become guides who show prospects the best path for them to take.

3) Prospects Already Know What They Want

One of the goals of targeted outreach is to introduce your products and services. Prospects trust your authority through the content you produce, and they get introduced to your services naturally through calls-to-action on your website.

This process helps them decide which of your products/services could be right for them. They typically decide on one (or a few) that they might be interested in.

When they reach your sales team, they already have this list prepared. All they need is more information to help them make the best decision possible.

This makes your sales team’s job much easier (and more effective). People don’t want to be sold to. They want to be helped.

The most effective route for your sales team to take is to help prospects as much as they can. And it all begins with a targeted outreach campaign that warms prospects and introduces them to your business.

Wrap Up

Targeted outreach is one of the most effective ways to introduce prospects to your business. But it also provides benefits further down the marketing/sales funnel.

These prospects are warmer when they reach your sales team. Your sales team’s job now becomes that of a guide rather than a salesperson.

Why does this work?

Because today’s prospects are more receptive to being helped than to being sold to.

Takeaways

  • Through targeted outreach, leads are warmer when they reach sales.

  • Your sales team guides prospects, rather than sells to them.

  • Prospects already know, like, and trust your business. This is what leads to a more effective sales process.

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Topics: Inbound Marketing, Sales & CRM