Lead qualification – common misconceptions & pitfalls
So there is a huge topic of lead generation (cushy guide we have here) and lead qualification is vital part of it as not all leads created equal.
Quality of leads should be use as one of the criteria of ad campaigns effectiveness. I believe context of lead qualification varies a lot, so let’s better go through some common pitfalls & misconceptions.
Lead qualifications basics
Sorry, can’t go straight to myth busting because Google loves to tank in depth content, but feel free to skip this part, no hard feelings.
A “lead” is a potential customer who in one way or another expressed interest in partocular product or service.
Secondly, the term “lead” refers to the client’s activities, which are necessary for the company (and the sales department specifically).
- It can be a call to a sales manager,
- a use of live chat widget,
- a subscription to a newsletter, etc.
So basically “lead” refers to a customer’s contact information obtained during the process interacting with your company.
Here’s a little example to understand why you need to evaluate the quality of leads. Pretend you’re selling a life insurance service. You receive three letters.
- The author of the first letter would like to issue a standard insurance program for drivers and asks how to appoint a meeting with an official.
- The author of the second letter asks what insurance program is better to choose for children, what programs are there and what payout can be expected after the contract ends.
- In the third letter, the author wants to know the costs of car insurance.
So you got three leads: all of them left phone numbers and email addresses. However, their quality is very different:
- The first e-mail: already decided on the security plan and wants to get a specific product and wants to know how to contact an agent. The probability of a transaction (i.e. purchase) is very high: you just need to pass the contact details to the agent.
- The author of the second email is just interested in your product. The client’s goal is to compare programs and analyze the terms of contracts. You (or your insurance agent) will have to work to make a deal: find out the needs of this potential client, offer suitable programs, process objections, etc.
- The author of the third letter was not at the right place. Life insurance company does not provide car insurance. But it’s a lead still: as we can guess, every car owner risks life and health, thus needs life insurance anyway. Your agent will have to work hard to close this deal.
The first client classifies as a “sales lead” – a lead appropriate for making a deal. The second two clients are “marketing leads” – leads, which marketers should work with.
It’s better to get one lead asking “okay, who should I pay?” than 10 leads who don’t even know enough about your product yet. Right?
This is true for this particular case, but do not rush with conclusions. So let’s to shatter the common myths, in order to be able to evaluate leads properly.
Myth #1: Any lead is a success
Inexperienced marketing specialists consider each lead to be a major success. They immediately redirect contact details of all potential customers to the sales department and consider sales managers at fault, if they don’t make deals go through.
“Successful” leads are ready to make a deal. You can easily redirect them to the sales department. But marketing leads are just an indication of your professional feat. Consider them to be materials for your work. Part of your job is to grow marketing leads sales leads.
Myth #2: lead qualifiaction by gut feeling
There are two extremes that exist in the market.
- One: some companies spend a great deal of effort to determine the quality of leads. They use special programs to determine if a potential client is ready for a deal.
- Extremity two: in some other companies, the quality of leads is determined by their sales people. Their perceived view is the most important measurement tool.
According to Sales Force, companies that use objective criteria to evaluate leads achieve the ROI of marketing campaigns up to 138% higher compared to organisations where leads are evaluated subjectively.
Note that you don’t need any special software or a CRM to evaluate the lead. It is enough to use the objective criteria. For example:
- if the customer has added some goods to cart,
- compared the prices (remember those chats on pricing pages?),
- downloaded some freebie material like white paper
Myth #3: the responsibility of the marketer is limited by lead-generation
Marketers are responsible for working with “cold” leads. They form the needs and prepare the potential clientele for the deal. That is the vital condition for the marketing funnel to work well.
If your marketers work with leads and grows them, then the sales department only gets customers who are ready to buy. In other words, sales managers only see a fraction of leads. On the other hand, some of the sales leads get directly to the sales team, bypassing marketers. So marketers also don’t get to see the whole picture.
Sales managers and marketers should assess the quality of leads together. As noted above, this should be done using objective criteria. The effective cooperation between sales managers and marketers will boost overall sales funnel effectiveness.
Myth #4: Social media cannot be seen as a source of quality leads
According to Kuno Creative, since 2012 SMM has generated more leads than outbound marketing. Therefore, you will be disconnected if you do not work with your customers on Social Media.
Please note that you mostly get marketing leads from social networks (while sales leads can be passed directly to the sales team).
Myth #5: It is only necessary to actively work with high-quality leads, which are clearly interested in the product
If people interact with your website one way or another, they are interested in your product to a certain degree.
Your mission is to find out the interest degree of the lead, or the quality of the lead. Users who want to make a purchase must communicate with sales managers. Users who need or require additional information should receive it from marketers.
Myth #6: sales leads always make deals
A person can make a decision, but postpone it for one reason or another for a certain period of time.
For example, imagine a car enthusiast, who prepares a sleigh in summer. Our enthusiast chooses winter tyres in advance. The person got the necessary information from the sales managers, but did not make the order right away. In this case you can contact the customer to inquire when one is planning to make a purchase and arrange a future call.
So allow some room for natural processes and errors in sale process and be aware of how it affects lead qualification.
Myth #7: business can only generate quality leads using its own resources
Staff marketers know the market, the product and the audience. However, this does not mean that outer sources cannot generate leads. According to a study by Marketing Sherpa. Cooperating with external marketers increases the number of sales leads by 43%.
From my experience running GRIN tech agency lead generation companies add up to a great sales channel if you have
- consistency to test a handful of them
- understanding of whats going on even if you outsource (e.g. how cold emails work)
- resources to allocate for testing. This one is true for every acquisition channel though, but sadly overlooked by many decision makers.
To sum it up on lead qualification
Just want to point out one more thing – similar to A\B testing efforts of implementing and tuning a lead qualification process will yield a positive ROI only starting from certain scale.
So build and tune acquisition channels first.