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Lead qualification – common misconceptions & pitfalls

So there is a broad topic of lead generation (cushy guide we have here), and lead qualification is a vital part of it as not all leads created equal.

Quality of leads should be one of the criteria of ad campaign effectiveness. I believe the 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 rank 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,
  • 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 of 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.

  1. 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.
  2. The author of the second letter asks what insurance program is better to choose for children, what plans are there and what payout to expect after the contract ends.
  3. 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: The lead 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 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 in the right place. A 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 continue nurturing.

It’s better to get one lead asking “okay, who should I pay?” than ten leads who don’t even know enough about your product yet. Right?

That is true for this particular case, but do not rush with conclusions. So let’s shatter the common myths, to be able to evaluate leads properly.

Myth #1: Any lead is a success

Inexperienced marketing specialists consider each lead to be a significant 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.

According to Kuno Creative marketing agency, 61% of marketers redirect each lead, regardless of its quality, straight to the sales department. If you commit to working with marketing leads to grow them, you will outcompete almost 60% of your colleagues.

Myth #2: lead qualification by gut feeling

Two extremes exist in the market.

  1. First, 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 sale.
  2. Second, in some companies the quality of leads determined by their salespeople. Their perceived view is the most important measurement tool.

According to SalesForce, companies that use objective criteria to evaluate leads achieve the ROI of marketing campaigns up to 138% higher compared to organizations where leads subjectively assessed.

Note that you don’t need any special software or a CRM to evaluate the lead. It is enough to use 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

I’d even say that micro conversions are the best foundation for your retargeting strategy.

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 necessary condition for the marketing funnel to work well.

If your marketers work with leads and grow 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. Close cooperation between sales managers and marketers will boost overall sales funnel effectiveness.

Myth #4: Do not treat social media 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 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 specified period.

For example, imagine a car enthusiast, who prepares a sleigh in summer. Our enthusiast chooses winter tires 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 the sale process and be aware of how it affects lead qualification.

Myth #7: business can only generate quality leads using its resources

Staff marketers know the market, the product, and the audience. However, this does not mean that outside 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
  • an understanding of what’s 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 at a particular scale.

So build and tune acquisition channels first.