Lead generation and qualification are essential steps in the sales cycle to determine the eligibility of a lead to become a paying customer.
In B2B sales, lead generation and qualification is a lengthy and highly engaging task that requires sales and marketing teams to identify, qualify and nurture leads through the sales funnel till they eventually convert to customers.
Even with all these efforts put into the lead generation and qualification process, it still doesn’t guarantee success, as, Popupsmart reports that only about 20% of leads will become sales-ready.
You can have over a thousand people visiting your websites or social media pages, but only about 50 individuals among them are interested in your products/services.
So how do you identify the qualified leads from the unqualified ones and target these sets of people without wasting your time, effort, and resources?
You need a lead qualification strategy, which will be our main area of focus in this article. We will also walk you through some of the important questions and steps to follow to qualify leads and nurture them to become customers.
Table of Content
- What is a lead qualification?
- Benefits of the lead qualification
- Lead qualification process
- Three steps of the lead qualification process
- Five questions the lead qualification checklist should ask
- Lead qualification checklist
- Lead qualification frameworks
- Tips on moving leads down the sales funnel
What is a lead qualification?
Lead qualification is the process of evaluating a lead’s purchasing authority. It involves assessing your prospect to determine whether the individual matches the set rules of your ideal customer profile (ICP) and the possibility of them making a purchase.
Considering the number of prospective customers that a sales team interacts with on a daily/weekly basis, lead qualification enables them to identify and channel their sales efforts on these qualified leads to drive sales and increase revenue.
The lead qualification process involves finding all the information you can about your leads (their interest, pain points, and goals) to determine how best they fit into the scope of your products or service needs.
With this information, you can identify the qualified leads that should be prioritized and unqualified leads to set aside for later.
Ultimately, lead qualification and prioritization will help you increase your conversion rates and customer base. Check out the difference between MQL and SQL.
Qualified leads Vs. Unqualified leads
A qualified lead is a prospective customer that has a need and interest in your products or services. These leads have a high likelihood make payment.
Some of the traits of a qualified lead include;
- Are well informed about your products and services and their benefits/uses.
- Have a budget and can afford to buy your product or service.
- Have a firm and clear intent to buy and are decision-makers
- They are in the process of completing the sales deal.
- Have low churn rates.
While an unqualified lead might be interested in your product or service, they might not necessarily buy from you.
Some of the traits of an unqualified lead are;
- Have low confidence in your products or service and their benefit to them.
- Can’t afford to buy your product or service
- Not sure of the solution they need.
- They have not been nurtured properly to want to influence their purchase intent.
- Have a very high churn rate.
Benefits of lead qualification
Lead qualification can help sales reps achieve the following benefits;
1. Qualifying leads helps you understand your leads better
A lead qualification process enables you to find all the essential information about your prospects to discover their goals, interests, and pain points for better understanding.
2. Qualifying leads helps you save time and be productive
According to a study by Salesforce, sales reps only spend only 33% of their time selling while they spend the other 67% doing repetitive, mundane, and unimportant tasks.
By qualifying leads, sales teams can save time and stay productive by developing tailored sales strategies for prospects more likely to become customers.
3. Qualifying leads helps you build stronger relationships with your prospects
Lead qualification provides you with all the information and valuable insights to help you understand what works for your potential customers and build mutually beneficial relationships with them.
4. Qualifying leads helps you increase your ROI
When you identify your valuable leads and target them in your sales campaigns, you get to close more sales deals, which will automatically improve your return on investments (ROI).
5. Qualifying leads helps you develop personalized sales strategies
The valuable insights you gain from your lead qualification process will help you understand how best you can tailor and personalize your messages to convert your prospects to customers.
6. Qualifying leads helps you target your prospects at the right time
Lead qualification enables sales reps to identify and target their most valued prospects at the right time in the sales pipeline. With this, sales teams can gain better control of the sales process and reduce the number of lost customers.
Lead qualification process
The lead qualification process begins with lead generation activities carried out by the marketing and sales teams.
It is the process of segregating leads based on the sales team’s sales criteria. Looking at the huge difference between generated leads and qualified ones, there is the need for sales professionals to effectively qualify the leads for higher success.
For this reason, sales organizations have identified five (5) types of leads based on their interest and readiness to buy. They include;
1. Unqualified leads
An unqualified lead is an individual with very low interest in your products or service and is less likely to buy from you.
Marketing qualified leads are prospects that have been deemed ready to receive marketing communications such as email campaigns, social media messaging, content marketing offers, etc.
Sales-qualified leads are prospects that have indicated high interest in your products or service and are ready to talk to a sales rep and begin the sales process.
Product-qualified leads have only shown interest in your product or service but are not qualified to make a purchase.
These leads have either signed up for a free subscription, a free trial, use of a limited feature model, etc. These leads have an experience with your type of product or service and can afford to buy from you.
A conversion qualified lead is a prospect ready to convert and buy from you – these leads have converted on your website by clicking on the buy now button or have requested to speak with a sales rep.
Three Steps of the Lead Qualification Process
Leads go through three stages in the lead qualification process before they eventually convert to paying customers.
Marketing Qualified Leads (MQLs)
A marketing qualified lead is a lead that has indicated an interest in what a company has to sell based on the marketing campaigns and is more likely to become a paying customer than other leads.
An MQL is an individual who has deliberately interacted with your brand by doing either one of the following actions – filling the contact form, downloading gated content, adding an item to an e-commerce website cart, or frequent visitor of your page.
MQLs need more intensified messaging and campaigns to convert them.
Sales Accepted Leads (SALs)
A sales accepted lead is an MQL that a marketing team has nurtured and reviewed in a lead acceptance process to be transferred to the sales team.
An MQL becomes a SAL when a sales team officially accepts them and qualifies them as sales-ready for targeted and personalized sales messaging.
Sales Qualified Leads
A sales qualified lead is a prospective customer that has successfully moved through the sales pipeline from marketing qualified leads to sales accepted leads and are only a few step away from becoming paying customers.
An SQL already has all the information they need about your product or service and has the budget to buy from you but only needs a few more personalized sales campaigns to make a purchase.
To convert an SQL to a paying customer, sales reps must do the following;
- Develop a business proposal highlighting all the benefits of your products and what your prospects stand to gain from buying them.
- Develop a personalized and automated sales messaging strategy.
- Create a timeline to nurture leads and close deals.
Five questions the lead qualification checklist should ask
The lead qualification checklist should contain all the defining characteristics of your ideal customers. For effectiveness, the checklist should inform you about the purchasing power of your prospects.
To determine this, you must ask the following defining questions.
1. Is the person truly interested in what I’m selling?
Lead generation is a long process that might not always yield your desired results – a high quantity of leads does not always translate to quality leads.
You can have so many leads in your pipeline with few interested in your products or services. A lot of times, even the ones you classify as SQLs might still not buy from you.
For this reason, you need to set some criteria that would enable you to identify your lead’s interest in your products or services. To be extra sure of the status of your leads, ask them the following sales-specific questions;
- Are you looking to purchase a product or service? (specify the products or services)
- Can I get you started with one of our pricing plans? (If they checked your pricing plans)
- Are you interested in learning more about a (resource) topic? (if they downloaded content on your website)
If they answered no to the above questions, you should disqualify them from your quality leads.
2. Do they have a use for my Products or service?
What are your lead goals, interests, and pain points? And how can your products or services help them achieve their goals or solve their problems?
Sales can only be guaranteed if your prospect has a “need” for your products rather than just wanting them. For a better understanding of these needs, consider looking out for the following;
- What are their current challenges?
- What are their immediate and long-term goals?
- What roadblock could stop them from achieving the above goals? and how can your product or service save the day?
Once you identify the above factors, you can determine how best your products or service fits into their needs.
3. Do they have enough money for what I’m selling?
Discussing finance with your leads can be a very uncomfortable topic to address. They wouldn’t want to openly discuss their finance or budget with you.
So how do you determine if they are financially buoyant to afford your products or services? To get your way around this topic, ask them the following questions carefully;
- What products are they currently using? (This will give you an idea of their current spending)
- Are they comfortable with the price they are paying for the products or services?
- What is their ideal price range?
4. Is now the best time for them to buy what I am selling?
This question is important to determine your prospect’s sales readiness and help you decide on the best strategies to nurture them till they become paying customers.
Your prospects might be interested in your products and have the budget for them, but the time might not just be right for sales.
To determine their purchasing timeline, consider the following factors;
- Where are they in the buying process? (Are they still gathering information or comparing prices?)
- Do they have certain obligations that can hinder them from buying from you?
- What is the purchase timeline? When are they planning to make payment?
Their answers to the above questions should help you determine their sales readiness.
5. Are they the ultimate decision maker?
A product or service’s sales depend on your lead’s purchasing authority. You need to determine your lead’s job title or position to authorize payments.
Most times you can determine a lead’s purchasing power from their job title, but if you aren’t sure of their position as a decision maker, consider asking the following questions;
- Who decides on the product or service that the company uses?
- Who can you speak with to discuss solutions that your products or service provides?
From your lead’s responses to the above questions, you can qualify and prioritize your prospects to fasten the decision-making process.
Lead Qualification Checklist
Lead qualification requires using lead scoring methods to score leads and classify them based on some pre-existing criteria.
Lead qualification checklist itemizes all the information or factors that a sales team must define and understand during the sales qualification process. It provides you with valuable insights on your prospects and how to tailor your sales campaigns to convert them.
The qualification checklist should contain the following;
1. Buyer’s profile
A buyer’s profile gives you an insight into your buyer personas and helps you check how best your leads fit into your target industry and ideal customer profile.
2. Company Information
You should find all the valuable information about your lead’s company, their services, recent activities, achievements, and contact details to shape your sales outreach campaigns.
Researching your lead’s company will enable you to better position your campaigns and products for success.
3. Online behavior
Look into your lead’s online behavior, website, or social media page visiting/interaction pattern to gain a better understanding of your leads.
To discover this, track their page views, number of downloads, most visited websites or social media pages, or the frequency of their social media visits.
4. Recognize their challenges or pain points
The key to meeting your sales goals/target lies in your ability to provide value and understand your leads – their pain points, challenges, and problems.
Consider following your leads on social media to keep track of their activities, interests, and goals. With this information, you can develop a tailored sales strategy to improve their conversion and increase revenue.
5. Solve their problems
With the information you have on your prospects’ challenges, use your products or services to proffer a realistic solution to the problems.
Without wasting too much of their time, go straight to highlighting the benefits they stand to gain from using your products or services.
To qualify your leads, look into their interaction with your social media pages and consistency. Look out for their likes, comments, shares, click-through rates, and retweets on Facebook, Twitter, and LinkedIn.
7. Spam detection
You don’t want to waste your time, effort, and resources on the wrong lead. To filter the wrong leads from your pipeline, check out for spam and any irregularities in your leads that can be a red flag.
Look out for personal email addresses such as @yahoo.com or @gmail.cominstead of corporate email addresses e.g. Zee@sloovioutreach.com. Aside from this, also look out for red flags like online forms filled in low case, omitting important information in the forms, wrong contact information, etc.
Lead qualification frameworks
Sales reps use the following lead qualification frameworks to qualify leads and help them determine the time and effort spent on their products.
The most widely used frameworks are as follows;
BANT, which stands for (Budget, Authority, Need, Timing) is simple, easy to use, has a proven track record of success and is best suitable for luxury products that can only be bought by a few – mostly B2B brands.
The BANT framework asks the following questions to qualify and prioritize leads;
- Budget: Does the product or service fit into the budget of your prospects?
- Authority: Do they have the power to authorize payments? (are they the ultimate decision maker?)
- Need: How much do they need the products or services? How important is it to solve their pain points?
- Timing: Are the prospects ready to make a purchase? If not, what’s their purchasing timeline?
CHAMP stands for Challenges, Authority, Money, and Prioritization.
It was developed by InsightsSquare to enable sales professionals to understand the challenges of their prospects, determine their suitability for the products or services and eventually prioritize high-value leads and disqualify leads who don’t need the products or services.
The CHAMP framework asks the following questions to qualify and prioritize leads;
- Challenges: What objectives can your products help them achieve by solving their problems/pain points.
- Authority: Who makes the purchase decisions?
- Money: How much investment is required of them.
- Prioritization: What steps should you put in place to target the high-value leads.
MEDDIC stands for Metrics, Economic Buyer, Decision Criteria, Decision Process, Pain Point Identification, and Champion.
It is best suited for high-priced products or services with low sales – mostly software products. It enables sales professionals to determine a lead’s likelihood to make a purchase and understand the buying process.
The MEDDIC framework asks the following questions to qualify and prioritize leads;
- Metrics: What are your prospects expected ROI from buying your products or services?
- Economic Buyer: Who is making the purchase decisions?
- Decision Criteria: What influences your lead’s purchase decisions?
- Decision Process: What process does your lead follow to make a purchase?
- Identification: What problem do they want to solve?
- Champion: Is there a brand advocate vying for your products or service in your lead’s company
ANUM stands for Authority, Need, Urgency and Money.
It is best suited for sales professionals who have no idea of the leads purchasing authority and startups with no defined buying process. ANNUM helps to prioritize leads and define purchasing process.
GPCTBA/C&I stands for Goals, Plans, Challenges, Timeline, Budget, Authority, negative consequences, and positive implications.
This framework focuses on the goals of the leads rather than their needs and provides sales reps with a lot of information on their leads.
It asks the following questions – what are your lead’s goals, plans, challenges, purchase timelines, budget, and purchasing authority as well as the negative consequences and positive implications of your products or services on their goals.
Tips on moving leads down the sales funnel
The following are proven tips that you can use to successfully guide your leads through the sales funnel:
- Use lead magnets (free resources) to attract them to your brand.
- Always pre-qualify your leads to determine their eligibility as an MQL or SQL
- Identify why your prospects are not converting.
- Use the information gathered to improve your strategy.
Lead qualification is a lot easier when you have your checklist. An updated checklist helps you to thoroughly assess your leads and determine their eligibility for your products or services.
Before reaching out to your leads, use your checklist to evaluate and analyze their interests and likelihood to buy from you.
With a lead qualification checklist, you can gain valuable insights into your ideal customer profile to achieve higher sales and conversion rates.