MQL vs SQL: Difference and Importance to Sales and Marketing

You’ve probably heard a thousand times that effective strategy rules the sales and marketing game.

Strategy guides and directs the successful planning and execution of every sales and marketing activity. It reinforces the importance and well-planned means of getting the job done.

No wonder many people go by the phrase – “if you fail to plan, you are planning to fail.”

The sales and Marketing teams are mainly responsible for enabling revenue generation and fostering the growth of every organization.

While marketing is mainly concerned with how a company presents itself to prospective customers through social media marketing, email marketing campaigns, content creation, and lead generation. Sales, on the other hand, are the deliberate conversion of these leads to customers through strategic sales outreach – sales calls, emails, and follow-ups.

For sales and marketing teams to achieve the required revenue growth, they need to find and target leads that will eventually become paying customers.

This is where marketing qualified leads (MQLs) and sales qualified leads (SQLs) come in. However, before we delve into the definitions and importance of MQLs and SQLs, we must understand the meaning of leads.

A lead is a person who has indicated an interest in your company in some way. They could be a website visitor, a social media page follower, or someone who liked your ads or content.

A lead’s intention is mainly vague at this point. So what changes?

When a lead begins to show more interest in the company by downloading the contents, clicking on ads, signing up on the mailing list, or calling for inquiries, based on some criteria, marketing teams will qualify them as a marketing-qualified lead (MQL). After an MQL gets transferred to the sales teams, their intent to purchase qualifies them as a sales qualified lead (SQL).

In this blog, we will help you understand the meaning of MQLs and SQLs, their differences, and how they contribute to sales and marketing efforts. Check out the related guides, sales analysis report and what is gross revenue.

Table of Content

• MQL vs. SQL: What do they mean?
• The difference between MQLs and SQLs
• Importance of differentiating MQLs and SQLs
• Stages of a lead transitioning from MQL to SQL
• Importance of MQLs and SQLs to sales and marketing teams

MQl vs. SQL: What do they mean?

A marketing-qualified lead (MQL) and a sales qualified lead (SQL) are two important leads for every organization’s revenue generation. Although slightly different based on some pre-set criteria, the right nurturing of these leads can help sales teams hit their sales targets.

What is a Marketing-Qualified Lead (MQL)?

A marketing-qualified lead (MQL) is a prospect that a marketing team confirms is worthy of becoming a prospective customer based on their engagement with your business marketing assets, for example, social media content and website but aren’t quite ready to buy yet.

Usually, based on lead intelligence and pre-defined criteria similar to a buyer persona – behavioral, demographic, and firmographic attributes, a marketing team identifies the promising leads that are more likely to buy compared to other leads.

How does this work in real life?

Imagine that a marketing team develops a social media campaign – a marketing video for a newly launched product and promotes it on Twitter and LinkedIn. In this scenario, a lead is a Twitter or LinkedIn user that likes or comments on the video. 

Pretty basic right?

To identify a marketing qualified lead from other leads, the marketing team has to look into other actions that the lead performs – clicking on their ad to visit the website, subscribing to a newsletter, or calling to inquire about the product.

In a nutshell, marketing qualified leads (MQLs) are generated based on the lead’s level of interest and how best they meet the MQL criteria.

What is a Sales Qualified Lead (SQL)?

After MQL comes to SQL, it is the next stage a lead goes through in the sales funnel – an MQL progresses to an SQL to transition to a customer.

A sales qualified lead (SQL) is a lead that has been vetted and confirmed as ready for direct follow-up from the sales team.

So essentially, a sales-qualified lead is a prospect that has indicated interest and is engaged with your company – commenting on your social media posts, sending you an email inquiry, or calling your reps for more information. These leads are very likely to make payments.

SQLs are at the last stage of the consideration and are progressing into the decision-making stage of a customer journey where strategic sales-oriented content and outreach will influence them to become customers.

Using the previous example, the MQLs from Twitter and LinkedIn who meet the qualified lead criteria of the sales teams become SQLs – the ability of the MQLs to fit into the sales qualified lead criteria set by the sales team makes them worthy of attention from the sales reps.

MQLs and SQLs are part of a prospect’s journey to become a customer. However, before a marketing qualified lead (MQL) becomes a sales qualified lead (SQL), it must go through the SAL stage.

What is a Sales Accepted Lead (SAL)?

A sales accepted lead (SAL) is a lead that a sales team officially accepts and manages from the marketing team to nurture and move down the funnel – convert to a customer. SAL is transitioning stage when an MQL that meets the pre-set criteria of the sales team qualifies as an SQL. 

An MQL, SAL, and SQL are part of the sales pipeline. They all follow a direct process – MQL to SAL to SQL to customer.

Some of the importance of SAL to the sales process are;

1. Improve the Follow-up process
2. Eliminate chances of losing promising leads.
3. Ensure Timely Follow up of prospects.
4. Identify and Address Problems in the sales process.
5. Align the marketing and sales team

MQL vs. SQL: What’s their difference?

The transition of an MQL to SQL has always been an issue of concern in sales discourse. Considering that 90% of MQLs are never converted to SQLs by the sales team, it has become imperative to identify the differences between MQLs and SQLs. 

Hence, the following paragraphs will help you understand MQL vs. SQL and when you should consider moving them to the next stage of the sales funnel;

• Lead Behavior
• Lead Demographics
• Likelihood to Buy
• Lead Scoring

Lead Behavior

Lead behavior considers a prospect’s behavior towards a brand and their engagement rate – frequency of website visits, number of comments, and other actions to place them in the sales funnel. To understand these behaviors, consider the following;

1. The frequency of visits

This is key when defining the MQls and SQLs. Naturally, a first-time visitor to your website will most likely be categorized as a marketing-qualified lead (MQL) while a frequent visitor to the website is more likely a sales-qualified lead (SQL).

Sales and marketing teams have to analyze the following data to qualify a lead as an MQL or SQL;

• The web pages a lead visits.
• The time spent on the website – how long the lead spends on the website.
• When leads return to the website and the web pages they visit (when they return).

2. Conversion (Engagement) Rate

Conversion considers the list of actions a lead takes to show their interest in the company – how much content they downloaded, how many comments they leave under your social media post, or how many times they open your emails.

Essentially, engagement rate helps you determine your leads’ level of interest in your brand by tracking how actively involved in your content your leads are.

You need to consider the number of content that your lead interacts with. If your website has many web pages with different ads or campaigns, you might want to look at the different web pages that the lead visits and the number and type of social media posts they like and comment in.

For example, if your social media page combines promotional and educational content, a lead’s engagement with the posts can help you determine their chances of becoming a paying customer.

3. Relevance of the conversion

To convert your MQLs to SQLs, you need to get data on your lead engagement and the relevance of their engagement to their readiness to make payments.

While this can be hard to discover, consider checking for specific purchase-related engagements or types of conversion like filling out a form on your website or social media ads, adding a product to your shopping cart, making calls, or sending emails to ask about your products, etc. to determine their readiness to buy.

4. Referral channel

Every sale and growth-oriented organization must have multiple marketing channels.

A referral channel is a basic requirement of every serious-minded business. These marketing channels include social media marketing, email marketing, Google Ads, websites, and other channels.

After using some of the above-listed marketing channels for a while, the marketing and sales teams can discover which channels bring the most leads (MQL or SQL) and the ratio of such leads turning into paying customers.

For example, if you notice that leads generated from website visits have the highest rate of becoming potential customers compared to the leads generated from Twitter, it’s safe to automatically qualify leads from website visits as SQLs, while Twitter leads will be qualified as an MQL.

In essence, the effectiveness and track record of the marketing channel plays a major role in the conversion of MQLs to SQLs.

5. Contact Requests

This is one of the most straightforward ways to categorize a lead as an MQL vs. SQL.

A lead request to be contacted by your sales rep via sales call or email is a clear indication of interest by the lead. A contact request shows you that the lead is interested in using your product or service but only needs a little more sales effort from your sales team to turn them into a customer.

Identifying leads who make contact requests simplifies the marketing and sales teams’ lead qualification process and helps them identify high-quality leads from unqualified leads.

Lead Demographics

When it comes to categorizing marketing qualified leads (MQLs) from sales qualified leads (SQLs), it is crucial for marketing and sales teams to check a lead’s demographic information and how best they fit into the ideal customer profile.

To qualify the leads (MQL vs. SQL), consider checking their demographic information like age, education qualification, job role/employment, income, and job industry to determine their likelihood to buy from you.

Aside from demographics, you can also check their profile like pain points, buyer persona, and budget for the product or service to help you their position in the buyer’s journey.

Likelihood to Buy

A lead’s likelihood to buy is one of the crucial factors in the lead qualification criteria. A lead who has shown strong interest and intent to make a purchase qualifies as an SQL while a lead with no evident sign of making a purchase is an MQL.

While it can be a bit challenging for your to determine an MQL vs. SQL based on the conversion rate and other lead behaviors, the BANT system helps the marketing and sales department identify qualified prospects;

1. Budget

Budget refers to the financial capability of the lead. You can determine this with questions like – Do they have the budget to buy the product or service?

2. Authority

What power do they have to make purchasing decisions?

3. Needs

How relevant is your business solution to their business and pain points?

4. Timeline

How long or how soon are they planning to make a purchase decision? The sooner, the higher their chance of becoming a sales-qualified lead.

Lead Scoring

Most marketers use a lead scoring system to assign point values necessary for moving pre-prospective clients from MQLs to SQLs. Lead scoring helps the sales reps to develop an ideal customer profile (ICP) to separate promising leads from low-quality leads.

Most B2B companies use lead scoring to add a lead score to lead actions to determine their stage in the sales cycle. It requires sales and marketing alignment to update the buying cycle. Also, check out the guides, B2B sales, SaaS sales and tech sales.

Importance of differentiating MQLs and SQLs

It’s a different thing to understand the difference between a marketing qualified lead (MQL) and a sales qualified lead (SQL) and another to understand why categorizing leads as MQLs vs. SQL is important.

Considering that the success rate of sales and marketing lies in the effectiveness of their strategies, differentiating MQLs from SQLs will help the two teams understand what they need to convert a lead to a paying customer.

By categorizing MQLs and SQLs, the marketing teams can determine the marketing strategy that will help them nurture leads and move to the SQL stage. If your lead has already indicated enough interest in your brand, you don’t want to send brand introduction content when you should be sending them sales-focused content.

Similarly, the sales team has to accept the leads and check if they meet the criteria of a sales qualified lead (SQL) to determine what inbound sales strategy would best convert the leads to revenue-generating customers.

In a nutshell, a sales and marketing team has to qualify leads to MQLs and SQLs to channel the right content and strategy to the right leads.

Stages of a lead transitioning from MQL to SQL

As stressed earlier in this article, a lead has to go through some stages in the sales process before becoming a customer.

Although the marketing department manages the early stage of a lead generation process, the sales team handles the last stage and plays a crucial role in converting the leads to customers. The stages of a customer’s lifecycle or journey are;

1. Subscriber

Subscribing is the first stage of the customer’s lifecycle. It is the first sign of interest a lead shows in your company – liking a post, subscribe to your mailing list, or first visit to your website.

2. Lead

A lead is the second stage in the customer’s cycle. It is the extra interest a person shows in your business – Fill a form on your website but not particularly identify any pain points.

3. Marketing qualified Lead (MQL)

MQL is the next stage of the cycle. It is when a prospect shows great interest in your company by their engagement rate and the number of visits to your site – click on your ads, download gated content, and fill in their information on your website.

4. Sales Qualified Lead (SQL)

SQL is the defining stage where a lead shows their intent to make a purchase – fill in their contact detail (Phone number or email) to be contacted by your sales reps. SQLs are categorized as potential customers with a clear intent to buy.

5. Opportunity

Opportunity is the stage before the leads become customers. At this stage, the sales reps have contacted the leads and have gotten all the necessary information – pain points to sell the business solutions to them.

With this information, sales reps can determine which product or service will most likely solve the lead’s problem (Sales strategy) and go for this.

6. Customer

A customer is the last and most rewarding stage in the customer lifecycle. Here, with inbound sales strategies, the sales reps have already made sales from the SQL and turned them to customers.

Importance of MQLs and SQLs to sales and marketing teams

The sales and marketing teams are the powerhouse of sales and revenue generation of every organization.

For these two teams to maximize their sales and marketing efforts to get the best results, they need to improve their lead generation and qualification process to generate customers and build their customer base.

MQls will help marketing teams understand what content and strategy will help the leads become SQLs, while SQLs are the sales teams’ best bet to convert promising leads to paying customers.