While some leads turn out to be your ideal customer, not every lead is right for your product or service. To determine which leads have the most potential, you need to learn about qualifying leads. A qualified lead is one that is most likely to convert, demanding more attention and resources than other leads.
What Is a Qualified Lead?
Qualified leads are those individuals who are most likely to convert. The average cost of a lead varies by industry, but based on a recent survey from FirstPageSage, it can be anywhere from $91 (e-commerce) to $982 (higher education). Either way, when you multiply that by thousands of leads, it adds up fast, and it can be hard to know where to spend the money most effectively. Qualifying a lead ranks them by likelihood of conversion, letting you know where to focus your efforts.
Difference Between a Lead and a Qualified Lead
A lead is someone who has engaged with your product or service offer through a touchpoint, therefore showing some interest in your company. A qualified lead is one you’ve vetted further and determined is likely a true fit for what you’re offering. Think of it like a customer shopping for fruit at the grocery — they’ve not just looked at the apple, they’ve picked it up and inspected it to determine it’s ripe.
Common Types of Qualified Leads
Marketing Qualified Lead (MQL)
- Top of funnel.
- Aware of product but hasn’t taken the next step.
- May have downloaded an e-book or attended a webinar.
Sales Accepted Lead (SAL)
- Still considered top of the funnel.
- Has potential to be a qualified lead based on certain definitions, such as budget, location, need.
- Sales team may be able to move the SAL to an SQL.
Sales Qualified Lead (SQL)
- Intent has been made.
- May have asked for a demo or quote.
- Further along in the sales funnel.
What Is Lead Qualification?
Lead qualification, also sometimes called lead scoring, is an analysis of a lead to determine how much potential they have to become a buyer, and also how well the product or service matches their needs. This process involves multiple considerations, including:
- Does it match the need they think they have?
- Does it match the need they actually have?
- Is it within their budget (or, in B2B cases, do they have the power to make decisions over budget-related decisions on their team)?
- Are they just considering their options, or very close to making a decision after comparing multiple options?
By lead scoring, then focusing resources on those qualified leads, you will enjoy higher conversion rates and shorter sales cycles.
The Importance of Lead Qualification
Lead qualification is a critical aspect in determining where to allocate time and resources as part of a comprehensive marketing and sales strategy. Guessing which leads will convert is a waste of time and money, and will result in a more difficult and expensive process, with lower conversion rates and longer cycles.
Loyal Customers
If you vet potential customers thoroughly up front, you can identify those who may be long-term and returning customers.
Shorter Sales Cycles
Reap the benefits of shorter sales cycles with more targeted resource allocation as you get better at lead qualification.
Organization
You can target specific customers and use lead scoring to determine which leads are best for specific offers, further breaking down your lead scoring as needed.
Lead Qualifying Frameworks
GPCTPBA/C&I
Goals, Plans, Challenges, Triggers, Barriers, and Actions/Context and Insights
A marketer’s main goal is to truly understand customer behavior. This model has the customer journey and their choices along the way at heart, through identifying and understanding these key aspects.
Goals: What are your leads’ main goals? What do they want to accomplish? What specific needs are they looking to fulfill with your product?
Plans: What plans do your leads have to reach those goals? This might include a combination of hiring experts and purchasing tools or products, or metrics and data measurement over time to determine progress.
Challenges: What issues, concerns, or obstacles might your lead face in achieving their goals, whether they predict having these issues, or if you’re the one suspecting they might arise?
Triggers: What event prompted them to take action and investigate solutions?
Barriers: What’s preventing them from simply buying now? Do they really have the funds and authority? Are there other hoops they need to jump through first?
Actions: What are they doing along their customer journey? Are they downloading free resources, but hesitant to explore paid options?
Context and Insights: This is a related framework that asks the marketing team to consider more deeply what the context is around the lead considering your product or service. What are their experiences in the past? How have their demographics, social interactions, background and training, and other aspects affected the decision? This leads to insights that can help you better tailor the customer’s journey.
MEDDIC
Metrics, Economic Buyer, Decision Criteria, Decision Process, Identify Pain, Champion
Often seen as best for those selling to an enterprise business audience, MEDDIC uses data-driven decision making to help create strong deals.
Metrics: What metrics can you share to demonstrate the financial or economical impact of the product or solution?
Economic Buyer: Who is making the financial decisions at the lead’s company? Are you dealing with the decision maker directly?
Decision Criteria: What metrics or rubrics are they using to determine if you and others are a fit? This can help you to position your own solution in an ideal light, demonstrating the necessary metrics to make the decision, phrased in a way that makes the most sense to their team.
Decision Process: How long does decision making usually take?
Identify Pain: What solution are you providing that solves their problem, and what happens if they don’t solve that problem?
Champion: Who is a fan of your company, and will be a “champion” for your cause internally? Focus on that person.
BANT
Budget, Authority, Need, Timeline
It’s a framework initially developed by IBM over 70 years ago, and for some, it still works best today. Others criticize its relevance and efficacy, pointing to newer and more helpful methods, but each marketing team needs to decide for themselves.
Budget: Can they afford your product or service? Do they really have the budget for it?
Authority: Is your contact the person who actually has decision-making power, or do they work with a team who does?
Need: Do they need your product or service, or is it just an extra or “nice to have” that they’re considering?
Time: What is their timeline, and how soon will they need what you have to offer? Are they shopping with intent to purchase soon, or on a longer timeline?
CHAMP
Challenges, Authority, Money, Prioritization
If you’re really sick of hard selling tactics and want to get back to truly helping your leads meet their goals, you can consider CHAMP, a nickname for a four-step process in which hard selling takes a back burner to making sure the customers get the help they need.
Challenges: What difficulty is the lead solving for?
Authority: Who has the power to decide the solution?
Money: What is the budget?
Prioritization: How soon do they need to solve this problem, and how high/low priority is it in their business?
FAINT
Funds, Authority, Interest, Need, Timing
Are you hoping to cultivate interest from very early stage buyers? This might be the most helpful framework for those who aren’t even shopping much yet, or are very early in the shopping process and just entering the funnel.
Funds: Is there a budget in the near future that allows this shopper to consider engaging with your services?
Authority: Does your contact have the ability and position within their company to make shopping and buying decisions?
Interest: Has the potential lead engaged a little with the brand, and showing signs of interest in learning more?
Need: Do they need the product or service you’re selling, and/or are you well-positioned to understand their need and communicate how you can help solve it?
Timing: Will they be shopping at a leisurely pace, or are they working with an upcoming trigger event that makes it more pressing?
A Step-by-Step Guide to Lead Qualification
Revisit Your Ideal Customer Profile
Align your lead qualification strategy with your existing buyer personas. These are detailed profiles of your best-fit customers: Think of them as a guide for spotting the kinds of leads most likely to convert. Use these profiles to set up a consistent scoring system that ranks prospects based on how well they align with your ideal audience.
Build a Scoring Model That Reflects Real Value
Once you know which customer attributes matter, assign point values to each. For instance, someone at a large company in your target audience who you’re positive has budget, purchasing authority, and leadership status over their project direction would hold much more weight than a junior marketing team member at a smaller company. Collaborate with your sales team to research and determine which data points should carry the most weight. Often, they’ve got firsthand knowledge of what makes a lead worth pursuing, and which aren’t worth as much of your time and money.
Use Your Data
You’ll gather data for lead scoring from a variety of sources: form submissions, site activity, email engagement, newsletter open rates, social media interactions, and more. These insights can help you identify not just who the lead is, but how they’re behaving. Maybe prospects who attend a certain webinar or download a particular guide are consistently closer to making a purchase.
Next, set a threshold score that determines when a lead is ready to be handed off to sales, and keep adjusting it as you learn more. Tools like automated lead scoring software can help scale this process efficiently, making it easier for marketing and sales teams to focus on the leads most likely to convert. Lead generation software can help you use this data more efficiently and improve performance marketing at scale.
How to Optimize the Lead Qualification Process
Technology and Automation
Use technology to automate as much as possible, to prevent wasting time manually qualifying leads. Use AI tools to educate the system on who your ideal customer is, then let it do the work going forward. Lead qualifying and generation software can also help match ideal customers to your preferred customer profile, and track how well they’re engaging with your content. You can also ensure your lead capturing strategies and initial interactions gather the correct information to quickly and accurately qualify leads through your tech tool.
Get Ready for Meaningful Smarketing
What happens when your sales and marketing team actually collaborate efficiently? Quite a bit! Smarketing involves the two departments working together, sharing data, helping each other with content creation, and making both jobs easier to ensure lead generation and qualification are going well.
Access to First-Party Data
First party data will clue you into real customer behavior, such as what they’re searching or downloading, allowing you to better customize the customer journey to their needs and actions. Lead qualification is much easier with this data, as you can teach your technology tools to watch for specific types of searches, downloads, and other high interest data to help push a lead over the qualifying threshold, and ensure they move to the next step of the funnel.
Key Takeaways
A qualified lead is one that has been vetted for their potential to convert, ensuring that they’re a great candidate for your company’s product or services. Creating and automating a lead scoring system and staying in frequent communication with the sales team can help marketing experts optimize this process. Streamlining the lead qualification process can lead to quicker converting leads and more loyal, long-term customers.
Frequently Asked Questions (FAQs)
What is the role of an MQL in the lead generation process?
An MQL is a “marketing qualified lead,” meaning they’ve passed through your scoring system and have been qualified as an optimal lead with high potential of converting. The role of MQLs in lead generation is to help sales and marketing teams identify who to focus on, rather than spreading resources too thin, such as on unqualified leads that have a lower chance of converting.
How do marketing teams hand off MQLs to sales to become SQLs?
Once a qualified lead is ready to purchase, they hand the lead off to the sales team, and they become a Sales Qualified Lead, or SQL. Once they’ve accepted them into their section of the CRM or other marketing platform, the rest of the sales process can move forward to complete the deal.
What is lead scoring?
Lead scoring is assigning a numerical value to a lead, based on multiple features and data points that communicate how high of a priority they should be. Marketing companies can score leads based on the size of a company, industry, budget, timeline, and other factors, and set a threshold for what would officially qualify a lead.
Intent vs. identity-based targeting: How does it affect qualification of leads?
Intent-based means a lead is qualified based on their intent to buy, including them signalling they are close to being ready, e.g., they might have downloaded a price sheet or set up a call. Identity-based targeting is lead generation and qualification based on who someone is, such as their position in a prominent company that would make them an ideal client, rather than based on their behavior.
