Sales leads are the lifeblood of your company. They’re your link to new customers, new opportunities, and future revenue. However, not all leads are of equal value. The ideal lead identifies a prospect who wants to buy your product or service immediately ,has more than enough budget, is not price or term-sensitive, is looking to make a significant purchase, and has identified your company as the sole source. Ideal leads rarely occur, if ever. Usually, one or more of these seven variables affects the value of the lead: decision timeframe, requirements, budget, price, terms, deal size and competition.
Your sales representatives will spend time on each sales lead according to the rep’s perceived value of the lead. If the rep perceives value – easy to close, immediate decision, large deal size or significant follow-on business, and little competition – he or she will be more likely to follow up on the lead. By establishing a good lead qualification process, you can provide reps with a reasonably accurate assessment of each lead’s value.
Lead Qualification Process
The lead qualification process involves gathering information about the opportunity and the prospect. The amount of information gathered and the effort expended should vary based on the size of the deal and the timeframe involved. Smaller deals, deals with very short sales cycles, or low-margin deals do not justify a major lead qualification effort. Larger transactions or leads for prospects that represent significant future business potential justify a much greater effort.
Once you’ve collected the data needed to qualify your lead, rank the lead “A,” “B,” or “C.” “A” leads are the most important. They represent significant opportunities with a high likelihood of closing. Your sales reps should follow up on “A” leads immediately. “B” leads are important, but may be smaller in size, less likely to close, or have other obstacles your sales team needs to overcome. “C” leads are the least promising leads or they may require a significant investment of time and resources to close. Sales reps should actively pursue “C” leads, but with a lower priority. Over the life of a lead, you may adjust its ranking (from “A” to “B” or “C” to “A”, for example) as conditions change.
For complex, high-margin transactions, the following information is generally valuable when qualifying a lead and jump-starting field sales involvement:
Who Should Qualify Your Leads?
You have several options to consider. You can use your marketing staff, inside sales team, field sales reps or outsource the function to a specialty company. The option you choose will affect the quality of leads passed on to your sales force. It will also affect how many leads are followed up on and how many ultimately produce new business. You will want to select the option that will:
First, evaluate whether it makes sense to outsource lead qualification or bring the operation in house. Here are the key questions to ask when comparing an internal group with an outside firm.
Whether you use an internal or external group, it’s critical to properly train those responsible for lead qualification. They need proper telephone and sales techniques. They need to be motivated to act fast, with a sense of urgency because leads can go stale very quickly. Leads must be qualified quickly and delivered to the field sales representatives while the opportunities are still hot.
To be most effective, lead qualifiers need to be thoroughly grounded in your company’s:
Sales leads fuel your company’s growth and help maintain its competitive position. Make sure you fully realize their value.
For more information, contact Wallace Management Group at (203) 834-0143 or email David Wallace.
© 2009, David P. Wallace