A start-up audiovisual systems integrator needs to take every single lead seriously because, with no backlog of client work, every new lead feels like immediate gratification as a sales lead. When this company grows and has plenty of work, do the leads become less important or is every new lead still a sales lead?
The answer would likely rock many systems integrators, consultants, manufacturers and AV dealers which have not matured their marketing and dales thinking.
Don’t Assume All Prospects Are Actually Leads
Is it really inconceivable that not every prospect is a lead?
Vizzini: “He didn’t fall? INCONCEIVABLE!”
Inigo Montoya: “You keep using that word. I do not think it means what you think it means.”
The scene above from the classic comedy The Princess Bride is funny because Vizzini uses this exclamation repeatedly as he tries to outrun The Man in the Black Mask. No matter the amount of disbelief Vizzini expresses, not only is it entirely conceivable, but The Man in the Black Mask is, in fact, continually gaining ground in spite of Vizzini’s incredulity.
Likewise, the truth that not all leads are, in fact, sales qualified leads may cause certain sales managers to argue the facts. A lead who hasn’t met a threshold of determining at least intent to purchase and has not demonstrated some level of pre-qualification is not a yet primed for a sales call or email. Even more importantly, unqualified leads shouldn’t pull sales professionals away from better-qualified leads.
The Path to a Sales Qualified Lead
If not all leads are really qualified leads, then what is the process for creating a fully sales qualified lead? The lead pipeline looks like this:
- Visitor – The first interaction with your brand. You know nothing about the person at this point.
- Prospect – The person has engaged with your brand. You may know a little about them, but unless you have some type of marketing automation software to track cookies over time, the prospect may still only be a visitor to you.
- Marketing Qualified Lead – Once you have enough information (likely gathered over time through forms to know more about the lead), they can hit a threshold of activity/engagement to be ready to drive down a marketing drip funnel.
- Sales Qualified Lead – If marketing had done their jobs well, then the lead has been primed and is ready to pass onto sales.
To get this kind of lead pipeline, marketing and sales need clearly aligned KPIs to business outcomes and proxy metrics to reflect progress, bottlenecks, and roadblocks on the customer journey from prospect to marketing qualified lead to sales qualified lead to new client.
In the same way that if the sales team were to be judged based on the number of emails sent or the number of prospects called as their main metrics. This would create a seriously busy sales team which may or may not deliver value, as sales activity is not a reliable proxy for closing sales. Activity is not a proxy for delivering results.
KPIs and Lead Conversion Flow
While KPIs are different in each organization, in most marketing departments delivering viable leads is a common goal so one KPI is the conversion rate flow, which measures and tracks the ratios and the rate of change of conversion rates from visitors (unknown user) to prospects (known user) to marketing qualified leads (MQL) to sales qualified leads (SQL) to a closed sale (client). As a simple example, it might look like this:
- 1,000 ad clicks to new landing page visitors at $1,000 ad spend | 55 percent bounce rate off of landing page
- 50 call-to-action clicks to form submission or cookied users | 5 percent conversion rate from ad click
- 20 sign-ups for new prospect webinar | 40 percent conversion rate from CTA clicks
- Five new prospects who fit MQL threshold scoring | 25 percent conversion rate from webinar registration/attendance
- Three new sales prospects who meet SQL threshold and enter into sales pipeline | 66 percent conversion rate from webinar leads to sales qualified leads
- One new client from sales pipeline | 33 percent conversion rate from SQL to new client; a .1% conversion rate from ad click at $1,000 cost per conversion
In the above example, one KPI is the overall flow of the conversion rates (highlighted in italics) with an additional KPI being the cost per conversion. The purpose of these two KPIs is to visualize both the actual cost per new client and the typical flow and expected loss thresholds along the customer’s buying journey.
Let’s go back to the example above. Inside of the conversion rate flow, the main KPI includes several proxy metrics:
- 5 percent conversion rate from ad click
- 40 percent conversion rate from call-to-action (CTA) clicks
- 25 percent conversion rate from webinar registration/attendance
- 66 percent conversion rate from webinar leads to sales qualified leads
- 33 percent conversion rate from SQL to a new client.
On their own, each of those individual metrics doesn’t mean much out of context. However, in the conversion rate flow, each of those proxy metrics represents how one set of metrics is reflecting progress in the overall customer journey.
Though every lead is important, not every lead should be sent immediately to sales. In fact, no leads should go to sales immediately; the immediacy is in building the lead pipeline. Changing the flow of leads is not merely intellectual, but practical. Qualifying leads over time is a sure sign of a mature and aligned marketing and sales team.
What do you think about Anthony Coppedge’s ideas on qualifying leads for Sales?