Lead generation is critical to the sales process. Without leads, any business will severely struggle to sell, make a profit, and expand.
When it comes to lead generation, sales and marketing teams are more inclined towards the ‘Quantity’ of the leads. They treat all leads in the same way, with the confidence that if they try, at least some deals might close.
It is imperative to know that not all leads are equal. It doesn’t imply that a lead is good or bad. But a few leads do have higher chances of conversions than others.
Lead qualification is a systematic process of evaluating if a lead is able and ready to buy your offerings. But, it is worth knowing that the concept of lead qualification differs from industry to industry and company to company.
In this article, you’ll understand how leads are classified as qualified and unqualified, understand their needs before drawing them in your sales efforts, and get answers to the key questions for business success with the right ways to qualify leads.
So let’s get started.
What is a Qualified Lead?
Any company/individual deemed more likely to turn into your business’ customer than others are termed as qualified leads.
Prospects reach a business through your website, online networking, social media, ads, or any other medium to get more information on how you can provide what they want.
Qualified leads are those who are in the process of buying a product/service that mostly aligns with what you are selling. They have done all their research, brainstormed and listed their exact needs, and precisely know what they are searching for.
They have a clearly defined budget allocated to them and full control over the buying cycles. However, the terms can vary depending on your business type.
Based on their source of origin, qualified leads can be classified as
- Sales qualified leads (SQL)
- Marketing qualified leads (MQL)
But how would you know whether you have a qualified lead?
Lead qualification takes much more than impulses and persistence. The first step to finding out if the prospect qualifies, based on their interest and fit, is that they have to show clear interest. They should be ready to invest their time to understand
- what you have to say
- how your solution can help address their needs
It happens most of the time. A lead disqualifies during the exploration and discussion phase. Hence, there are a few questions that should be answered to identify a qualified lead:
- How well do they match your ideal customer profile?
- What do they need?
- What is the role of the prospect in the buying process? Are they just a delegate or the final decision maker?
- Do they properly understand what your company is offering?
- Can they afford your product or service?
- Are they ready to have another meeting, attend a product demo, sign up for a trial, etc. to know better?
- Do they firmly accept that your product/service will be a good match for their business?
- What other solutions are they considering?
- For them, how does your solution compare to the competitors?
Having satisfactory answers to all such questions can ensure if you have a higher chance of converting the prospect. If the prospect qualifies, it is worth scheduling a meeting with your sales development rep.
What is an Unqualified Lead?
An unqualified lead is an individual/business that is mostly unfamiliar with your business. They have not been nurtured enough in the sales funnel.
They may be unsure of your product, may not need it, or may not know if they need it. Sometimes, they don’t have the budget to make the purchase.
Simply put, the three most common reasons why a lead is not ready to buy
- Timing
- Budget
- Inability to see your product’s value
Too often, the buyer is just price-shopping and is probably in communication with a few other companies. Many times, these are only influencers looking for information to identify a problem in the company. They’ll be clearly seen refusing to bring their bosses or the original decision-maker in the scene before the searchers are sure themselves.
Unfortunately, no business runs on a boundless budget and assets. Spending your marketing expenditure on leads who don’t need, can’t buy, or are simply unsure about the product/services you are offering is a sheer wastage of time and resources.
The leads who are not interested in buying at the moment may seem non-valuable to the sales team.
But they aren’t.
These unqualified leads can be nurtured until they near the purchase window and become qualified leads.
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What to do with Unqualified Leads
The failure of B2B sales prospecting can be hurtful. Converting unqualified leads into paying customers may look like a lot of time and effort. But with the right tools and tactics, it isn’t the case.
Never knock off the unqualified leads entirely from your database. Even if they don’t qualify, get the maximum details out of them smoothly. Here are some smart ways to do so:
- Use fun and engaging ways like quizzes to reach out to your target audience and gather more information about them.
- Organize email marketing campaigns and send newsletters to share the company’s latest updates, new offers, prices, discounts, and valuable information with the prospects.
- Guide them on how you can provide a solution to their needs, what benefits they will enjoy once they decide to invest in your offerings. For example, if the price is an obstacle, explain why your product costs more than that of competitors. Sooner or later, your product might find a fit in their budget and requirements.
Lead qualification is a process
As hectic it may sound, any company has to give a prospect time to engage, disengage, and re-engage with its business. Conducting efficient lead nurturing programs is the best way to push the leads further down the sales funnel. Let them cover the stages of awareness, consideration, and decision-making. You’ll find several lead qualifying opportunities over time.
To be on the safer side, appear transparent with the product’s pricing on the website.
You may think that this can backfire. What if your solution is out of their price range, and you may lose customers?
Big deal. At least you are left with those who are willing to spend.
Lead qualification takes combined efforts from the marketing AND sales teams. They have to agree on the lead lifecycle stages. The marketing team should listen to the demand of the sales team, and the sales team should understand who the marketing team is defining as a qualified lead.