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When is a lead ready to be passed on to the sales department? What prospects should the sales team focus on? Lead scoring? BANT? … Today I’m going to explain the different levels of lead qualification and how you can go about applying them to your sales funnel.
Potential clients are not always ready to be pounced upon the moment they show an interest in your product. An element of courting is required; typically a number of interactions and exchanges of information take place before being gradually guided to an optimal state of buying.
As many of these leads will inevitably fall by the wayside this process is referred to as a sales funnel; lot of prospects at the beginning with a reduced figure filtering down to the finish line.
According to a study by Rain Today, only 25% of the initial leads are ready to move to sales. The other 75% are either not qualified or need further nurturing. Focusing your efforts on this group costs you both time and money, and that’s why qualification is so important.
A fundamental aspect when designing your sales funnel
Sales and marketing MUST maintain a fluid line of connection when it comes to leads. Those coming in via inbound marketing campaigns are not the same as those generated by individual efforts on behalf of the sales team. If there is to be effective lead qualification, the design must understand and cater for, or at least be thinking about the role both departments play in the process.
One way to represent the sales funnel is through the following six phases:
Pre-qualification: The marketing department generates leads via recruitment campaigns and assigns them to the sales department for the pre-qualification.
Prospecting: During this phase it’s normal for a lead to inquire further regarding the options available to them with a sales rep. However, until a serious desire to move the process forward is observed, they’re still not considered an opportunity.
Value proposition. The sales rep has a solid idea about the product or service that will be offered to the lead.
Proposal: The price of the product or service is presented in an official budget that is attractive to the customer. You can include offers, discounts, etc.…
Negotiation: The sale is almost closed. The client is, at this stage, still able to request the withdrawal of some products or try to haggle down the price. Depending on the type of product / service, the business is more or less free to negotiate and submit a final financial offer to help you close the deal.
Close deal: Congrats all around! Time to roll out the champers.
Now that the basic phase model has been explained, it’s time to delve a little deeper. We know that a lead has been prequalified and has entered the prospecting phase, but just how hot are they? For that, we can take advantage of the following procedures:
Technical qualification of leads
Lead qualification is essential to avoid falling into the trap of providing advanced treatment to a lead that’s simply not ready for it. If you fail to approach at the optimal time, the lead may react negatively and go on the defensive.
Lead scoring
In order to evaluate the quality of our potential leads, we must first look at the following two criteria:
The demographic criteria positions the lead relative to the buyer persona (ideal client) so that the closer they are to it, the higher their resulting score will be.
For example, imagine you’re in talks with a B2B business client and you want to know the position your lead holds within the company. Ultimately, are they going to be the one making the final purchase decision? If so, your score for this lead will be positive and you will apply a predefined number of points accordingly (10 or 15, for example) to this specific lead. Conversely, if you are speaking to an intern or grad student, who are unlikely to have the final say then the score will be negative (-10 or -15).
Behaviour criteria works in a similar fashion. If you call the company to make an appointment with a business lead, and you are successful, you will assign a high score for that particular item. On the other hand if you face nothing but excuse after excuse or they go ahead and cancel an appointment, you will subtract points.
When all the points have been tallied up, you’ll end up with a result to compare with a pre-set scale. For instance:
Lead cold: from 0-31 points.
Lead warm: of 32-51 points
Hot lead 52 onwards
The lead scoring system is a simple and intuitive process to which you can organise your leads depending on their likeliness to close.
BANT
The term “BANT” stands for Budget, Authority, Need and Timing and offers an alternative format for lead qualification.
Budget: You should find the range of money the customer is willing to spend. If this is a business, chances are they have a pre-assigned budget.
Authority: As we saw in the case of lead scoring, it’s important to discover the role your lead plays within the company. Levels can be set depending on whether the lead is limited to gathering information, whether they’re involved in the decision-making process or if it is they who have the final say.
Need: Does the lead value our product or service? It’s vital you figure this out, or else you may be wasting resources. Here you can assign values of urgency: (high, medium or low, for example).
Timing: It is simply to determine the period of time with which the client needs your services. Immediately? In a month’s time? 3 months? 6, maybe?
These fields allow you to set priorities and focus efforts on those most likely to make a purchasing decision.
Both of these methods, unsurprisingly, require the support by software tools such as CRM and marketing automation applications to help store all the necessary data.
ForceManager CRM includes a Pipeline management tool with which you can group and customise your conversion flow as you see fit, increasing your opportunities and chances of selling.
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