The worlds of sales and marketing are packed with specialist terminology. With so many specific words, it’s often helpful to revisit the fundamentals, in order to make sure everybody is on the same page.
So today we’re reviewing the basics.
Anybody who’s familiar with sales and marketing will undoubtedly be familiar with the word “lead.” You’ve heard phrases like “lead generation”, “lead nurturing”, and “lead qualification” time and again. But everybody doesn’t have the same definitions of these common terms.
This lack of consensus can throw conversations into disarray and affect the way you engage with your leads. Since 61% of marketers say generating traffic and leads is their top challenge, it’s critical to make every lead count.
In this piece, we will:
- Explore the meanings of terms, in order to help your team reach a consensus.
- Dive into the distinct types of leads. What do you need to do with them?
- Find out how to optimize the lead handover process between marketing and sales, which can be tricky.
What Is a Lead?
To begin, let’s offer up a clear, common definition of the term:
Leads are the people or businesses who might eventually become clients or customers.
This definition is simple, but things become more complex as we dig deeper. Over the course of the buyer’s journey, these individuals or businesses are placed into different lead categories according to factors like their level of product knowledge and likelihood of making a purchase.
It’s helpful to bunch these leads together. By grouping them, sales and marketing departments are better able to develop effective strategies and leverage automation. This practice can give these departments the power to build strong relationships and close more deals.
After a certain point, these leads will need to be passed from marketing to sales. This science is delicate, and businesses must define a clear handover process. If not, those businesses run the risk of confusing their team members and alienating their leads.
The most effective marketing and sales departments around the world build effective lead funnels that accurately classify and recategorize leads as they mature.
When does a lead become a prospect?
A point of confusion often arises when sales and marketing departments use the words “lead” and “prospect” interchangeably. But there’s an important difference between these two terms.
Potential customers are referred to as leads until they’re qualified by sales. From that point on, it’s helpful to refer to them as prospects. This simple distinction between the two groups makes it easier for salespeople to hone in on the appropriate prospects.
Types of Leads
Now that we have a better understanding of what we generally mean by the word “lead,” let’s dig deeper into some of the more specific groups. This dive will help you speak clearly and confidently about the leads at the different stages of your sales funnel.
The exact terminology will often differ from one business to the next. But there are five main types of leads that most businesses need to focus on:
Here’s a closer look at the main groups of leads you’re likely to come across while working in the world of sales and marketing.
As the name suggests, a cold lead is a business or individual that does not currently have an interest in purchasing your product or service. Cold leads are often new to your industry, too.
But these cold leads are potential customers, given that they’re in the market for the product or service you offer. “Cold lead” can sound somewhat negative, but it means there’s a chance that lead could be nurtured to become a customer in the future.
A typical cold lead
Let’s imagine that a man named Frederic is in the market for a new CRM tool. He’s identified his need, and he’ll start exploring the different options out there. In other words, Frederic is now a cold lead in the eyes of sales and marketing departments selling CRM tools.
If your marketing efforts are effective, there’s a chance that your cold leads might become an information qualified lead.
How to attract cold leads
It’s critical for marketing departments to attract cold leads by using the following techniques:
- Content marketing: 72% of marketers say that content marketing increases engagement – OptinMonster
- Event marketing: 68% of B2B marketers agree that live events help generate the most leads – Marketing Charts
- Social media: 66% of marketers see lead generation benefits with social media – SocialMediaExaminer
- Public relations: 80% of PR professionals believe the future is digital storytelling – MediaKix
- Digital and print advertising: Small businesses earn an average of $3 in revenue for every $1.60 they spend on Google AdWords – PowerTraffick
- Community engagement: Lead generation is the third main benefit of social media after boosts to brand exposure and website traffic – Small Biz Genius
Ready for more? Read our piece and learn from seven proven lead generation strategies that drive results.
Information Qualified Lead (IQL)
Once you’ve effectively attracted a cold lead, he or she will “convert.” In other words, the lead will provide his or her contact information to the business.
The specifics of that transaction will vary according to the technique used to attract the cold lead. For most SaaS businesses, these leads will provide their contact information in exchange for a piece of content (aka a top-of-the-funnel offer).
A typical information qualified lead
Let’s consider Frederic again. In his search for the best CRM for his needs, he comes across a great eBook that outlines ways to make the most of a CRM tool. So he provides his contact information in exchange for the eBook.
Frederic is now considered an information qualified lead.
How to nurture information qualified leads
Once a business has attracted an IQL, it’s important that the marketing department methodically manages the lead and develops a strategy to nurture him or her. This nurturing will further warm the lead and move him or her to the next phase.
Here are some of the key lead-nurturing strategies that marketing departments use:
- Free webinars
- Case studies
- Product sheets
- Email sequences
- PPC and display ads
Let’s take a look at Bluehost, a web-hosting provider, for inspiration. Here are just some of the various pieces of content they use to nurture their information qualified leads:
Offers and discounts
Marketing Qualified Lead (MQL)
After an IQL has demonstrated a substantial level of interest through his or her interaction with your content, he or she will be redefined as a marketing qualified lead.
In other words, the lead is almost warm enough to be passed along to sales. The exact strategy will vary from one business to the next. Some marketing departments will pass these leads along to be qualified by sales, while others will nurture them further.
A typical marketing qualified lead
Let’s revisit Frederic. After downloading the eBook, he receives regular emails and pieces of content from the CRM provider. He clicks on these pieces and learns more about the company.
At this stage, the marketing department might step things up a notch and try offering him free trials and consultations.
How to take marketing qualified leads to the next level
Marketers will use a number of techniques to nurture their qualified leads and encourage them to make decisions. Here are some of the key techniques:
- Free trials
- Product demos
- Product samples
- Free consultations
- Offers and discounts
- Price estimates
Wondering how to pass a lead along to sales? In the next section of this piece, we’ll take a closer look at the five steps you should take to optimize this handover process.
Sales-Ready Lead (SRL)
Once a lead is warm enough, it’s time for marketing to pass him or her along to the sales team. At that point, sales will assume the responsibility for managing the relationship with that particular lead.
It’s important that marketing and sales work together to develop a strong strategy. This practice will help ensure that the marketing team only passes along high-quality leads that have a high likelihood of converting.
If marketing sends along too many low-quality leads, it can affect the productivity of the sales team and stop them from achieving their goals.
A typical sales-reddy lead
At this stage of the game, Frederic has decided to engage with the business on a deeper level. He’s very interested in the product, and he’s decided to schedule a demo or take advantage of an offer.
Behind the scenes, you pass Frederic along from marketing to sales. Now the sales team will assume responsibility for him and try to assess his suitability.
How sales engage with a sales-ready lead
The way that sales departments engage with sales-ready prospects vary greatly from one business to the next.
In most cases, the sales team will want to engage a sales development representative, in order to get in touch with the prospect and pre-qualify him or her. In other words, the sales development representative will collect important firmographic information and try to understand whether the customer is an appropriate fit.
Sales-Qualified Lead (SQL)
Once a lead has been qualified by a sales development representative, he or she is transformed into a sales-qualified lead.
At this stage, a salesperson will take control of the relationship and try to close the deal. He or she will use his or her in-depth product knowledge and powers of persuasion to understand the needs of the lead and make the sale.
A typical sales-reddy lead
Now that Frederic has been qualified by a sales development representative, he can expect to meet with a salesperson. In that meeting, they’ll discuss the fine details of the product and ultimately decide whether he’ll make the purchase.
How sales closes a sales-qualified lead
The actual sales process will vary greatly from one department to the next. A number of factors will affect this process, such as the location, industry, and product.
At this point, salespeople will want to work efficiently without pressuring or scaring away potential customers.
How to Optimize the Handover Process between Marketing and Sales (Step-by-Step)
Once a lead has been sufficiently nurtured by marketing, it’s time to pass him or her along to sales. It’s important that this process upholds the alignment between the sales and marketing teams.
A lack of alignment here could result in your leads receiving simultaneous, multiple, conflicting approaches from your marketing and sales teams. This mistake reflects poorly on an organization, so you’ll need to avoid it at all costs.
To help you achieve a harmonious handover between marketing and sales, here’s a closer look at the step-by-step process you can follow to optimize it.
1. Define exactly when the handover happens.
To start, the sales and marketing teams will need to discuss exactly when leads should be transferred from marketing to sales.
A number of factors will affect this decision, such as:
- Historical data
- Anecdotal evidence
- The volume of leads
- Sales capacity
The teams will need to balance these factors, in order to find the optimal moment to transfer leads.
As we explored earlier, it’s helpful for sales and marketing departments to use a number of lead categories. In most cases, marketing will pass leads to sales when they are defined as sales-ready leads.
This process will significantly simplify the handover process and give both teams a clear description of their responsibilities.
2. Put the appropriate triggers in place.
Now that you have a clear consensus on when your leads should be passed from marketing to sales, you’ll need to set up the appropriate triggers. These triggers will automate the handover process by automatically reclassifying the lead and moving him or her into the sales workflow.
This process will vary greatly according to the tools and software stack you use. It should be possible to automate this process, though, and move your leads between a number of tools.
For instance, it’s fairly common for marketing departments to use specialist marketing tools to gather and nurture leads before passing them directly into Salesforce.
For the best results, this step requires a significant amount of marketing expertise, as well as clear logic.
3. Integrate leads into the sales workflow.
Now that the leads have officially passed over to the sales team, it’s critical that they’re seamlessly integrated into the sales workflow. Again, this process will require tinkering with your chosen tools, but it should be relatively straightforward.
A number of CRM tools can help sales teams effectively order their incoming leads. This process can help salespeople contact the right leads in a timely manner, in order to unlock the best results possible.
4. Document and share key decisions.
During the handover process, your worst enemies are confusion, miscommunication, and doubt. Unfortunately, it’s all too common for these factors to emerge when two separate departments work together.
Therefore, it’s important to unlock efficiency during the lead handover process and document and share the decisions you make along the way.
The marketing and sales teams should agree on specifics and create the necessary documentation. These documents should cover things like the definition of a lead, the categories you’ll use, the lead-scoring methodology you’ll adopt, and more.
(If you need help with lead scoring, be sure to check out the only guide to lead scoring you need to read.)
You could simply share these documents as Google Drive docs, or you could add them to a knowledge base, in order to help guide new hires in both departments.
5. Diligently review the handover process.
Once you’ve developed and established your handover process, it’s important not to let things slide. You should be sure to diligently monitor the performance of your handover process, in order to quickly identify any potential challenges or opportunities.
For instance, you might want to schedule a regular meeting between the head of marketing and sales, in order to exchange important insights about the handover process.
If you manage to sensibly refine your handover process over time, you’ll be sure to work as effectively as possible and achieve consistent results.
We hope this piece has helped you more fully understand the world of lead management. As you can see, there’s a lot of layers here, and you’ll need to apply your knowledge to get the best results. If you want to accelerate your growth, be sure to use SalesRipe to target sales leads.