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Sales goals are useless if you don’t have a strategy behind achieving them.
Once you set your sales targets for the month, quarter, or year, the next logical step is to supplement them with a strategy that helps you maximize your odds of success.
A study pointed out that 79% of leads don’t convert into sales. This means one should not run in different directions with just hope and no plan to improve conversions.
If your sales reps keep chasing dead ends, they won’t find gold.
To grow sales consistently and manage resources better, one needs a system that works to their advantage.
The question is, how to build such a system?
Lead qualification can be the backbone of having a systematic approach to sales – one that gives you more accurate insights about your customers and adds consistency to your sales approach.
Most importantly, qualifying leads can be the foundation of a system that helps you avoid losing time and money.
To understand how qualifying leads in sales can work to your advantage, we’ll take a closer look at the impact lead qualification can have on your sales performance.
First Things First: The Need for Qualifying Leads
Identifying relevant opportunities to focus on is critical in sales – especially when sales reps are spending only a third of their time on selling.
A relevant opportunity is someone you can identify and label as a qualified lead, someone with the potential to become a customer for your business.
Sales qualified leads (SQLs) are opportunities that have proved their intent, by taking relevant action. For example – the action could be downloading a case study or a whitepaper, attending an event, or requesting a product demo.
SQLs are important because they help you narrow down your target list to relevant and valuable opportunities. Once you know who to target first, you can spend the right time and effort on converting them into customers.
Let’s look at how qualifying leads in sales impacts your team and business.
Impact of Lead Qualification on Sales
Qualifying your leads might seem like something that requires extra effort, without any clear reward or benefit.
But if you look closely, it can help your sales teams get better at the core job – i.e. finding the right prospects first, and position yourself around their needs and expectations.
Let’s look at the day in the life of two sales reps to understand how qualifying leads can make a difference in the way work gets done.
Typically, a day in the life of a sales rep requires –
- Making calls
- Replying to messages
- Sending emails
- Meetings with prospects
- Completing follow-ups
- Conducting research work
Say you have two sales reps, A and B in your team, and both have a bunch of leads to sell to.
Rep A starts his day by making a bunch of calls, sending messages, scheduling meetings, following-up on emails and doing sales-related stuff.
When on calls, Rep A asks questions to capture details about the leads. He asks basic questions about the budget and timelines, but doesn’t go beyond them. Typically, he is eager to make an impression by pitching the products and its benefits right upfront.
Rep A gets the job done, and closes leads into customers, but he does this without having a set framework for measuring the impact of his efforts. He has no set process to evaluate the quality of a lead or to measure the likelihood of a particular lead converting into a sale.
Rep B also starts his day with the same set of tasks, but has a different way of doing them.
When on calls, Rep B tries to go deeper and asks specific questions to understand the interest and intent of a lead. By taking a note of their responses, he gives each lead a score. During the conversation, he listens actively, and tries to pinpoint the problem statement accurately.
Rep B, on the other hand, completes the same tasks, but does them differently. He decides his next set of actions on the basis of the lead scores i.e. whether to follow-up with a lead or not, how to nurture the lead better, how to modify his pitch to suit the needs, etc.
So, what's going on here?
Both reps do their share of heavy lifting every day.
Rep A is majorly relying on intuition and emotion, more than clear inputs or data points. He has little to no context on what prospects are looking, or how to identify cold leads.
Rep B puts emphasis on thinking through and asking the right questions, helping him take decisions with data, and allocate his efforts in the right direction.
Over time, Rep B will have a more consistent quarter and clear visibility on the sales pipeline.
So, what’s the takeaway here?
Essentially, Rep A executes his tasks to perfection but misses out on making the best use of his time and efforts.
Whereas, Rep B understands the importance of asking the right questions early on and identifying relevant signals to know how to best utilize his limited time and resources.
Rep A misses out on long term growth, and has no way to get more value out of his efforts.
Rep B consistently closes more deals because he has a clear framework to make decisions.
No matter which way you look at this, most sales teams have both Reps A and B in the mix.
The point here is – if your goal as an organization is to make the best use of your resources and generate consistent conversions, you should focus on building a system where sales reps have a systematic and structured approach to selling.
As a framework, lead qualification can open up room for your sales reps to think and get better at the everyday functions of their job, such as –
- Listening to people
- Asking the right questions
- Identifying pain-points, needs, and goals
- Improvising your pitch around your prospects
- Positioning your business as a solution
- Building long-term relationships with prospects
By simply qualifying your leads, you can exponentially increase your chances of being more efficient with your time and efforts.
All this is the qualitative impact of having a framework, let’s look at some numbers to understand how lead qualification can impact your sales positively –
- A Forrester study pointed out that qualifying your leads can allow you to generate up to 50% more revenue opportunities at 33% lesser costs.
- According to Salesforce research, on an average sales reps spends only 33% of their time on selling. Qualifying leads can help salespeople spend their limited time in the right way.
- As per a study conducted by Pardot, only 56% of companies have a qualification process in place, this means focusing only on relevant leads can help you set your business apart.
By synchronizing the efforts of your sales team around a lead qualification framework, it’ll be a lot easier for you to build a winning sales strategy. One that is consistent, data-backed and puts your prospects at the center.