A qualified lead is a term frequently used by marketers in their marketing efforts. It refers to a prospect that could become a potential customer for a business. Such assumptions are purely based on the information provided by the prospects as part of the lead generation process. Two types of leads are associated with any database marketing process – Marketing Qualified Lead (MQL) and Sales Qualified Lead (SQL). This article discusses both these types helping you to re-look and enhance further your marketing strategies.
Marketing Qualified Lead
When a lead, when compared to other leads, is more likely to get converted into a customer, it is considered to be a Marketing Qualified Lead (MQL). To qualify a lead as a Marketing Qualified Lead depends on what web pages a lead has visited, or what material they have downloaded, or the engagement they have the business content.
The closed-loop analytics helps to keep the business lead intelligence well-informed. Proper coordination with the sales team can help the marketers to determine the leads that they are required to generate based on the demographics, or activities, or behaviors, or other criteria given by sales. Once the lead requirements are defined, it helps to assign point values for various MQL qualifications – it forms the basis of your lead scoring system. This ensures delivery of high-quality leads to the sales team enabling them to improve productivity.
About the Marketing Funnel
The journey of a lead from being a potential prospect to becoming a customer is described by the marketing funnel. The journey starts with someone learning about your business and then going on to the purchasing stage. The marketing funnel maps the entire route to conversion and beyond. How does the marketing funnel help you? Well, careful analysis and evaluation of your funnel can enable you to drive more sales, increase loyalty, and generate stronger brand awareness.
According to the AIDA model, every purchase involves Awareness, Interest, Desire, and Action. Thus, the name AIDA arrived at by Elias St. Elmo Lewis in the twentieth century! According to this model, the prospect is aware of its problem and a possible solution shows interest is a particular product or service. With a desire to purchase, the prospect starts evaluating, and finally, it converts to action – whether to purchase.
The simplification of the customer journey by the marketing funnel makes it easier for businesses to follow them. A marketing funnel is always a must – whether for your online sales or generating traffic to your website. That the marketing funnel enables measurability is the biggest benefit it offers. You come to know at which stage you are losing customers and strategize accordingly, and so on.
Sales Qualified Lead
Once a lead is qualified by the marketing team, it is deemed ready to be passed on to the sales team. Such leads that qualify to be sent to the sales team of a business are referred to as Sales Qualified Leads (SQL). A well-researched and vetted prospect generated by the marketing department and then recognized by the sales team is known as a Sales Qualified Lead (SQL) – such leads are considered to be ready for the next stage in the sales process.
You should not get confused with a Sales Qualified Lead and the Marketing Qualified Lead. By now, you are aware of the terms – prospect, marketing qualified, sales qualified, etc. However, if you don’t understand how your business determines and segments the leads within the sales process – chances are that you may end up losing potential customers. That’s the reason why understanding the term Sales Qualified Lead (SQL) becomes crucial for your business. Once your marketing team and then your sales representatives are alerted about a lead being fit and ready to be closed, you will be able to close deals at an increased rate leading to enabling your business growth.
How to Calculate Lead Generation Numbers
Once you have mastered your B2B sales funnel, it translates into the steps shown below. There are a few parameters of MQL that come into play when calculating your numbers.
- Inquiry – Once a prospect fills in your form, it means they have given their consent to contact them. So, it becomes your Marketing Captured Lead (MCL).
- Marketing Qualified Lead – Once a prospect meets a predefined criterion, the MCL gets converted to MQL. Here the prospects need personal nurturing by the marketing team.
- Sales Qualified Lead – Once a prospect agrees to a meeting with a sales rep, the MQL gets converted to SQL. Here too, the prospect has met a predetermined criterion.
- Opportunity – Once the SQL is handed over to sales, it generates an opportunity. This stage takes care to convince a prospect to convert them into a customer.
You need to look at each stage of your funnel to calculate your lead generation goals – quantity as well as conversion rate. We will try to understand this using the “lead waterfall” concept example. If your company’s revenue target is Rs. 10,00,000 and the contribution expected from marketing is 25 percent i.e. 2,50,000. Considering the average deal price to be Rs. 10,000 the number of deals you will require to achieve the target is calculated by dividing Rs. 2,50,000 with Rs. 10,000
The formula that you arrive at from the above “lead waterfall” concept example is:
MQL Vs SQL – Why Understanding the Difference Matters?
Whereas MQL is a contact that, though sales-ready is not yet ready for direct or personal attention from the sales representatives; SQL contact is the one that is ready for direct sales follow-up. It becomes the priority contact that a business needs to engage to convert into its customer.
If MQLs are leads that are qualified and ready for sales follow-up, SQLs are prospects that connect them to the next stage in the buying cycle. In an ideal environment, MQLs will sail smoothly into high- quality SQLs. However, such ideal cases are rarely around. We will try to understand the difference between MQL and SQL with the help of an example.
Take the case, marketing has devised a strategy to offer a free eBook and it is downloaded by 10,000 visitors to the website. If 5,000 of them aren’t decision-makers 4,500 of do not have the money to purchase; the low MQL to SQL conversion rate works out to 5% – this puts the pressure on the marketing department to change their strategy.
Marketing now offers the same eBook but, limits it by targeting it only to management level and higher contacts. This time, only 1,000 people download the eBook. The sales convert only five out of the 1,000 downloaders into customers which works out to a dismal 0.5% SQL to MQL conversion rate. This now puts the focus on the sales department to re-look at their efforts.
On getting your initial leads, it is natural for you to get excited, and may encourage you to jump the gun and send those leads directly to the sales team. However, hold on. You need to first know where each of those leads is placed in the buyer’s journey. Differentiating MQL from SQL, therefore, forms the relationship foundation between sales and marketing. Knowing one from the other is the ultimate platform for handing over the lead. Therefore, it now becomes important to know the difference between MQL and SQL. Knowing the difference between marketing qualified lead (MQL) and sales qualified lead (SQL) helps to understand your sales funnel and the bottlenecks within it. The figure shown below helps you to understand the MQL and SQL more clearly.
Robust Databases – The Key to Your Lead Generation
Understanding your target market and their behaviors will help you know which leads have to be nurtured, and which of those are ready for a sales call. Your business needs to focus on how your MQLs and SQLs get converted into revenue. A strong relationship between sales and marketing is essential to analyze these conversions.
A sales cycle involves multiple levels of MQLs. To trigger the promotion of high-activity leads is an uphill task. You need robust databases that are customized as per your target audience needs. In-house lead generation can gather leads but it’s a time-consuming process and needs a dedicated team of professionals.
If you are a start-up or your business cannot afford a full-fledged lead-generation team, your fastest route to sales growth is to obtain readily available databases from a reputed data provider. However, a word of caution here! You should only contact a data provider who is well-known and offers reliable solutions. The verified, updated, and guideline-conforming databases can indeed propel your business to dizzy levels.
Are Your Confused with Lead Generation? Get in Touch with a Reputed Data Provider
You can easily get confused with the terms Marketing Qualified Lead (MQL) and Sales Qualified Lead (SQL). Today, consumers are well-informed and sophisticated. You need to keep updated your sales process with the changing times. The large marketing and sales funnel coupled with complex situations can get messy, and may convert into a loss for your business.
BestdataProvider.com understands your sales needs and is here to solve them by clearly and concisely defining them. We are into the latest trends in digital marketing and deal in robust databases that are thoroughly verified, accurate, and conforming to all legal guidelines. We can help you in your lead generation activities and grow your sales. For all your lead generation needs and requirements, reach us at [email protected].
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