Lead Qualification is a very important part of the sales cycle. It is directly responsible for feeding your pipeline with high-quality leads that eventually close. It also happens to be the driving force behind conversions and productivity across the most successful sales teams we’ve seen.
If done right, you can bring in the most revenues you’ve ever brought in and make this a competitive advantage for your organization. In this blog, we’ll explore how to choose, build, and tweak your lead qualification process.
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What is Lead Qualification?
It’s the method of dividing leads into categories that will later define how the sales team will engage with them. It identifies leads that are likely to convert, so the Sales and Account executives can nurture them better. Leads can be qualified through both inbound and outbound prospecting. It comes in as a next step in the sales process after prospecting.
Why is Lead Qualification important?
A highly efficient lead qualification process saves you a lot of time by consistently connecting you with relevant leads. As a result, your conversion rates will drastically improve along with shorter sales cycle times, by prioritizing high-value leads.
All of this will naturally lead to making it easier for you to scale your sales function and increase revenues for your organization.
How to Qualify Leads effectively
We’ve written down a simple, 4-step process that will help you build and improve your own lead qualification processes.
1. Know your ideal customer profile
Your Ideal Customer Profile (ICP) is a customer who could possibly gain the most value out of your product or service. In B2B sales, your ICP has to have the characteristics of an account or organization. This profile will include things like the type of ideal industry, Deal size, company size (no. of employees, revenue, etc.), and more.
Depending on what you’re selling, this list could be longer. We’re also looking to minimize deal drop-offs before and after closing. So choose your ICP accordingly to optimize for conversions.
2. Draw out the characteristics of qualified leads
Now that you have decided on your ICP, it further comes down the leads you’ll be interacting with. You’ll need to narrow down on the ideal leads you want to nurture within your target account. How would you define this ideal lead? Use characteristics that would translate into quicker and more effective wins for your sales team.
These characteristics could be the title of the lead within the organization, if they are budget owners, primary users of the product, etc. Here, your focus should be to pick the decision-makers who are looking for a quick purchase.
3. Score leads based on their characteristics
Once you know how your ideal leads and companies look like, it’s now time to score them. Lead scoring is a way to assess the potential value of a lead. This value is represented by a ‘score’ to help prioritize them in your sales pipeline.
The formula you will use for scoring your leads will be dependent on how close the lead is to your ICP and if they match the criteria you set for a qualified lead. The channel from where the lead originated should also be taken into consideration, for eg., Cold Emails, Landing Page, etc. each having their own scoring values.
For example, if the lead is from the ‘X’ industry, they get 30 (out of 100) added to their score. Similarly, if their employee strength is greater than Y, it adds another 20. And so on.
4. Assign appropriate qualification to leads as per scores
After scoring the leads, you’ll now get to prioritize them on the basis of these scores and then pass them onto the Account Executives. You can do this by labeling these leads as per their scores. Continuing from a previous example, if a lead has a score of below 15(out of 100), they could be marked as unfit for your product. Similarly, 15-40 can be labeled as low hanging or low priority. This would complete the lead qualification process.
To get a better understanding of the characteristics and signals to look for in your leads, we’ll move on to explore Lead Qualification Frameworks that lay those out in more detail.
Effective Lead qualification frameworks
To help you refine your lead qualification process, there are several tried and tested lead qualification frameworks that have to do with different qualifying criteria.
BANT is an acronym for the Budget, Authority, Needs, and Timing framework. The budget would define if the lead has the Budget to make a purchase. If they do, it’s a good sign. Similarly for Authority – the lead should have the final say in the product purchase decision within their organization. Need defines how deeply is the lead facing the problem that your product solves, currently. Timing is about how quickly they might be looking to solve the problem and close a deal.
To collect all this information, you might choose to have some questions as part of the input-form, or trends in product usage that confirm these characteristics. You can also choose to engage them over Emails and set up introductory calls. This will be true for the rest of the listed frameworks as well.
FAINT is quite similar to BANT in many ways, except it adds another dimension to the lead’s qualification. It stands for Funds, Authority, Interest, Need, and Timing. As you might imagine, most of these align with what BANT does. FAINT adds interest as a way to build the lead’s interest to purchase your product or service. Interest here isn’t a qualifying criterion, it’s a strategy to pull the lead further into the pipeline by engaging with them, given the other 4 criteria are met.
Given how it works, FAINT would work well for companies that sell a higher ticket, niche, non-essential products and services.
ANUM (Authority, Need, Urgency, Money) is a lead qualification framework that’s another modification of BANT. Urgency replaces Timing and Need characteristics. There’s a focus on the quick need from the leads’ side to close the deal. ANUM framework works well for smaller sales cycles and small-medium ticket products due to this nature. It allows you to identify leads that have a strong intent to buy and by closing them earlier in the sales cycle.
CHAMP is the acronym for Challenges, Authority, Money, and Priority. This framework calls for any challenges your leads might be looking to solve, first. The rest of the framework is similar to BANT in the way it focuses on Authority, Money, and Priority (Time). CHAMP would make for a great lead qualification framework for teams that practice solution-based selling. Qualifying leads as per the CHAMP framework would also require the qualification to be carried out by Account Executives and SDRs over discovery calls and emails.
Goals, Plans, Challenges, Timeline framework allows salespeople to both qualify the leads and nurture the ones that will be moving further. You start out by asking questions to the lead, related to their goals, and the problem they’re trying to solve. Having listened to clients with similar problems, you can also help them augment these goals based on what your product can help them accomplish.
Once you’re clear about the goals, you’ll then enquire about the plans they have to meet those goals. Based on how much information you get, this will give you a better understanding of their buying intent and if they’re looking at alternate solutions.
You’ll then let your leads talk about the challenges they’re facing in bringing those plans to fruition. During this time you’ll get to explore if your lead could benefit from your product based on their requirements. You could also use this opportunity to explain how your product could be a fit for them.
Timeline part of this framework demands the lead wanting to solve their problem in the near future while aligning with your sales cycle. A lead that has a longer time frame for solving the problem you address will take more time to close. Which is counterintuitive to what we’re trying to achieve.
NEAT is an acronym for core Needs, Economic Impact, Authority, and Timeline. It was formulated by Sales Hacker and The Harris Consulting Group. It is a framework built to help sell and qualify leads. As the name suggests, focusing on the core needs of the lead helps salespeople create a narrative around the product being sold. Similarly, the Economic Impact helps the decision-maker understand the value of your product.
Authority and Timeline are parts similar to BANT, focusing on assessing the buying power and urgency for your lead to purchase.
This is a lead qualification framework developed by Hubspot, which stands for Goals, Plans, Challenges, Timeline, Budget, Authority, Negative Consequences, and Positive Implications.
It is fairly comprehensive in how much ground it covers, for good reason. GPCTBA/C&I contains qualification criteria from all the frameworks discussed above and further adds new elements to it.
Let’s explore the new criteria – Negative consequences and Positive Implications since everything else has been covered in previous frameworks.
Negative Consequences: As part of this framework, you will evaluate what the lead might have to lose if they don’t accomplish the set goal. What will be the monetary implications? How much of a setback will it be for other projects within their organization? Doing this will also help you position your value proposition to the lead and help them decide better.
Positive Implications: How will your product help the lead hit their goals? Can it go beyond that and deliver more value? How much does the lead stand to benefit from the deal? Evaluating and answering these questions will help you engage the lead more effectively and help you qualify them for further stages in the cycle.
Acronym for Metrics, Economic Buyer, Decision Criteria, Decision Process, Identify Pain and Champion, it was ideated at PTC. MEDDIC requires your sales team to deeply understand the functioning of the target organization to be able to qualify and sell to them.
Metrics represent the numbers behind the project or goal the organization might be looking to complete. What will be the economic impact of the project?
Economic Buyer is the person inside the target organization who stands to gain the most if the goal is hit. They’ll also be responsible for any losses that result from it.
Decision Criteria and Process represent the technicalities of the project. What are the specifications that need to be met in order to accomplish the goal? Once these basic specifications are met, what are the next steps in the process in order to move the deal forward?
Identify Pain faced by the lead and their team, currently. If they’ve approached you for a solution, there’s likely something specific they’re after. Could it be the right pricing terms? Could it be project timelines? Figuring this out will help your lead move quickly.
Lastly, you will need to find your champion inside the target organization. Oftentimes, this would be the lead that initiated the conversation for the deal. Champions serve the purpose of selling your product to the decision-makers on your behalf. Finding and nurturing the champion inside your target organization will help you skip the delays and speeding up the deal closure.
How to pick the right lead qualification framework
Lead qualification frameworks aren’t one-size-fits-all. They would be used differently across teams that sell different products. Picking the right lead qualification framework is dependant on the following things:
- What are you selling, how long is the sales cycle?
- You Ideal Customer Profile and their Buying process
- The volume and quality of leads being introduced to your pipeline
- The results you’re getting from the current framework
Once you have contemplated on the above-mentioned factors, you can go back to the list of all frameworks and decide which one suits your needs the best.
If you have a short sales cycle with high quality leads coming in, you can simply go with a framework like ANUM without spending much of your time qualifying leads. If you sell complex solutions and services with big-ticket sizes to large organizations, MEDDIC and GPCTBA/C&I frameworks would be a good match.
However, it’s important to understand that these frameworks might not be the absolute best fit for your team. You can refine and build your own framework, picking out individual elements of existing frameworks, and putting them together to work for you.
Until this point – we’ve covered various lead qualification frameworks and strategies to build and pick frameworks for your sales team. Let’s now proceed to learn best practices while executing these frameworks.
Best practices for qualifying sales leads
1. Hire dedicated members for lead qualification
If you have a defined sales process in place with lead qualification, it’s important you have a team working on it exclusively. A lot of teams make it part of Account Executives or SDR’s role. Lead qualification can be time-intensive and affect your account team’s core duties. Having dedicated members also makes sure you can focus on improving lead quality by assigning KRs and Metrics associated with them.
Aaron Ross shares the same idea about hiring dedicated members for each function inside sales in his book, Predictable Revenue.
2. Keeping qualification status binary
Oftentimes, some leads hang between multiple categories of qualifications, if you come across a new type of lead you didn’t anticipate. This kind of lead gets labeled inappropriately and eventually ends up falling through the cracks. Strive to keep all your leads qualified strictly as per the criteria you set. Whenever you get a lead that doesn’t match any of your criteria, update it, and qualify this new lead per the updated criteria.
3. Keeping unqualified leads with closing potential engaged
A lot of leads that will enter your pipeline will be unqualified by set standards. This isn’t necessarily a bad thing. A bunch of these leads will end up turning into qualified ones, given enough time and nurturing. But letting them fall through the cracks definitely won’t yield any results. Make it a point to enroll these unqualified leads into an engagement campaign specifically set up for them. The idea here is to stay at the top of their heads whenever they might need you, even if that’s later. You can send educational content, industry, company updates, and milestones.
4. Iterating on the process in liaison with Account executives
Having a basic lead qualification process won’t cut it. If you’re seeing low quality leads in your pipeline despite a lead qualification process in place, ask for hints from the Accounts team. They’re the people interacting with incoming leads. So they’ll be able to accurately point you to the reasons where and why your lead qualification process needs to be improved.
5. Automate and scale the process
Once you have a stable Lead qualification in place, you shouldn’t stop at that. Just like you will scale your Lead Generation process to bring in more revenue, you should scale and automate your Lead Qualification process. As your sales team or lead generation business gets larger, you need to be able to scale without compromising quality. Automating your lead qualification will help you improve the quality (and quantity) of leads that are being fed into the pipeline. You can use various tools, like the ones listed towards the end of the article, to automate your lead generation process.
6. Measure performance to improve your lead qualification
Just like automating and scaling, you should have systems in place, measuring the efficiency of your lead generation process. This will enable you to keep a track of the quality and volume of qualified leads, and present improvements as part of your efforts. It will also help the sales team pinpoint problems with the process whenever they aren’t seeing the expected results.
Lead qualification performance is measured by calculating conversion rates at each stage of the sales cycle. Going deeper, record conversion numbers for every lead generation channel and every stage of the sales cycle within those channels.
Once the lead has been qualified till this stage, they are now called MQLs(Marketing Qualified Leads). Next, these leads are supposed to be qualified as SQLs. The following section covers how to qualify leads into SQLs.
3 Sales qualifying questions
Once you’ve qualified leads into MQLs and passed them over to the Accounts team – they should further be qualified as Sales Qualified Lead(SQLs). To be able to qualify them as SQLs, there are the 3 questions you need to ask them on your first phone or email interaction as part of sales lead qualification-
1. What are the top challenges your team is facing?
While these leads might have been qualified by your team, it is further important to understand the size and complexity of the problems they are facing.
This will help with two things –
- Help you qualify if their problems can be addressed adequately by your product
- Better position your product as a fit for their problems while pitching it to them in the next phase.
2. How much time have you spent on finding a solution to your problem?
Asking this question will help you understand your lead’s familiarity with products like yours. They will also likely mention any competing products they might have checked out before yours. This will also naturally lead to deeper questions as if why they are still looking around, what specific terms they’re looking for, etc.
3. Are there any specific obstacles or deal-breakers with regard to the product?
When you ask this question, you’ll be able to structure your engagements and make modifications to your product to avoid them. Oftentimes there are requirements that might not have been discussed thoroughly during and before deal closure. These requirements might end up being discovered after the fact. It might result in a churning customer or deal dropping off altogether. This is one of the most important questions to ask qualified sales leads before moving forward with the deal
Apart from the 3 above, you can add more questions to the Sales Qualification process as the product requires. This can be with respect to Pricing, Service terms, Support availability, etc.
Now that we’re done with sales lead qualification, let’s explore the tools you can use to run you lead qualification process
Top 3 lead qualification tools
SalesHandy is a Sales Engagement and Productivity platform that can serve as a Lead Qualification tool. It allows you to send personalized email outreach campaigns with multi-stage follow-ups. Emails can also be scheduled based on the recipient’s activity. You get instant email open notifications when a recipient opens an email you’ve sent. All of these campaign’s engagement data is accessible from a single analytics dashboard.
The email notifications and campaign data allow you to pick and qualify the leads that respond and engage with your emails. Email engagement based lead qualification gets you leads with a high intent to purchase, hence making your lead qualification process effective.
You can also scale the process using SalesHandy – all of your email engagement data is available to export via CSV. It then can be used to run lead qualification on a large scale by processing this data on your CRM or Excel.
Salesforce is a CRM for organizations to track and manage their Sales and Marketing functions. Since it is a CRM, you can set up an additional stage in your pipeline that routes all the leads from Marketing into a new Qualification stage. From there, you can set up automation and rules to automatically set qualifications based on the data available in the CRM. If there are leads that don’t automatically qualify using the set rules, you might add or update your automation rules. Otherwise, you can set up a process to manually review unqualified leads as well.
Mixpanel is a product analytics platform. It serves as a portal where you can browse the users’ profiles on your website or application. It also keeps track of your users’ behavior based on the event triggers you set up. For lead qualification, Mixpanel allows you to form cohorts. It is a group of users that updates dynamically based on the conditions you set. For eg., You can create a cohort of users who’ve used certain feature ‘x’ times in a month. You can export a CSV of these results and upload them to your CRM.
Lead qualification can be quite complex and challenging for a Sales team to perfect. But as we just discovered, it comes down to experimenting, measuring, and improving on things, just like every other process.
It’s also not just about the top of the funnel leads that need to be qualified. Your existing customer base also needs to be qualified in order to be re-engaged. According to CSO Insights research, selling to existing customers depends heavily on Lead Scoring and Qualification.
How has your Lead Qualification improved over time? Are you having problems with the quality of your leads being fed into your pipeline? Let us know in the comments below, and we’ll help you out.