Let’s say you launch a new product or service, and your marketing team runs an effective campaign to gather thousands of leads interested in your offerings. But, of course, you don’t want to waste your time and resources having a one-on-one with unqualified leads that won’t translate into sales.
Therefore, qualifying leads is crucial for any organization.
Lead qualification is a process where sales representatives determine whether a prospect is a good fit as a customer or not. To make this possible, salespeople must do various tasks, including research, cold calling, and sending emails where they can ask qualifying questions. This way, they’ll know if a lead can convert into sales or if they can be a long-term client.
Why do businesses need to qualify their leads?
Qualifying leads saves time and resources and helps companies focus on their critical operations and other things that will generate more sales.
Here are some practical reasons why an organization needs to qualify its leads:
It allows businesses to focus on better sales opportunities
Talking to leads who are not capable of purchasing your products and services might cost your business other opportunities. This is one main reason an organization must qualify leads before starting its customer journey. After all, according to a study, 79% of marketing leads never convert into sales. Meaning, if you put your attention and resources to leads that are not qualified, you’d be wasting too many resources that won’t translate into sales at all.
You’ll build a database of leads that last
Qualifying leads allow salespeople to nurture those clients who are capable of staying loyal to the bran—despite the price cost. With this, an organization can discover long-term customers who repeatedly close deals with them.
Three effective ways to qualify leads
There are three effective frameworks for qualifying leads. These include BANT, SPIN, and MEDDIC.
First developed by IBM in the 1960s, BANT stands for Budget, Authority, Need, and Timeframe, aiming to determine leads’ solution needs.
Ask leads how much their budget is for this deal. This allows you to determine whether they can afford your product/service or not.
Determine if your lead will be the one to sign a deal. If not, know who will be in charge of making purchasing decisions.
Learn if your leads desperately need your products and services or if they are just interested in what you can offer.
Discover if the leads are willing to close the deal as soon as possible or if they will bank you for their future needs.
During the demo or discovery session, determine your client’s unique situation by knowing their spending, revenue, and profits.
Know what is the main problem or issue of the organization/client.
Determine what will happen if the problem or issue remains unsolved. Will it affect the current situation of the client?
Provide your leads with numbers and stats, helping them understand how your product can help them save time, effort, and money. Tell them the benefits of working with you.
Much more advanced framework and is usually used by SAAS and enterprise business, MEDDIC stands for Metrics, Economic Buyer, Decision Criteria, Decision Process, Identify Pain, and Champion. This helps them identify crucial pain points and address and take control of them.
This refers to quantifiable aspects that your product and services can help clients with. For example, increase in productivity, workflow, and more.
Determine who is in control of signing a deal and if they are willing to purchase your products and services.
This includes Technical Fit, Economic Fit, and Relationship Fit.
- Technical Fit – Can your product solve their problems?
- Economic Fit – Can your lead afford your product?
- Relationship Fit – Will you have a good working relationship with your client?
There are times when a sales staff almost closes a deal, but it turns into a ‘No’ because someone or something that affects the business process gets involved. These factors also include the stakeholders, legal department, other decision-makers, change in rules or processes, and more.
Paint an emotional transformational picture about their pain points and explain what will happen to the organization if not acted upon in time. Do this by talking about clients’ pain points using annual reports, current ROIs, and other issues within the company.
Identify who are the champions, who are the insiders with power, influence, and experience, who can help salespeople talk their way in the company.
Explain how you can make your client’s products and services better than the competition.
These frameworks allow salespeople to qualify leads accurately and quickly. With a proper framework for the qualification of leads, they don’t need to waste their time, efforts, and resources on leads that won’t convert into sales.