Unqualified sales leads cost you and your company more than only time; you also miss out on superior sales possibilities. Spending time pursuing terrible sales leads costs you the opportunity to speak with prospects who are significantly more likely to buy.
Greater sales outcomes are not necessarily obtained by increasing conversion rates; instead, larger sales are frequently produced by optimising your upfront procedures to better qualify the sales leads that come into your company in the first place.
Therefore, when it comes to acquiring new leads, bad leads are as disruptive as having no leads. Unqualified leads are worthless and a colossal waste of your time and the company’s resources.
Poor leads may take many forms, including leads that are too small, too large, or from an inconvenient place; leads that aren’t interested in your product or service; or leads with non-existent or insufficient budgets to do business with you.
Qualifying sales leads is a crucial part of the sales process that involves determining the likelihood of a prospect becoming a customer. It helps sales teams focus their efforts on the most promising leads and improve their chances of closing deals. In this article, we will discuss the process of qualifying sales leads and provide tips on how to do it effectively.
Many salespeople despise disqualifying prospects and shrink their pipelines. Their natural instinct is to try to work as many leads as possible, but this isn’t the best approach. The quality of your leads matters more than the quantity.
What is lead qualification? It is the process of evaluating the potential of a prospect to become a customer. The process involves collecting information about the prospect, assessing their needs and interests, and determining if they are a good match for your products or services. The goal of lead qualification is to identify the most promising leads and prioritise them for further engagement.
MAN
At the beginning of my career in sales four decades ago, when selling was not as complex as it is today, as a salesman, I was instructed to follow a simple theory ‘MAN’. It is an abbreviation for Money, Authority, and Need.
However, the times have changed with the internet and artificial intelligence, and customers are now far better informed when making their buying decisions. The customer’s buying behaviour has become more complex due to the prevailing superior information flow.
Why is sales qualification so important to an organisation? Simply put, it significantly improves close ratios. Without sales qualification, you risk pursuing leads that are not suitable for the products or services due to budgetary constraints, organisational challenges, or other factors.
Qualifying prospects allows you to pursue the leads that are most likely to purchase the product, saving you valuable time and energy.
As explained, unqualified leads waste time. Hence, if you identify a bad lead before pursuing it, you can use the irreplaceable time you save to spend on prospects that are more likely to buy your products.
Tailor-made solution
Similarly, the salesman can focus on a better and more specific segment of buyers who can be given closer personal attention. That way, you can guarantee that most of your efforts will lead to enhanced closing ratios. By intentionally and consciously qualifying a prospect through effective analysis, the salesman can deliver a tailor-made solution and also dispel the post-purchase doubts of a customer.
The ‘BANT’ qualification framework, originally developed by IBM, is perhaps the later version MAN,” which successfully discusses budget, authority, need, and timeline of a purchase. It uncovers four of the most crucial criteria in qualifying a sale.
Understanding the prospect’s budget is critically important before proceeding with a sales call. Can the prospect afford your product at this point? It is crucial to assess whether your prospect’s budget parameters are compatible with your pricing strategy.
Find out whether they have a budget set aside for your sort of product, how much they plan to pay, and if they have any financial flexibility. If your prospect cannot afford your product or is unwilling to pay your minimum price, it is preferable to forgo pursuing a potential dead end.
Wrong people
Salesmen sometimes waste a huge amount of their valuable selling time talking to the wrong people in selling situations. Therefore, at the initial stages, they must establish that the person with whom they speak is in a position of authority at their firm to sanction the purchase. Your principal point of contact at their organisation needs to be a decision-maker because often you may find gatekeepers who try to influence the real buyer.
Therefore, it is a good practice to find out how your contact’s firm makes budget choices and whether anyone else should be included in the purchasing process. Even if your contact is in charge of finishing the deal, they may require permission from a group of stakeholders during the decision-making process.
If you realise that your contact lacks the power to close the sale, it’s good to make an attempt to persuade them to bring in the true decision-makers. Over-enthusiastic salesmen often fall for the “casual inquiries” from pretending prospects and spend time following them as leads. Therefore, identifying whether there is an actual need to purchase your product must be investigated.
Pain areas
It is good practice to inquire with your prospect about their pain areas, the most pressing difficulties they have, the solutions they’ve previously attempted, and what they need your firm to accomplish to assist them. It’s not worth pursuing the sales process if you don’t believe your solution can successfully answer their problems.
The purchasing timeline is also an important aspect to consider thoroughly at the first stage of a sale. In order to determine the urgency of their situation, inquire as to how soon they wish to handle their difficulties.
You’re in good condition if they want to be done with their troubles in a few months. If their buying decision-making timeframe is closer to a year or more, it’s generally a better use of your time to suspend your pursuit and follow up with them later. However, you may also try to generate a sense of urgency by offering a limited-time discount on your goods.
The single most important criteria in the lead qualification process, regardless of the methodology, is that you must never interrogate the customer. All your probing questions, whether written or verbal, must be in a natural and conversational tone and manner that must come through a congenial rapport. Although qualifying leads is an essential part of the sales process, a single wrong approach may drive away a customer forever.
“It’s not what you say, but how you say it”. This phrase is extremely important when it comes to sales qualification.
“The prospects will provide you with all the information you need if your tone of voice and mannerisms are acceptable to them. Your success rests on effective qualification.
Your ability to find good prospects will make or break your business. Prospects who turn into happy customers mean not only revenue but also increased word-of-mouth advantage, referrals, and the possibility of cross or upselling.