How to Measure Lead Quality
High-quality leads are a crucial part of a successful sales business. While it’s essential for a growing company to generate new leads, it’s equally important to measure the quality existing leads so you can prioritize how you spend your time and energy.
For years, the sales standard dictated that the quantity of new leads mattered more than the quality of the leads. Nowadays quality is valued just as much as quantity. When you nurture high-quality leads your sales team has a better chance of closing a sale and maintaining an ongoing relationship with a client. Therefore, quality leads are often more worthwhile in the long-run!
Here’s everything you need to know about determining and measuring lead quality.
The Two Categories of Lead Quality
Generally speaking, lead quality is divided into two categories: closing potential and revenue potential.
Closing Potential: Is the likelihood that a client will close a sale with your company. For example, a lead who owns a small business might express direct interest in your product, offer contact information, and underline their budget. These actions would indicate that the prospect has high closing potential i.e. they are very likely to make a purchase.
Revenue Potential: Is the likelihood that a sale will result in significant and ongoing revenue for your company. For example, a chain of businesses might express preliminary interest in your product but neglect to include contact information or schedule a meeting time. This deal would have a high level of revenue potential, but may not have as much closing potential.
Closing potential and revenue potential are helpful categories to use to distinguish your leads. Ideally, a perfect lead would have a healthy measure of both closing potential and revenue potential.
What Contributes to Lead Quality?
Lead qualification starts by assessing various aspects of a lead and mapping those qualities onto your list of priorities. Typically, leads are assessed based on the BANT metric. BANT includes: budget, authority, need, and timing.
- Budget – Is the prospect able to afford your product or service?
- Authority – Are you speaking with the decision-maker?
- Need – Does your prospect have a necessity for your product?
- Timeline – How soon will they reach a decision?
Using these four characteristics as a metric, it’s easy to assess whether or not a lead is likely to be a good fit.
Another way to assess lead quality is to determine how the lead was generated. Most businesses utilize a multi-channel approach to marketing, generating some leads through online marketing initiatives and others through direct contact.
- Online Marketing – Online marketing is a great way to generate leads because it’s fast, user-friendly, and can reach a large pool of prospects with a single click. Common online marketing strategies are designed to appeal to a target audience and include email blasts and social media campaigns. The downside is that leads don’t have any direct contact with salespeople, so less qualifying information is available about each lead.
- Direct Marketing – While direct marketing is a slower tactic (e.g. cold calls, demonstrations, meetings) it’s offers your sales reps an opportunity to connect with prospects in person. This makes it easier for salespeople to determine the quality of the lead.
Concrete Ways to Measure Lead Quality
The task of “measuring lead quality” may feel abstract and confusing without proper strategies to get started. Here are a few concrete methods to help you determine lead quality.
The Basics: Categorize Your Leads
Start by dividing your leads into several categories such as “hot,” “warm,” and “cold.” This is a general way to narrow down the pool of leads you’re working with and identify which leads are more worth your time and attention. Categorizing leads isn’t data-driven, but it does help establish a preliminary organization system.
An effect method to quantifiably sort leads is to adopt a system of lead scoring. Choose a scale (e.g. between 1-3, 1-5, or 1-10 etc.) and use the BANT categories as a starting place. Where does each lead score in each category? This may help you identify qualities that you prioritize more than others, and create a hierarchy of leads based on their scores.
Sales Funnel Mapping
Another way to measure lead quality is to map your leads onto your sales funnel. A sales funnel is a roadmap of the sales process from start to finish. Visualizing where each lead falls in the progression of the funnel is a helpful way to identify leads that need more attention, and which ones aren’t moving forward in the sales process.
Tips and Tricks for Qualifying Leads and Closing Deals
At the end of the day, lead qualification serves the purpose of narrowing down your prospect pool so it’s easier to focus your energy and resources. Here are a few tricks of the trade we’ve learned throughout the years.
Don’t Follow Every Lead
Although it’s tempting to pursue potentially lucrative leads with low closing potential, it’s okay to step back and focus on other prospects. In general your skills are put to better use nurturing leads with high closing-potential than constantly hounding low-interest prospects.
Utilize Effective Follow Up Strategies
Most sales teams have an assortment of tried-and-true follow-up strategies. Whether you make follow-up calls, send emails, or reach out via social media, maintaining consistent contact with leads forms a lasting connection.
Track Lead Conversion Rate
Keep tabs on the conversion rate from qualified lead to customer. Although this data may not paint a full picture of the efficacy of your sales process, it’s a helpful benchmark and may point to areas of your sales funnel that could use improvement.
Streamline Your Conversations
Sometimes measuring lead quality has to happen in minutes, particularly during a sales call. For this reason, it’s wise to ask an assortment of illuminating questions to help you determine whether or not a prospect would be a suitable fit for your company. Develop a series of astute questions that provide insight into your prospect’s lead quality.
Outsource Lead Qualification
Instead of tackling lead qualification on your own, partner with an outsourced sales development and lead generation company. Professional sales development reps have access to the tools and resources needed to quickly and effectively produce high-quality leads. This saves your in-house team a lot of time and energy and ensures that your sales reps only pursue quality leads that have high closing potential.
Partnering with LeadJen
At LeadJen, we are dedicated to providing you with high-quality leads tailored to fit your ideal customer profile. With the latest in sales technology and years of relevant experience, our professional SDRs provide businesses of all sizes with lead generation and marketing support. LeadJen supports sales and marketing teams through database building, custom marketing campaigns, and appointment setting strategies. We are committed to helping your business thrive by using creative strategies and cutting-edge techniques to identify quality leads.
Why choose LeadJen? Our commitment to client satisfaction sets us apart. At LeadJen, we emphasize a culture of collaboration and strategic partnership. Your success is our main priority. Plus, you never need to worry about fitting us into your budget. With flexible payment and contracting options, we fit into any plan.
So what are you waiting for? Contact the team at LeadJen today to request your initial quote.