Learning how to properly qualify a sales lead can be the difference between landing a juicy new business deal or wasting lots of energy barking up the wrong tree.
Before the Internet flattened the business world, salespeople used to put significant energy into every single sales meeting. When sales prospects were few and far between, each one would warrant a high-level of attention and courting.
Now, with constant online access to a worldwide pool of potential clients for your business, it's become important to weigh which leads are worth your effort—and which are likely to result in a dead end. "There are certainly different challenges because buyers have access to a lot more information and access to a lot more suppliers than they used to," says Michael McLaughlin, principal of MindShare Consulting and publisher of Management Consulting News. "That makes their process different."
Learning how to properly qualify a sales lead can be the difference between landing a juicy new business deal or wasting lots of energy—and money—barking up the wrong tree. But by just controlling the sales conversation and asking the right questions, you can quickly find out if you're on the right track. Here are a few tips from pros in the field:
The first thing salespeople—especially new and eager ones—need to realize is that not every sales opportunity is worth jumping at. Many sales staffs get so excited at the prospect of a sale that they lose sight of the bigger picture of how the sale will play out down the road.
"Lots of sellers believe anybody who asks them for what they offer is automatically qualified," McLaughlin says.
They're sometimes enticed by the sales commission, or are just blinded with eagerness for locking down a sales opportunity, and don't weigh the long-term issues of profitability, sustainability, or compatibility, he says.
"When someone says, 'We want to work with you,' it's easy to sort of go off and say 'OK, lets get this sold."
Many sales professionals say they still stick to the old IBM-pioneered approach to sales qualification known as BANT, which stands for Budget, Authority, Need, and Timeline. It means you should feel out the sales prospect to see if your product or service is affordable to them, fits a need they have, can be delivered in a timeline that works for both parties, and that the person you're pitching to actually has the authority to make purchasing decisions.
"You want to make sure you're talking to the right person," says Russ Hill, president of Ultimate Lead Systems, an Ohio-based sales lead and customer relationship management services for companies such as Sherwin-Williams and CAT Lift Trucks.
The way to divine the BANT standard is to make sure you're controlling the sales meeting and asking targeted questions.
Experts say to avoid jumping in right away with your pitch and talking about how wonderful your company is; instead, sit back and ask some probing questions of the to ensure it's a good fit. Dropping your pitch too early is like turning the meeting over to the prospect, who then starts asking you the questions, putting you on the defensive, says Paul Cherry, founder and managing partner of Performance Based Results, which specializes in sales training and management development.
Cherry, who authored the book Questions that Sell, cited a 2003 Gallup study showing people were 12 percent more likely to buy from you if you can create an emotional connection, which you can start doing from the first meeting.
"It's really being able to tap into somebody's ego, their emotions, frustrations and concerns," he says. "I think most customers and prospects do want to talk if you ask them the right questions. When starting to talk about features and benefits, the prospect just tunes out."
To really test the waters of the sales prospect, Cherry tries a three-tiered approach: he first asks about their decision-making process to find out who in the company makes the purchasing calls and its overall goals; then he asks about decision-making criteria, which helps weed out less serious prospects.
"You get a lot of prospects out there shopping around, automatically trying to commoditize your product or service," he says.
Next, he asks about the criteria for the vendor they're looking for, which helps determine whether it's a high-value lead.
"The whole purpose is asking good questions so you take what might be a five or 10 minute conversation and expand it into 20 minutes or more," he says.
At the same time, you don't want to overwhelm the prospect with questions, because too many will turn them off.
"When you lump too many situational questions together, it becomes interrogational," he says.
Qualifying your sales lead doesn't have to be something that waits until you're in the room with the prospect either. Since so many tips often come from your marketing and street teams, experts say savvy sales teams enlist those departments in the vetting process. Otherwise, they might be sending you leads that are way off mark.
"The salespeople are charged with the challenge of following them," Hill says. "They don't necessarily work as closely together as they should."
You can sit down with everyone in the company who might send you a lead to make sure they know exactly what they should be keeping an eye out for. Hill says he'll give the marketing team a few basic questions to ask the potential client about their need and desired application of the product to help vet leads for the sales team.
All of this adds up to saved money for the business as a whole. Make sure to have keep good oversight of all departments so that each segment of the business is aware of what qualifies as a good sales lead, Cherry says.
"You don't want marketing to waste money," he says. "Marketing wants to understand what the sales department is looking for, sales has to understand responsibilities the marketing team is charged with. It starts at the top with the managers."