Nothing is more important to the success of your company’s overall sales strategy than having enough sales leads. Sales leads, or just “leads,” are individuals to whom you would like to pitch your product or service. Sales leads differ from sales prospects in that a prospect has already gone through some kind of qualification process. Leads are “raw” – just a name and contact information to whom you will need to reach out to find out more. They may hold a title to whom you usually sell, but you don’t know if they have the money, resources or interest to buy from you.
The process of qualifying sales leads is typically handled by a sales representative who will reach out to leads, determine if their personal details and contact information are correct, and ensure that they are indeed in a position to buy. Once leads are qualified into prospects they are turned over to account executives whose job it is to nurture and guide them through the buying process. This breakdown of roles allows more experienced sales professionals to focus on the deals with the highest probability of closing.
As sales has become more data-driven there has been an increased focus on sales lead tracking. Today an important function of sales management is to monitor the rate at which sales leads move through a company’s sales funnel. Understanding the ratios in your funnel is critical to accurate sales forecasting and tracking whether you have the number of sales leads that you need. For example, if you know that 50% of your sales leads (an unusually high number) will eventually become paying customers then you know you need to generate twice the number of leads as the number of customers you need to hit quota. This will help your marketing team know whether or not they need to spend more resources on lead generation.
Management will want to monitor how the conversion ratios change over time as well as what’s happening to each lead. Has someone reached out to them? Have they been qualified or discarded? As such, lead tracking software is widespread and is included in popular sales software such as Salesforce. More sophisticated lead tracking software will allow you to qualify leads at different levels or recycle them to be nurtured by your marketing efforts.
Because leads are the fuel on which your sales organization runs, ongoing lead generation is essential to creating enough sales pipeline to ensure adequate sales revenue. Some brand new companies won’t need to generate leads initially because they’re able to fill their pipeline with their founders’ contacts, former colleagues and referrals. However, the need for revenue growth eventually forces all companies into some kind of lead generation activity.
In most companies generating leads is the primary responsibility of the marketing department. Marketers generate sales leads from a variety of sources including advertising, webinars, attending industry conferences and requiring visitors to register on their sites before they’re given access to content. Some companies even sell lists of leads which can be purchased or rented for a specified sum. In 2015 eMarketer noted that email was the most commonly used method of generating leads. Whatever method you choose, lead generation strategies will be a team effort between your sales and marketing departments and will be critical to your company’s success.
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