As a B2B sales rep, you want to aim your pitches at people who will actually listen. Otherwise, you are wasting your time—and theirs.
A realtor would not just hang around local coffee shops, asking people if they are buying or selling real estate.
That method would be fruitless for everyone but the owner of the coffee shop.
Instead, a smart salesperson reaches out to people and businesses that are most likely to buy their solution, also known as sales leads, which come in many forms.
After reading this post, you will know which form of lead you are dealing with, how to turn each type into prospects, and which leads to prioritize.
What are Leads in Sales?
A sales lead is a person or company that fits your ideal customer profile or has expressed interest in your business.
We included “fits your customer profile” into the definition because although such leads have not directly expressed interest, they just might do so if you gave them a call.
As for those who have shown interest, they can do this in a variety of ways, some of which are more indicative of a sale than others.
For example, a sales lead could be someone who read one of your blog posts. Obviously, that person isn’t necessarily looking to buy your product. They could have just wanted an answer to a question which your marketing team happened to supply.
Although their interest is minimal and directed only to your brand, not your service or product, they are still considered a lead. Why’s that?
Well, because compared to someone who has never heard of your company, they are more likely to speak with you when that need arises. This gives you a decent chance to make a sale when the time comes.
On the other end of the spectrum, some sales leads signal their readiness to turn into paying customers from the outset.
For instance, someone who fills out a “demo request” or a “contact me” form is already interested in your specific solution, and therefore more likely to buy than the person perusing your blog for fun.
Lastly, you have leads that have never directly expressed interest in your company but have attributes similar to those of your happiest customers. If your company sold Legal Tech to small law firms, you would consider each small law firm this type of lead.
These types of leads are low-chance buyers, also known as cold leads, but if you call and email enough of them, you will start to find some who have the problems you solve.
As you can see, not all sales leads are equal in value. And each requires different tactics to turn them into a prospect.
Before moving onto the different types of leads, let’s make the distinction between a lead and a prospect.
Know the Difference Between Leads and Prospects
A sales lead is someone who shows interest in your solution but is still unqualified: not necessarily a good fit for your solution.
The lead becomes a prospect when you qualify them through two-way communication. This could be through an introductory phone call, an email exchange, or a LinkedIn conversation.
A lead who doesn’t answer your phone calls remains a lead.
Here are some examples of leads:
- Someone who filled out a marketing form.
- A company that fits your Ideal Customer Profile.
- Someone you messaged on LinkedIn.
- The nice people on your cold calling list.
However, a lead who answers your call, fits your criteria for a potential buyer, and engages with you becomes a prospect. You will now actively move them down the pipeline.
Here are some examples of prospects:
- Someone you gave a web-demo.
- A person who fits your target market who talked with you at a trade show.
- A lead you called and spoke with.
- A contact on social media who responded to your LinkedIn message or email.
To visualize the difference, imagine these sales leads sitting at the top of your sales funnel. There are a ton of them, and only a fraction will make it to the prospect level.
Leads who are qualified and interested after you learn about their needs, their business, and buying intent move down the funnel and become prospects.
This is a sifting process. If you speak with 1000 leads, maybe only a hundred of them will be qualified enough to continue pursuing, as shown in this picture of the sales funnel.
Now that we have gone over the difference between the two, let’s discuss how to turn leads into prospects.
How to Turn Leads Into Prospects
How do we get a lead’s attention, qualify them, and begin a sales conversation? It is a two-part process consisting of communication and qualification.
First, you must reach out to the lead and communicate with them.
You can do this by sending them an email or making a cold call. Or, perhaps you are lucky enough to receive inbound inquiries. In that case, all you have to do is answer the phone or respond to their email.
Then, once you are in communication, you have to qualify them. This means determining whether they are a good fit for your product or service.
If you bypass the qualification step, you run the risk of passing people to your pipeline who will do nothing but drain your time and energy.
So, before giving them the royal treatment that you provide to those in the sales process, you want to make sure they deserve it.
You need to assess the likelihood they will end up buying by asking them questions. The specific attributes necessary to become qualified differ from company to company.
But, in general, there are three qualities to look out for during qualification, as they affect this likelihood to buy.
1. Do They Fit Your Target Market?
First of all, you want to ensure they fit your ideal customer profile or at least share traits with some of your current clients.
This is critical. After all, you wouldn’t want to sell property management software to a company without any property to manage.
So, during this phase of qualification, ask them questions about their business and their needs. You want to develop a strong understanding of what they do and what kind of help they require.
Some of the best questions to ask here are simple. Questions like: “What do you need help with?” or “Can you tell me a bit about your business?” give you plenty of information.
2. Do They Have the Ability to Buy?
After they pass the first stage of qualification, you need to make sure they have the means to buy.
Is the person you are talking to the Decision-Maker at the company? Do they have the budget to buy?
You have to figure this out before moving on, or else you might be setting yourself for a long sales cycle or, worse, one that was doomed from the start.
Pro Tip: Even if they aren’t the Decision-Maker, you can usually still qualify them if their company passed step 1 of qualification. Just know that you will need to find this Decision-Maker sooner than later.
If they don’t have the budget for your price, it might be best to revisit the conversation at a later date.
3. Do They Have Any Intent to Buy?
You want to save your demos and presentations for people interested in making a purchase in the near future.
These are the individuals who need to solve a problem ASAP, so they are shopping around for solutions like yours.
Their intent can be hard to gauge so early in the sales process, but there are some specific signs the lead is ready to buy that you should look out for during your qualification:
- They ask about pricing.
- They want to hear stories about your other customers.
- They have a ton of questions.
- They have a specific product in mind.
- They make “if I had this…” statements.
And remember, if they aren’t certain that they will buy, that doesn’t mean you should necessarily disqualify them.
This is especially true if your pipeline is looking depleted or if they represent huge potential revenue.
Take your shot. Take them through the process and show them why a purchase would be in their best interest.
Different Types of Sales Leads
As we stated before, not all sales leads are equal in value. Some have a lower likelihood to buy than others. The lower their likelihood to buy, the less of your attention they deserve.
Further, different types of sales leads require specific types of communication and strategies for turning them into engaged prospects.
Here we will illuminate the key differences between each type and tell you how to approach them.
Also, keep in mind that the types of leads aren’t mutually exclusive. A marketing-qualified lead is usually also a warm lead.
1. Cold Leads
A cold lead is a lead that fits your ideal customer profile but has not communicated any interest in your solution.
They are the contacts sitting in your prospecting list. Maybe you found them through your research, or your lead generation software built the list for you.
No matter how they got into your CRM, they represent potential sales, even though they probably have no idea who you are or what your company does.
Obviously, this makes cold leads the most difficult to turn into prospects. However, they are also usually the most prevalent type of lead, so you need to master the art of sparking their interest.
To turn a cold lead into a prospect, you will use a series of calls, emails, and social touches.
When reaching out, follow these best practices:
- Be Persistent: Follow-up on your emails. Ask for the meeting more than once in a call, and keep trying. After enough touches, you should be able to land a meeting with them if the product is a good fit.
- Lead with Pain Points: Come across as a problem-solver with these leads. The first business-related thing you mention should be the pain points that businesses like them suffer, and how you help those businesses.
- Nurture Them: If you can’t get a response, put them in a nurture campaign, where you will send them helpful information such as industry articles or blog posts until they are ready to consider exploring your solution.
If cold calling is your company’s ideal method for microwaving these cold leads, check out Cold Calling Best Practices.
2. Warm Leads
A warm lead is a contact who is already familiar with your brand, service, and maybe even your name. Perhaps they gained this familiarity through a past conversation with you, or they follow your blog religiously.
Regardless of how they know you or your company, warm leads are easier to turn into prospects than cold leads. They are more likely to have a conversation with you since you don’t seem like a stranger.
To turn a warm lead into a prospect, set up a time to talk with them and learn more about their business and needs.
For example, if you reached out to someone last year and they refused to buy because it was bad timing or they lacked the budget, you can try again this year.
Maybe their circumstances have changed and they are open to checking out your solution.
If you or your brand have past history with the contact, it’s best to bring that up at the beginning of the conversation, like so:
“I know we met last year and your team wasn’t ready to take on a project like this. I wanted to circle back to see if anything has changed over there and if you need help with {pain point or value proposition}.”
They will most likely be flattered you remember their specific circumstances, and your proactivity may well pay off.
3. Hot Leads
Hot leads are the people who filled out your demo request form or called into your company, wanting to learn more.
They require immediate attention because they are such high-chance leads. Strike when the iron is hot, within 20 minutes of learning how interested they are, or else their interest might fade.
If you aren’t worried about them losing interest, worry about this. If they reached out to your brand, guess who else they are probably reaching out to—your competitors.
And don’t worry, they won’t get spooked by your haste. In fact, they will probably applaud you for reacting so promptly.
Hot leads typically have the following three attributes:
- Need: They have expressed a problem that you solve.
- Authority: They will be a Decision-Maker, or hold a title that is usually involved in the purchasing process of your solution.
- Company Type: They come from a type of company that fits your target market.
If you sold marketing technology to SaaS brands, and you received a call from the VP of Marketing at a SaaS company who was looking for marketing tech, well, that is about as hot as it gets.
Turning a hot lead into a prospect should not be too hard.
You still have to do some qualifying to see if your solution can truly support their needs. But after that, it should be easy to book a follow-up meeting where you can start the discovery phase of the sale.
4. Information Qualified Leads (IQL)
Information Qualified Leads are the contacts who fit your target market and have supplied you with information but have not yet expressed interest in your specific solution.
These leads are just beginning to explore the problem your company solves. If you sold document automation software, these leads could be reading an e-book titled “how much time your team wastes doing paperwork”.
A lead becomes information qualified in one main way. Usually, they fill out a top-of-the-funnel form to download useful information (e-book, tip sheet, report), thereby giving you information such as title and company type that helps you qualify them.
Therefore, they are qualified in the sense that they are a company with similar attributes to your clients. However, they lack qualifications in areas such as buying intent and the ability to buy.
To finish the qualification process and turn them into a prospect, you have to find out if they would like to learn more about what you offer.
For instance, if you learned they read your company’s blog post on “email marketing automation in 2021” bring that up in your outreach.
Ask if they found the article helpful, and ask what prompted them to read it in the first place. This digging will help you uncover their needs and problems, allowing you to qualify them, spark interest in your solution, and turn them into a prospect.
5. Marketing Qualified Leads (MQL)
A marketing qualified lead is the next step up from an information qualified lead. These leads are actively researching how your service might be able to help them.
Whether or not this lead is handed off to the sales team, depends on your organization. Some companies with enough sales bandwidth will pass them to sales reps. Others will keep the lead in marketing, continuing to nurture them until they become sales-qualified.
Here are some signs that they are an MQL:
- They downloaded a case study.
- They attended a webinar about your product.
- They watched your videos about how your solution works.
Since they are obviously interested in learning more about your solution, it should not be much of a challenge to push them into prospect territory.
Simply finish the qualifying process through a phone conversation or email. Then, try to arrange a discovery call, or even a web-demo or presentation, if you think they are ready.
Also, keep in mind that just because they are researching your company doesn’t mean they will answer your first emails or calls. You need to stay persistent on these contacts. They have a good chance of converting into a sale if you can just initiate a conversation.
6. Sales Ready/Accepted Leads (SRL)
A sales-ready lead is a lead who is considered well-prepared enough to be handed over to the sales team for further processing. SRL leads are hand-offs between marketing and sales. Of course, their readiness depends on your organization’s rules and procedures.
For example, some companies might consider an individual from a target company who read your ebook sales-ready.
Another company might not, and instead of moving toward the sale, the company will keep it in the marketing department’s arena until the lead is warmer.
In general, the more room you have in your pipeline the lower the standards for a lead to be considered sales-ready. If you have the time, give that person attending your webinars a call.
Even if they aren’t a good fit, at least you have disqualified them.
A Change in What It Means to Be “Sales-Ready”
In the past, marketing teams used to use the BANT method to determine if a lead was ready to talk with a sales rep. Fitting BANT means the lead had the budget, authority, need, and timing necessary to make a purchase.
However, this standard is too hard to meet.
If you only called leads who fit those criteria, you might be missing out on potential clients. You also might be bored out of your mind.
Also, it is often impossible to determine if they fit BANT until the later stages of the sales process. How will you know their budget until you talk with them? They aren’t going to put that into an online form.
To change the idea of sales readiness, B2B Marketing Advisor David Dodd proposes a less prohibitive definition of a sales-ready lead.
“An individual who (a) is affiliated with a qualified prospect, (b) can make or influence the decision to purchase your product or service, and (c) is sufficiently interested in exploring solutions to engage in a meaningful sales dialog with a sales rep.”
As you can see, Dodd thinks it best to make the outreach even if you still have a decent amount to learn about the lead before they are fully qualified.
7. Sales Qualified Leads (SQL)
A sales qualified lead is a potential customer who is ready to meet with a member of the sales team. They have expressed definite interest in exploring your offers and they are a step up from an MQL in terms of qualification.
An example of an SQL is a Decision-Maker who called asking about your service.
Or, the SQL might be an individual in the Decision Stage of the sales funnel, where they are downloading content that will aid them in deciding to buy. This content could be case studies, comparisons of your solution against its competitors, or your pricing plans.
You should consider these leads to be hot, and reach out to them quickly. Since these leads have been qualified by your marketing team, you just need to make contact with them and certify that they are indeed who they say they are.
Then, you can begin walking them through the sales process, either with a discovery call or a presentation.
Which Leads Should You Focus On?
As a rule of thumb, you should dedicate more effort to leads that are more likely to close.
A hot lead deserves more attention than a warm lead, and an SQL deserves more follow-ups than an MQL.
Now, if warm and hot are too vague descriptors, and you want to get more technical, try implementing a lead scoring program.
With this, you will actually rate your leads on their likelihood to buy. The higher the rating the more attention you give them, ensuring your sales team isn’t spending too much time on low-quality leads.
Each lead’s rating depends on scoring factors, which are usually chosen and assigned certain weights by the marketing team.
The common scoring factors fall into two categories: the attributes and behaviors of the lead.
Attributes of the Lead:
- Company Size
- Company Revenue
- Title Level
- Industry
After you assess those attributes, it’s time to look at how the lead interacts with your business. These are some factors to consider.
Behavior of the Lead:
- Email opens
- Email forwards
- Web page visits
- Content downloads
- Social media engagement
- Webinar attendances
Using these factors, a lead who visited the website 100 times, downloaded 6 pieces of content, and is the VP of their department could receive a high rating – 8 or 9.
Meanwhile, a lead who opened a few of your cold emails, has never visited the website, and holds the lowest title in their department, might receive a low rating – 2 or 3.
Sometimes it will be up to the salesperson to choose which lead deserves pursuit. Other times, marketing will only send a lead to a sales rep if it reaches a certain number.
Setting this system up is certainly an undertaking, but organizations using lead scoring see a 77% increase in lead generation ROI, so it is definitely worth looking into.
How to Generate Sales Leads?
Rather than putting all of your resources into one lead generation method, you should have a variety of strategies for generating sales leads. Some should be active, others passive.
To accomplish this and build a predictable and scalable pipeline, Aaron Ross, the author of “Predictable Revenue,” recommends using these 3 main methods for lead generation: seeds, nets, and spears.
1. The Seeds
The seed method grows leads from current relationships. You should be leveraging your current clients to get other leads from referrals or word of mouth.
To make sure your seed method is productive, invest in a good account management team.
2. The Nets
The nets capture leads through one-to-many marketing. This is when you create a marketing plan that will attract potential buyers to your website.
You could invest in content marketing, google advertising, or something else that brings customers to you.
The logic goes that once prospects reach your website, they will engage with your content, and potentially want to check out your solution.
3. The Spears
Spears catch leads through one-to-one prospecting efforts. Your business development team will captain this method of lead generation through their cold calling and emailing efforts.
Of course, to throw spears effectively, salespeople need a list of cold leads to contact and sell.
To acquire these leads, many companies use a lead generation tool like Soleadify, which automatically assembles lists of best-fit companies and their associated contacts.
That way, salespeople can spend time engaged in the most important part of the job: actively selling.
Don’t Dismiss the Less Coveted Leads
Understanding the differences between the various types of leads is crucial for managing your time and scheduling your outreach blocks.
However, when you are deliberating on whether or not to call that peculiar lead who keeps devouring your company’s blog content, don’t dismiss them just because they lack the perfect title or you lack the intel.
Sometimes it is impossible to know if a lead is profitable until you give them a call.
In sales, you have to jump into the mud sometimes to figure out if there is any gold in there. When you start doing that, you avoid missing out on any opportunities to build relationships with potential buyers, even the mysterious ones.
