Marketing generates quality leads, sales happily accept them, deals close, the MQL to SQL (Sales Qualified Leads) conversion rate is almost 100%, and everything is terrific, right? WRONG!
If marketing holds onto every lead until they are sure it’s a lock-down SQL, bad things happen, like:
Losing your selling window. Remember, buyers are in control. They buy on their timeframe, not yours. Wait too long, and the buyer will be locked into another vendor or on to another project.
Losing out on promising leads. Qualifying leads isn’t an exact science. Marketing can err on the conservative side – knowing that some good leads might not get to sales (what we in the marketing demand gen world call a “False Negative”), or marketing can be more aggressive knowing sales will get some “False Positives”.
For those not familiar with the term, a False Positive would be a lead that appears to be sales-ready by displaying buying behavior, such as watching demos, looking at pricing, or downloading RFP templates, but in fact, they are still just researching.
Most companies will accept “False Positives” to rapidly get sales leads, provided it doesn’t get out of hand. I recently talked to one CEO who saw a 90% MQL rejection rate, meaning that only 1 out of 10 leads was sales-ready. Now, that’s out-of-hand, although it’s not uncommon.
So, what’s the right MQL to SQL conversion rate? Today’s best practices hover around 60%. Get close to this, and you should likely be feeling pretty good. But to get the full story, you need to be looking at a bunch of other metrics (metrics that a sound closed-loop marketing automation/CRM system should be able to cough up quickly), such as:
% of MQLs resolved – meaning the rep could reach the prospect and conduct a discovery call. Somehow, the best reps always seem to have the highest percentage, but there can be other reasons for varying rates. For example, my tele-qualifiers passed MQLs over at one point without setting appointments, as the reps wanted to own their calendars. With this process, we only got a 30% resolved rate and a 15% MQL conversion rate. Once the tele-qualifiers started to schedule meetings, the resolution and MQL conversion rates tripled.
% of MQLs disqualified with lousy info (bad contact info, the wrong role, not being employed at a company, the company not in the right region, size, etc.). This number should be low, but it is important to watch to ensure the demand generation process is aligned correctly. For example, perhaps a marketing list was created with companies that are too small or a tele-qualifier misunderstanding the qualification criteria.
% of MQLsreturned to marketing for nurturing (right company type and role but doesn’t fully meet MQL definition). In other words, these are your “False Positives” and at some point, down the road, through nurturing efforts, they hopefully will be ready to buy.
These metrics can differ by marketing campaign, region, and sales rep, so understanding them helps both marketing and sales adjust behavior and improve conversion rates. What trends are you seeing in your company?
About the Author
Jeff Whitney is a B2B software marketing executive with extensive experience – from early-stage start-ups to achieving marketing equity. Jeff has a passion for building a world-class marketing function, starting with the organization, demand generation programs, sales enablement tools, and aligning sales and marketing.
Perhaps, like many people around the world, you made New Year Resolutions as last year rolled into this one. Items such as eating healthier, getting organized and losing weight typically top the list of resolutions people commit to in the waning hours of New Year’s Eve. Many business leaders take advantage of the fresh start of a new year as well, vowing that this will be the year they conquer social media, expand their marketing efforts, improve their leadership skills or finally add some expertise to their bench.
January 1st dawns bright with promise and bursting with potential. The unfortunate reality, however, is that January 31st often shows no sign of the changes avowed just a few weeks earlier. A stunning 92% of people who make resolutions abandon them completely, afraid/unwilling/unsure of how to make the changes necessary to be successful.
How can you reach your goal?
Want to ensure that you’re in the 8% of people who make (and keep) their resolutions? A careful look at the habits of people who keep their resolutions provides insight into how to make sure you’re one of the few who maintain their resolve through the year.
Statistically, simply by making a resolution, you’re more likely to be successful at attaining success than those who don’t bother to make any commitment to change. (Seems rather obvious, doesn’t it?) It’s an important distinction, though. To be successful at improving or progressing, you must first determine where to make a change, and what the change needs to be. Put your resolution in writing as both a reminder and a commitment to yourself.
Another important component in reaching any goal is seeking professional help. In addition to acting as an accountability partner, a professional adviser can provide you with expertise and insight that can help you to determine what changes can and should be made to propel you to success. In your personal life, it could mean hiring a personal trainer, signing up for a class or learning a new language from a native speaker. For the business professional, partnering with a consultant may be exactly what you and your company need to reach new levels of success this year. A skilled expert can move you in the right direction.
What kind of consultant should you hire?
Do a quick internet search for ‘business consultants’ and you’ll get thousands of results. How do you know what type of consultant you need and which one would be the best to help you accomplish your goals? Finding the right consultant is imperative for your success. Look for a consultant who can offer assistance in multiple areas of business management, with proven success and verifiable client testimonials. Consultants with strong accreditations and experience in the business world will be able to readily identify areas that need improvement and offer you both support and advice.
What sets BLUE SAGE Consulting apart?
BLUE SAGE has been in the consulting field for decades, with accreditations and accolades and experience from some of the biggest names in the business world. (Find out more about us here.)
Prior to joining BLUE SAGE, our team of experts worked in a variety of fields, handling real-world business challenges and opportunities faced by market-leading public and private enterprises. From assessment, strategizing and execution, BLUE SAGE Consulting stays with our clients every step of the way. Regardless of the size of the organization, BLUE SAGE offers hands-on, focused attention to help our clients figure out exactly what they need to succeed. Most important, we not only get our clients to that point, but we also roll up our sleeves to work alongside our clients to make it happen.
Over the next few weeks, we’ll be taking a look at some of the issues that you may be facing in your organization this year and exploring how BLUE SAGE Consulting can help your business thrive in the coming months.
Don’t let your resolutions fall by the wayside. Let BLUE SAGE Consulting help you develop a strategy for success and move from “I should…” to “I did.”
Contact us today to find out how we can make this year the one when you get things done.
Even though your business is considered successful, you still feel like there’s more that can happen; you’re just not sure how or what. You’ve thought about hiring a business consultant but don’t really think that it’s worth the expense because you’re not sure how they can help you.
Being so close to your business, it’s hard to see how an outsider could really understand what’s needed and how to do it without being a part of the business. The ability to see your business objectively and provide you with active, viable solutions is part of the process of working with a business consulting professional.
Working with a management consultant means you’re ready to do what’s necessary to help your business thrive. The first step is finding the right fit.
Learn New Skills
Chances are your business marketing strategy may not be bringing the best results. Business consultants will put your strategy under the microscope and work with stakeholders in your business to implement techniques that optimize opportunities, and bring qualified leads through the door. Skills like project management, resource utilization and problem identification can make a big difference in your business. The more you learn about how to implement these skills in your business, the better prepared you’ll be to implement the necessary steps to succeed.
Create Business Systems
Creating a business system forces you to address the specific steps you need to take to succeed. When you’re that focused, you’re forced to think things through and make better decisions. Being a business manager means that you’re wearing a lot of hats and probably judging competing priorities. A business management consultant can provide the experience, objectivity and focus that will help you improve your business and make it more adaptable.
Change Behaviors
We know the old adage, “You can’t teach an old dog new tricks”, but when you change behavior, you can often change consequences. Most business managers are focused on things that prompt behavior, such as managing expectations or adhering to company norms, instead of things that can have a significant impact on future behavior, like trying new ideas or embracing culture change. Working with a business management consultant helps to create an environment where positive consequences can be encouraged, and new ideas can be tested.
Discover New Opportunities
Business consultants spend their time working with a variety of organizations, which helps to build extensive networks, strategic partnerships and joint ventures. Whether you’re building a new business or entity, growing a line of business, or maintaining a steady stream of business, a business management consultant can work with you to identify ways to expand your business in ways that minimize costs and maximize exposure.
In my first post on sales and marketing alignment, I shared a demand generation alignment checklist I’ve created and have continually refined over many years of marketing with many high-growth software companies.
Here, I’ll dive into the first two items of the checklist:
Get marketing ready by understanding the buyer persona, the buying cycle, and the competitive landscape. And make sure you know the differences by region and distribution channel. Interviewing the sales team (sales reps, SEs, etc.) and answering sales calls helps greatly. Also, interview partners and customers, including ones who have just bought. This process can take months and be quite formal, but you can get started quick ‘n dirty in days. The bottom line is this: marketing can’t play an effective alignment role unless they understand and help create a structure for the buying process.
Create a Marketing Qualified LEAD (MQL) definition. Not all leads are the same. Marketing creates leads in many ways –email campaigns, the website, webinars, trade shows, etc. An MQL is a lead that marketing has qualified and is passing to sales as having a high probability of converting to a Sales Opportunity. But, defining an MQL may not be nearly as simple as it seems. It requires understanding the maturity stage for each of your products and then educating and getting the revenue team’s agreement on the type of lead that best maps to that product stage. It also requires mapping leads to target geographic regions, company size, prospect job roles, etc.
You’ll need some patience here – both in understanding the MQL concept and getting agreement. The lead definition concepts are new to most people, and they’ll need time and education to overcome historical biases.
Check out Sirius Decisions’ research on Demand Types. They’ve been thought leaders in this area for years and have excellent reports. I’ve successfully used their research and analysts to help educate and select the proper lead definitions for my company’s products.
Historically, sales teams want BANT (Budget – Authority – Need – Timeframe) leads. And what salesperson wouldn’t? However, BANT leads work best in replacement markets (think toner, paper, office furniture, and other commodity-like products), where buyers already have the product, have the budget to buy more, and often buy on price or convenience. However, the replacement market is a tough one, and most companies don’t want their products in this category.
Fortunately, most software products fall into the New Paradigm category, where the product performs a function differently and hopefully better than previous solutions. But, because it’s a new approach, waiting until the buyer has BANT is not a good idea. Wait that long, and competitors have likely guided them to that point, and you’re just sales fodder. New Paradigm leads map better to prospects with Need and Interest. Sales reps may resist, but Sirius Decisions research shows that in this market, you’ll get more leads if you focus on Need and Interest, and that opportunities will close at a higher rate and for more money than waiting for BANT leads.
The third type of software product market is the New Concept. New Concept products address a problem that most buyers must be aware of. Wait around for BANT or even Need and Interest in this market, and your sales team will have lots of free time. You want to find people in specific target markets who can sponsor change for New Concept products.
If you’re unsure of what category a product falls under, take a quick survey of sales reps and other members of the revenue team to clarify key questions in the buying process.
A note of caution: if you have multiple product lines, they could fall into different market categories. Training teams to qualify one product on BANT and another on Interest and Need, for example, is difficult, but it’s necessary.
Once you identify the correct lead definition, you must educate and convince the sales team. Marketing can carry most of the education load, but sales management must take ownership of the convincing. It will take group and individual discussions and then monitoring to ensure compliance.
About the author: Jeff Whitney is a B2B software marketing executive with extensive experience – from early-stage start-ups to achieving marketing equity. Jeff has a passion for building a world-class marketing function, starting with the organization, demand generation programs, sales enablement tools, and aligning sales and marketing.
Successful sales and marketing alignment seldom happens by accident or because everyone wishes it. It requires true conscious competence and a commitment by all key parties.
By way of background, before finding my passion in marketing, I was a bag-carrying (and yes, above quota) sales rep. As a result, I started my marketing career confident I could avoid the seemly ubiquitous sales and marketing chasm.
Wow – how wrong I was.
Maybe I did better than other marketers without sales experience, but I fell into way too many chasms and each one hurt. I realized that no matter how hard I worked, alignment wasn’t just on my shoulders. Just as a solid marriage requires the commitment of both parties and agreement on key aspects of the relationship, I realized I needed the commitment of all key parties involved in the revenue generation process, along with the list of crucial alignment items for us to work on.
The checklist below combines the key alignment issues with items that marketing or sales must do to prepare for the alignment.
Get marketing ready by understanding the buyer persona, the buying cycle, and the competitive landscape.
Create a Marketing Qualified LEAD (MQL) definition.
Understand the MQL to sales opportunity metrics.
Set MQL and Marketing-Generated Sales Opportunity goals and then communicate to the team.
Create a closed-loop system for tracking leads from creation to win/loss. Create Sales SLAs (service level agreements) for handling MQLs.
Establish consistent processes for creating a Sales Opportunity.
Require quick, insightful feedback from sales on disqualified leads.
Communicate and listen to sales.
Help reps create their own MQLs.
Find out why opportunities stalled or were lost.
In additional posts, I’ll expand on this checklist and share my sales enablement checklist too. What are your experiences with sales and marketing alignment? Do you have any items to add to this list?
About the author: Jeff Whitney is a B2B software marketing executive with extensive experience—from early-stage start-ups to achieving marketing equity. He has a passion for building a world-class marketing function, starting with the organization, demand generation programs, sales enablement tools, and, of course, aligning sales and marketing.
