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.
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.
Every April, my hometown of Hopkinton, MA – the start of the Boston Marathon – turns into an athlete’s village when tens of thousands of runners and spectators descend on our streets to make their way along the 26.2 mile course into Boston.
In years past, we would make it a point to be out of town during “the race”, including in 2007. That was the year when Mike Olivieri (now Executive VP at American Business Journals) made an appeal to guests at a Boston Business Journal-sponsored breakfast, asking if any Hopkintonians in the audience would be willing to give shelter to a marathon team the morning of the race. A Nor’easter storm was threatening to hit that morning, and Mike and his team from AccesSportAmerica were hoping to stay dry up until the start of the race. Mike and his team camped out at our “safe house”, which was close to the starting line, and a tradition was born that continues today.
Over the years, our family has hosted runners from around the world during the morning of the Boston Marathon: first time runners, elite runners (who knew?) and family from the Chicago Running Club. This year was especially memorable as the first race following the Boston Marathon bombings. Runners from Ireland, the UK and five different states arrived hours before the race, conducting their personal rituals, sharing strategies for completing the race and getting ready for personal triumph.
This year’s Marathon has ended, and the last athletes have crossed the finish line, which makes me think about some lessons behind our town’s slogan – “It All Starts Here” – and how they might apply to the business world, including:
Preparation is key, and repetition leads to improvement. The town of Hopkinton has hosted this event for the past 90 years, and each year it seems to go off without a hitch. With heightened security this year, the preparation was a bit different. Nonetheless, the town returned to a sense of normalcy within hours after the last runner left the gate. My guess is that 90 years of “getting ready” for this race were critical in anticipating and preparing for the unexpected.
Common interests can be infectious. In her post “The Only Day People Know My Hometown”, Hopkintonian Shannon Motyka gives her perspective of how the Marathon has been a part of her life. Whether or not you’re a runner, it’s impossible to not get caught up in the spirit of the race and the sense of community that comes from a shared experience. Are there ways that you can encourage your customers and prospects to share common interests or discuss business topics? Are there common topics and specific business issues that you’re seeing in the market?
Never say never.This year, many who had hung up their running shoes came back to Hopkinton for the 118th running. Some runners began training last April following the bombings; others were determined to finish what they had started last year. A common theme that I heard is how different this year is from years past. Remembering that things change – whether it’s business conditions, personal training goals or a company’s overall success – can help keep an open mind.
It’s never too late to be what you might become. This year, we met Katherine Beiers – an 81-year-old runner from Santa Cruz who is #1 in her age group. Katherine began running at the age of 49, on her lunch hour. She explained to me that she doesn’t really like running, but she does looks forward to the rewards of a good run – being outside, increased energy and invigorated spirit. What an inspiration! Katherine’s approach is to look at the rewards of running – the outcome, and not the struggle of each mile. Whether you’re building an inbound business, launching a product or improving your company’s revenue model, think about the rewards, and remember that it’s never too late to try new things.
Have you learned any lessons from this year’s Boston Marathon? Are there other observations that might apply to the business world?
It’s fine to learn from your own mistakes, and it’s better to learn from someone else’s. Take inbound marketing for example. Countless businesses have tried to implement inbound marketing within their organization, only to fail miserably. And why? Not because of any inherent flaws with the inbound marketing process, but rather flaws in their perception of what it is and how it’s supposed to work.
In other words, they failed because they believed the myths of inbound marketing. And if you don’t learn from their mistakes – if you try to implement inbound marketing with the same set of unrealistic expectations – there’s a good chance you’ll join them. With that in mind, take a look at 6 inbound marketing myths that you can avoid on your way to building an inbound business:
Myth #1: You’ll have so many leads, you won’t know what to do.
You might get leads in greater quantity from inbound marketing, but the real goal here is quality. Instead of 100 cold leads from a purchased directory list – people who will likely hang up or opt out the first chance they get – you’ll have 20 leads from people who voluntarily expressed interest in your company, your products or services. Who would your sales team rather follow up on? Exactly, so don’t get hung up on the numbers.
Myth #2: Inbound marketing is a one-department job.
It’s called inbound marketing, but you’re going to need the expertise of other departments in order to succeed – from IT and product, to sales and engineering. We’ll be covering this subject in greater depth in the next few weeks, so stay tuned, but the bottom line is this: If you expect the marketing department to handle everything inbound-related, you’re probably not going to make it.
Myth #3: People will find your content on their own.
The “if-you-build-it-they-will-come” fallacy is fairly common among business starting out with the inbound approach. You’ve gone through all the trouble of creating original content, and because you don’t actively promote it, it just sits there collecting digital dust. To get your content in front of the right people, you’ll need to put some marketing muscle behind it in the form of social media, merchandising and perhaps even advertising spend.
Myth #4: Inbound marketing doesn’t require much money.
False. Compelling content doesn’t materialize out of thin air. Landing pages don’t self-replicate. Marketing automation tools (despite their name) don’t run themselves. Many companies fail at inbound marketing because they don’t anticipate the costs and quickly run out of money and/or content. Usually both.
Myth #5: Inbound marketing isn’t for every type of company.
Does your company have a product or service to sell? Good, then you can make inbound marketing work. It doesn’t matter how big or small your company is, what it sells or where it sells it – if you have a business, inbound marketing can work.
Myth #6: You’ll see results immediately.
You might see results immediately, but generally it’s a slow and steady climb. Many companies start off strong, with lots of new content updated on a regular basis, and when they don’t see the results they wanted after several months, they lose interest and give up. Remember, inbound marketing is a method, not a tactic, so you need to make a long-term commitment if you really want it to succeed.
There’s a lot of misconception surrounding what it takes to succeed in building an inbound business. The myths we listed here are only a few of the ways in which businesses get sidetracked.
Those of you who are familiar with us know that we take a somewhat unique approach to business management consulting.
In addition to the research, reporting and advisements of traditional consultants, we actually enjoy getting our hands dirty with execution.
That sounds a bit gruesome, doesn’t it?
What we’re trying to say is that we don’t just determine the appropriate course of action; we roll up our sleeves and help make it happen. Over the years – as we’ve helped clients of all sizes and industries – we eventually codified this process. Today, it’s known to us (and now you) as the “3P” method of business consulting: poking, prodding and producing. Again, context is everything when it comes to business lingo, isn’t it?
Anyway, if you’re unfamiliar with this approach, we wanted to briefly outline the basics in the event that you or someone you know might be looking for more value from a business consultant. So with that in mind, allow me to quickly explain the benefits of this approach by pillar. Here we go…
Poking: In the world of business management consulting, nothing is ever as it appears. The client knows there is a problem (why else would they contact a consultant?) but often times they are not entirely sure what that problem actually is. A lot of consultants simply take their word for it and immediately begin working on a solution. We take an alternate route. Instead of accepting the client’s version of the problem, we examine the business ourselves, and in doing so, we often end up drawing much different conclusions. In other words, we make sure we’re trying to solve the right problem.
Prodding: Once we’ve identified the underlying issue, we dig deep into the details. What factors are contributing to the problem and making it worse? Are the problems a result of people, processes or systems? Are they caused by a lack of planning, a lack of execution or a misinterpretation of data? Unlike the first phase, this process is highly collaborative, as we spend a great deal of time interviewing key stakeholders (as well as customers in some instances) to determine the specifics of a particular challenge.
Producing: The problem has been identified, along with the symptoms. Next comes the fun part. Now it’s time to create and implement a solution. As you might expect, this process varies greatly depending on the client and their specific challenge. They might be launching a new inbound marketing initiative and need to remodel their business plan or revise their sales process. They might be looking to increase operational efficiency and need an overhauled operating model. Or, they may need additional resources to be on-site as needed, to understand their business and address challenges in real time. Whatever the challenge, we take the lead to address it.
It’s the “producing” part of the approach that separates us from the vast majority of business management consultants out there. Today’s businesses are increasingly looking for more tactical, hands-on execution, not just suggestions on the appropriate course of action.
This isn’t a big change for us – it’s what we’ve been doing for more than a decade.
Does this sound like an approach that can move your business further? If so, drop us a note.
After years of cold-calling and prospecting, your sales team is now (or soon to be) receiving inbound leads for the first time. The question is, are they ready? In our experience, most sales teams are not; they ignore the key differences between inbound (warm) leads and traditional (cold) leads – and in doing so, squander countless opportunities.
Read on to find tips to help you and your sales team avoid these mistakes.
Tip #1: Adjust your sales pitch
When making cold-calls, the salesperson has a lot of ground to cover. They’ve got to make it through the “survival stage” – introduce themselves, the company, its products & services; they have to understand the prospect’s pain points and gauge their level of interest – ideally, before they hang up the phone (or delete the email). With inbound leads, this conversation has already taken place by the time you contact them.
If done effectively, the inbound leads will already know the basics about your company. They will know about your services and products. More importantly, you will already have a good idea of their level of interest, depending on their conversion point(s). So, the conversation (or email thread) should focus on providing additional information; to answer their remaining questions and move toward closing the business. The salesperson will be able to quickly position themselves as a trusted advisor based on the useful content that has already been seen by the downloader.
Tip #2: Know the offers
Most sales teams are more than happy to receive an influx of inbound leads, but if they don’t know where the leads are coming from – and what the prospects are interested in – the conversations will be shallow, short and unproductive.
If you’re generating leads from whitepapers, eBooks, and webinars, your sales team must also be familiar with these materials. Often, the marketing team will create a new piece of content and distribute it internally, via email as a “heads up.”
We suggest administering a short quiz on the contents and then letting the sales person follow up on these leads after they’ve passed the quiz. This is tough love, but it will ensure the salesperson can have an intelligent conversation with the prospect.
Tip #3: Know their behavior
If your company is leveraging inbound marketing, there’s a very good chance that you’re collecting and analyzing data on user behavior. So before your sales team reaches out to an inbound lead, make sure they can answer some basic questions. What steps did the prospect go through as they converted to a lead? What offer did they convert on? What other pages were viewed on your website, and for how long? How should I approach this conversation? Have a tip ready to give to a prospect based on the information they are downloading.
A little research upfront on the part of the sales team will save them a great deal of time down the road, which brings us to our next pointer.
Tip #4: Prioritize
Not all inbound leads are created equal. A lone whitepaper download will be lower on the inbound totem pole than, say, a “request a demo” conversion, which shows more legitimacy of a prospect.
While your sales team should be following up with all leads, it goes without saying that they should spend more of their time on the leads who have expressed more interest in the product or service. Inbound leads are not “beggars” anymore; they are “choosers”.
Tip #5: Give it time
A typical sales team will hit the ground running with outbound leads, calling and contacting leads almost immediately. With inbound leads, however, they need to take their time (in more ways than one). For example, when a prospect downloads a whitepaper, don’t call them immediately – they probably haven’t even opened the document yet! Instead, set a reminder to contact them, depending on the nature of the lead.
A pricing inquiry, for example, should get an immediate response.
Give them at least a day for a whitepaper or case study download. Don’t be too eager.
These are just a few quick tips on enabling your sales team to excel in an inbound marketing environment.
For a more in-depth look at how you can get your sales team ready for inbound business, reach out to us!
