This is the first in a two-part series. Read Part II here.
Sales people are traditionally quantitative people. Give a rep a new compensation plan and, within five minutes, she’ll tell you how to earn the most with it. However, give a rep a sales funnel and she’ll become fogged by the same optimism that drives her. Most sales people find comfort in a full sales funnel. It looks good to management and creates a personal sense of abundant opportunity. However, funnels bloated with low quality leads can throw off organization sales forecasts, inflate rep quotas, and lead to missed expectations. Poor lead qualification can also rob the organization of valuable sales headcount by misdirecting thousands of hours of sales time a year toward no-win opportunities. To improve lead qualification and enhance sales force effectiveness, high-performing sales organizations use some of these best practices.
Start with rigorous targeting. A quality lead starts with a quality target customer. Since most leads are generated by sales and marketing, this puts the onus on them to select the most attractive customers or potential customers at the outset. The most effective method to select target leads is to translate the organization’s target customer segment definition to clear criteria that sales and marketing can act upon. This includes company characteristics, typical buyer titles, and attractive opportunity types. To test the effectiveness of your targeting, select a good sample of reps and match their target customer and prospect account lists with the company’s target segment definitions. Does the sales organization’s tactical action align with its strategic segment targeting? Do reps self-select their target accounts based on personal preference or comfort level? Targeting prospects that have a poor fit with the company’s objectives dramatically lowers the potential for quality leads.
Map the customer’s buying process. Knowing where the lead is within the customer’s organization can help the rep to improve or write-off the opportunity. It is essential to know the complete buying organization in terms of its decision-making process and criteria. Relationship sellers often rely too heavily on a single close contact to pull through a sale and therefore overrate lead quality. A good place to start is to understand how customers within certain target segments typically make their decisions by mapping the steps, players, criteria and interactions using a number of historic sales processes both won and lost. Consolidate these actual buying process maps and use them to test assumptions on the quality of specific live leads for the same customer segment. Knowing your true position helps you better qualify your opportunities.