If you’re a B2B solution provider, you probably have tons of potential leads at the top of your sales funnel.
But, the truth is, not everyone who expresses interest in your solution is ready to buy. Only a fraction of those leads will become customers.
The process of filtering through those leads to find the best ones is called lead qualification.
Lead qualification is a critical part of the sales process, and it’s essential to find the correct technique for your organization. It’ll help clarify when a lead should be moved further down the sales funnel, held back for more nurturing, or disqualified completely.
This guide will walk you through the fundamentals of lead qualification, highlight the different frameworks you can use, and also share signs to know if your lead is on the path to conversion or a road to nowhere.
What is lead qualification?
Lead qualification is the process of assessing which potential customers are most likely to purchase your product or service.
Lead qualification isn’t a one-time event — it’s an ongoing, shared responsibility between marketing and sales. It begins before the first contact and continues throughout the buyer journey, up until you’ve closed the deal.
Without lead qualification you’d probably talk to hundreds of leads, only to end up with just a small percentage of closed-won deals to show for all your effort. It’s a critical component of any successful sales process.
Let’s take a look.
Why is lead qualification important?
Lead qualification is crucial because it significantly improves close ratios.
Without it, you risk pursuing leads who aren't a good fit because of budgetary constraints, organizational challenges, or many other factors.
Think about how costly it can be to pursue a poor lead.
You’d be wasting away time, money, and other resources that should be devoted to leads that have a chance of actually converting.
Still not convinced?
Let’s take a look at more reasons why lead qualification is so important. By successfully qualifying leads, you’ll be able to:
- Know when to move on when a lead isn’t qualified.
- Spend more time on leads who are more likely to buy.
- Ensure your work leads to a positive impact on revenue.
- Deliver a more personalized experience to a specific portion of buyers.
- Get into the nitty-gritty of prospect challenges and deliver a better solution.
In a nutshell, by intentionally qualifying leads you’ll be able to deliver a purpose-built solution that closes more and improves customer satisfaction.
Lead qualification and its role in the sales process
The lead qualification process normally begins with a pool of leads populated by your marketing, sales, acquisition, and product teams. For smaller teams, this pool may come via website submissions and may not have a specific designation.
In a B2B organization, for example, you’ll find different types of leads:
- Unqualified Leads: Leads that haven’t been nurtured enough to be moved forward.
- Marketing Qualified Leads (MQLs): Leads that have been qualified to receive marketing materials like content offers, email campaigns, etc.
- Sales Qualified Leads (SQLs): Leads who are ready to connect with a sales rep to begin the sales process.
- Product Qualified Leads (PQLs): Leads that have shown an interest in your product by signing up for a free trial or starting a freemium-style subscription.
- Conversion Qualified Leads (CQLs): Leads that have converted on your site by submitting a form or clicking a contact/call button.
These leads are then sent into a lead qualification framework, where a series of qualifying questions may be asked to determine if they are a good or bad fit.
Following this, leads are classified as qualified or disqualified.
Qualified leads are sent on to the sales process and disqualified leads are fed into a nurturing process, where they should eventually warm up to the product and make a purchase later down the road.
You’ll be able to organize all of the processes we’ve discussed so far using lead qualification frameworks.
Qualify leads with lead qualification frameworks
A qualification framework is a guideline that, typically, sales development representatives (SDRs) use to determine whether a lead is likely to become a successful customer.
Every lead and every sale is unique, but all closed-won deals have a few things in common. Sales qualification frameworks distill those common traits into general traits that reps can look for when qualifying.
Let’s walk through the different frameworks.
BANT (Budget, Authority, Need, and Timeline) was originally developed by IBM in the ’50s and is still widely used today.
BANT seeks to uncover the following four pieces of information, in order of decreasing importance:
- Budget: Does your product or service fit the prospect’s budget?
- Authority: Is the prospect in a position to decide on purchasing?
- Needs: Does the prospect have a problem your business can solve?
- Timeline: Is the prospect ready to buy? If not, when?
While BANT is a great choice to address opportunity-level requirements, it misses the mark on many others.
Authority is a tricky one. For example, in many B2B organizations, the decision-making authority could be more than one person.
Timeline is a little dicey too as it can be easy to act prematurely. While a strict BANT might tell you to disqualify a lead who isn’t ready to buy, you can still send educational resources and offer help until they’re ready to buy.
MEDDIC (Metrics, Economic Buyer, Decision Criteria, Decision Process, Identify Pain, Champion) is a complex, yet effective, lead qualification framework pioneered by Jack Napoli when he was at PTC.
MEDDIC requires sales reps to understand every aspect of a target company’s buying process, down to even having an internal champion — an employee at that company who will internally sell your product.
Let’s check out the overlapping factors:
- Metrics: In quantifiable terms, what is the prospect hoping to get out of your solution?
- Economic Buyer: Who is the person that makes purchasing decisions?
- Decision Criteria: What are the buyer’s criteria for deciding or not to purchase?
- Decision Process: Which process does the buyer go through when evaluating a potential purchase?
- Identify Pain: Which challenges is your prospect seeking to solve?
- Champion: Who inside the buyer’s organization already believes in your product or service and is willing to “champion” for it?
MEDDIC requires gathering lots of detailed information about leads.
You should only consider using MEDDIC as a lead qualification framework if your team has a relatively low volume of very high-value sales.
These types of teams can afford the time to engage deeply with each lead to understand exactly how a prospect buys, why they would buy, and who’s “championing” you internally.
CHAMP (Challenges, Authority, Money, and Prioritization) is similar to BANT but prioritizes whether a lead’s challenges are solved by the product or service being sold.
CHAMP also defines authority as a “call-to-action” and not a roadblock. You shouldn’t hang up the phone if your lead isn’t the decision-maker, you can instead ask questions that’ll help you map the company’s hierarchy to determine who to reach out to next.
Also, identifying a prospect’s challenges first and then determining whether there is a fit helps sales teams quickly disqualify leads who don’t need what you’re selling.
Yes, it’s quite the mouthful, and probably the longest string of acronyms ever, but it’s a really useful framework.
Devised by HubSpot, GPCTBA/C&I (Goals, Plans, Challenges, Timeline, Budget, Authority, Negative Consequences, and Positive Implications) is a response to changes in buyer behavior.
Buyers today increasingly come into the sales process well informed, so this framework places the sales rep in a more advisory-type role.
Here are some of the questions sales reps should ask in this framework:
- What is your top priority this year?
- Do you have specific company goals?
- What are you planning to do to achieve your goals?
- Do you have the right resources in place to implement this plan?
- How are you currently dealing with challenges?
- Why do you think you’ll be able to eliminate this challenge now, even though you’ve tried in the past and you’re still dealing with it?
- When will you begin implementing this plan?
- Do you have the bandwidth and resources to implement this plan now?
- Are you spending money on another product to solve the problem we’ve discussed?
- Are the goals we discussed important to the economic buyer?
- What concerns do you anticipate they’ll raise?
- What happens if you do or do not reach your goals? Does the outcome affect you on a personal level?
As you can see, this framework allows sales reps to gather a huge amount of information.
Having these insights is incredibly valuable if your product or service is complex and stands to become an integral part of your prospect’s business strategy.
However, GPCTBA/C&I might not be for every B2B organization. Depending on what you sell, such a thorough qualification might not be necessary.
ANUM (Authority, Need, Urgency, and Money), is an alternative spin on BANT.
ANUM places the decision-making authority of the buyer at the very top of the list. Need functions the same way as it does in BANT, but has been moved up in priority. Urgency correlates with Timing, while Money replaces Budget as the least important factor.
This is a great lead qualification framework for selling to groups where decision-making authority isn’t always clear, such as startups that don’t yet have a well-organized purchase process in place.
FAINT (Funds, Authority, Interest, Need, and Timing) is a variation of the BANT and ANUM frameworks.
FAINT is great because it’s designed to reflect the fact that many buying decisions are unplanned and won’t be associated with a set budget.
So, like ANUM, FAINT looks for organizations with the capacity to buy, regardless of budget, and also adds Interest into the mix.
This lead qualification framework works well for prospects who may not know that your product or service exists in the first place. While BANT, in contrast, is better suited for those that are already educated about your product and whose interest is clear from the outset.
What about lead scoring?
Lead scoring is the process of assigning positive and negative numerical expressions to a prospect’s behavior and information.
This “score” can then be used to automatically channel leads to the right team.
Though a lead score can theoretically have as many data points as you want, it effectively consists of three main components:
- Behavioral attributes: Explicit actions or behaviors that represent an interest (or lack thereof) in your product, like page visits, duration, form submissions, etc.
- Demographic components: Visitor attributes like role, company size, or industry are also important to factor into your lead score.
- Sales components: These include assigning scores for every successful sales contact through emails or phone calls.
Once you have all your scores, you should add them for a single lead score for that prospect.
A high score indicates the lead is more likely to buy and a low score can mean one of two things: they aren’t a good fit or they need more time.
This data-driven, lead qualification approach has its fans and detractors. It’s definitely not for everyone.
For example, it just didn’t work out for us at Chili Piper.
We believe the way our customers buy has evolved and where they buy can’t be captured in traditional lead scoring methods.
Read into the details of why we stopped scoring leads and learn what went wrong, why we shifted our strategy, and what our new model looks like now.
When should you move qualified leads through the funnel?
By using the lead qualification technique that best serves your business, your sales and marketing teams can decide when it’s time to move a lead further down the funnel.
Important signs that indicate a qualified lead include:
- The potential for a purchase soon
- Alignment between your pricing and the lead’s budget
- Expression of interest and a need for your product or service
- A profile that aligns with similar closed deals
- An industry that your company normally sells to
- The ability to answer questions about their needs specifically and consistently
After a lead is qualified, your sales team should continue nurturing them.
Scheduling additional calls or meetings, conducting product demos, and generating more opportunities to discuss the product are popular tactics for moving qualified leads down the pipeline and on the path to conversion.
Using a lead qualification checklist
As you may have seen, identifying the attributes of a qualified lead can be a complicated process, especially if your product or service appeals to a wide variety of customers.
Sales reps need a clear and structured approach to make sure their lead qualification process is consistent and dependable.
A lead qualification checklist is a great way to do just that.
A well thought-out checklist will help your team establish the criteria and step-by-step structure they need to spend less time on unqualified leads who fall through the cracks and more time closing.
Qualifying leads makes sales skyrocket
Lead qualification is absolutely critical for every sales and marketing organization.
Your ability to find good-fit prospects will make or break your business.
An effective lead qualification process keeps the focus on your most viable leads, maximizes revenue, and preserves valuable resources.
Check out how Chili Piper can help instantly qualify, route, and schedule meetings when your leads are most captivated by your product or service. Book a demo today!