Lead management explored

What is lead management?

Lead management is the business process of attracting, capturing potential clients, then evaluating and effectively moving them through the sales funnel until they become customers. Both marketing and sales teams are critical players in the lead management process.

Your sales process will be unique to your industry, and your individual business. However, common lead management activities include the following:

• Marketing

• Lead generation

• Lead capturing

• Lead scoring

• Lead qualification

• Lead nurturing

Benefits of effective lead management

Improve your customer experience (CX)

Effective lead management plays a crucial role in enhancing the overall customer experience.You are able to tailor your interactions and communications accordingly by understanding the needs and preferences of potential customers. This personalized approach fosters a stronger connection with leads, building trust and loyalty.

Increase your conversion rates

By identifying and prioritizing high-potential leads, your sales team can focus their efforts on the most promising opportunities. This targeted approach ensures that resources are allocated efficiently, leading to a higher probability of converting leads into customers. 

Decreases time to close your deals

Efficient lead management helps businesses optimize their resources by directing them towards the most promising leads. Companies can quickly identify qualified leads by automating repetitive tasks and employing effective lead-scoring mechanisms. This saves time and reduces the costs of pursuing leads that are less likely to convert.

Challenges in lead management

Lead management contributes greatly to your customer journey and must be optimized to ensure the success of your business. However, any lead management framework faces challenges.

Lead management is not a simple process

To do it right, you need to effectively manage many moving parts to optimize lead management flow.

Lead management is labour-intensive

Salespeople spend copious amounts of time on lead management–oftentimes more than on actual selling.

Lead management is time-sensitive

From the first contact, lead management activities are more successful when they happen at the right time.

Lead management depends on accurate lead information

When a salesperson has incorrect contact information, they waste time and miss opportunities. An incorrect phone number can be the difference between closing the sale and missing out.

Not all leads are the same. Each lead is at a different place in your sales funnel and has varying authority to close a deal, and not every lead is even a good fit for your company. The two main classifications of leads are marketing-qualified leads and sales-qualified leads.

Marketing qualified leads (MQLs)

Marketing qualified leads (MQLs) are leads whose marketing activities indicate that they are likely to become a client. They have engaged with your marketing efforts in meaningful ways, but they are not yet ready to buy. It’s time to provide them with more information so they can make a good decision.

Sales qualified leads (SQLs)

A sales-qualified lead (SQL) is a lead who has shown interest and is poised to make a purchase. They’ve accessed some of your advanced assets, like case studies. It’s time for your sales team to swing into action to close the deal

How to qualify a lead?

In order to qualify a lead, you must put a system in place to calculate their relative values. Here are some places to start.

Differentiating qualified and unqualified leads

It’s critical to be able to easily differentiate between qualified and unqualified leads. Without this knowledge, your team can’t effectively prioritize, which leads to contact and nurture. This results in time wasted on leads without intent to buy, as well as missing out on leads that were ready to buy.

Lead scoring is the process of ranking leads according to their sales readiness based on lead data about their interaction with your brand. Implement a lead scoring practice so your teams know where to put their time and energy.

Establishing a system for qualifying leads

It would be time-consuming and tedious to do this manually. So it makes sense to use lead-scoring tools for this vital activity. Robust customer relationship management systems (CRMs) like Freshsales allow you to build and customize your lead scoring system based on your unique ideal customer.

With Freshsales, you set up the rules and guidelines, and the software does the rest. For example, you can assign certain job titles more points, and those points will be immediately calculated when you capture new leads.

Identifying sales opportunities in qualified leads

Ideally, your company has plentiful high-quality leads. Use tools like lead scorecards to drill down into the details to identify who’s truly ready to buy. Reports and analytics give you unique insights into the specifics of each lead.

Continuously review your lead scoring efficacy to make sure your system is working. With customizable tools, you can easily tweak rules and parameters that don’t result in conversions.

Lead management key performance indicators (KPIs)

1. Leads to sales qualified leads (SQL) conversion rate

A lead to SQL conversion rate is the percentage of overall leads who become sales-qualified leads. This metric tells you how well your marketing campaigns and lead qualification efforts are performing.

A low conversion rate might mean your marketing team is attracting low-value leads. In this case, you would want to analyze data on aspects of your strategy, such as email campaigns and targeted ads. A low rate could also mean you are not effectively scoring in order to effectively nurture the right leads.

2. Lead conversion rate or lead-to-sale conversion rate

Your lead conversion rate, also called lead-to-sale conversion rate, is the percentage of leads who eventually become customers. This KPI tells you how well your lead nurturing process and sales teams are functioning.

Once you understand where you are, you can target issues and make necessary improvements to increase the percentage of conversion and thereby increase revenue.

3. Sales cycle length

The length of your sales cycle provides a host of valuable information. Although cycle length will vary from industry to industry, in general, the shorter your sales cycle, the better.

By tracking this metric, you can evaluate the effectiveness of your sales process as a whole. You can also get granular with this data to assess individual sales reps. With that knowledge, you can work to replicate success and improve failures and shortfalls.

Automation for lead management

Lead management can be an intensive and time-consuming process. The sheer number of data points that go into lead qualification alone, for example, can be very challenging. However, lead management software that leverages automation can streamline and improve your sales process and lead management system.

Marketing

Marketing automation allows you to more effectively create, distribute, evaluate, test and improve your marketing efforts. Better marketing increases your chances of connecting with the best lead for your business. 

Lead capturing

Automation streamlines capturing leads by collecting info from web forms on landing pages, deploying chatbots to solicit leads in conversation, and other methods. Those leads are then seamlessly entered into your CRM, so your sales team can take over.

Lead scoring

 Automated lead scoring instantly scores leads according to the rules you set up and aligns that data with the customer profile to assist your sales agents

Lead distribution

Automated lead management tools like Freshworks’ auto-lead assignment excel at routing leads straight to the right salesperson. This cuts down on response time for high-quality leads.

Lead tracking

Automation like dashboards, analytics, pipeline management workflows and more follow your leads throughout their journey.

Lead nurturing

Lead nurturing automation facilitates email marketing, social media marketing, sales calls, and more. Once your sales team has the lead, follow-ups, and reminders ensure they stay on top of the process. AI can suggest and prompt the right activities at the right time. And workflows ensure every touchpoint is covered.