2Identify potential customers with lead generation
3Qualify leads to see who’s in a position to buy
4Assign leads to your sales team
5Nurture and track leads through the sales funnel
6Convert leads into customers
7Recycle non-converting leads
8Evaluate your lead management strategy
Lead management is the process of tracking and managing leads through the sales funnel, from initial identification to the moment they become a paying customer and beyond.
Prospecting and generating new leads is essential for any sales organization. However, without the right systems in place, those potential customers might never convert, dropping out of the funnel and opting instead for one of your competitors.
With proper lead management software in place, you can align your marketing and sales so that you’re spending more time with your highly qualified leads and closing more deals.
In this guide, we’ll show you how to document and implement a lead management strategy in your business. Along the way, we’ll share insights from an exclusive panel of salespeople across various sectors and see the role technology plays in lead management.
1. Define your ideal customer profile (ICP)
Many salespeople try to get as many leads as possible into the top of the sales funnel, reasoning that reaching out to more leads will result in more customers. Unfortunately, this can lead to stretched resources and low-value customers.
By prioritizing quality over quantity, you can focus your efforts on the leads most likely to become customers in the first place. To avoid wasting resources on leads that were never going to become customers, start with a clear definition of your ideal prospect.
Instead of guessing what your ideal customer might look like, start by reviewing your existing customers. Which types of businesses have the highest conversion rates? Which customers have benefited the most from your product or service? Which have been with you the longest and have the highest lifetime value? Who is always leaving you positive reviews and recommending you to others?
As you compare your top existing customers, look for commonalities across relevant demographics and firmographics, such as:
Hopefully, you’re already storing all this information in your customer relationship management (CRM) software, but if you don’t yet have a CRM system, or you’re not using it to record this information, then it’s time to do some research.
Many of these details can be easily found on sites like LinkedIn and Crunchbase. For anything else you need to learn, this is a great opportunity to jump on the phone and catch up with your favorite customers.
It’s essential that your marketing and sales team work together on this definition, as this will impact the whole customer experience. When both teams are aligned, your marketing content and sales outreach will be consistent and complement each other.
2. Identify potential customers with lead generation
The next step is to find and generate leads that match your definition, using a combination of inbound and outbound methodologies.
For example, inbound leads could come from people completing web forms on a landing page or engaging with your content on social media. Inbound leads effectively identify themselves as potential customers, but the marketing team still has to create content (based on that ideal lead definition) that grabs their interest.
Generating outbound leads is traditionally carried out by sales teams, who also use the lead definition to work out the best places to find high-quality leads. For example, you can use popular tools like Sales Navigator and Pipedrive’s LeadBooster add-on to find leads who match very specific criteria. Your sales team can then reach out to those leads through different channels such as email, phone calls, social media and direct mail.
Don’t forget your existing customers when trying to find the right prospects. For example, if you’re offering a new product or service, talk to previous customers who’ve already used your solutions and trust you. These customers can also be a great source of sales referrals, introducing you to similar companies that could benefit from your offer.
Benji, a sales manager at a leading entry security system, prefers to stick to a simple textbook to handle inbound leads. “When a lead comes in, a salesperson enters the details in a quotation book. That generates a unique number and that follows the lead right until it gets turned into an order..”
This kind of approach doesn’t work for everyone though. According to Daniel, a sales and marketing director at a prominent construction company, a paper-centric approach is fine until the leads flood in from every direction:
“Sometimes, we’re overwhelmed and we must sort the wheat from the chaff, especially as a large part of our business is quoting for jobs.” The best lead management software allows businesses to organize and manage their new leads and overcome any lead generation challenges they might encounter.
3. Qualify leads to see who’s in a position to buy
Whether you’re dealing with inbound inquiries or chasing down your own leads, you’ll still need to qualify all leads before moving forward.
There are two main types of leads:
Marketing qualified leads (MQLs). These are leads who’ve engaged with your marketing campaigns but are not yet in the sales funnel.
Sales qualified leads (SQLs). These leads are in the funnel and your sales team is actively working to close them as a customer.
Both marketing and sales need to agree on the lead qualification criteria, especially for when an MQL becomes an SQL, so everyone is clear when responsibility shifts from marketing to sales.
Lead scoring is one popular method, where you assign a score to actions that indicate buyer intent (such as downloading a white paper or spending time on a sales page) to rank and prioritize leads. You can score leads throughout the sales funnel to work out when someone is ready to move to the next stage.
You can use this alongside qualification frameworks, such as:
FAINT. Funds, Authority, Interest, Need and Timing.
Budget. Can the lead afford your product or service?
Authority. Do they have the authority to make a purchasing decision?
Need. Does your product or service fill a pressing need?
Timeframe. When will they be ready to purchase?
You can automate some aspects of lead qualification, such as collating customer information. According to Michael, a business development manager at one of the world’s largest grocery store chains, a clear benefit can be derived from “leads being fed directly into our CRM and being able to filter them based on who they are and what purpose they need filling.”
It’s a similar situation for Daniel, who believes having a central brain to manage the leads is critical:
Especially with the larger clients, a centralized sales hub is fundamental for better performance. We have to win a relationship, because by winning a relationship with a client we’ll get ongoing work. This is why we’re looking to bring in CRM, because we need access to that information and at the moment it’s on a spreadsheet – and that’s only as good as what we’re updating.
Using a CRM solution enables you to capture all your prospects’ details and make them available to your entire team. In turn, they can understand who the decision-makers are and build rapport.
Some CRM systems can help streamline the qualification process by automatically integrating any relevant publicly available data, such as contact information and company details.
Pipedrive’s Smart Contact Data feature can reduce the amount of time your sales team spends on lead research.
4. Assign leads to your sales team
Once you’ve qualified your leads you need to decide who will lead them through the sales funnel.
Some sales managers take a hands-on approach, relying on their in-depth knowledge of the team’s strengths and skills and manually assigning leads to the reps they think are best suited to the task. Others prefer to add leads to a pool and allow reps to pick them on a “first come, first served” basis.
While manual routing might be sufficient for small businesses, it is difficult to scale and can be time-consuming in bigger sales teams. It can also lead to mistakes. In a recent survey, 67% of respondents said that their leads had been assigned to the wrong sales rep.
Alternatively, you can automate the process. For example, a round-robin system can automatically assign new leads to the next rep in the queue. Other systems can be designed to take your reps’ skill sets into account. For organizations looking to break into new markets, that extra level of know-how can be the deciding factor.
David, a business development director at a global art tools supplier, found that moving into the Chinese market came with some unexpected challenges.
There was a lot of confusion because we didn’t understand how to deal with Chinese business practices. We lost a number of leads because the way we conducted ourselves didn’t match the way they did.
David agrees that a CRM’s contacts function, which allows you to centrally store team members’ skill sets, might have helped to iron out teething issues and made it far easier to assign personnel with China expertise.
You can easily automate lead distribution by using a routing app integration, such as RouterJet or Lead Assign, with your CRM. Alternatively, you can create your own workflow automation directly in Pipedrive to route new leads to different reps.
5. Nurture and track leads through the sales funnel
Only a small number of your qualified leads will be ready to buy immediately. A successful lead nurturing strategy will help you build those relationships and keep your leads warm and engaged.
Sales teams sometimes make the mistake of bombarding leads with sales messages and offers, but this kind of one-way traffic only gets limited results.
Effective lead nurturing is about listening to your leads. Engage with them to learn more about their wants, needs and pain points. Then use that information to offer relevant value and provide solutions to their biggest problems.
This means creating tailored content, based on your leads’ challenges and where they are in their customer journey. You can then use marketing automation to deliver the right content at the right time, such as when the prospect takes certain actions or meets predetermined criteria. For example, you can send a follow-up email when someone downloads a resource, views your LinkedIn profile or visits a sales page on your site.
Properly organizing those leads is essential to ensuring none slip through the cracks, as Daniel found out. “We have large fish and so many swarms of little fish at the other end that we can’t possibly cope. Putting leads into an Excel spreadsheet doesn’t work, it’s too much for us to cope with.”
A CRM tool helps organize those leads, but some find they get the best results when they combine traditional methods with modern tools. Saul, a business development manager at a leading wholesale jeweler says his Filofax and iPad are his pride and joy:
“When I first started out I made actual notes, so now I make everyone on my team make notes on their PDA when they’re out and these then get uploaded to a report, which I read every week.”
When it comes to tracking and measuring leads, capturing each action and task is crucial. CRM-enthusiast Saul thinks using software and apps works well because they allow his team to set reminders to call people back. However, he insists tools are only as good as the person applying them. “I’ve known people to not follow procedure; they decide to enter something in their own inimitable style, so when you search for something you can’t find it because it hasn’t been entered properly.”
This can derail the whole tracking process, demonstrating how tools and CRM are designed to support the human touch, not replace it.
Reliable tracking is also essential for accurate sales forecasting, which can be difficult without a CRM. As Benji puts it, “Our forecasts aren’t terribly accurate. We just try to do more the next month than the last.”
CRM can aid forecasting by allowing you to look back and see which sort of leads are successful, so you can make better forecasts and reduce any unpleasant surprises at the end of the month.
6. Convert leads into customers
The whole purpose of a lead management and nurturing process is to convert those leads into happy paying customers.
Personal attention is key. Each lead is unique, and your sales team will need to address their individual objections and concerns. The panel’s general consensus is that the human touch is central to closing a deal, regardless of whether you use CRM.
“You can sense in a way if it’s going well or not with the customer,” explains David. “People often act on instinct when in sales, but judgment is just as important. You can have two leads that seem equal, but you’ll have a sense which one would be more useful.”
Benji agrees that the key to sealing the deal will always be the human element. “Personally, I think it’s harder for a customer to say no if you’re sitting face-to-face with them.”
With the increasing popularity of remote sales teams, managers are always looking for ways to add that personal touch even when you can’t be in the same room. By integrating video calling apps with your CRM, reps can manage their communication and engage with potential customers, with all their notes and contact details readily available on the call.
7. Recycle non-converting leads
For those leads who still haven’t converted, a dedicated “recycling” nurture track can help you keep in contact and stay top of mind.
As you regularly engage with past prospects, stay alert for any big changes at the company. For example, maybe the lead has recently been promoted, their team has recently expanded or the company has opened a site in a new location. On the other hand, it might be that you’re the one that’s changed. Maybe your product has new features or you’ve expanded your service, making it an even better solution for the lead.
Any of these changes could mean the time is now right for your product or service. Approach these people and see if they’re ready to move forward.
One of the benefits of recycling previous sales leads is that you know them. You’ve already done a lot of the necessary research and you’ve been able to engage with them as they move through the sales funnel. Build on that to make a compelling offer that addresses their unique challenges while also taking into account any changes to their circumstances.
Whatever the reason, a salesperson needs to be able to catch up on all previous interactions and touchpoints. Why were they contacted in the first place? Why didn’t they convert? Most sales CRM platforms allow you to add notes to a deal or contact, so use that to record all the relevant information.
When you keep your CRM up to date with a full history of all your email and communications, a rep can ensure any future messaging is relevant and personalized.
8. Evaluate your lead management strategy
As with any part of the sales process, it’s important to measure the effectiveness of your CRM lead management software and use what you learn to optimize your future strategies.
Ensure you are tracking key metrics that relate to the different stages of lead management. For example, measuring the conversion rate for each step of the sales funnel lets you know if there are any gaps in your lead management process. Your customer lifetime value (CLV) will help you understand if you’re going after the right kind of leads. In contrast, customer satisfaction (CSAT) and net promoter score (NPS) can reveal if converted leads are happy with the process.
For Michael, it’s simply a case of keeping everything under review throughout the process. Others on the panel agree that having a CRM greatly helps the evaluation process by allowing you to store and record key information, insights and completed tasks.
Across the panel, the unanimous takeaway was the importance of optimizing performance via a fusion of old-school methods and modern tools.
According to Peter, managing director of a digital marketing agency, this means balancing soft skills with sales technology:
“Having instinct is important in sales, keeping human communication and tracking platforms up to date at all times, with as much information as possible.”
Lead management is integral to a successful sales process, enabling sales teams to define, identify and nurture leads until they’re ready to become customers.
While old-school methods can work up to a point, the right CRM software can supercharge your lead management by providing better organization, easily accessible information storage and lead tracking. Combining effective lead management tools with a personalized touch can help you fill your sales pipeline with high-quality leads and close more deals.
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