Sales qualified lead definition

Introduction

A sales qualified lead (SQL) is an opportunity that meets specific criteria and has a good chance of turning into a customer.

This concept has been around for as long as businesses have been trying to generate business from potential customers.

Sales qualified lead definition
Sales qualified lead definition | Image by Patrice Audet from Pixabay

Still, it’s only recently that the idea of creating a standardized definition for SQLs has gained popularity among marketers.

A Sales Qualified Lead (SQL)

A sales qualified lead (SQL) is a lead that has been deemed to be more likely to become a customer.

They are qualified by both the marketing and sales teams, who have determined through research and testing that they have a specific set of characteristics that make them more likely to convert than other leads.

The four critical components of an SQL include:

  • A well-defined persona or buyer profile
  • Results from marketing efforts like paid ads or retargeting campaigns
  • A clean email address with no spelling errors or typos (no Hotmail addresses)

Both the Marketing and Sales teams qualify SQLs.

Both the Marketing and Sales teams need to have a shared understanding of the ideal customer profile, including their buying process and the company’s sales process.

It also requires a clear definition of a qualified lead and how this determination is made. In other words, who decides if someone has been correctly identified as an SQL?

Marketers will ask: “What is your customer’s problem? How can we solve it? Where do they find their solutions online? Are there flaws in our website or advertising strategy that prevent them from finding us online?

Do they know about our content marketing efforts, and are they listening to us on social media?

Are we reaching out to them through email newsletters with helpful information about their industry and what we offer, or just sending them advertisements for our product line (and not caring if it’s relevant)?

And finally: How many people are actively searching for solutions like ours in Google or Bing right now?”

A sales-qualified lead requires the following components.

A sales-qualified lead is a prospective customer who meets all of the following criteria:

  • Has the sufficient need for the vendor’s product or service
  • Can purchase it (if not, they may be a qualified marketing lead)
  • Has the authority to decide whether or not to buy it (if not, they may be an opportunity generated through a lead generation tool)
  • Has allocated budget for this purchase in their annual plans (if not, they may still be an opportunity generated through a lead generation tool)

A sufficient need for the vendor’s product

The primary qualification for sales-qualified leads is needed, and this means that the person has a natural, specific problem that your product or service can solve for them.

They have the authority to make decisions about their organization (either directly or indirectly). And they have the budget to buy what you’re selling.

Ability to purchase the product

At the beginning of the sales process, it’s important to identify non-qualified leads. If a lead is not qualified, you’re wasting time and money by spending too much time trying to close them, and they won’t become customers.

To determine if a lead is qualified or not, ask yourself these questions:

  • Is this person able to buy my product?
  • Does she have enough budget for my development?
  • Does she need what I’m selling?

Authority to decide whether or not to purchase the product

The salesperson needs to be able to speak with someone with authority to make the purchase decision. The person with authority to make the purchase decision is known as the decision maker.

A sales qualified lead is “a prospective customer that demonstrates an interest in purchasing a product or service from your company and is ready for you to conduct further research about them.”

This means that your prospects have already been through stages 1-4 on their journey towards becoming a customer, which are:

  • Awareness –> Interest –> Desire –> Action (AIDA).

The budget allocated to purchase the product

Budget is a key factor in the buying process in the sales qualified lead definition. It’s easy to think of a budget as just a monetary figure, but it’s also much more.

A customer’s budget is their financial plan for spending and saving money over time. It can include income and savings and can be affected by factors such as family size or debt levels.

The customer’s budget will often be one of the first things they tell you when they contact your company through channels like phone calls or emails.

Opportunity to speak with a salesperson at the company offering the product or service.

A sales-qualified lead has expressed interest in your product or service and is ready to speak with a salesperson at the company offering the product or service.

It’s important to note that this definition doesn’t include any information about whether the person is actually in a position to purchase your product or service; it merely means they’ve expressed interest (and may even have requested more information).

It may be too soon in the buying process.

The sales qualified lead definition has evolved as marketing automation, and other technologies have become available to drive efficiency and productivity in multi-step lead generation processes.

If you are interested in learning more about the latest trends in this area, I invite you to check out my article on Sales Qualified Leads. A New Definition For The Digital Age.

The sales qualified lead definition has evolved.

The sales qualified lead definition has evolved as marketing automation, and other technologies have become available to drive efficiency and productivity in multi-step lead generation processes.

An automated marketing system allows you to better segment your audience and target them with relevant messaging, resulting in more leads interested in buying from you.

This means it’s easier for marketers to create a sales-qualified lead definition by using data-driven tools like predictive analytics.

But why do we even need a sales-qualified lead definition? What difference does it make if someone is ‘qualified’ or not?

Conclusion

The sales qualified lead definition has evolved as marketing automation and other

technologies have become available to drive efficiency and productivity in multi-step lead generation processes.

In the past, it was difficult for a company’s sales team to identify potential customers because they did not have access to the same data that marketers had access to.

Nowadays, all that information is stored in one place, so it can be combined with other data points like company size or industry type to create more accurate leads that are easier for sales reps to follow up on quickly.

 

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