The main goal for Marketing in B2B companies is to generate leads for sales teams and increasingly to deliver direct revenue. Some marketers define anyone who fills out a form or attends an online or physical event as a lead.
But I’m here to tell you: an “inquiry” (someone who fills out a form) and a “lead” are not the same thing.
The main problem here is that there is no common understanding of the difference between an inquiry and a lead. This continues to be one of the biggest mistakes marketing makes. And this problem drives a deeper wedge between marketing and sales.
Why is this important? Research shows that as much as 71% of inquiries are are completely wasted and 36% of leads are never contacted at all.
The Bottom Line: When marketing gathers up new names from contact forms and dumps them over to sales, no one wins. And the potentially valuable interested inquirers are left wondering if there’s anyone home at the company they just raised their hand to.
I spent the first 5 years of my career in sales. When I moved to marketing, I committed myself to two things:
- Marketing should be accountable for driving quantifiable business value.
- Marketing needs to partner closely with sales.
I spent about half my career in marketing creating, tweaking and optimizing demand generation processes, most recently for the world’s largest software company. And in the process, I somehow managed to accomplish both. We delivered a solid return on marketing investment. And we accomplished this by focusing on giving sales what they wanted: truly qualified leads.
So, what is getting in the way of so many sales and marketing conversations? Definition and clarity around the definition of a lead…
An Inquiry Is Not A Lead
So you are running marketing programs, engaging content and campaign messages across a variety of paid, owned and earned media channels. Here’s just a few examples of the mistakes marketers make when defining inquiries as leads:
- Every person who signs up for your newsletter, downloads a white paper, or registers for your webcast is not a lead.
- Just because you got a list of attendees from an industry conference and they fit your target demographic profile does not make them a lead.
- Someone who reads 10 blogs on your website is not a lead. Someone who clicks on your product / solution pages is not a lead.
It doesn’t mean that you should ignore these folks either. More on that in a bit. But first, what is an inquiry and what is a lead?
What Is A Marketing Inquiry?
As the examples above show, a marketing inquiry is an individual who has expressed interest in your company, your content, or your product by providing you with their contact information when they took an action such as downloading an eBook or subscribing to your blog.
At SAP, we called these inquiries “raw responders.” They are names and email addresses, and if you are lucky, phone numbers and company names and titles. These people are interested in getting educated on how to solve a problem. Your job is to figure out how many of those inquiries have the potential to become leads you can pass to sales.
You should never expect a sales rep to do this hard work for you in marketing! Sales people are built to sell.
Sales teams that attempt to follow-up on inquiries often get frustrated that their time is being wasted on people who don’t actually have the budget or desire to buy something. So they assume all the leads are crap. And often they stop following up at all. Hence the large number of leads that are never contacted.
Sales people want the highest quantity of quality leads you can send them. It’s all about achieving the right balance! Send them low-quality inquiries and they will stop bothering to consider them quality leads. So what is a marketing lead then?
What Is A Marketing Lead?
A marketing lead is a qualified business opportunity. The only way to know whether an inquiry is a qualified business opportunity is to ask the inquirer if they are interested in buying something and a few other important questions. It’s important to know if they have budget to buy something. If they have the ability to buy something. And if they plan to make a purchase decision relatively soon.
This is all based on a deep analysis of specific kind of marketing lead that sales people viewed as high quality. The system is called “BANT” and it was first defined by IBM a few decades ago when phone calls where the easiest way to find out this information. Now we have online forms and many other data capture opportunities available to us in marketing.
BANT stands for Budget, Authority, Need, and Timing for solving their problem:
- Do you have a real Need?
- Do you have the Budget?
- Do you have the Authority to make a purchase decision?
- Are you making a decision in a sort Time period?
Some have added to or modified the BANT qualification model by adding an agreed follow-up step such as “can we meet for coffee on such and such date” but the bottom line is that sales should never see leads from marketing that have not had some direct qualification, to determine if there is a real business opportunity.
Decision-making in the B2B world typically includes many stakeholders. That first inquiry may be from an influencer rather than an actual decision-maker. You’ll also need to determine if there is a timeframe for making such a decision.
How Do You Score A lead?
Too many marketers use what’s called an activity-based lead scoring model. Visited our website? You get 10 points? Downloaded our white paper? Oh! You get 50 points. The problem with this is it has no consideration of the purchase intent of the visitor / downloader.
Instead, you want a more strategic approach to B2B Demand Generation. Assign a score to each inquiry using the criteria in BANT. You could make it 25 points each so that if they answer “yes” on 3 out of any 4 questions, they become a qualified lead and get passed on to sales.
- Do you have a real Need? Yes = 25 points
- Do you have the Budget? Yes = 25 points
- Do you have the Authority to make a purchase decision? Yes = 25 points
- Are you making a decision in a sort Time period? Yes = 25 points
Leads who score under 75 can go into a lead nurture pool and re-contacted in a few weeks.
Or you could add a next step question and make each question 2o points each so that if they answer “yes” on 4 out of any 5 questions, they become a qualified lead and get passed on to sales.
- Do you have a real Need? Yes = 20 points
- Do you have the Budget? Yes = 20 points
- Do you have the Authority to make a purchase decision? Yes = 20 points
- Are you making a decision in a sort Time period? Yes = 20 points
- Are you willing to speak to a sales person? Yes = 20 points
I would recommend weighting the Authority and Needs question a little higher since sometimes prospects are trying to find budget and don’t know the timing. Or you could add extra points for the sales call question.
- Do you have a real Need? Yes = 25 points
- Do you have the Budget? Yes = 10 points
- Do you have the Authority to make a purchase decision? Yes = 25 points
- Are you making a decision in a sort Time period? Yes = 10 points
- Are you willing to speak to a sales person? Yes = 30 points
In this example, anything with a 70 score or higher get passed on to sales along with EVERY yes to speak to a sales person with the caveat that this may not be fully qualified. At SAP, we handed these leads to lower level “internal” sales reps or BDRs who would further qualify the lead until it was ready for the hot shot sales rep.
What Is The Average Conversion Rate From Inquiry To Lead?
There is a ton of research out there on lead conversion rates, and some of it is even done by industry. Some suggest the average conversion rate from inquiry to lead is 4.4%. Meaning you need 351 inquiries to generate a new customer. Even “best practice” companies are only converting less than 10% of inquiries to truly qualified leads.
In my experience, even with a really optimized inquiry generation process will yield around a 4% conversion rate from raw responders. And you should achieve closer to 8% once you scrub out the “Mickey Mouses” “[email protected]” and other false data registrants.
We used to scrub out independent consultants, non-work email addresses, non-US companies and duplicates (although sometimes this was a signal of someone who did convert to multiple marketing campaigns.) For duplicates, we ran a separate nurture stream to get them qualified and sent to internal sales.
There is a trade off that is worth thinking about: the lower your conversion rate from inquiry to lead, the higher the conversion rate should be from Lead to Sale. This maximizes the efficiency of the sales team so they are closing new business and not chasing unqualified prospects.
This also means you are likely not generating nearly enough inquiries. That’s why leads from content marketing is so important to generating cost efficient leads. Attract visitors to your content, convert them to subscribers and nurture them with offers that help them move through the buying process.
What Are The Best Lead Stage Definitions?
Almost a decade ago, I was directed to implement a common Demand Generation Waterfall from the board of a startup where I ran marketing. It consisted of tight definitions around lead stage that include:
- Inquiry: a net-new inbound responder to marketing content
- Marketing Qualified Lead: BANT qualified
- Sales Accepted Lead: Usually systematically (CRM) routed and agreed to be worked by sales
- Sales Qualified Lead: Sales re-qualifies the lead and in some cases gets a meeting
- Closed / Won Opportunity: Revenue!
I had this image pinned on my wall:
Marketing Inquiry Qualification Matters
The bottom line of all this for marketers: If you are sending marketing inquiries to your sales team prior to a true qualification, you are wasting money and the precious time of your sales team.
Marketers need to define a lead scoring methodology so that marketing-generated leads are passed to the sales team.
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18 thoughts on “Hey Marketing: An Inquiry Is Not A Lead”
I could not agree more with the headline. I get calls from companies all the time just because I downloaded a whitepaper and it’s annoying as hell… And I think I am not the only one with that opinion.
Very interesting Michael – as usual :=)
Thanks Mael, I know we can do a better job! Thanks for your support. I think the whole space of predictive modeling can help marketing as the technology matures and the data becomes more widespread.
Brilliant points on the differences here. As someone with a marketing background, I understand why so many eagerly jump at the opportunity to call an inquiry a lead.
There’s just something about that word “lead.”
But you’re 100% right. In order for us to properly quantify our efforts, there’s gotta be a clear understanding between the two. Otherwise, like you pointed out, it’s wasting the time and money of our sales teams.
Thanks for the reminder, Michael! 🙂
Thanks so much Chelsei,
It’s so easy to clog the system with unqualified inquiries. I understand the natural desire. But I also know from a sales point of view it’s like death to the marketing and sales relationship. Thanks for your support.
Excellent, Excellent, Excellent. The issue is Marketers are the sales enablers. Once this culture is embedded & Marketer KPI’s (Shared) are aligned with Sales, they will tango with sales staff.
Love the dance analogy Akram!
This is interesting. Michael suggests that Marketing should call in order to qualify and Mael great no more calls – how does that go together?
Hi Ulrica, what I’ve found is that the best practice is not to call everyone. First time white paper downloaders should likely be put into a nurture stream to help them “down the funnel.” What has worked for you?
Michael, “inquiry” is going in my lexicon now.
Though I do agree with Ulrica that I’m not sure how realistic it is to have Marketing be the one calling inquiries. Perhaps a direct email asking when they may be making a purchase decision and if they’d be interested in speaking with a sales person…
I’ve seen a number of different approaches work. In some cases, we routed all inquiries to a 3rd party call center that was trained in soluution selling. The average conversion rate was very low (~4%) but we paid per “lead.” And I’ve also seen the email nurture approach work as well. Open rates ~ 10-20% but then you still have to qualify live.
If you test your own approaches, please share with us all here so we can learn what works for you.
Excellent article!! You clearly showed the difference between a qualified and an unqualified lead. It does save a whole lot of time and resources if we are able to classify them and concentrate our energies towards creating marketing pieces that bring in qualified leads, that is a win for both sales and marketing!
I have a question. Is a social media query considered an unqualified lead, and how do you suggest we qualify them?
Hi Sunath, thanks for your support and question.
I would say most definitely that a social media query is an inquiry not a lead unless the question was some kind of sales cue like “can I get a demo?” or “can I speak to a sales person?”
The goal is to move that person from an unknown inquiry to a known inquiry. So I would ask them to connect on Linkedin and ask permission to setup a call with a trained inbound specialist who can qualify the person with some subtlety into a lead.
Appreciate the response. Its spot on!
While I don’t agree that Marketing should be doing outbound calling (unless it’s for data collection purposes), I do think that sales organizations should have a low-cost capacity to reach out to those lower quality inquiries. The purpose is simply to mine the Marketing investment with the goal of turning the inquiry into an actual lead and move it down the funnel. If it remains an inquiry, then find a way to keep them warm until ready to engage and become a lead.
Hey Michael, great article, and thanks for including our site in your links! I see three problems recurring over and over with our clients – who all have long, complex sales cycles (4-10 member buying committees, 6-18 month buying cycle).
1. If they wait for BANT to consider a lead qualified, then the lead is already in deep with a competitor. That’s the only way the “B” (budget) gets defined. Ideally, Sales needs to get in earlier to set vision and collaborate with marketing to nurture.
2. If they wait for “A” (authority), then they miss out on the analysts and consultants that are often engaged to evaluate and shortlist options. So once again, they’re late to the dance.
3. If marketing passes under-qualified leads to sales, then sales is reluctant to put much time into them. So they call the lead 1-2 times, even though research consistently shows that deals that closed usually took 5-9 calls before sales made first contact.
We tried offering a service to qualify leads for a client several years ago. But we found it very difficult to effectively qualify since my team didn’t have as much product/customer needs training as the client’s internal team. So I’m not convinced that this kind of work can be effectively outsourced for complex, esoteric, enterprise technology.
Curious as to your thoughts. I realize that this scenario is specific to these complex deals. A SaaS software sale would have a completely different experience.
Thanks Candyce, most of my experience came from the largest enterprise software company in the world (SAP) where the ASP was over $200K and the sales cycle was 6-12 months. I think your point 3 trumps 1 and 2. So we both outsourced to a vendor with lots of training (pay for performance so they were motivated) and insourced the validation. First touch occurred within 24 hours! So routing the inquiries was really important.
The extra time and quality more than made up for the cost in the form of higher conversions and sales and sales team trust that the leads we passed had as good a chance as any to convert to a sale. We literally produced more than 100,000 inquiries per year to get to a few thousand leads to get to a few hundred deals. But the revenue was millions more than the cost.
Happy to discuss the approach if you like.
You’re only working when you’re ear to ear or face to face with a live qualified buyer.
To much time is wasted chasing people who are wheel- spinners!
Jimmy Crimmins/ Author Rockin’ Selling Secrets
Thanks Jimmy, I think so many businesses make this mistake.
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