Sales Lead Definition: A sales lead is someone who is committed to making a change that your product or service can help accomplish. A sales lead is not someone that is merely interested in your product. A real sales lead goes beyond interest and is committed to action and making a change.
Every qualified sales lead should meet the threshold above. Beyond that however, every company will have to come up with their own standard for what counts as a qualified lead. Let’s explore how you can come up with your own customized standard for determining a qualified sales lead.
One of the most common, and misguided, ways of determining a sales lead is BANT. The acronym BANT (Budget, Authority, Need, Timing) is misguided because it is far too limiting and strict of a definition. In many cases, buyers don’t have to have pre-defined projects with set budgets and timeframes to develop a sales opportunity. Therefore the Budget and Timing standard in BANT are far too limiting and could prevent legitimate opportunities from entering the funnel.
Modern sales leaders have addressed this issue by crafting different acronyms. Ken Krogue, founder of InsideSales.com, proposed ANUM (Authority, Need, Urgency, Money). Another popular acronym is by InsightSquared, who proposed CHAMP (Challenges, Authority, Money, Prioritization). These models still look for money and budget, which is important, but it’s not a prerequisite to a sales opportunity. If the leaders of an organization are committed to making a change, the budget will get created.
Instead of focusing on pre-existing budgets, sellers need skills to develop need and urgency with the C-Suite at a prospective account. Once you have leadership buy in and a desire for change, you are able to build urgency and help them figure out how they are going to fund the changes in their organization. There are already a lot of models and acronyms but the best course of action is to learn from them and focus on developing your own customized standard for your team.
To do this effectively, you will want to decide how loose or strict you want your sales lead definition to be.
With this approach to a sales lead definition, the goal is to let a lot of leads through and give the sales team lots of ‘at bats’ to build their opportunity pipelines. A heavier focus on outbound prospecting will yield meetings with people who are interested but not necessarily committed to changing. For the sort of companies described above, it’s more important to develop opportunities rather than figure out who is in an active buying cycle already.
On the other end of the spectrum, you can employ a much tighter sales lead definition. We have a client organization who defines a qualified lead as meeting with the right person (C-Level) at the right account (shares characteristics with target accounts) as well as having a specific need, urgency to take action, and an understanding of the source of money to fund the purchase. This organization doesn’t define a lead as qualified unless all of the criteria above are met.
This strategy for a sales lead definition focuses on passing highly qualified and winnable leads. If you are getting a high volume of inbound inquiries or have a high volume of sales in general, it makes sense that you limit the number of opportunities you focus on. In this scenario, you are not trying to develop a lead but instead find the deals that are most likely to close now. Therefore, a more rigid threshold for defining a qualified sales lead makes sense.
No company wants to keep winnable opportunities from the sales funnel. Sales leaders also don’t want their sellers’ funnels to be larded with junk opportunities. So, you don’t want your companies threshold for a qualified sales lead to be too loose or too narrow.
Using this blog as a guide, take some time to reflect on what the right definition of a qualified lead is for your organization. If you have any questions, we’re always available for a consultation.
