Formal sales cycles help businesses from various industries increase sales revenue consistently. But no business can boost sales revenue without managing the key stages in sales cycles efficiently. Sales qualification is one of the key stages in the formal sales process that helps salespeople identify and differentiate disqualified leads.
According to Gartner.com,
“Sales qualification is the process of evaluating leads to determine their likelihood to make a purchase.”
This sales process stage focuses extensively on evaluating the leads generated through various digital marketing channels. The salespeople evaluate the leads using a slew of parameters to identify the leads that are a good fit for the specific product or service. Hence, they close more sales deals by following or nurturing only qualified leads. Since sales qualification is very important for an organization, here is a guide to sales qualification for your business.
Businesses these days generate leads regularly by running multiple digital marketing channels. But salespeople cannot increase the close ratio simply by talking to every lead. They can close more sales deals only by focusing on qualified leads. The sales qualification process helps salespeople separate qualified and disqualified leads using a variety of frameworks.
The sales qualification process starts after leads are generated through various digital marketing campaigns. They evaluate various types of leads – marketing-qualified, sales-qualified, conversion-qualified, product-qualified, and disqualified – using a slew of sales qualification frameworks. Every lead qualification framework differentiates qualified leads from disqualified leads by asking specific strategic questions.
The salespeople include qualified leads in the sales process and remove disqualified leads from the sales cycles. But many organizations these days nurture disqualified leads after removing them from the current sales cycle. These lead nurturing strategies help them to convert some of these disqualified leads into paying customers. However, the sales qualification process focuses only on the identification and segregation of qualified leads.
Most organizations these days implement sales qualification as multistep processes. Salespeople evaluate and do not disqualify or remove leads only after making the discovery calls. They evaluate the leads gradually during various stages in the sales cycles based on additional information. Hence, lead qualification occurs in most companies at three different levels – organization, opportunity, and stakeholder.
While qualifying leads at the organizational level, salespeople check if they need to do further research or look for additional information about the lead. They evaluate the prospects based on the buyer personas created by the company. They check if the lead fits the buyer persona using important parameters like industry, company size, and territory.
While qualifying prospects at the opportunity level, salespeople check if the product or services offered by the company meet the specific needs or challenges of the lead. Instead of using buyer personas, they focus on determining the specific needs, problems, and pain points of the lead. They normally qualify prospects at this level asking important questions like does the product/service meets the precise needs of the lead, does the lead is familiar with the product/service, and how many people will the product.
While qualifying leads at the stakeholder level, salespeople focus on converting the lead into a paying customer. As the person fits the buyer persona and needs the product/service, they want to influence the purchase decision by knowing the organization’s budget, decision-making process, and the number of decision-makers.
The salespeople qualify a prospect sequentially through these three levels. They disqualify a lead at each level if she does not meet the qualification criteria. For instance, salespeople disqualify a lead if she does not fit buyer personas. Likewise, they disqualify a lead if the product or service does not meet her requirements. Hence, the qualified lead advance in the sales process only after being evaluated at a single level or multiple levels.
While qualifying leads, salespeople must remember that customers differ from each other in many aspects. They must use a variety of parameters or criteria to know if the lead will become a paying customer. Salespeople these days use a slew of sales qualification frameworks to qualify leads by asking the most relevant questions.
The sales qualification frameworks developed by IBM help salespeople to qualify prospects based on four important pieces of information – budget, authority, need, and timeline. Budget depicts if the lead can afford the product/service, while authority indicates if the lead has adequate authority to close the sales deal.
At the same time, need helps salespeople understand if the product/service will solve the business pain, while the timeline depicts the amount of time required by the prospects to place the order.
Salespeople use the BANT framework to qualify prospects at the organizational level. They ask a slew of questions to gather these important details. But they need to engage with multiple stakeholders if the purchase decisions are made by a team. Also, they need to compare each stakeholder based on buyer persona.
The sales qualification framework pioneered by Jack Napoli is used widely by salespeople to qualify enterprise or business-to-business (B2B) leads. It helps salespeople to close high-value sales deals by gathering in-depth information about a company’s sales process. This framework requires salespeople to ask relevant questions to decide if the lead could sell the product/service to the B2B client.
They must know why and how the enterprise customer buys products or avail of services to influence the decision-making process. The information is essential to understand and manage the changing behavior of the client while buying a high-value product. Also, salespeople can keep the pipeline healthy by identifying the manager or decision-maker who will act as a brand advocate during the decision-making process.
Salespeople need a variety of information to qualify and nurture leads. They can gather accurate and reliable information only by asking relevant questions. SPIN is one of the sales qualification frameworks that emphasize salespeople asking the most relevant question. While qualifying leads using the SPIN framework, salespeople ask relevant questions to understand their needs and motives. The understanding helps them to present the product/service as a solution to specific business problems as well as create customized offers according to their precise needs.
This framework uses authority as the foremost criterion for qualifying prospects. It emphasizes salespeople communicating only with decision-makers. Salespeople often use the ANUM framework to qualify leads in the early stages of the sales process. They start the qualification process by checking if the prospect makes or influences the purchase decision.
They ask additional questions to know if the product/service meets business needs if the business has the budget to place an order, and if the business wants to place the order in a specific timeframe. But salespeople ask these questions only after ensuring that they are communicating with a key decision-maker.
Salespeople opt for CHAMP as an effective alternative to motive. Unlike ANUM, the CHAMP framework prioritizes challenges to authority. Before checking whether the lead can make purchase decisions, this sales qualification framework focuses on determining if the product or service will solve the lead’s inherent challenges or problems.
While using this framework, salespeople use authority as a call to action. They do not disqualify a lead if he lacks the authority to make or influence purchase decisions. Instead, salespeople continue the interaction to understand the organization’s hierarchy and decision-making process. They ask relevant questions to identify the managers involved in the purchase decision-making process.
This sales qualification framework developed by RAIN Group emphasizes qualifying leads based on their capacity to buy. It assumes that salespeople are interacting with a decision-maker with adequate funds or budget to buy the product. The salespeople ask additional questions to know if the organization is interested in the product/service if the product meets specific business needs, and when the organization will place the order. Salespeople try to influence the purchase decisions of leads with the capacity to buy by generating interest using various lead nurturing best practices.
The lead qualification framework developed by HubSpot aims to manage changes in buyer behavior. The framework assumes that the leads gather and evaluate a variety of information before entering into the sales pipeline. Salespeople can influence the lead only by adding value to the lead’s existing product knowledge. They add value by asking a slew of questions to understand the prospect’s business model, strategic goals, and specific problems.
Unlike other prospects qualification frameworks, GPCTBA/C&I requires salespeople to gather a wide range of information. Salespeople may not need the additional information if they are not selling complex and highly-differentiate products. They use the framework only when the product will become an integral part of the lead’s business strategy and the organization is ready to build long-term strategic partnerships.
Each of the sales qualification frameworks requires salespeople to gather elaborate information about leads by asking a variety of questions. Smarter salespeople decide about qualifying or disqualifying a lead based on her answers as well as the tone of voice. They always look for both positive and negative signs to decide about disqualifying the lead or continuing the sales cycle.
Decision-makers these days gather information from various sources to solve recurring business problems proactively. The salespeople can easily evaluate the prospect based on her intimate knowledge regarding the issue. They can ask specific questions to the lead to assess his knowledge about the organization’s needs, goals, and challenges. Salespeople can influence the purchase decision by engaging and nurturing a prospect with in-depth and up-to-date knowledge.
Often decision-makers look for solutions to specific business problems before communicating with the salesperson. But the business problem remains due to the lack of adequate solutions or the actions taken by the decision-makers. While interacting with salespeople, such leads always cite excuses to explain why the business problem still continues. Smarter salespeople consider such excuses as a good sign to understand the reality and severity of the business’s pain.
Decision-makers always focus on specifics while looking for solutions to real business problems. They assess the business problem by combining a plan of action, up-to-date statistics, and elaborate explanations. The salespeople ask relevant questions to know if the prospect focuses on specifics. For instance, they ask questions to understand the business goals or business problems as well as know the timeline for solving the business problem.
No salesperson can nurture or influence a lead when she does not answer questions. Many leads give brief or one-word answers with the intention to discontinue the conversation. Smarter salespeople often disqualify such leads as they lack adequate knowledge or understand the severity of the issue. They look for other decision-makers in the same organization who are interested to solve specific business issues.
Salespeople ask various questions to check if the lead has adequate knowledge. If the lead has adequate knowledge, she can answer each question elaborately and unambiguously. But her answers will appear inconsistent when the prospect does not have adequate knowledge. Smarter salespeople consider inconsistent answers as a red flag and look for other decision-makers in the organization.
As a key stage in the formal sales cycle, sales qualification helps salespeople to identify and nurture leads/prospects who are likely to become paying customers. In addition to saving time and effort, sales qualification helps salespeople to close more sales deals. But the salespeople must use the right parameters and frameworks to find good prospects who will become paying customers as well as loyal customers.
The article was republished in February 2023.