B2B Marketing Lead Lifecycle 101
More than half of B2B companies ghost their leads according to a lead time response survey conducted by Drift. In 2017, Drift surveyed 433 B2B companies and found that 55% of companies they contacted did not respond to their request over the course of five business days. This is a scary statistics for marketers that are working hard to pass leads to their sales team. Could all your marketing work be for naught? Or is there a better way to ensure no leads slip through the cracks?
If you are a B2B marketer that works with a direct or indirect sales team, a lead lifecycle process should be your best friend. A clearly defined lead management flow can do wonders for your sales alignment, reporting and overall marketing operational efficiency. However, it is not uncommon for B2B marketing leaders to have either an undefined lead lifecycle or no lead lifecycle at all.
This is a major missed opportunity for B2B inbound marketers.
As inbound marketers continue to grow their influence in B2B organizations, there will be an increasing number of quality leads passed through marketing to sales. Establishing a process to define how marketing passes leads to sales and how sales addresses leads passed from marketing is incredibly important. It is just as important for improving the experience of a prospect in your buying cycle as it is for you to be able to track and optimize lead conversions in your marketing funnel.
If you’re sitting there thinking “isn’t it obvious how sales should follow-up with leads?” or “why is it necessary to define steps of the lead flow?” – or perhaps it’s just never crossed your mind that this was something that needs to be done – this article is for you.
Here is the down and dirty of it all: without a clear lead flow process (lead lifecycle), valuable leads will be overlooked, marketing will miss out on critical lead quality feedback from sales and alignment between marketing and sales will suffer.
Image From Drift’s 2017 Lead Response Time Study
Implementing a formal lead lifecycle process backed by a sales and marketing service-level-agreement (SLA) will help maximize the return on leads generated by marketing (in other words, it will increase the likelihood of sales closing marketing sourced business opportunities and help marketing to understand which activities are helping them drive the most business revenue).
It also help with understanding your sales cycle and optimizing conversion rates between lead stages. If this is a new concept for you, you’re not alone!
This article will cover the nitty gritty of lead lifecycle marketing, including what a B2B sales and marketing lead lifecycle is, why it is important, a best practice approach and how you can get started creating one for your organization.
What is a B2B Marketing Lead Lifecycle?
A traditional lead lifecycle is the process used to manage the journey of a prospect to a customer by defining the stages a lead progresses through from the moment it is created in your marketing automation system or CRM to the closed won or lost business opportunity.
The lead lifecycle defines where a lead can live, how a lead moves along through sales and marketing process and expectations for how the lead is handled at each stage of the lead lifecycle. It is used to manage “the rules” of a lead, including the workflow of how a lead is transferred from marketing to sales, how leads that aren’t ready to buy can be “recycled” and provides a mechanism for analyzing stages of the lead funnel.
Today, B2B marketers are looking beyond managing leads through the net-new business sales funnel to cater to the entire customer lifecycle. This means expanding the responsibilities of marketing to not only close on new business but also help with cross-sell, up-sell, and advocate marketing.
Why Your Lead Lifecycle Needs a Sales and Marketing Service-level-agreement (SLA)
A B2B marketing lead lifecycle operationalizes a sales and marketing service-level-agreement (SLA). A sales and marketing SLA is used to create alignment between sales and marketing by detailing the speed and depth of following up with marketing-generated leads.
Typically, a sales and marketing SLA will cover the following:
Protocol for leads sent to sales from marketing
What are the bare minimum fields and qualification criteria that need to be provided by marketing before sending a lead to sales?
What notifications will sales receive when a lead is passed over from marketing?
Timing for sales follow-up of marketing qualified leads
In return for quality leads, how quickly will sales follow up with a marketing qualified lead (MQL)?
How many times will sales attempt to contact an MQL?
What methods of contact will sales use for outreach to MQLs (phone, email, how many times for each)?
How sales accepts or rejects a lead from marketing
How will sales notify marketing that a lead will be pursued or not?
How much time does sales have to vett if a lead is worth pursuing?
Enforcement notifications for leads the breach SLA terms
Once agreement has been reached about timing for leads passed to sales, how will you manage leads that violate the SLA?
Having an in-depth conversation with your sales leadership to solidify your SLA will give you grounds for defining your lead lifecycle process. This will also help to level-set the sales and marketing organization with a formalized process for ensuring leads are handled with care.
As a side, it is not uncommon for your marketing and sales SLA conversation to instigate the first attempt for the sales organization to standardize their lead follow-up process.
What are the benefits of a B2B Lead Lifecycle?
There are a number of benefits of a well-defined lead lifecycle for both B2B marketing and sales teams.
When looking at the advantages of clearly defining and operationalizing the stages of the buying process, marketers reap the benefits of:
Increased lead quality through advanced nurturing. Research conducted by Marketing Sherpa found that 79% of marketing leads never convert to sales, with a lack of lead nurturing as the common cause for poor lead performance. Furthermore, Forrester Research found that companies that excel at lead nurturing generate 50% more sales ready leads at 33% lower cost.
A lead lifecycle model that defines the difference between a prospect and a qualified lead creates an opportunity for marketers to score a lead based on demographic and behavioural criteria. This scoring process, typically conducted through marketing nurtures, is used to gauge a lead’s interest and readiness to buy from sales. Without nurture qualification, marketing has a tendency to pass every name that comes their way over the fence to sales, which leads your sales neighbors to receive a lot of garbage.
Recycle feedback loop to ensure that no lead is left behind. A well-designed lead lifecycle program will provide sales with an option to send a lead back to marketing for further nurturing. Wrong timing, lack of budget or another reason may prevent a lead from being ready to buy now – however, further nurturing from marketing will keep your company top of mind for when the time is right.
SLA timeline means leads don’t sit idle and will be engaged with without haste. By agreeing to a timeline for sales follow-up from marketing leads passed to sales, marketing can rest assured that their hard work isn’t in vain.
Drift’s 2018 lead response study found that 90% of B2B sales teams took more than five minutes to respond to a contact request. What makes that stat significant is the fact that there is a 10x decrease in your odds of making contact with a lead after the first five minutes.
As a marketer, any friction you can remove in the process of passing a lead to sales and easing their follow-up time can vastly improve the likelihood of converting a lead to an opportunity.
According to CSO Insights, Companies with mature lead generation and management practices have a 9.3% higher sales quota achievement rate. A few other positive outcomes of a lead lifecycle program for sales teams are:
Improved quality of marketing sourced leads. A lead lifecycle helps to negate garbage leads being thrown over the fence from marketing to sales. When you work through the lead lifecycle process and your sales and marketing SLA, you have the opportunity to clearly define with sales what a qualified lead is. Marketing can then ensure any lead passed to sales meets the defined criteria.
More precise definition of (a qualified) lead means sales can spend less time “cold-ish” calling non-buyers and more time in revenue-producing activities. By establishing a shared understanding between sales and marketing of what constitutes a ‘qualified lead’, marketing can limit leads passed to sales to those that meet the defined criteria. This creates a more efficient use of sales time as they are no longer following up with unqualified leads that aren’t ready to buy.
Feedback loop from sales to marketing. The lead lifecycle provides an avenue for sales to report back to marketing what leads are good or bad. This gives marketing the information they need to invest in activities, channels, and types of leads that best serve sales.
Defining Your Lead Lifecycle
What is a “lead”? That is not a rhetorical question. It is vitally important that your enterprise has a shared and detailed understanding of what constitutes “a lead”. Many organizations make the mistake of using this loose methodology without clarifying what constitutes a quality sales-ready lead.
The lead lifecycle defines what makes a qualified lead and creates a transparent and shared understanding of the different stages in your buyer funnel. The following five stages are a proposed best practice approach to standardizing the lead lifecycle model as a prospect moves through the buying funnel.
Marketing Inquiry (MI): An inquiry is defined as a person that has shown limited interest and needs to learn more.
This is not a lead! This is a response or a name in your database. The inquiry stage usually reflects a behavior like downloading a top-of-funnel whitepaper, attending a webinar, or stopping by an event booth with no direct request for sales follow-up.
At this stage, a prospect enters the lead lifecycle and should be nurtured by marketing. As the prospect continues to engage with content or other marketing touches, they accumulate a lead score.
A marketing inquiry should not be passed to sales as they have not shown enough interest to be ready to be contacted by sales. Sales contact at this stage can be off-putting and sour the relationship with a prospect.
Marketing Qualified Lead (MQL): A person that has shown signs of buying intent and sales readiness.
An MQL should have demonstrated a propensity to buy by asking to be contacted by sales or admitting to a specific business problem or challenge that your business solutions can help.
Typically, an MQL is a deeply engaged prospect that has consumed multiple pieces of content, provided full contact details and has earned a lead score from a number of actions that qualify them as ready for a sales conversation. They may have also filled out a single "high value" form that requires and immediate follow up from sales.
As part of the lead lifecycle definitions, marketing should guarantee valid lead contact details are being passed to sales. As an example, marketing may agree to provide, at a minimum, the prospect’s:
Full name
Phone number
Email
Company name
Location
Product interest
The MQL stage should also lay out the hand-off criteria between marketing and sales. How will sales be notified of an MQL? What will this look like moving from your MAP to your CRM? How will the lead be assigned to a sales person? The devil is in the details so be sure to not overlook the specifics here.
Sales Accepted Lead (SAL): At this stage, sales or inside sales will contact the person to identify if there is a need or fit for your business solution. This is a work in progress lead.
SAL is a vetting stage for sales to check the pulse of the lead – do they have a valid phone number? Do they look like a lead that is worth working?
If so, sales should change the lead status to SAL. If not, sales should close/disqualify the lead and send it back to marketing for further qualification or to get correct contact info. This is a critical stage in feedback for marketing to improve lead quality.
Sales Qualified Lead (SQL): Sales or inside sales has spoken with the person and identified them as being sales-ready, even if a full opportunity does not yet exist.
If the person has a need, budget and timing to purchase, they should be converted to an SQL and a stage 0 opportunity should be raised. If it’s discovered that the lead does not meet your BANT (budget, authority, need, timeline), sales should return the lead to marketing to nurture.
Closed Won Opportunity or Closed Disqualified
If all goes well, the final stage of the lead lifecycle is a closed won opportunity. This is a completed business deal.
Closed disqualified, however, can happen at any point in the lead lifecycle process. A closed disqualified lead can be due to a bad fit, someone who will never buy, or it can be someone who is not quite ready to buy.
If the lead is closed disqualified for a reason that means they are not ready to buy, they should be recycled back to marketing. This is a return to nurture step. When a lead is returned to nurture, marketing is able to keep leads warm so they can be sent back to sales when they are ready to buy.
A Lead Lifecycle in Practice
Below is an example of a lead lifecycle workflow with a timeline for each of the lead stages.
For the best outcome, marketing and sales should sit down together to ensure they have a shared understanding of language around the lead stages and are clear on the process.
Ready to Build Your Own Lead Lifecycle? Consider the following tips that my brilliant Marketing Ops colleague has recommended to lead lifecycle newbies:
Buy-In: Find a sales champion that understands the vision and can help you get buy-in from the larger sales organization and be your sounding board for ideation.
WIIFM: Does sales understand, and believe in, what they will gain from implementing a lead lifecycle process?
Agreement: Before building your lead lifecycle, work together with sales management to define your SLA first.
Lead Scoring: To effectively qualify a lead, you will need a lead scoring model. Your scoring model should incorporate demographic and behavioral criteria. Involve sales in the development of your lead scoring model and be prepared to iterate after launch.
Training and Onboarding: Don’t forget to create a plan of action for your roll-out. The rubber meets the road with your sales team so you need to ensure they understand what’s required of them. Develop an easy-to-understand step-by-step process for sales to be onboarded about what is expected of them with the new lead lifecycle.
Final Takeaways
Your lead lifecycle is not meant to be a set-it-and-forget-it model, you should regularly review the process and ensure it is achieving goals. Look for areas of improvement based on team feedback and performance. Leverage an agile and iterative approach to continue to refine your model.
One final, important note: lead lifecycle is not just about SLA enforcement or lead process rules but truly its greatest benefit is the ability to achieve better reporting. Marketers greatly benefit from ease of access to data and reporting from the lead lifecycle. The better equipped with data a marketer is, the easier it is to grow marketing’s influence in an organization.