There Are Many Different Types of Leads, Which Is Best for Your Business?
They say that coffee is for closers, but before we can close any new business we need to generate the lead. So, what is a lead? Why are leads important to our business? Why do we spend so much time and effort trying to generate these leads? Are there different types of leads for your business? It seems that the business world is obsessed with lead generation.
Our businesses rely on leads to survive. Without leads, our business crumbles under the pressure of lack of cash flow. Leads are the lifeline of our business. The definition of a lead is simply, a name of a company or person that might be interested in our product or service. Leads are the initial phase of the selling process.
I want to make sure that we are on the same page here before you go out and buy a mailing list. Just because you have the name of a lead does not mean that they are going to be your next customer. Do your research before you SPAM and cold-call your lead. Remember, we are trying to build a trusted brand, not build the used car lot on the corner of your hometown.
All leads are created equal.
Start with A CRM
Before we jump into chatting about leads, let’s ensure that we are setting ourselves up for success. We need to set up our success with the right marketing and sales tools.
I am a strong believer that your leads should live in a CRM or inbound marketing platform, not a sticky note attached to your computer. Your CRM is a vital tool needed to organize and manage your sales pipeline and leads. A solid CRM is going to increase the chances that you turn that lead into a customer.
Over the years, I have seen many companies and organizations go without a CRM. This leaves the sales team lost and confused as the company begins to scale. Set your sales team and business up for success, give them a tool that will help them close more leads and make their jobs easier. Your CRM is your sales and marketing home base.
Benefits of a CRM
There are many benefits to a CRM that your business can take advantage of. Here is a small list of how your company will benefit from a CRM.
- Improved Sales Organization. A CRM will help your sales team organize and stay on top of your leads. Organizing your sales team will help your team become more efficient and productive.
- Improved Customer Satisfaction. Yes, a CRM is going to help you retain and service your customers. Documenting conversations and interactions will help your entire organization serve your customers better.
- Increase the efficiency of your sales team. A CRM is going to allow your sales staff to automate follow-ups and touch points along the customer journey. A CRM houses the data needed to use marketing automation effectively.
- Improve the reporting of your marketing efforts. Do you know where your revenue is coming from? A CRM is going to help you close the loop on your marketing efforts and show in dollars what is working, and not working.
- Improve your communication with your leads. Yes, all your leads should have a single point of contact. But what happens when your sales superstar takes a day off or goes on vacation? A CRM will allow anyone to jump up and close the deal because they know where the deal is in the pipeline.
- Enable your sales staff to focus on the right leads. A CRM can track all the digital transaction of your lead. Did they open that email? Did they visit your pricing page? Did they interact with a social media post? This information will help your CRM score your leads based on behavioral data, then let your sales team focus on the leads that are ready to close.
There are many types of leads in marketing, your CRM is going to help your business identify and organize the leads in your sales pipeline. Starting your lead generation starts with a CRM.
Different Types of Leads- Cold Leads vs. Warm Leads vs. Qualified Leads
We know that the more leads we have, the more opportunities we have to make a sale. Further, we also know that there are leads that are easier to close than others. We want to ensure that we are focusing our time on the leads that are ready and motivated to buy. Lead scoring will help us identify the leads that are ready to make a purchase.
Let’s take a look at the difference between a cold lead, a warm lead, and a qualified lead. This will help your sales team focus on the right actions to close more business. The closer to the end of the buyer’s journey, the better the chance of closing your leads. Let’s look at the different types of leads for your business.
What is a cold lead?
Who likes to receive cold calls or emails from an unknown person asking to do business with their team in India because they can offer you the lowest price? I am sure nobody is raising their hand. I mean most of either block these messages or completely ignore them.
Well, these are examples of cold leads. Cold leads typically come from some sort of purchased list. The user on the receiving end of this phone call or email did not ask for the marketing communication, but the company has contacted them anyway. This is typical of an outbound marketing strategy. We are pushing a message to a user because we want them to see the communication, not because they asked for it.
What is a warm lead?
A warm lead is a prospect that has shown interest in your product or service. There are many ways that leads can become warm, from signing up to watch a webinar to following your company on social media. Warm leads are close to purchasing and might need a little more information about your company. These leads are the leads we should be focusing on.
Your CRM can help you identify warm leads through lead scoring. The higher the lead scores, the warmer the lead becomes. Making this lead more likely they are to purchase from your business. As a salesperson, these are the leads we are looking for.
What is a qualified lead?
Qualified leads are the holy grail of lead generation. Qualified leads have shown interest in your products or service, have a budget in place, have the need to purchase, have the authority to make a purchase, and are ready to implement your solution.
Qualified leads might be shopping competition or doing their final research. These leads are the closest to purchasing your product or service and need just a little more information to help make the purchase. Again, lead scoring in your CRM is going to indicate if your lead is qualified or not.
Where Do Leads Come From
Most businesses rely on 1, maybe 2 different ways to generate leads. However, lead generation can come in many forms. We have always found that your business needs to establish a minimum of 5 lead generation tactics to be successful. This gives your business the ability to diversify and test your lead generation strategies.
There are two main categories when it comes to lead generation. Inbound marketing leads and outbound marketing leads. There are many sub-categories of each category, to make sure you are using both inbound and outbound marketing to move your business forward.
Inbound Marketing Leads
Inbound marketing leads are attracted to our products and services through valuable content. Leads from the inbound marketing methodology are generally more cost-effective. Leads from inbound marketing come primarily from your blog, search engine optimization, and social media marketing. Developing a solid inbound marketing plan will help you grow your business.
Outbound Marketing Leads
Outbound marketing leads are leads generated by sending a marketing message to a potential customer. Typically, outbound marketing leads are generated through paid media like television, radio, or print. These leads are typically more expensive because you are paying for placement, but many times they are still valuable and profitable. Finding the right outbound marketing tactics can help increase brand awareness and generate customer quickly.
The Leads We Should Never Forget
There is one lead that most companies forget about. This lead is lead that never converted. For some reason, maybe budget or timing, they did not opt to purchase your product or service. These leads are often forgotten about and never followed up with. We figure that is they did not convert the first time, they will not convert in the future. But things change.
Unconverted leads can be a gold mine if nurtured correctly. As you build out your sales pipeline, ensure that these leads are included in an automated nurture campaign. Use your CRM and marketing automation to follow up and send periodic emails to gauge the interest. This will help you know if they are still interested or if they have moved on.
You never know. They could have used a competitor but had a terrible experience and are now back on the market. Unconverted leads are often overlooked, make sure that your company has a way to stay in touch.
Conclusion: Different Types of Leads
There are many different types of leads that can drive your business. The question becomes, what are the right leads for your company. Well, the answer is not going to surprise you. Leads need to come from multiple places. Our opinion is that your business should set up a minimum of 5 lead sources. This can be any combination of inbound and outbound marketing leads. Find the right lead mix that drives your company.
Lead generation is always on the top of the mind of business owners. As you continue to grow your business, ensure that you understand where your leads are coming from and how to nurture them to close. The better you know your leads, the better chance you have to convert. Lead generation combined with lead nurturing will help your business grow and continue to increase cash flow and revenue.
In your business, what are the different types of leads you focus on?