Lead Management – What It Is and How to Do It
Lead management is a systematic process for generating leads, qualifying them through the marketing funnel, thereby increasing conversions and sales.
I’m going to go over exactly what lead management is and how to do it. After you’re finished with this article, you’ll know how to do the following.
- Generate sales-ready leads
- Reduce your amount of lost leads by up to 71%
- Build a holistic lead management system that will help you increase conversions by up to 50%
What is Lead Management?
Lead management is defined as a set of methodologies and systems meant to generate potential customers.
In other words, lead management allows you to attract and manage people who are interested in your product or service.
At first glance, there’s a lot going on with lead management. It looks complex.
Thankfully, the lead management process becomes seamless and simple by means of the right lead management software.
First, a quick explanation of the terminology.
A lead is someone who’s interested in what you’re offering. This is different from a prospect, who is simply someone who belongs to your target market.
Every customer starts out as a prospect, becomes a lead, and then finally becomes a customer (and hopefully a repeat customer).
Often, people will talk about inbound vs. outbound leads. An inbound lead is a lead that comes to you, while an outbound lead is a lead that you go out and get.
Therefore, lead management is the process of generating those leads, qualifying them, nurturing them, and converting them. It covers a lot of ground, but don’t worry––we’ll be diving deep into each aspect of lead management.
Why You Need Lead Management
While every business manages leads in some capacity, some businesses don’t have a solid lead management system in place.
If you’re one of those businesses, then you’re probably suffering. Companies without lead management systems tend to convert leads at much lower rates than companies with those systems.
In short, lead management helps a ton.
With good lead management, you can convert more leads, prevent lead loss, and nurture long-term relationships.
It doesn’t matter how big your business is or what industry you’re in––you absolutely need lead management. Without it, you’re potentially losing hundreds if not thousands of customers.
Now that we’ve looked at why lead management is so critical, let’s look at all of its parts one by one.
Lead Management: Lead Generation
Lead generation is the process of gaining leads, and it’s an integral aspect of lead management as a whole.
Basically, lead generation involves getting people interested in your product or service. It’s when prospects––people in your target market––become leads who have the potential to be customers.
Without lead generation, you won’t have any leads to manage, so it’s obviously a huge part of lead management.
Here’s an overview of the lead generation process from start to finish, courtesy of Hubspot:
Let me briefly walk you through that.
First, you go out into your target market and attract people. This is where you’ll be doing most of the actual lead generation, so you’ll need a great lead generation strategy.
Generally, you’ll appeal to people by providing value, usually in the form of content, whether that’s articles, videos, social media posts, or a little bit of everything.
Second, you’ll take those people that consumed your content and convert those prospects into leads. This is typically done by engaging each prospect who shows purchasing interests.
At this point, a lot of the lead generation is complete, but you’re not home free just yet. You still convince your leads why they need your product or service.
Third, you’ll close the sale, therefore turning the lead into a customer.
And last but not least, you’ll continue to delight your customers with the goal of keeping them.
That’s lead generation from a top-down view.
Lead Qualification
Another integral part of any lead management strategy is lead qualification.
To convert inbound leads, you first need to qualify those leads.
Lead qualification is gauging a prospect’s interest and determining how likely they are to become a customer.
After you generate a lead, you need to begin the actual conversion process, and that requires qualification. Qualifying leads is so important because it tells you how to convert your leads.
Let’s say you have Lead A, who has downloaded an ebook from your website, and Lead B, who has requested a demo of your software. Each of these leads requires a different sort of qualification because they’re in very different places.
The point here is that the type of lead in question will determine how you manage that lead.
The goal of qualifying is to move a lead down your funnel, increasing their interest in your product and hopefully closing a sale. This graphic from LeadSquared displays how lead qualification fits into your overall marketing and sales strategies:
Lead Nurturing
Another important element of any good lead management strategy is lead nurturing.
Nurturing a lead means cultivating relationships with leads at every stage of your sales funnel.
It’s about listening to the needs of your prospects and leads and responding to those needs. By doing so, you increase the likelihood that those potential customers will become active customers.
Lead nurturing can often make the difference between a lost lead and a converted lead.
In fact, studies show that good lead nurturing can generate more sales-ready leads at about a third of the cost. Here’s a handy graphic from Lyfe Marketing:
Nurturing a lead involves tracking leads throughout the buyer journey and responding to their needs along the way. The best way to do this is with lead management software that will allow you to see where a lead is at any point. (We’ll cover that later on in this guide.)
There’s a great example of lead nurturing from digital marketing consultant Shane Barker. Writing for Forbes, he recounted how he was hesitant to enter his credit card info for a free trial, so he abandoned cart.
The next day, he got an email from the company with a link to sign up without having to enter any card details. This is great lead nurturing at work.
Lead Conversion
This is the last major pillar of lead management.
Being able to convert inbound leads requires excellent lead qualification and nurturing. It’s an interdependent relationship––you can’t have one without the other two.
Conversion is the ultimate goal of lead management, so your lead qualification and lead nurturing strategies will work toward conversion.
To summarize:
- Lead generation: We engage prospects by publishing valuable content, interactive social media marketing, and more, capturing leads along the way.
- Lead qualification: We use the Chili Piper software to schedule calls with leads in order to keep the momentum going and stay at the forefront of their minds.
- Lead nurturing: We listen to the needs of our audience so we’re prepared to solve any problems our prospects and leads might have.
Lead Management System: Why You Need a CRM
In addition to having software that allows you to engage leads, you’ll need software that can help you manage leads after generating them.
This kind of software is known as CRM (customer relationship management) software.
CRMs can be insanely powerful. They allow you to comprehensively track, manage, nurture, and even qualify your leads, and you can also integrate CRMs with software for even more lead management brawn.
Essentially, a good CRM can serve as a nearly all-in-one lead management tool.
But with great power comes great responsibility. It’s easy to misuse or underutilize CRMs, which can result in a catastrophe.
So how do you use CRMs the right way? By seeing them as tools for growing and increasing revenue.
Many companies use CRMs to manage their internal workflows, make predictions, and plan strategies. There’s nothing inherently wrong with that, but you can’t do just these things. You need to use your CRM for actual customer relationship building.
That means choosing a lead management system (CRM) that fits your needs and using it as a holistic lead management tool.
When it comes to CRMs, Salesforce is arguably the best lead management software. It’s used by many of the most successful businesses in the world, and it gets recommended by experts time and time again.
In terms of lead management system features, Salesforce has a lot to offer. From general sales lead management to marketing automation, Salesforce offers a ton of muscle.
You can also integrate Salesforce with meeting automation software for a powerful one-two punch.
This will allow you to book meetings directly from within Salesforce, route meetings across departments, and convert inbound leads more quickly.
In short, you get all the benefits of a lead management platform with all the perks of a meeting scheduler.
This combination will help you optimize your processes for lead conversion. Roughly 71% of leads are wasted, and it’s usually due to not responding quickly enough.
That’s why using the right tools (and responding instantly) can help you dramatically increase the number of converted leads.
How to Create a Lead Management Process
Now that we’ve gone over all of the aspects of lead management, let’s put the puzzle pieces together and look at how to build a lead management cycle from the ground up.
- Assess your current needs, capacity, and workflow. How many leads do you want to generate? How much power will you need to manage those leads?
- Formulate your lead generation strategy. Decide what techniques you’ll use to get people in the door, whether that’s creating lead magnets, posting videos on social, or something else.
- Think about how you’ll nurture your leads. How can you ensure a seamless customer journey while responding to individual buyer needs?
- Put a system in place for lead qualification. Figure out how you’ll qualify the different types of leads, how you’ll assign them to your sales team, and what methods you’ll use for engaging them.
- Find top-of-the-line software that meets your needs. Specifically, you want an excellent CRM that can serve as a lead management database and help you convert leads.
Lead Management: FAQ
If you just want an overview of these topics (or if you’re in need of a summary of everything we’ve gone over), here’s a short FAQ for you that addresses the most common questions about lead management.
What is lead management?
Lead management refers to the comprehensive process of turning leads into customers. It comprises lead generation, qualification, nurturing, and conversion.
What is lead management software?
Lead management software allows you to generate leads and track them throughout the lead management cycle. This type of software is collectively called CRM (customer relationship management).
What is a CRM lead?
A CRM lead is a lead that you’re tracking and managing with CRM software. It can also specifically refer to leads generated with the help of a CRM.
What is a lead management process?
A lead management process is an overall methodology you use to engage with your leads and move them toward conversion. A good lead management process involves determining your strategy each step of the way and choosing the right software to help you accomplish your goals.
Why is lead management important?
Lead management ensures that all of your internal processes are optimized for converting the most leads. Having a good lead management strategy in place will allow you to prevent lost leads and convert more leads more quickly.
What is a lead generation strategy?
A lead generation strategy is a strategy for attracting people in your target market with the goal of engaging them and turning them into leads. Generally, you’ll appeal to prospects by sharing valuable content that builds interest in your product or service.
How do you build a lead management system?
To create a lead management process, you need to determine how you’ll generate, qualify, nurture, and convert your leads. This is done by assessing your needs, capacity, and workflow to figure out how you’ll process leads every step of the way.
What is the best lead management software?
Many experts use Salesforce as their CRM of choice. You can also integrate other apps (like Chili Piper) with Salesforce for maximum effectiveness and versatility.
Do you need better lead management?
Having awesome lead management can’t be optional. It’s an absolute necessity if you want to attract paying customers.
If your lead management process isn’t concrete, you’re probably losing leads. Knowing how to manage leads effectively can make or break your entire sales pipeline, so it’s important to get it right.
Originally published here.
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