What is lead management?
Lead management is the multi-step process of acquiring, qualifying, and engaging leads until they make a purchase. Lead management aims to generate new business by bringing in new customers. Sales and marketing teams work closely throughout this process and deploy various strategies to secure leads.
Customer relationship management software (CRM) software helps facilitate the lead management process, making it easier for businesses to determine which leads to pursue and which ones to filter out. These tools allow organizations to track and manage customer interactions in a single system of record.
Types of sales leads
There are various types of leads to consider when thinking about the lead management process. Sales lead types include:
- Cold leads fit the ideal customer profile but have not shown interest in the product or service. These may require more time and attention to get them to convert.
- Warm leads may be familiar with a business and its product, service, or representative, but they may not have directly expressed interest in making a purchase.
- Hot leads show a direct interest in a product or service. They may want more information from the business, so it’s essential to give them immediate attention to keep them invested.
- Information qualified lead is a lead that’s researching solutions for a specific problem. In many cases, they may request more information about a business's product or services. They may be trying to learn more without having expressed explicit interest.
- Marketing qualified leads find a business through marketing efforts, such as webinars and case studies. These leads are known as marketing qualified leads (MQLs).
- Sales-ready leads are considered ready to be connected to a sales team representative. Businesses can establish what a sales-ready lead looks like to them, or this type of lead may reach out to speak to someone from sales.
- Sales qualified leads are ready to meet with a sales representative, have expressed interest, and are prepared to make a purchase. These leads are close to the finish line in terms of making a purchase.
5 stages of the lead management process
The lead management process includes five stages. How a business approaches each stage varies depending on the goals of the organization and the systems they have in place.
1. Lead capturing
The first stage involves collecting and capturing leads. Businesses often run lead generation campaigns to collect potential clients. Sales and marketing teams can feed leads through a CRM system for more efficient capturing.
2. Lead tracking
Tracking leads includes identifying sources, monitoring their position in the funnel, and taking actions to move them throughout the rest of the process to secure a sale. Tracking activity, such as email opens and responses to phone calls, can help sales representatives gauge interest and understand where a lead currently sits.
3. Lead qualification
Effectively qualifying leads helps teams prioritize their efforts and identify leads they should spend their time pursuing. A scoring system can help sales teams rank leads’ interest to determine how likely they will convert and make a sale.
4. Lead distribution
Once teams track and qualify leads, teams should distribute them to sales representatives for pursuit. Businesses may distribute them geographically, by product or service, or other salient categories.
5. Lead nurturing
Lead management involves nurturing leads to convert prospects into new customers. This includes building relationships with leads and helping them become sales-ready through education, proof of value, and promotional offers.
How to choose the best lead management system for your business
When businesses choose a lead management system, there are various details and elements to take into consideration.
- Cost: Every business should take into account their budget for software, how many seats they'll need, and if the software has any hidden costs that may put them over-budget.
- Scalability: Make sure the tool your business goes with supports all of your lead collection and categorization needs, even if your leads were to rapidly scale overnight. Some software comes with modular structures allowing you to add or remove certain functionalities to adapt to your business's needs.
- User-friendliness: Businesses don't want to spend an excessive amount of time training their team on how to use a new tool, so be sure the one you go with is easy to use, offers a streamlined workflow, and can be customized accordingly.
- Features: From being able to track prospects to automating the lead scoring process and facilitating all types of communication, make a list of the features your team would like in a lead management system and be sure the tool you choose offers them.
Types of lead management software
Businesses often turn to lead management software to help capture, nurture, and convert leads into happy customers. Whether they use landing pages, forms, or other visual aids to capture prospects, these tools can move these details through the sales funnel.
CRM software
As mentioned, CRM software is great for facilitating the lead management process from start to finish. It's easy to track and manage customer touchpoints and interactions all in one place while also housing all relevant customer data like contact information, history, and transaction summaries into a live record.
Marketing automation platforms
Businesses can also choose marketing automation platforms, which automate marketing actions or tasks, streamline various workflows, and measure the outcomes of marketing campaigns. Since they provide a central marketing database for all marketing information and interactions, these tools can help create segmented, personalized, and timely experiences for customers or prospects.
Email marketing software
Another great option is email marketing software. These tools can build and manage email lists, segment lists to target email sends, and monitor subscriber responses. Additionally, this type of software can integrate with a CRM, making it easy to enhance the predictive capabilities of the platform.
SMS apps
Finally, SMS marketing apps, also known as business text messaging software, which can help companies plan and implement marketing campaigns that target mobile devices through SMS (Short Message Service). Using these apps can increase brand loyalty and engagement by delivering timely, personalized messages to customers’ mobile devices.
Benefits of lead management
Lead management is necessary for securing new clients and growing a business. Companies who develop and adopt a management process, supported by the right tools, experience several benefits, including:
- The ability to contact a lead quickly. Managing a lead to lock in a sale involves engaging and communicating in a timely manner. With a strategy in place, team members can build contact with leads quickly and establish contact to start building a relationship right away.
- A system for organized contact information and details. Lead management processes and the software systems that support them keep contact details organized and up-to-date. It’s easy to access information when needed, so representatives can focus on building relationships.
- More revenue when leads become clients. When leads are converted to opportunities and sales representatives secure a sale, businesses generate more revenue.
Lead management best practices
Setting a solid business foundation increases the likelihood of success in lead management. Businesses that stick to the following best practices achieve the best results:
- Have a cohesive plan between sales and marketing. Sales and marketing teams are critical touch points throughout the management process. These teams must have shared goals to work toward. Establish handoff points, how they happen, and how to best serve leads together.
- Create a lead scoring system. When qualifying leads, having a system to score them against is highly valuable. To avoid wasting time, use a lead scoring system. Consider the types of leads and determine whether they have expressed interest in the product or service.
- Use tools to support the processes. Keeping track of contact details and other relevant information can be difficult when managing multiple leads at once. CRM tools can streamline the communication process to help representatives focus on making meaningful interactions. If a CRM tool is not an option, consider building a communication log spreadsheet to store details.
- Keep lead status updated regularly. Avoid wasting time on leads that have communicated they are uninterested in moving forward by keeping the lead status and additional notes up-to-date. Sales representatives should set aside time to update the status of leads frequently or as soon as they interact with a lead.
Alyssa Towns
Alyssa Towns works in communications and change management and is a freelance writer for G2. She mainly writes SaaS, productivity, and career-adjacent content. In her spare time, Alyssa is either enjoying a new restaurant with her husband, playing with her Bengal cats Yeti and Yowie, adventuring outdoors, or reading a book from her TBR list.
