What is lead management?

Ira Mataić / 22 Mar 2024
  • Industrija
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TABLE OF CONTENTS:


You decide to spend a whole day by the lake, trying to catch a fish. You waited patiently and finally caught a nice fish, only to realize you do not have anywhere to place it.


Now you have wasted a day and a nice catch.


The same is done when you generate leads, but do not have a proper lead management strategy in place.


Lead management involves identifying potential customers, guiding them through the sales funnel, and building relationships.


Simply capturing leads isn't enough. What’s the point of collecting contact information if your leads never buy from you?

What is Lead Management?


Lead management is the continuous process of drawing in, assessing, and turning potential customers into actual buyers.  


Achieving success in lead management depends on creating strong connections with potential customers and guiding them to choose your solution over the competition.


This process starts with identifying prospects and continues through to their completed purchase.

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Why is Lead Management Important?


Lead management is important in order to improve the conversion rate, better predict sales, allocate resources and increase revenues.


This involves gathering qualified leads – those who match your target personas – and effectively guiding them through the lead cycle.


Lead management can help to:


  • effectively track information about potential leads
  • establish an immediate relationship with potential leads
  • stay in touch with potential leads at all times
  • improve user experience
  • save time and money
  • increase profit

What is the Lead Management Process?


Lead management process is a series of steps and strategies that aim to attract potential clients, assess their interests, and convert them into customers. The process itself is systemic and follows certain key steps.


Key steps of a lead management process are:


1. Generating leads

Lead generation is the first step.


It involves gathering information from potential customers. You can collect email addresses, names, phone numbers, and other contact information.


You can collect information through newsletters, demo products, social media, cookies, SEO or other data-gathering tools.


2. Qualifying leads

Not all collected leads are worth pursuing. Some people are simply curious about your product, but do not wish to make a purchase.


Evaluate them first!


3. Building customer trust

Most potential customers aren’t ready to buy at the first interaction.


To encourage them, you need to build trust over time by staying in touch with them and providing all the relevant information about your product until they are ready to buy.


4. Scoring gathered leads

Scoring leads will help you know when to contact them.


Here you should be able to rely on your CRM software to do most of the work. Set the parameters and let your CRM application to notify you when you should contact your lead.

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5. Lead distribution to sales team members

After scoring you have your potential customers.


Assign them to your sales team representatives who best fit the sale based on location, experience and performance.


6. Lead conversion

Lead conversion is the goal of lead management. A lead is converted when a sale is finalized and you have gained a customer.


It costs 5 times more to attract a new customer, than to keep an existing one. (Invesp)

7. Retention

With customer acquisition costs being so high, lead retention is the way to go. Lead retention is the process of maintaining and nurturing existing clients, so they may make repeat purchases and engage with your brand.


Unfortunately, you cannot plan one fishing trip and call yourself an expert fisherman.


Once you have created your process it is important to identify improvements and perhaps use additional tools to make your sale process even more effective.

Analytics in Lead Management


Improvement comes from measurement and analysis of your sales results at each step.


Firstly, define clear objectives for your lead management process. This can be boosting sales numbers, acquiring more customers, or increasing sales per customer.


Having well defined goals can help you create effective strategies and measure your success more accurately.


For example, one of the most useful performance indicators is lead conversion.


Let’s say you have acquired a large pool of leads that include all people interested in your product. If you segment your leads properly, you’ll be able to track and manage them better.


Leads are divided in the following groups of potential customers:


  • Information-qualified leads (IQL): potential leads who will provide their contact information to receive useful information
  • Marketing-qualified leads (MQL): potential leads who have shown interest in what a brand has to offer based on marketing
  • Sales-qualified leads (SQL): potential leads who have gone through the sales process and expressed enough interest that the sales team can focus on converting them into customers.
  • Free-trial users: potential lead who has subscribed for a free trial

Choosing the Best Tools for Lead Management


Let software tools support your lead management.


While choosing a solution right for you, take in account the following:


Industry fit

Most lead management systems are pretty versatile, some are intended for B2B or B2C companies.


Also, some industries have strict compliance requirements. So if you belong to the health, finance, or other industry with sensitive information, be careful which software you choose.


Scalability

Does the system support your lead collection and categorization needs or can they keep up with your growth?


Some software solutions have a modular structure, allowing you to add or remove functions, as to better adapt to your business needs.


User-friendly

A good lead management software can be customized, but it also needs to be easy to use for your team.


User-friendly solutions are more easily adopted, cause less frustration in your staff, and save time better spent on a sales call.

crm-importance-for-closing-sales

Using the right lead management tools can greatly streamline your sales process.


This can include CRM software for lead management, email marketing software for lead nurturing or analytics tools to track and measure performance.


Mastering lead management is crucial for any business aiming for success.


By implementing effective strategies, utilizing the right tools, and prioritizing user engagement, you can unlock great growth opportunities.


Focusing on lead management allows businesses to not only maximize their revenue potential but also to cultivate enduring customer relationships.


This strategic approach serves as the foundation for a thriving enterprise.