5 Things You NEED to Pre-Qualify a Lead
One of the most overlooked yet essential stages of the sales process is the Pre-Qualification milestone.
67% of lost sales are as a result of sales reps not properly qualifying their potential customers before taking them through the full sales process.
This results in a substantial amount of wasted time and resources that could be better spent to generate revenue.
Last week’s article covered in detail the first step of the 10-Step Sales Process, the Prospecting Stage. Incase you missed either of the first two parts of the series, or if you wish to revisit any of the points discussed, you will find the links to both articles at the bottom of the page.
Today I’m going to take you on a journey through the 2nd, and super critical step of the selling process, the Pre-Qualification Stage, by sharing with you the framework that I developed, N.U.B.I.T. which I address in more detail in my upcoming book. This will help you ensure that you’re investing your time into the right potential customers, those that are likely to buy from you, so that you win more sales at the end of the day.
The best sales professionals don’t sell, they help their customers buy. Often times sales people jump into a sales cycle and focus on a need that they think is important to their prospect and that their product or service could easily solve. This assumption is often times costly because the sales person doesn’t actually know if their potential customer sees the same urgency in the solving the need or if that need isn’t being worked on by another company or an internal staff member. By failing to understand the most urgent challenges that your customer needs solved you risk pitching them a service or product that they don’t see enough value behind. As a result, they won’t buy and you and your sales team will waste precious time and energy pitching the wrong service.
Try asking some of these questions to help determine if your customer has real need for your kind of product or service:
– What are you finding most challenging right now?
– Is this a problem that both you and the business feel is wroth solving?
– What are the possible implications, both to you and to the business, of not finding and implementing the right solution?
It’s important to have a high-level overview of the big challenges that your prospect is facing to ensure that there is a need for your product or service.
If your prospect expresses certain challenges that you are able to present a unique solution for, then they are a prospect worth engaging into the full sales process. If not, you will end up spinning your wheels. You need to ensure that your prospect is not using, or has not committed to using a different method to help them address the same challenges that they’ve shared with you.
To avoid this trap, try asking the following questions:
How have you tried solving these issues in the past?
Are you currently working on, or have someone working on a solution?
What are some of the ways you tried working addressing your challenges in the past?
Have you entered into any agreements with anyone else?
It’s important to understand whether or not your potential customers has or can find the budget to invest into a service or product that fits their needs and addresses their concerns. This will prevent you from wasting time on potential customers that have no ability to buy and are merely looking to get information. Those simply seeking information need to go into a warming process with your marketing or customer engagement team. It’s not the right time for a sales person to come into the picture.
Here are some questions you could ask these potential customers to understand if the budget is or could be there to buy your product or service:
– Do you have the budget to allocate to your solution if you present them with something worthwhile?
– Are you on a calendar or fiscal budget year?
– When does your new budget year start?
– When do you start planning for your budget?
– Do you have a discretionary budget remaining?
– Whose budget money would a purchase like this come from?
– Can money be found in any other budget or department?
I: Influence Level
People like to feel important and will often times engage you into a sales cycle regardless of whether or not they have the authority or enough influence in the company to make a purchasing decision. This will almost always result in you endlessly chasing after them and wasting your precious time. You need to be certain that you are either speaking with the actual real decision maker or at the very least a real strong influencer to the final decision maker. If you are speaking with the decision maker or influencer, you need to understand who else needs to be involved in order to make the decision. This enables you to strategically plan your process to involve the other parties at different stages of the game as needed.
Ask these questions to determine if you are speaking with the right person and to understand who else is involved in the decision making process:
– Provided that I show you enough value in using our service or product, would you have the authority to make the final purchasing decision?
– Who else needs to be involved in making a purchasing decision with regards to this product or service?
– Is there a committee that needs to approve the decision?
– Who is on that committee?
– Does your purchasing department have to approve the order before issuing payment? In other words can they overrule the decision even after it is approved by the decision maker and/or the committee?
If you are speaking with the decision maker or a key influencer who either has the budget or can find the budget for a viable solution, and has a unique problem that’s worth solving, the final piece of the qualifying equation is to understand what kind of timeline your prospect is working with. If they recently signed a 3-year contract with a competitor and are just looking to see what else is out there, then I wouldn’t spend too much time taking them through the sales process. I’d answer their questions and put them into a warming cycle until they’re closer to the expiration date of their current contract.
You should consider using some of the following questions to help determine if the timing is right to engage them into your selling process:
– How quickly do want or need to act on addressing this issue?
– What’s the urgency to act now or what kind of deadlines are you working with to solve this problem?
– What makes you want to address these challenges now?
– Are there seasonality issues?
– Does it align with your budget planning and when does that usually happen?
– How long will the approval process take?
– What is the procurement process?
As you can see, the qualifying part is pretty straightforward and doesn’t take too much time to do. You’ll usually be able to get through it either on the initial call, your first phone meeting, or your first face-to-face meeting. Whatever you do, don’t go into proposal mode without first qualifying your prospect.
By mastering the skill of pre-qualifying your prospects, you will make better use of your time and you will be able to focus on the right potential customers at the right time which WILL result in an increase in sales!