As an early stage B2B company, you of course want to talk to everyone who might be interested in buying your solution. But the reality is that not every company you engage with will be able to, or indeed should, use your solution.
One of the most powerful productivity improvements your team can make is early qualification – and qualifying prospects out is as important as qualifying them in.
There are two types of qualification, Data Qualification and Conversational Qualification which happen at different stages of the sales cycle.
Data Qualification is the initial qualification of working out the type of prospects you can make successful and should therefore be selling to. This could include what sector they’re in, their size, revenue, number of employees, credit rating, use of specific technology etc. You’ll take an early stab at what makes sense for you and then iterate as you gain more clients and a better understanding of the type of customer that is most successful with your solution.
This iteration is incredibly important. You probably won’t find your sweetspot until you have over 50 clients – more if your solution is lower price / self-service. You should schedule a monthly task of looking at the deals you’ve closed and the ones you’ve not been able to, and feed this knowledge back into your Data Qualification process.
One of the most important aspects about Data Qualification is that it should always be done before the prospect gets to the sales team. However you do this initially – hire an intern, get a sales admin person to take on this role (and as you get bigger you’ll have people in sales or marketing whose job it is to qualify leads) – just don’t give companies or contacts to your quota carrying sales people without Data Qualifying them first. It’s a complete waste of their time and therefore a waste of a very valuable resource of which I am sure you never have as much as you need.
Conversational Qualification happens when someone from your sales or marketing team actually talks to a client. A lot of companies use the model of having SDRs (Sales Development Reps) who generate and qualify leads before giving them to the quota carrying sales team. A common qualification mechanism is BANT (standing for Budget, Authority, Need and Timing) and I personally favour BANTFR (BANT + Fit, Red flags):
Budget – Do they have budget assigned in their current financial year to pay for a solution? Is there enough budget to meet your minimum spend requirements.
Authority – Are you engaged at the right level in the organisation? Does your primary contact have the authority to get a deal done? Perhaps their manager is the final sign-off, in which case do you need to present your offering to that person as well to make sure the deal happens?
Need – An obvious one, but you’d be amazed how often this doesn’t get probed enough. Do they have a real need for your solution? Are the KPI’s of the individual and/or organisation you’re selling to aligned with your proven success metrics? What does success look like for that person / organisation?
Timing – What stage are they at in the buying cycle. How soon do they need your solution? Do they have a deadline to meet, do they need to get the deal done this FY to get the spend out of the budget? If they’re more than 6 months away from making a purchasing decision, do they need to be on a different engagement cycle with your business?
Fit – Does the organisation fit your profile for a successful client? For example, do they have someone who’ll be dedicated to the project? Do they have someone dedicated to using your platform once you’re up and running? What else makes a prospect a good fit for you?
Red flags – Are there any red flags that could derail the deal? This could be a relationship with a competitor or competitor partner? What other properties of a prospect has caused you to lose a deal in the past that you could identify earlier on in the sales cycle?
Again, you’ll take a stab at an initial BANTFR that makes sense for you and then iterate on it over time. You might decide to assign points to each section of BANTFR and only allow prospects with a certain number of points to proceed to the next stage of the sales cycle.
For example, if your minimum spend is £X and the client only has 1/3 £X in their budget, it makes no sense to take this client forward to the next stage (which may well be more time consuming – e.g. a customised demo) until you understand whether there are options in the business to get closer to your price.
Don’t be afraid to ask the difficult questions. If you’re polite and ask with a spirit of curiosity during your discovery process, you’ll be able to get the information you need.
The most important part of qualification is simply to use it, and use it early in a sales cycle as you learn about a customer’s needs before you spend too much time on them. Use your qualification matrix to qualify out those companies who you discover you cannot make successful, or those who you’d be better engaging with at some point in the future because they’re not ready to move forward now.
It’ll save you time, money and allow your sales team to be much more focused on the clients that you can make successful which in turn will allow your business to grow more quickly.
What’s not to like about that!
Want to know more? Give me a call or drop me a line.
Share on Facebook
Share on Twitter
I'm busy working on my blog posts. Watch this space!