Lead generation is the business process by which companies (or sole proprietors) attract and identify new potential buyers for their services and/or products.
A new potential buyer is called a lead.
Lead generation is often the prelude to sales.
You might think of lead generation much like the time when a farmer sows his seeds in hope of a future harvest.
It’s means by which businesses get to know eventual customers before persuading them to buy.
Getting leads is achieved in 3 ways by a business:
- Outbound marketing: where a business sends personnel out into the marketplace to meet with and identify new business leads
- Inbound marketing: publishing marketing collateral in high traffic location (online or off-line) as a way of attracting interested prospective buyers
- Buying leads: paying another business money for rights to use lists of contacts (leads) which they are selling
There are contacts and there are leads.
Contacts are people (independent parties or who represent companies) that have become known to a business. And when contacts become qualified, they are known as leads.
Leads are therefore qualified contacts.
But what is qualification and what do we mean by ‘qualified contact’?
Qualification (in lead generation) is the process by which contacts are screened for their suitability for buy the products of services of a business.
A qualified contact or lead therefore is a true potential buyer.
In other words, there is a match between what they need and what the offering business provides.
There are varying degrees of suitability when it comes to leads and their potential to becoming a buyer (customer).
Some leads more suitable sales opportunities than other leads – and therefore are considered better quality.
In other words, there is greater potential of these converting into a sale.
A goal of lead generation always is to optimise your lead generation activities for bringing you in the best quality leads.
Leads and shelf life
Leads present commercial opportunity.
Somebody needs something within a given time frame. Conditions could always change, but that’s how things were at the time the potential buyer got in contact.
However, circumstances are always in continual flux.
A qualified lead today, might be disqualified tomorrow for any reason:
- Regulatory hindrance
- Change of personnel etc.
Alignment for agreeing a deal might fall out because of change.
Businesses that are in constant communications with their audiences (e.g. by email newsletter), by nature, are re-qualifying the interest of leads all the time.