Internet Trends 2011 by Mary Meeker, Partner at KPCB

KPCB Internet Trends 2011

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How to Qualify Sales Lead and forecast Sales Target

Sharing my thoughts on how to qualify leads and forecast target.

Over the years, I have successfully used the BANT framework across the Waterfall Model of Funnel.



Let's look at the stages of

• Stage 0 (Demand Generation)
• Inquiry  - via a demand generation campaign like email/social media/webinar etc. or a sales rep. driven
• I'm not sure how you have got these 22 leads.
• From here, 22 prospects needs to be qualified along with 3 existing qualified leads to be sure.

• Stage 1 (Lead Management)
• Awareness - customer says do I have a problem, root problem /or a symptom of a problem
• Exit criteria - Marketing Captured Lead (MCL) which is data requests like  decisions makers, address, email, employees and other details of an organisation
  
• Stage 2 (Lead Management)
• Consideration - mean buyers say I have a problem and a need
• Exit criteria - Marketing Qualified Lead (MQL) -  BANT 1 can be used to exit to the next stage 
• Stage 3  (Lead Management)
  
• Engagement  - mapping buyers journey to engage and see if my solution can solve your problem and shall I try it
• Exit criteria  - Sales Accepted Lead (SAL) - Tactical exit criteria are BANT 2
• Stage 4 (Opportunity Management)
• Intent - Customer is ready to learn more about it
• Exit criteria - Sales Qualified Lead (SQL) - BANT 3 or 4
• Stage 5
• Sales Opportunity is qualified and identified
• It's at this stage, sales rep starts his/her efforts

This process can take some time depending upon how much info (like personas and 360 deg  profile of customer) we have, but if we have most of it then, it's a 1-2 day exercise only.

By Stage 5, it will be interesting to see how leads/prospects qualify as an Opportunity. Also, funnel mix needs to be considered esp; how many opportunities are cross/up-sells and how many are new opportunities. 

This will also give a good indication at this stage whether forecasted numbers can be achieved or not.  This process will help to invalidate. Both bottom-up and top-down approach must be used for validation of forecast.

Since I don't know

• how many leads qualify for Stage 5
  
• what is  a typical size ($TCV) of a deal
• an average time of conversion from Stage 5 onwards  to close
• Conversion ratio (say 25%)

But if we know these 4 parameters, then the sales number can be forecasted with certainty.

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