Knock Knock - Who's there?
Leads? Leads who? MQL / SQL / PQL
Editors note: Sebastian wrote this from top to bottom and I couldn't’t be happier. So if you share please tag him on twitter. I always scoffed at anyone who writes in true LinkedIn thought leadership declared ‘leads are dead’ or ‘demand generation is about un-gated content distributed to ICP channels bla bla, its not *lead generation*’. I never thought it made any sense & to be clear I still dont think it does. Leads are a unit of revenue. But as Sebastian shared drafts of this essay, I realized we have become to ‘micro’ focused & often miss the bigger picture that we are just software vendor standing in front of a person, asking them to buy.
P.S this newsletter now has its own domain & logo. Its growing up! Thanks for everyone who reads & subscribes.
We have noticed an emerging social media pattern which claims MQLs are dead. From the clearly brand driven ebook to examples in mainstream media that argue that “understanding why MQLs are finished is crucial to learning how to move forward and optimize your inbound marketing strategy.”
Before we discuss whether or not MQLs are dead, we must take a step back and talk about leads in general. Because, it is this concept that seems to be clearly misunderstood (particularly in a marketing context).
Inevitable talking about marketing means talking about leads. It is a commandment that organizations must nurture marketing qualified leads (MQLs) with content that solves their problems and parallelly have a fantastic offer for sales qualified leads (SQLs) ready to buy a product like yours. And, if you do it correctly, you will find yourself orchestrating a team of marketing and sales that work like clockwork.
The more you do the process, and the more you foster a team that specializes in each step of this predictable funnel, the more your organization will grow. Or so the legend goes.
According to the Cambridge English dictionary, a lead, in the context of marketing, is "a piece of information that allows a discovery to be made, customers to be found, or a solution to be found." A clear definition that highlights one of the biggest problems we have both created and perpetuated as marketers; to simplify words to the point, they lose all meaning and value.
If we think about leads in the traditional sense they are used today, the definition would likely be something along the lines of "a potential customer on a stage of a marketing funnel." It is a simple, straightforward way to understand that a lead is a person that eventually evolves from not knowing your brand, product or category to purchasing it. It is a probability game that allows you to calculate a percentage of customers from a pool of potential buyers. And, your job as a marketer is to develop strategies that enable that percentage to be more favorable and less expensive for the organization.
But, as we will discuss throughout this piece, a lead is much more than a person who might buy your product at some point. It is a person that connects with your value proposition and the culture around your product.
If you're unsure of what we mean by this idea of meaning and how it shapes our understanding, think about words such as "innovation," "disruptive," "user-centric," or "product-led-growth." These once valid words and frameworks are overused until we experience semantic satiation and their meaning gets lost (Thank you, Ted Lasso, for this concept).
Surely you've read statements such as:
"We are disrupting the X market."
"Our organization is user-centric."
"Innovation is at the core of our growth."
"PLG is our Go-to-market strategy." (this last one is a cognitive fallacy, check out our PLG essay for more info).
These claims make a lot of sense; in fact, many of us probably worked at companies where they were maxims, ideals, and even habit-forming cultural guidelines. But, looking at them in context, they lose meaning, not because they are potentially misleading (some of them are), but because if everyone is innovating, no one is. If we are all disruptive, there is no disruption.
Most organizations claim to be user-centric, but translating that into concrete organizational processes rarely happens. On the one hand, because it became a buzzword (and buzzwords are usually cultural red flags you must be critical about - they sound good but aren't necessarily true). And on the other hand, because we exhausted the concept until we no longer know its precise meaning.
This is not just a digital marketing issue; on the contrary, it is shared across all fields and categories of human thought. This may not sound like a big deal at first, but how we understand and provide meaning to the world around us clearly impacts the possibilities we imagine and execute. And, when it comes to the whole conceptualization of marketing and leads in the marketing space, what they are and why they are essential, it seems we have forgotten their essence.
Thinking in terms of quantity vs. quality of leads is almost always an issue.
Have you had the chance to work at an organization where the marketing lead was obsessed with filling up a pipeline with leads? Chances are, if you have been in marketing long enough, you have first-hand experienced the pain of being an SDR whose sole metric was the number of leads found per day.
This is an issue because even ins a digital marketing context, a lead is considered to be "an individual or organization that has expressed interest in buying what your business is selling". And, assuming by default that a higher number of leads equals more sales simply isn't accurate.
Actually, having a pipeline full of leads that do not care about your brand is a considerable problem (buying lists and spamming contacts rarely provides valuable results).
Leads are individuals who visit your site and engage with resources you have created to solve their problems. They are usually individuals who have a problem or are figuring out their problems and possible solutions. The marketing department's job, in that context, is to market a solution that solves that problem even if the person is not a decision-maker nor a potential customer.
To do that, and this is where inbound marketers tend to overlook outbound, you inevitably need to get in front of people with a problem you can solve. Sometimes, that means following inbound maxims and creating content that leads leads (see what I did there) to your product and solution. Some other times, it means you must heavily invest in ads to create awareness, develop interest, and close potential deals.
What matters and adds value to this conversation is that if your marketing team measures your lead acquisition teams in a binary (quantity vs. quality), you may be doing it wrong.
Not because the process is inherently wrong (having a healthy iterative pipeline to measure is crucial), but because there are a limited number of individuals who have a problem you can solve. Metrics become decontextualized from the product's and potential buyer's culture, and we forget that quality and quantity need to be synch for a product to thrive. Not in opposition.
We forget that marketing aims to add value and solve problems, not interrupt and spam people who have issues a product does not solve.
What is the problem of quality vs. quantity in lead acquisition?
The issue with thinking anything in a binary mindset is that we overlook the general principle behind what we are doing. Thinking of good and evil, positive vs. negative, and quantitative vs. qualitative narrows our understanding of what we do and why it matters.
In that mindset, it is natural to fall into an anxious metrics-driven framework (ignoring the person that embodies the lead). Or, if you prefer humanities, you may go the opposite route, finding few leads with a cultural affinity that almost allows you to predict a purchase. Unfortunately, neither of these options is accurate, nor should a marketer follow when thinking about leads and predictable revenue engines.
A better way to envision the challenge and the number of leads you can attract is to understand your ideal ICP, where they are in the technology adoption curve, and where they live online. Once you know these three factors, you can craft scoring systems that are less bidimensional (good vs. bad / MQL vs. SQL) and focus on understanding potential customers in a demographic and engagement matrix (just to give an example).
In a future article, we will develop this framework. Just remember that a lead is much more than what we have been taught to believe. And, the more you understand the cultural affinity plus how easily you solve your potential customer's problems, the better you can qualify, disqualify, and create predictable revenue engines. Not everything is MQL vs. SQL, Marketing vs. Sales; the more you understand your potential customers as a spectrum with different psychographic, demographic, and engagement qualities, the more successful your lead generation processes will be.
And no, MQLs are not dead; terrible marketing is, though.
Poor leads are leads that are disconnected from the company's vision.
Being an SDR and/or BDR is hard work. Your daily routine consists of understanding every lead that comes in, finding new leads, and providing a sales pipeline that sales representatives further develop.
In a nutshell, SDRs and BDRs touch every lead and filter out the ones that aren't good fits. But, what happens when you have to do this process day in and day out? You may start to overlook the person behind the lead and focus on numbers exclusively.
However, the best SDRs and BDRs usually go a step beyond the numbers and focus on adding quality leads to the pipeline.
That is, of course, if you manage your leads internally.
What happens when you end up adding third parties to the equation? In a sentence: you may burn your brand by actively engaging with people who may have the problem you can solve but have no interest in your product.
To better understand this process, it is essential to know what happens behind the curtain and how it may hurt your brand (and your sales stats) more than you imagine.
Buying leads usually works like this:
You contact a team that promises you the exact ICP you are looking for for a fraction of what it will cost you.
They hire a team of people who are not interested in the company's vision (growth), but with the minutia and annoying nature of finding thousands of leads (quantity). Because, as we mentioned above, the number of leads seems to be the primary metric overlooking quality.
You reach out to the leads you think might be your ideal ICP, and surprisingly their responses are negative.
What is the problem?
It is not that your outsourced leads are inherently a bad fit for your organization. Instead, what is happening is that your organization is not going through the effort and the actual nurturing process required for those potential customers to be ready to buy your product.
A better strategy is to focus on bridging the gap between Brand and Performance Marketing (being in front of people with a fantastic user experience via PPC to develop awareness).
You need performance to build a pipeline of leads, develop awareness across your ICPs, and become a salient brand in a hyper-competitive world.
Good leads are humans who develop trust in your product or service. And trust cannot be pushed.
In the post-truth world, people want brands they can trust. We are constantly exposed to ads, and to be honest, most of them are pretty terrible. Even worse, many of them are click-bait images with products and services that are not only uninteresting but also scammy.
However, the great ads that touch upon something we are interested in and present a real problem/solution are memorable, and can potentially become products we are willing to purchase. In that sense, an invitation we want to bring forward for marketers is to reframe PPC as an awareness tool that allows potential customers (leads) to develop an interest in your brand and product.
In fact, to do brand properly, we believe organic alone might not be enough. Rather, getting in front of your ICPs and providing value (not only push for sales) is a much more effective strategy in the long run.
It is time we get over the brand vs. performance. This false dichotomy misses the fundamental problem in the digital marketing world: trust.
As Byung Chul-Han argues in his book Non-things: Upheaval in the Lifeworld, back in the industrial age, we could touch products and determine to buy them (eroding human experience from nature and artisan practices). Now, however, we cannot physically feel most of the things we value and purchase, and the brands that succeed are those who plug trust into the purchase of non-objects.
In other words, and less philosophical, to triumph in a saturated and post-truth digital advertising world, our job as marketers is to make your product is as tangible and grounded as possible. To easily visualize the benefits of having such a product and delivering on the promise we crafted to develop trust.
Users need to understand why they need your product, how to use it, and why it provides value. To do so, you need a brand that rings a bell (qualitative insight in a world devoid of meaning) and a performance strategy that works (quantitative insight in a world that drowns in data).
What is the problem?
Marketing teams forget digital products are abstract, and to win, you need to ground everything about the product as much as possible. By doing so, you earn trust and, ultimately, sell.
We see this trend of focusing on the user behind the screen and letting go of performance marketing as intrusive and unnecessary as long as you differentiate your brand. Unfortunately, this concept is simply not true. What we may need, instead of focusing on either brand vs. performance, user-centric vs. product-centric, and so on, is to focus on reconciling and connecting our humanity with our digital nature. We need both performance and brand.
Forget about leads (MQLs, SQLs, Lead scoring, etc.) and remember that digital worlds are fuzzier and more predominant than ever. Our job as marketers is to build the bridges between users and their problems and our product and solutions. Of course, the way we get there (performance or brand) is irrelevant as long as we build the trust required for that person to choose us.
MQLs are definitely not dead. What is dead is bad marketing that detaches the importance of valuable Ads from the branding efforts.
Forget about leads, and remember that you are trading not just products but actual trust as a marketer.