January 01, 2014

Lead generation vs sales

lead generation vs sales - CRM interfaceMarketers often use key performance indicators (KPI) to measure the effect of their efforts. KPIs are metrics that help analyze and report on website and marketing campaign performance. Leads and sales are deep KPIs that also demonstrate a return on investment. When determining whether you should track lead generation vs sales, you will need to understand your sales process to make an appropriate determination.

Not all organizations can use sales as a KPI. Some sales cycles are too complex, interconnected or long for a single web transaction. B2B sales cycles, for example, are often longer than B2C and require a more immediate metric to determine the effect of a campaign. Leads are perfect for many such organizations. Generating a lead is a major step towards completing a sale.

A lead is a demonstration of interest in a brand, product or service. A prospect who has encountered a brand or message and decided to provide their contact information in exchange for content or an offer (whitepaper, demo or pricing information) can be considered a lead.

Salesforce CRM - leads vs sales

Above is an image of a Salesforce CRM report. The sales lifecycle can be tracked using an enterprise CRM or a marketing automation system--most often in combination with both. Simple KPIs can be measured with a web analytics tool like Google Analytics. For closed loop marketing there are tools that help close the gap between website activity and activity within the sales process. These tools are commonly referred to as marketing automation systems--examples include Hubspot or Marketo. Marketing automation can help with up-sell activity and post-sale customer engagement as well as pre-sale.

Difference between lead generation and sales

  • A lead is near the beginning of a sales process.
  • The final action in the process is the sale conversion, which can be many things: cash purchases, signed contract, subscription or some type of engagement.
  • A lead should be voluntary--coercion or trickery does not help a sales process.
  • A lead helps measure interest and typically adds a new contact to a business CRM.
  • Leads can be nurtured into a sale conversion
  • A sale is typically the final determination of return on investment, unless an organization is focused on lifetime value of a relationship--which may involve the measurement of numerous sales, engagements, communications and referrals over time.

Common marketing to sales lifecycle

  1. Prospect
  2. Subscriber
  3. Lead
  4. Marketing qualified lead
  5. Sales qualified lead (sales-ready lead)
  6. Customer (after point of sale)