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What is lead management and how do you do it right?

By Luke Strauss · August 16, 2023
Icons of three people representing leads and contacts grouped together against a yellow background.

When I was a kid, our family dog would always chase after squirrels in our yard. One day, she finally caught one, and guess what she planned to do with it? She had no idea—and neither did we. She ultimately dropped it, and we watched it scurry away.

Lead generation is essential to growing your business, but without a lead management strategy, you're just catching squirrels with no plan.

In my time working for a marketing agency, I've witnessed the benefits of an effective lead management strategy firsthand—and in this guide, I'll unpack what lead management is and how to do it right.

Table of contents:

  • What is lead management?

  • The importance of lead management

  • 7 stages of the lead management process

  • Best practices for lead management

  • How to choose a lead management system

  • Automation for lead management

What is lead management?

Lead management refers to all the ongoing processes involved in attracting leads (potential customers), qualifying them, and using targeted strategies to convert them into customers.

The importance of lead management

Lead management is the backbone of the sales process. It's about collecting qualified leads—those who align with your target personas—and driving them through the lead lifecycle as efficiently as possible. It's a very active and continuous process, requiring you to follow up with leads quickly, segment them appropriately, and assign them to the appropriate sales reps, following up at the right intervals.

In addition to streamlining the path to conversion, effective lead management:

  • Enhances the customer experience. By ensuring your leads receive relevant information, you don't accidentally annoy them with irrelevant marketing content.  

  • Saves you time and resources. Understanding which leads are most likely to convert allows you to focus your marketing and sales efforts where it counts. 

  • Increases profit. By nurturing the right leads with the right information, you close more sales, ultimately boosting your bottom line. 

And when you combine your lead management process with the power of automation, it can be a largely self-sufficient relationship-building machine.

7 stages of the lead management process

"Lead management" is one of those broad terms that encompasses a lot of steps and strategies (kind of like the term "marketing"). Don't catch squirrels with no plan—here's a step-by-step process on how to effectively perform lead management.

1. Lead generation

Before you can drive qualified leads down the lead generation funnel, you first need to gather their info. Lead generation is about providing the right "doors" for prospective customers to enter. The most obvious place to collect leads is your company website—think newsletter sign-up pages, product demo CTAs, and other gated content that offers your target audience something of value. You can also use social media, email marketing tactics, and other lead generation tools to collect information about your audience.

You'll want to get their email address (that's the bare minimum), their name and industry/role, and maybe their phone number, depending on how your business operates. Plan how you'll organize this information in your CRM so that it works with your existing marketing strategy.

2. Lead qualification and segmentation

A flowchart outlining the lead management process with a list of automation tips beneath it.

Not all leads you collect will be ones you want to pursue actively. Some leads may join your lists out of curiosity, but may not be the type of customer you want to attract, if they're interested in your product at all. Don't waste your sales team's time by having them spend hours on the phone with unqualified leads. Vet them first.

Lead qualification is about ensuring you devote your time and effort to the right leads—specifically, the members of your target audience who are ready to purchase your product or service. If you don't have a lead qualification process in place yet, it's important to devote resources toward developing one.

For example, you may require a lead to describe their role and their organization's needs when they sign up for your newsletter or download gated content. If this information doesn't fit your target customer, segment them into an "unqualified leads" group or a more specific category that you may target down the road.

3. Lead nurturing

Most leads aren't ready to buy the first time they interact with you. To nudge them through their customer journey, you need to nurture them. Lead nurturing allows you to stay in touch with potential buyers until they're ready to buy.

Providing leads with relevant content helps them get to know your brand better, feel understood, and learn how you can help them. This all builds trust—and keeps you top of mind when they're ready to make a purchase.

The content you use to nurture leads will depend on your audience, but I'm describing things like:

  • Blog articles

  • Email campaigns

  • Customer success stories 

  • White papers

  • eBooks

  • Infographics

The marketing team will likely create this content, but the sales team can provide feedback on its effectiveness and the types of questions potential customers are asking. Sales reps can also help marketers identify content gaps that need to be filled to help buyers in their decision-making process.

Keep in mind: While lead nurture starts the moment someone interacts with your brand, it doesn't finish once they're passed along to sales—or even once they purchase. You'll continue to nurture your leads (and customers, once they convert) throughout the buying process.

4. Lead scoring

Lead scoring is the process of identifying sales-ready leads, so you know when to pass leads over to the sales team to contact them. To score a lead, you'll use all the insights you gathered and score them against the description of a sales-ready lead you created in the lead qualification process.

Lead scores are a numerical (or at least, less subjective) representation of the interest the lead has shown in your business, their current stage in the buying process, and how well they match your ideal customer profile.

You're not going to be putting gold star stickers on pictures of people's faces or anything—your CRM software should do most of the work for you. And because it's automatic, the timing will always be right. As you know, timing can be the difference between winning or missing out on sales.

Here's the general process:

  • You tell your CRM what point values to assign to specific demographic information and various activities, such as event attendance, visits to certain web pages, content downloads, and form submissions.

  • As leads come into the CRM during lead gen, the CRM starts scoring them automatically against your criteria.

  • When a designated score is reached, your CRM notifies the sales team to further qualify and advance through the sales process. 

Getting this right means not wasting time on unqualified leads, which, in turn, gives sales reps more time to speak with prospects who are ready—at the exact moment they're ready.

Initially, it's best to err on the side of caution and hand leads over to sales earlier—and, if necessary, have them passed back for more lead nurturing until they're ready. Based on this kind of feedback, you can adjust your lead scoring over time.

5. Lead distribution

Once leads have passed through the lead scoring process, they need to be sent to the sales rep best equipped to help them. You'll consider things like:

  • Geographic location (aligned with the prospect)

  • Seniority

  • Experience selling to a specific industry or customer type

  • Performance

  • Availability to respond to the lead fastest

Of course, not all of these apply to every business. Which elements you prioritize will be based on your industry, what you're selling, and various other factors.

In some cases, you might just send out leads to reps in consecutive order or even allow reps to select leads from a pool. But having sales leadership involved in these decisions is important—they know which reps will be able to best help the people who are ready for them.

Just like with lead scoring, once you define criteria in your CRM or marketing and sales automation tool, it'll do the distribution for you.

6. Convert leads

Converting qualified leads into paying customers is the whole purpose of a lead management process.

But a closed deal doesn't automatically signal the end of the lead management process. Let's say there's potential for a customer to upgrade their plan. Or you want them to repeat their purchase. In either case, you'll repeat the process of nurturing your leads (stage three) through to another purchase.

7. Tracking and adjusting

Lead management is an iterative process. You need to track which leads end up as paying customers, what worked, what didn't work, and where improvements can be made. You'll be looking at metrics like the length of a sales cycle after a lead is handed off and percent of leads closed by sales reps. Combined with feedback from the sales team, you'll be able to tweak your lead management processes over time.

Once again, all the tracking will be automated in your CRM. Most CRMs offer one-click reports to give you information on your primary metrics, or you can set up more complex reports to track the metrics that are most important to you.

A circular flow diagram showing the cycle of the lead management process.

Best practices for lead management

The lead management process is easier said than done. So I consulted with an expert in strategic partnerships to develop some proven tips on how to collect, manage, and hold onto your leads.

  • Automate inbound lead qualification. If you don't have a lead qualification framework in place, it's time to develop one. Use your CRM and other tools to automate this process, identifying what qualities constitute a sales-qualified lead (SQL) and segmenting these leads so they can be quickly handed over to your sales team.

  • Don't leave your SQLs waiting. When an SQL inquires about or expresses interest in your offerings, forget about the "respond within 24 hours" rule. To maintain momentum and continue driving them through the lead lifecycle, your sales team should respond to them as soon as possible.

  • Reduce time to value. The last thing you want is for leads to bounce because you haven't provided them with some immediate value. Quality top-funnel sales enablement content demonstrates you have something to offer, so provide useful material for your audience in this content while incentivizing lead generation through gated content, newsletter sign-up forms, and other strategies. Go a step further by adding targeted, value-additive suggestions when conducting outbound outreach.

  • Play the long game. Not every lead will qualify as an SQL right off the bat, but that doesn't mean you should ignore them. Lead scoring has its place, but some leads take a little longer to warm up to your offerings. Invest time and energy into all of your leads—some may just be on a longer sales cycle than others, and investing in them could pay off big in the long run.

  • Never stop nurturing. Whether your sales team closed the deal or not, support your account managers by identifying ways to expand deals or re-engage leads that have gone cold.

  • Measure your efforts. Some lead generation campaigns will inevitably be more successful than others. Actively monitor how well your campaigns perform to make wiser decisions about resource allocation.

An illustration of six tips for lead management success.

How to choose a lead management system

Please don't manage your leads by hand—let software support you. When choosing a lead management system, consider the following:

  • Industry fit: While most lead management systems are pretty broad and can be used in any industry, some are more geared toward supporting B2C companies, while others are more B2B-focused. Plus, some industries (like finance and health care) have strict compliance requirements that may limit your options.

  • Scalability: Does the system support all of your lead collection and categorization needs, even if your leads were to hit the thousands and tens of thousands? Some software comes with modular structures allowing you to add or remove certain functionalities to adapt to your business's needs.

  • User-friendliness: You want to strike a balance between customization and ease of use. The system you choose should be powerful and customizable enough to cater to your organization's unique needs without befuddling your staff. 

  • Cost: Have you assessed each system's up-front and hidden costs? You may need to upgrade to a more expensive plan as your organization grows or pay extra for things like installation or data migration.

Still curious about where to start? Let Zapier introduce you to the app categories you should be thinking about when putting together your lead management system.

Automation for lead management

Lead management should be a self-sufficient machine. Here are some ways to save time on lead management and other marketing operations processes with the help of Zapier:

  • Automatically track your leads. Whether you acquire leads from forms, ads, email campaigns, or all of the above, you can set up automation so that lead information is automatically moved into your CRM or a spreadsheet, making it easier than ever to track your leads.

  • Send personalized welcome messages. When a lead enters their information for the first time, there doesn't need to be a sales team member on the other side of the screen welcoming them. Automatically send a welcome email or text message personalized to their role or interests. Marketing automation can help you do this.

  • Automatically carry out nurture campaigns. Automations can also help you conduct lead nurture campaigns, automatically sending leads content such as discounts and event invitations throughout the buyer lifecycle.

Lead management doesn't have to be messy and tedious. Use Zapier to automate your lead management process so that you have time to craft the perfect strategy for captivating your prospects.

Zapier is the leader in workflow automation—integrating with 6,000+ apps from partners like Google, Salesforce, and Microsoft. Use interfaces, data tables, and logic to build secure, automated systems for your business-critical workflows across your organization's technology stack. Learn more.

Related reading:

  • Audit your lead management process

  • 6 fatal mistakes in lead generation strategy

  • How to build an email marketing list

  • The best digital marketing tools

  • The best sales tools for sales managers and B2B sales teams

This article was originally published in February 2022 by Margot Howard. The most recent update was in March 2023.

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