B2B businesses follow a lead qualification process where a lead is deemed marketing qualified (MQL) by the marketing department and then passed on to the sales team. The sales team then determines which leads are sales-qualified and tries to convert them. This is a standard procedure, but for SAAS companies, customer acquisition model has changed in the past few years. Surveys have found that more than 50% of B2B SAAS buyers now prefer to do their own research and complete the buying process without talking to a sales representative. Customers want to see things for themselves before they decide to commit. This is the reason why almost every software company now offers a trial of some sort. The users that sign up for the trials may not have attributes that fall under the marketing qualification criteria but may still be qualified. These leads although qualified would be ignored. For SAAS, the sales cycle is longer than other B2B industries and for companies who run the freemium model, qualifiers are more complicated as there is no set time-frame.

The Gap Between MQLs and SQLs

Once leads enter the funnel, they are Marketing Qualified based on their profile and behavioral attributes. This includes demographic qualifiers, company profile qualifiers and behavior triggers such as filling out forms or reading emails to determine if a lead is a good fit. The data looks sufficient but a benchmark report published by Salesforce found that only 13% of Marketing Qualified Leads became Sales Qualified and took 84 days to convert. Only 6% of those became paying customers. The huge gap proves that the traditional Marketing Qualification procedure is not good enough for the SAAS model. And, it also puts the burden on salespeople as they have to pursue leads by calling them only to later find out that most of the leads provided to them are not sales qualified. SAAS companies need a qualification system that takes into account how prospects engage with the product along with regular marketing qualification attributes.

Product Qualified Leads (PQL)

A product qualification (PQ) system analyzes product engagement to determine if the lead is getting proper value to consider a purchase. The qualification of a lead is determined based on a lead’s usage signals. Make no mistake, a lead who signs up for a free trial is not a PQL. It is his actual in-app usage that determines his qualification. While the PQL checkpoints are different for every software, you can get an idea by answering these questions:

  • Has the lead completed his account setup?
  • Is the lead using the product actively?
  • Which features are they using the most?
  • Has the lead reached an important product milestone? (Eg: Adding a team member or reaching free account limits)
  • Has the lead received quantifiable value from the product?
  • How fast is your lead adopting the product?
  • Will the user actually benefit by switching to a paid plan?

The Qualifiers That Fit Your Product

Like we mentioned before, the qualifiers differs from product to product. For a social media company, PQ might mean adding profile information and adding 10 friends. For a chat application, PQ can be sending 100 messages. For a CRM like Pipedrive, PQ can be adding 50 leads and moving them through the pipeline. What does your Ideal Customer Profile look like? What are the actions that you expect them to perform? How do accounts of your existing customers look like? Do they use any competitor products already?

Some attributes that you can use to qualify leads:

Product usage

This qualifier is pretty straightforward. Based on your ICP, you already know how active a user needs to be a serious prospect. Is the product mission critical for the lead or is it something that is good to have? You can qualify leads based on how many times they use your product every day or how many trigger actions they perform. For example, for a CRM company, importing leads daily can be an important qualifier.

Crossing usage limits

All freemium products have usage limits on their free plans. If a lead is about to cross the usage limits, he/she may need an upgrade. Dropbox offers 2GB of storage in their free plan. People who are on the verge of crossing the limit may need to upgrade.

Adding users to account

If a lead has added team members from their company, it is a good indicator that they are trying to adopt your product. Based on your ICP, you can create triggers to qualify leads based on the number of users joining from the lead’s company.

Integrating your product with their framework

If the lead integrates your product with other software they use, there is a good chance that they are trying to fit your product in their existing framework. A significant product qualification attribute can be frequent usage of activated integrations.

Features used

Is there a particular feature or a set of features that your high-value customers use? If a lead is using high ticket features frequently, it would mean that they are more qualified for premium plans than other free users.

Once you figure out what triggers define a qualified customer, setting a PQ framework is pretty simple with the right data and tools.

Product Qualifying Leads with Salespanel

Salespanel helps you find your PQLs by letting you segment and score your leads based on in-product user behavior. Salespanel tracks your leads system-wide in real-time. You can create workflows to filter out users who perform a specific set of activities or assign lead scores based on triggers. You can also send leads who are determined as PQL straight to your CRM with complete automation. Salespanel will help you show personalized content and emails to your leads. Add them to activation drips, show them relevant messages and turn them into paid customers.

Combining the power of Marketing Qualification and Product Qualification

The product qualification framework does not eliminate the need for MQL attributes. It does not matter how PQ your leads are. If they don’t have the decision making power or the budget to purchase your product, they won’t purchase your product. So, profile and behavior attributes like job role, company size, pricing evaluation, etc. still matter and need to be used along with your product qualifiers.

With the data provided by Salespanel, you can create the perfect qualification framework for your business and transfer high intent leads straight to your sales pipeline. Let your sales team talk to your sales-ready leads and finish the job with high conversion rates. Everybody wins.

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