MQL (Marketing Qualified Lead) and SQL (Sales Qualified Lead) are two KPIs and metrics that are highly beneficial to B2B software companies. These lead types indicate lead velocity, which is a precursor to identifying future business growth. An MQL is a lead that has engaged with marketing activities, however, has not been “qualified” by the sales team. An SQL is a lead that has engaged with the sales team and is making its way through the sales process.
Key Takeaways
- An MQL is considered a lead that matches the ideal customer persona (ICP) of the business and generates demand for the company. When an SQL is that same ideal customer persona (ICP) that has engaged with the sales team in a manner that shows interest in what the company offers.
- Creating MQLs is usually a precursor (demand generation) to capturing that demand for the sales team. The generation of MQLs usually leads to an increase in SQLs.
- Both MQLs and SQLs who are not the ideal customer persona or buyer persona are not considered to be actual “qualified” leads.
MQL vs. SQL
An MQL is a lead that has engaged with certain B2B SaaS marketing activities. This would be a measurable lead that has done something like the following:
- Signed up for an email newsletter.
- Signed up for a virtual webinar.
- Signed up for an offline event.
- Signed up for a private community.
- Signed up to receive a software demonstration.
What makes the MQL (Marketing Qualified Lead) important is that they are opportunities to then further convert those Users or prospects into potential customers. An MQL can be considered demand generation, which is the creation of interest in the software product.
In contrast, the SQL (Sales Qualified Lead) is considered demand capturing. Where the MQL then begins the sales process. In most software companies, this is when the MQL schedules a software demonstration with an account manager and learns more about the solution. At that point, once the prospect has shown up to the software demo, they are considered a sales-qualified lead.
What an MQL is not
An MQL (Marketing Qualified Lead) is not one of these things:
- A person with the intent to fill any form that isn’t the Ideal Customer Persona (ICP).
- A person with the intent to fill any form that doesn’t have interest in the software solution.
What an SQL is not
An SQL (Sales Qualified Lead) is not one of these things:
- A person who has the intent to learn about the business rather than the software solution.
- A person who doesn’t show up to the software demonstration.
- A person who doesn’t move down the sales funnel (moving from demonstration to contract stage).
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Why MQL and SQL matter to B2B companies
If you have a B2B software solution that relies on fixed-term contracts, where the customer is bound to a specific period of time for using the software, your sales team is the people who close prospects and turn them into customers.
The largest difference between these two KPIs and metrics is the buyer’s intent to buy (or intent to purchase the software). An MQL can be any person who engages with top-of-funnel strategies. These could be content offers, free downloads, and other ways of generating inbound demand for the software.
An MQL will often get placed into lead nurturing campaigns, which have the intent and potential to take that prospect and turn it into an SQL (usually this pivotal point is when they choose to schedule a software demonstration).
Without MQLs then SQLs are less likely to occur. Or, the channel(s) is less likely to succeed (general B2B marketing activities).
Related: SaaS Marketing Metrics
Think of the importance of both metrics like this:
- MQLs are considered demand generation: creating interest in the company, the offerings, and the software.
- SQLs are considered demand capturing: when the demand that’s been created through marketing activities moves to potential customers.
Types of Activities That Generate MQLs
Here are the types of activities that generate MQLs (Marketing Qualified Leads):
1. Content Marketing
- Blog Posts: Creating and publishing SEO-optimized articles addressing audience pain points.
- Case Studies: Showcasing real-world success stories to build trust.
- Statistics and Reports: Shareable content that helps distribute industry statistics.
2. Lead Magnets
- Webinars and Online Events: Hosting live or recorded webinars or events on industry-relevant topics.
- Free Tools and Templates: Providing free and helpful resources, calculators, or checklists.
- Exclusive Content: Creating gated content behind a sign-up form.
3. Email Marketing
- Newsletter Sign-Ups: Providing consistent value through ongoing email updates.
- Drip Campaigns: Sending tailored sequences of emails to nurture leads based on their interests.
4. Search Engine Optimization (SEO)
- Organic Traffic: Attracting users through high-ranking, informative content.
- Pillar Pages and Topic Clusters: Creating comprehensive content hubs that link to relevant resources.
5. Paid Advertising
- Search Ads: Targeting high-intent keywords to capture interest.
- Social Media Ads: Running targeted campaigns on platforms like Facebook, Instagram, and LinkedIn.
- Retargeting Campaigns: Re-engaging users who previously interacted with your website or ads.
6. Social Media Marketing
- Live Streams: Directly connecting with your audience in real time.
- Groups and Communities: Building relationships in niche communities.
7. Website Optimization
- Landing Pages: Creating conversion-optimized pages focused on specific offers.
- CTAs (Call-to-Actions): Strategically placed buttons or forms encouraging engagement.
- Interactive Pages: Quizzes, polls, and surveys that capture visitor information.
8. Events and Networking
- Industry Conferences: Collecting leads from event attendees.
- In-person Workshops or Meetups: Building connections and trust through face-to-face interactions.
Types of Activities That Qualify an SQL
The SQL (Sales Qualified Lead) is generally marked as such when the following activities occur:
1. There’s a Scheduled Software Demonstration
If you’re a SaaS business, when a software demonstration occurs, the MQL is marked in a CRM (like Salesforce or Hubspot) that has shown interest in wanting to receive a software demonstration for their pain points.
2. The Buyer Persona is Confirmed
When the buyer persona is confirmed to be a contact that is considered to be a “decision maker,” the MQL may turn into an SQL. This is when a contact that appears in the CRM matches the ideal customer persona (ICP) for the sales team. At this point, the MQL may turn into the SQL if the team chooses to perform direct outreach to that contact.
3. The Contact Stage Changes in the CRM
If the contact stage changes from “contacted” to “meeting scheduled” or some other type of status in the sales CRM or sales process, this may move the contact from being an MQL into an SQL. For the BDR and SDR (business development representative and sales development representative) the ideal stage is moving that contact from “scheduled” to “contract sent.” The contract sent stage is the most lucrative for the sales team as it allows them to control and impact the average conversion rate for contracts sent.
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November 26, 2024
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