Lead generation, as part of the marketing and sales process, boils down to connecting buyers with sellers. The overall process can be very short, such as when a consumer lands on a web page and determines that they will make a purchase right then and there. (For example, buying a book or a DVD).
However, for businesses that have more expensive and/or complex products, as well as businesses that provide service offerings requiring person-to-person conversations, there is an inherently longer sales process. Of course the more expensive or more complex the offering, the longer the sales process.
Lead generation is a vital component of establishing the initial flow of potential customers or clients (beginning with an “inquiry”), who would then move through a sales process, ultimately resulting in money being exchanged. Of course, not every inquiry will turn into a sales-ready lead, and only a percentage of the those leads will become qualified prospects, and in turn, only a percentage of those will become customers or a clients.
Lead Generation Statistics
So, what would be some benchmarks for a lead generation and sales process?
The following chart from Sherpa sheds some light on to that question. This chart and statistics represent “Average Conversion Rates in the Marketing-to-Sales Process.”
“We wanted to know what percentages of leads in each stage of the pipeline are likely to advance to the next stage. As this chart shows, on average, nearly four in 10 leads move from initial inquiry to being sales-ready, and approximately the same ratio advance from sales-ready to qualified prospect. As might be expected, the trend deteriorates moving to the next stage where only three in 10 qualified prospects convert to a sale.”
It cannot be overemphasized that these numbers represent “averages.” The specific percentages along the various stages of the sales conversion process will be more or less effective depending upon the quantity of education required before buying decisions are made, as well as the quality of the information provided, and the effectiveness of sales personnel closing the entire process.
Regardless, the chart serves as a practical reference for marketers launching sales campaigns for which they have not yet established any metrics for comparison.