How to Improve Lead Quality for a Better ROI

min read
How to Improve Lead Quality for a Better ROI

Does your marketing team need more leads or better leads? This is kind of a trick question, because “more” doesn’t always mean “better.” After all, it’s value, not volume that spurs marketing success. You can have a ton of leads, but if sales can’t convert them to customers, they are essentially useless.

In this post, we offer guidance on how to improve lead quality so you can see a better return on your investment (ROI) in generating and pursuing those leads. We’ll look at how improving lead quality can help reduce costs for your marketing operation. And you’ll get concrete examples of ways to improve lead quality, like conducting more efficient lead tracking by using call tracking software.

First, let’s explore what we mean by “lead quality” and what metrics you can use to assess it. 

Understanding Lead Quality

Lead quality has a direct impact on the success or failure of your sales and marketing strategies. Higher-quality leads deliver more conversions, which means higher sales and overall business success.

Leads are targets who already know about your company or product and want to know more.  We’ll dig into this more later, but high-quality leads come from digital sources such as online searches and website visits, and from face-to-face and phone interactions. The key for marketers is to be able to track all valuable leads from every source. 

Key Metrics for Assessing Lead Quality

How do you assess the quality of a lead? Here are some measures you can use to gain a deeper understanding of your lead:

  • Lead Source: If a lead placed a phone call looking for more information, visited your website, or filled in an online form, they already know about you. That makes them a strong lead. Examples of bad leads can be found on dated and inaccurate marketing lists you’ve purchased, or from poorly targeted mass marketing campaigns.

  • Lead Conversion Rate (LCR): LCR measures the percentage of leads that successfully convert into paying customers or take a specific, desired action, such as signing up for a service or a newsletter. It indicates the effectiveness of a marketing or sales campaign in converting potential leads into actual revenue-generating customers.
  • Lead Score or Grade: Lead scoring uses activity and behavior data and scoring criteria to tell you if a lead is ready to convert. Lead grading is a broader approach that tells you if a lead is an ideal customer, based on your ideal customer profile.
  • Engagement Metrics: Any touchpoint between you and your customer can be a valuable measure of engagement. Examples range from bounce rates on websites to formal Customer Satisfaction (CSAT) scores.
  • MQLs vs. SQLs: Marketing Qualified Leads (MQLs) inhabit the top of the sales funnel. These leads are in the early stage of research into your product, so it’s marketing’s job to engage them. If marketing does its job, MQLs move further down the sales funnel to become Sales Qualified Leads (SQLs). Then, it’s the sales team’s job to guide SQLs to a purchase.
  • Customer Acquisition Cost (CAC), Customer Lifetime Value (CLV), Cost Per Lead (CPL): These are all key performance indicators (KPIs) that marketing can use to show lead quality. If you can generate a lead and convert them into a paying customer at a lower cost than projected, that means you had a good lead. And, if a lead becomes a paying customer who makes repeat purchases and referrals, then you can confidently categorize them as a high-quality lead.

Identifying Low-Quality Leads

Of course, you want to focus your resources on cultivating leads that can help you boost sales and revenue and generate greater CLV. This four-step process can help you weed out low-quality leads so you can do just that.

1. Understand Lead Quality

Not all leads are equal. You must establish clear criteria for what constitutes a high-quality lead based on demographics, firmographics, and behavior and use that data to guide your marketing outreach.

2. Measure Lead Quality Using a Lead Scoring Model

Develop a lead scoring model based on lead behavior and demographics to objectively evaluate and prioritize leads based on their fit and readiness to purchase. Use this model to measure lead quality.

3. Divide Leads into Segments

Once you’ve measured lead quality, you can divide the leads into segments. Start with the highest-quality leads — the ones that most closely align with your ideal customer profile.

4. Remove Bad Leads

After you complete the first three steps, you should be left with a pile of obvious bad leads — the ones that waste your resources and don’t deliver. Once you’ve isolated them, toss them out!

Qualifying and Nurturing Leads

To make the most of good leads, you need to develop them. This is where lead qualifying and lead nurturing come into play.

Lead Qualification

Lead qualification is a process that involves lead scoring and grading. It helps you determine how valuable your leads really are. And it provides your team with the intelligence to marshal the resources needed to make outreach more effective.

Lead qualification can be based on demographic, psychographic, and behavioral data. You can supplement this data by asking your leads basic questions such as, “Are you looking to purchase something in particular?” and “When are you planning to make a purchase?” 

Lead Nurturing

Once you’ve qualified your leads, you’ll want to cultivate them. Building relationships with qualified leads at every stage of their customer journey helps guide them toward a transaction.

This process involves engaging with customers through various channels and providing relevant information, resources, and support to guide them toward making a purchase decision. Your aim is to foster trust, maintain communication, and ultimately, turn leads into loyal customers.

Lead tracking is an effective tool to aid in your lead nurturing efforts. You need to know where a lead originated from and how close that potential customer may be to purchasing. This information can be easy to determine when you’re following a lead’s digital data trail online. But what if your business conducts sales over the phone? Not a problem. You can tie customers’ digital journeys to phone calls if you use the right call tracking software.  

5 Strategies for How to Improve Lead Quality

If you’re looking for specific tactics to improve lead quality, we have some suggestions. Here are five straightforward strategies to consider using.

1. SEO and SEM

You can attract better leads to your website through search engine optimization (SEO) practices that ensure you employ compelling meta descriptions and relevant, targeted keywords. SEO will help you attract better organic traffic and improve the visibility of your brand on search engines.

As part of a search engine marketing (SEM) campaign, you can launch targeted pay-per-click (PPC) advertising campaigns using platforms like Google Ads to capture leads actively searching for your products or services.

Make sure to include artificial intelligence (AI) in your PPC strategy, such as Google Ads Smart Bidding. The use of AI in PPC ad campaigns makes targeting and deploying campaigns easier and much more effective.  

2. Social Media

Social media can provide you with a wealth of quality leads, provided you’re using the best platforms to reach your target audiences with organic and paid social media campaigns.

If your primary demographic is younger women, for example, you will want to make sure that YouTube is a prominent channel for your social media outreach since 83% of women and 93% of 18 to 29-year-olds frequent the platform.

3. Blog

Relevant, informative, and engaging blog content can be a highly effective tool for nurturing leads. Optimize blog posts for search engines with relevant keywords, internal links, and structured data markup to improve discoverability and organic traffic.

4. Email Marketing

Email marketing campaigns with personalized content, engaging subject lines, and compelling calls to action (CTAs) will draw in and help you retain better leads. Use lead data such as name, location, past interactions, and purchase history to increase engagement and conversions.

5. Revenue Execution

Making sure that marketing and sales fully align across every channel in the customer journey can enhance lead quality, reduce costs, and drive revenue.

Platforms like Invoca can close the gap between a customer’s digital (online) and offline (phone) journeys, enabling marketing and sales to optimize their efforts and focus attention on high-value leads with the best chance of generating revenue. This helps your teams collaborate more effectively around the shared goal of driving revenue and CLV. 

The Long-Term Impacts of Improving Lead Quality

In addition to driving revenue execution and growth, you’ll see several other benefits from improving the quality of your leads. They include:

Sales and Marketing Efficiency

Higher-quality leads mean less work for your sales teams by reducing inside sales workforce needs. That leads to cost savings and resource optimization.

When you use a revenue execution platform like Invoca, you can track the quality of phone leads using AI to analyze every conversation. This ensures you’re tracking, qualifying, and nurturing only the highest-value, highest-quality leads.

Increased Financial Stability

Higher-quality leads are more reliable as purchasers than lower-quality leads. They are also more likely to deliver repeat business. So, taking care to qualify and nurture quality leads can positively impact the company’s bottom line and overall financial stability.

Enhance Customer Acquisition and Retention

Improved lead quality allows your marketing and sales teams to focus on fewer — but better — leads. The results are more effective efforts to acquire and retain customers. High-quality leads are more likely to convert to customers. And because they receive more personalized attention, they are also likely to become satisfied and repeat customers.

Improve Customer Lifetime Value

Happy and loyal customers are more likely to become your long-term customers. Less churn means higher CLV, which can give you a competitive advantage in the marketplace and help you drive growth and achieve long-term profitability.

Strengthen Brand Trust

Attracting and keeping high-value customers can help improve brand reputation and image, too. Having a strong brand identity boosts industry credibility and attracts more high-quality leads. 

How Revenue Execution Platforms Help Teams Improve Lead Quality

By prioritizing lead quality and investing in strategies to attract, nurture, and retain high-value customers, your business can achieve sustainable growth while creating lasting value for your customers and stakeholders. You also need the right tools.

Solutions like Invoca can provide marketing and sales teams with acute insight into the quality of phone leads driven by marketing campaigns. The technology also helps you gauge how well your sales agents are closing leads over the phone. In short, it serves as a revenue execution platform that helps keep your marketing and sales teams aligned and making the most of high-quality leads.

Invoca can show marketing and sales teams how to improve lead quality in the sales funnel, close more deals, and increase revenues. Forrester recognized Invoca among notable vendors in The Real-Time Revenue Execution Platforms Landscape, Q1 2024. Check out the report, which outlines the value of real-time revenue execution platforms, use cases, and what to look for when choosing a vendor. 

Additional Reading

Want more tips on how to improve lead quality and drive revenue? See these resources:

Reach out to us today to schedule a customized demo so you can see for yourself how Invoca can give you insight into the quality of the phone leads your marketing efforts drive.

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