A Source of Conflict
A continuous source of friction between salespeople and their managers is the question of... What constitutes a qualified lead? After monitoring and tracking contacts over a twenty year period, in a specialized market, I noticed that, as a general rule, I sold to 40% of my contacts, 20% of them bought from a competitor and the remaining 40% did not purchase at all in the six to eighteen months they were contacted after the presentation.

Does this mean that 40% of the leads were unqualified and that I should never have seen them? Or does it mean that those people were interested until they learned something about ownership they didn’t like? Maybe they were ready buyers until I, or one of my competitors, talked them out of it, or confused them. The truth is, it is probably a combination of all of these reasons, and more, that those people didn’t buy. Does that mean I, and the other salespeople (if any), should count these prospects as “qualified leads”? I will say “yes” because it is my experience that, from a management perspective, you must maintain that... “A lead is a lead is a lead is a lead.”

Most efforts, beyond establishing basic criteria, to prequalify people who will meet with you, in order to prevent wasting time, will result in a very high cost per lead. One application of the Power of 1%™ Calculator is to evaluate the effect of lead cost on net profit or commissions. By entering higher values under the expense or overhead sections and leaving all other values the same, you can see how increasing expenses affects the Power of 1%™ effect on your earnings.