Pay Marketing and Sales for MQLs

Tara Sestanovich

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January 27, 2021

Sales and marketing have closely linked responsibilities, so why do they rarely see eye to eye? Sales ignores leads from marketing because they are “bad leads.” Marketing blames sales for not working their leads.  If you are living in this dysfunction, or see that 50% of sales time is being wasted on poor prospects, it’s time to think about driving closer alignment between your sales and marketing teams.  Paying marketing and sales for working MQLs (or some shared pipeline metric) is an essential move. 

Why Sales Ignores MQLs

First, some definitions. We define an MQL (marketing qualified lead) as a lead that marketing shares with sales to contact (like “hand-raisers” or event attendees) and an SQL (sales qualified lead) as a lead that sales believes meets your internal qualification rules (ex. BANT).  

The transition from MQL to SQL is far from seamless. 85-95% of MQLs do not convert to SQLs.  From the sales perspective, this seems to be a bad use of their time compared to directly sourcing their own leads.  (Nevermind that few reps hit quota purely through self-sourced leads.)

No one likes doing work that results in failure; even though we know that pipeline losses are where learning happens.  

Why Everyone Loses When Sales Ignores MQLs

Generally, MQL outcomes can fall into four buckets:

  • Success!
  • Not now.
  • Not me.
  • Fail.

The outcome typically triggers additional marketing activities to support the pipeline:

  • Success! Sales support materials
  • Not now. Nurture and reengage in future
  • Not me. Create account-based campaigns
  • Fail. Redeploy investments to higher performing campaigns

Without that feedback, marketing does not know how to support sales. If you’re in sales and think marketing is not doing enough,  look in the mirror and see if you are giving your marketing team the data-driven feedback that they need.

Pay Marketing and Sales on MQLs

So how do you avoid becoming part of the 25% of businesses that describe their sales and marketing teams as either “misaligned” or “rarely aligned”?   Here are four steps to encourage alignment and turbo-charge your lead gen machine:

1. Create an agreed definition of an MQL

The “Q” in MQL is the important factor here, and sales should absolutely have a seat at the table.  What firmographics and titles are in your ICP?  What are the acceptable boundaries? 

2. Have a qualification checklist in your CRM for your sales team

The second step is to define the “Q” in SQL.  This should be transparent to your marketing and sales teams.  What are the factors that you can’t learn without a conversation?  

3. Pay both Marketing and Sales on leads that have a qualification checklist completed

This should be no more than 20% of your sales team’s variable comp, and no more than 20% of your marketing team’s total comp.  The point here is you are paying for the data, whether the MQL becomes an SQL or not.  This builds the habit of picking up all leads from marketing.

4. Review the data and refine the MQL definition

As you have more data and your business continues to grow, you will be able to further refine your MQL definition.  This will over time lead to more SQLs, better nurture and account-based campaigns, and improve the lead quality overall.

In Conclusion

Paying sales and marketing on MQLs is a small investment that will help your sales team hit quota, but the value of the alignment will massively increase performance.  It’s shown that proper alignment of marketing and sales teams have impacts further down the pipeline, including  38% higher win rates and 36% better customer retention.

So do it!

Next Steps

Read our other tips for CS comp plans. 

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