The Revenue Process Alignment Series, Part 1: The End Of MQLs
For years, the MQL (marketing qualified lead) has been the standard for sharing information about potential deals between marketing, the revenue development rep (RDR/BDR) function, and sales. Recently, a new alternative, the MQA (marketing qualified account), appeared in revenue processes as an attempt to shift the focus from insight about individuals to insight at the account level.
Unfortunately, both the MQL and MQA fail in providing optimal and actionable insight as the focal point in the revenue process. In addition, a focus on either the MQL or MQA often drives misalignment across the various functions in this process. In this four-part blog series, we’ll explore why it’s critical that marketing, the RDR, and sales agree to what is being shared as the focal point in the revenue process. The series will look at:
- Why the MQL era is antiquated and needs to end immediately (parts 1 and 2).
- Why the new MQA approach lacks the context to be a valid approach and should never be adopted (part 3).
- Why the opportunity approach is the best for optimizing an aligned revenue process (part 4).
The MQL Era Is Antiquated And Needs To End
For more than 20 years, the MQL has been the focus of most (if not all) B2B revenue processes. Individuals “raise their hand” as an inquiry or lead in response to a tactic in a marketing program (ads, website offers, emails, events). Leads are scored based on a combination of profile (explicit) and engagement (implicit) factors, and those leads that reach the scoring threshold magically become MQLs that are sent to either the RDR/BDR for qualification or are sent directly to sales. It’s been this way since the late 1990s, and it’s fraught with problems.
Waterfall benchmarks from Forrester show that the typical conversion rate from inquiry to close won of a lead-centric process (leveraging MQLs) is less than 1%. That’s less than one successful won deal for every 100 people who raise their hand to express interest. Let’s flip that around: The cross-functional business process that converts early interest from prospects to revenue fails more than 99% of the time; that’s tragic and expensive — and needs to change.
An MQL Is Not The Buyer
B2B buying decisions, especially when deals are large and complex, are made by buying groups, not an individual person, and the larger the deal, the larger the buying group involved. A recent report from Forrester shows that over 80% of buying decisions are made by a buying group of more than three people. Individuals participate in the decision process as buying group members with specific personas and roles such as influencers, users, champions, or decision-makers, but it’s the team that makes the decision. Good salespeople know that they must gain support from multiple people across the team. Sales also knows that the MQL provided by marketing and the RDR/BDR provides a very limited view about this team, and it’s often up to sales to identify additional team members and gain consensus across the buying group without the help of marketing.
The MQL Definition Is Typically “Made Up”
One of my favorite TV shows is the ad-lib comedy show “Whose Line Is It Anyway?” where comedians ad-lib humorous skits to win a friendly competition. Drew Carey, the show’s host, is known for his famous quote of “Welcome to ‘Whose Line,’ where everything is made up and the points don’t matter.” This quote is a perfect reflection of most lead scoring strategies used to define MQLs today. Scores are assigned based on a combination of profile characteristics and engagement for a single individual. The issue is that the points for the profile and engagement factors (such as downloading a whitepaper) and the threshold on when to forward the MQL are typically based on guesses and random estimates, without any true analysis of propensity to buy. While the engagement of a single person can imply interest, the fact that someone binged and downloaded four whitepapers has minimal to no correlation to the true propensity to buy; it just shows that one individual was active, but the activity of a single person does not indicate that a purchase decision is imminent (or even being considered). So is a whitepaper worth 10 points or 40 points? Is the threshold 80 points or 200 points? Statistically, when the focus is based on only a single person, it really doesn’t matter.
MQLs By Design Ignore The Data Points That Matter
While the scoring of an individual person is a horrible predictor of propensity to buy, one data point that shows a much stronger correlation to purchase is the recognition of multiple signals all aligned to the same buying group and solution. Signals of engagement from multiple people increases propensity. Simply put, one person downloading four whitepapers is mildly interesting at best to the RDR and sales, but seeing signals from multiple buying group members has a dramatically higher propensity to buy. Unfortunately, though, most scoring models will respond with excitement to the individual binger and completely miss the more important signal of engagement across the group. This is because most MQL-centric processes look only at individuals and don’t attempt to merge these individual MQLs into a buying group.
Want to learn more about challenges with MQLs? Read part 2 of this series for more reasons why MQLs should be dropped. Think that the marketing qualified account approach is the answer? Not so fast. Click here to learn why the MQA approach may actually be worse, or click here to learn more about why focusing on opportunities is the new standard for the revenue process.
(Source: Forrester’s 2021 B2B Buying Survey)