4 Ways to Optimize the Middle of the Funnel | Lead Management
The middle of the demand generation funnel receives way less attention than it deserves. Test
At the top of the funnel, marketing increases traffic and fills the database with new leads through paid ads, social media, search, referral programs, and a variety of other channels. At the bottom of the funnel, marketing helps close the sale by creating urgency and helping prospects make the business case for purchasing the product or service.
But in between, marketing needs to nurture and qualify leads by encouraging them to engage with content until they’re sales-ready. It’s easy to overlook the middle of the funnel because it involves many different priorities, from quality to quantity to speed to customer experience, and it can be the most difficult stage to manage.
What exactly is the middle of the funnel?
According to SiriusDecisions Demand Waterfall, the middle of the funnel is the area where the marketing to sales hand-off (MQL to SAL) and the sales development representative (SDR) to account executive (AE) hand-off (SAL to SQL) happen.
The middle of the funnel, or MOFU, is like a valve. It’s where you can expand lead quality definitions to pass a higher volume of leads to your sales team, or tighten lead quality definitions to give them a more specific segment of qualified leads.
In most B2B organizations, marketing focuses on facilitating a successful hand-off to sales. The marketing team develops content to educate leads and identifies the leads who show buying intent by implementing a behavioral lead scoring model. They also spin up campaigns aimed at accelerating leads, such as limited-time offers, product trial campaigns, and case studies.
In the middle of the funnel, marketing aims to help the sales team prioritize their time by providing clear and accurate information on each lead. Concurrently, sales teams’ focus is on creating as many deal opportunities as possible from the leads they’ve received from marketing.
Why focus on the middle of the funnel?
With so many transitions happening during the hand-off process, the middle of the funnel has the biggest potential for misalignment between marketing and sales, as well as within sales. Below are some common bottlenecks that may arise during this stage.
Misalignment during the marketing to sales hand-off:
- Marketing does not pass enough leads to sales to create a sufficient number of opportunities that meets their revenue target.
- Marketing hands off enough leads to sales, but leads are hard to reach because they are not ready to consider a purchase yet and need more nurturing.
- Marketing sends too many leads to sales, and sales doesn’t have enough information about the leads to prioritize them effectively.
Misalignment during the SDR to AE hand-off:
- SDRs could have a hard time reaching the leads marketing passed to them.
- It can take too long for SDRs to create a list of sales-accepted leads for AEs.
By creating common definitions and goals, you can help alleviate sales and marketing misalignment. Here are some aspects you’ll want to understand and agree on:
- Lead volume helps determine whether your top-of-the-funnel marketing efforts are sufficient to meet sales’ revenue targets.
- Conversions measure lead movement from stage to stage, showing how marketing is performing throughout the entire sales cycle.
- Velocity is the time it takes a lead to move through the funnel, typically measured in days.
These metrics help marketing understand its impact on the business and where to prioritize their investments. Weakness in any one of these areas will affect revenue, so marketers need to keep a pulse on how the middle of the funnel is performing at any given time.
The middle of the funnel also presents some unique problems. Leads can become stagnant or cold here. They may stop responding to marketing content, which means that they aren’t qualified for a sales conversation yet. This can lead to slow velocity and restricted lead flow for sales. Fortunately, there are four key strategies you can leverage to tackle these problems:
1. Fight Low Lead Quality at the Source
Not all lead sources are created equal. Four metrics can be tracked for every lead source:
- Volume of MQLs
- % SQLs (opportunities created)
- % closed won (new customers)
- Average selling price (ASP)
While it’s helpful to dive into ROI goals for specific programs, these metrics help marketing stay accountable for driving quality leads to sales and identifying problems as quickly as possible. For example, leads whose last action was a trial sign-up tend to move much faster through the funnel and close at a higher rate than leads whose last action was a webinar viewing. For lead sources with lower-than-average conversion rates, such as whitepaper downloads, a higher qualification bar is required before passing the lead to sales.
Additionally, data quality directly affects lead quality. Bad data leads to low contact rates and lower conversions. Several third-party lead generation programs may be used to help generate new leads. Sometimes, these leads look like good quality leads at the top of the funnel because they come from companies in the target market, but once they are passed over to sales, important data such as company size and phone number may be incorrect. Clearbit data enrichment can be used to clean up as much data as possible, but occasionally, sources need to be shut down completely due to bad data.
2. Accelerate More Leads from Specific Segments
Building a repeatable lead nurturing process is the pride and joy of any demand generation marketer. Unfortunately, the business doesn’t always follow a perfect plan. Sometimes, marketing needs to send a large volume of leads to the sales team quickly, either to meet a strategic goal or make up for the lost time.
Rather than going broad and sacrificing quality, marketers can narrow in on a specific segment of leads waiting in the middle of the funnel.
3. Improve Lead Velocity with Lead Scoring
Lead scoring is a key lever you can pull to improve lead velocity. Demand generation managers can perform regular regression analysis on the database across several different behavioral factors to determine which characteristics make up a good lead.
Across several actions, such as email clicks, website visits, whitepaper downloads, webinar registrations, and social media engagements, you can measure how many leads took these actions that ultimately led to deals, customers, and revenue. By conducting this research, you can determine which behaviors are the best indicators of buying intent.
Here’s an example of this with dummy data:
From there, you can create a weighted score for each action. If a lead who clicked on a link in an email is 50% more likely to become a customer than a lead who visited the blog, adjust your lead scoring model to reflect email clicks at five points and blog visits at three points. By adjusting your lead scoring model in this manner, you will be able to send leads who are ready to buy over to the sales team faster, improving the metrics.
Because content, audience targets, and business goals do shift over time, make sure to run this analysis every month to make sure the lead scoring model is aligned to serve your goals.
4. Reduce Hand-off Friction with Content and Context
When your sales team doesn’t have enough information about each lead to follow up with them in a way that creates urgency, the result is often non-responsive leads and slow velocity. Marketing can alleviate this problem to an extent.
As a first step, marketing can provide the sales team with case studies, whitepapers, and other educational materials that they can send to leads. As a next step, marketing can create optimized content experiences for leads by linking one piece of content to another (for example, when a lead watches a webinar, send them a related ebook).
To ensure that your sales team can follow up with each lead, your marketing team can create an alert email that gets sent to a sales rep every time a new MQL is assigned to them. This email contains lead record data and contextual information, such as the title of the webinar they just watched and a few details about the webinar. Then, your sales rep can simply reply to the email if something seems inaccurate or if they need more information about the lead. A complete marketing automation platform, like Marketo, will be able to help you communicate with sales and share all the engagement activities and interesting moments in a lead’s history.
To avoid turning the middle of the funnel into a bottleneck, work in tandem with sales to increase conversion rates and velocity for results that spread across the board.
Better Results Ahead
By following the four steps outlined above, you will be able to improve the quality of the leads you hand off to sales, make smoother handoffs, and keep prospects engaged with relevant content.
Gain insights on how to keep leads moving through the sales funnel by downloading The Definitive Guide to Lead Nurturing.
What middle-of-funnel bottlenecks have you experienced in your marketing organization? How did you fix it? We would love to hear in the comments below.