MQL vs. SQL: What They Are and How to Use Them

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Leads are the main form of currency in the world of sales and marketing. They guide all marketing efforts and are the primary focus of the sales department. But what exactly is a lead and what’s the difference between the two main subcategories of leads: marketing qualified leads (MQL) and sales qualified leads (SQL)?

These questions can be difficult to answer because every company and organization uses different criteria to set their MQL and SQL guidelines. However, understanding the difference between them and how you should be using them to guide your marketing and sales strategies is critical to reaching new prospects and turning them into customers in today’s digital environment.
 

Understanding the marketing and sales funnel

Before diving into the details of MQLs and SQLs, it’s first important to understand the ins and outs of the marketing and sales funnel to better conceptualize where each lead type fits into the larger picture.

Top of funnel

The top of the funnel is primarily the domain of the marketing team. A well-run marketing operation will cast a wide net to promote brand awareness and generate interest among anyone and everyone who might someday need the company’s product or service offerings.

The top-of-funnel stages are:

  • Awareness: A prospect has made initial contact with your brand by engaging with your online collateral, typically broad-based content like blogs and social media posts. This demonstrates that they know who you are and might even understand what you do — in short, they know you’re out there, and that’s all marketing teams need to get started nurturing.
  • Interest: Time has passed and the prospect is now demonstrating a more serious interest in your product offerings. They are visiting your commercial landing pages more often and, importantly, they are spending a good chunk of time there. Consumption of certain noncommercial content might also suggest they have begun researching the market.
Middle of funnel

As the prospect moves further down the funnel, the marketing team will deepen its engagement by sharing more relevant marketing materials to further nurture the prospect and cultivate more serious interest in the brand and its offerings. The next two stages of the marketing and sales funnel are:

  • Evaluation: The prospect has begun comparing different products currently available in the market. They are not only researching your offerings but also your competitors’, and they might also be downloading content like buyers’ guides and case studies that provide more detailed information about available offerings.
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  • Intent: The prospect has narrowed their options down to a shortlist and they are getting close to being ready to make a purchase. They’re working to get the green light internally, and they want to engage directly with shortlisted vendors to learn more about specific features, pricing structures and possible incentives.
Bottom of funnel

It’s at this point the prospect has moved to the bottom of the funnel and, with that, should likely convert from an MQL to an SQL. Sales representatives will take over, conducting conversations and product demos to provide more detailed information about how your offerings can solve the specific problems the prospect faces. The final two stages of the funnel are:

  • Conversion: The prospect has decided to purchase your product and become a paying customer. Depending on the product type, the sales team might hand the customer over to other internal teams for the delivery, implementation and support of the product or service package. Ideally, sales reps will remain involved even after handover.
  • Ongoing relationship: Sales should continue to keep the customer close, engaging them throughout the relationship to ensure their expectations are met. They will continue to learn about their business and their challenges to cross-sell or up-sell other products that meet their varied needs as they emerge.

 

What is a marketing qualified lead?

Every organization has different lead qualification procedures, making it somewhat difficult to provide a uniform definition of either MQLs or SQLs. However, generally speaking, a marketing-qualified lead (MQL) is a prospect who has demonstrated a heightened likelihood of converting to a customer based on the way they have engaged with various marketing materials and other online collateral.

As the term implies, MQLs are defined by your marketing team. They tend to match preset criteria (which include demographic and firmographic information and should be clearly detailed in your buyer persona guidelines) and demonstrate some level of interest in your brand through the consumption of specific types of content.

The marketing lead classification process helps marketers place prospects in the appropriate stage of the customer journey, which serves to guide more focused nurturing activities to gently move them down the sales and marketing funnel and closer to conversion.

 

What is a sales qualified lead?

After a marketing qualified lead has been sufficiently nurtured and the marketing team deems it is ready for more focused attention from the sales team, a similar qualification process will take place to define a prospect as a sales qualified lead (SQL) An SQL is a prospect that has shown significant interest in becoming a customer and is now looking for more detailed information about your product or service.

Where marketing lead qualification is based primarily on behavior and demographics, the process of qualifying sales leads depends on both qualitative and quantitative processes. Sales representatives might learn more about a prospect’s challenges and business through initial screening calls and product demos, information that can help determine whether the organization can provide a product/service that can help them solve those challenges.

 

Comparing and contrasting MQLs and SQLs

The difference between MQLs and SQLs primarily comes down to where prospects are in the buyer journey. MQLs are those prospects who have only recently entered the market and have conducted some degree of early-stage research. While lower-funnel MQLs usually have demonstrated some interest in a product, they are still not deemed ready-to-buy prospects.

SQLs, on the other hand, have been identified by both sales and marketing teams as warm prospects that have a sincere interest in your product or service (or who have at least shown consistent market activity and demonstrated a keen interest in products or services like yours). These prospects are ready to receive more focused attention from sales representatives and begin moving further down the funnel toward conversion to customer status.

 

How to tell the difference

There is no one-size-fits-all approach to marketing or sales lead classification. It largely depends on the organization, the industry, the competitive landscape and, of course, sales and marketing team needs. However, properly categorizing leads largely depends on the way prospects have engaged with a brand, including both online content and company representatives.

You can safely move a prospect to the top of your marketing and sales funnel once they have taken some action on your website, like clicking a top-of-funnel blog or downloading a report touching on a general industry topic. Begin moving them down the funnel as they increasingly engage with high-commercial-intent elements of your website, like product pages and case studies.

Those who are ready to interact with a sales representative have shown a consistent interest in your specific products or services by visiting your product pages numerous times and downloading button-of-funnel content like buyers’ guides and product comparisons. They might even have reached out to your sales team directly, requesting a product demo, free trial or an informational conversation.
 

Why it’s important to know the difference

Understanding the difference between MQLs and SQLs is critical because it enables you to engage with prospects in the most appropriate, relevant way to maximize the chances of success.

For example, MQLs who are still in the awareness phase of the buyer journey are best served with blogs and other general content covering different aspects of the challenge they have identified. SQLs closer to conversion, however, are more likely to want a face-to-face conversion with one of your representatives.

That’s crucial because properly qualifying marketing or sales leads helps you assign prospects to the teams best equipped to engage with them and move them further down the funnel. Marketing teams speak marketing and sales speaks sales, so if you bombard prospects who are “just browsing” with sales sheets and product demo requests, you risk turning them off completely. On the other hand, marketing might not have the firepower to turn conversion-ready prospects from leads into customers.

 

Converting MQLs to SQLs

 

  • Lead behavior: In addition to demographic and firmographic criteria used to define MQLs and SQLs, marketing and sales teams should identify behavior and actions taken that suggest a lead is ready for transfer. Once MQLs that have been nurtured and moved down the funnel begin to display higher intent behavior (like downloading bottom-of-funnel content or reaching out directly to sales teams), they are ready to be reclassified as SQLs.
  • Lead scoring: One of the most straightforward ways to convert MQLs to SQLs is to use lead scoring. Lead scoring is a quantitative methodology that aims to assign numerical values to leads based on predefined criteria. Advanced lead scoring technologies can automatically analyze lead behavior and place them inside a larger predictive framework to forecast future decisions and actions that can guide qualification.
  • Technology: Tech solutions like customer relationship management (CRM) platforms can help you track all prospect information in a single, centralized location. This provides both marketing and sales teams with a single source of truth that helps them better track the progression of leads down the funnel, making it easier to determine when they are ready to convert from MQL to SQL.

Transferring leads from your marketing team to your sales team should be handled delicately. While technology can help ensure this process is as smooth as possible, marketing and sales should be fully aligned to ensure both teams are well-equipped to handle prospects at different stages of the customer journey and maximize the chances of converting them into paying customers.

 

Make intent data part of your lead qualification process

As marketing and sales operations become more sophisticated, it’s becoming more important for your organization to put high-quality intent data at the heart of their strategies. Doing so makes you better able to reach and engage customers and more efficiently move them down the marketing and sales funnel.

CONTENTgine manages a database consisting of hundreds of thousands of B2B content assets that generate billions of intent signals that help marketers gauge buyer intent and target the right prospects. Check out our blog for more content marketing insights, and contact us to learn how we can help you transform your marketing campaigns to drive the results you want.