Sales lead generation

Below is a model for thinking through how to generate sales leads. You might think this model looks too complicated for you and your business - you could be right.

However, it still sets out the general principles that should be considered. Once again, my experience tells me that many companies look at the generation of sales leads in an overly simplistic way and as a consequence their plan doesn't work and/or they waste large sums of money. This particular model was used by one of my clients that had an annual turnover of over £100 million - hence the need to go into the process in some detail.

A Model for generating sales leads

Buying customer
(has bought within defined period)


Working Prospect
(firm proposal on the table - awaiting decision)


(needs and wants to be understood)


Hot Lead: They want to see you. "We've been seriously thinking about it"


Warm Lead: Seems very interested. Open to exploratory chat or meeting


Future Lead: "Contact me again in 4 months"


Potential Lead: Not interested. "Happy with current arrangements"


We think they could use our services/products

4 contacts

Reactive activity

Proactive activity

Yellow Pages ® respondents

Cold calls, perhaps after mailer

selling vs other companies

selling the need

100 contacts
Left Right

The model is split into two halves and attempts to do a number of things.

  1. It explains the process a contact would need to go through from a "cold call" to a "buying customer".
  2. It compares this proactive activity with the reactive activity whereby customers come to you via advertising etc like Yellow Pages ® .
  3. By comparing this proactive activity and reactive activity it gives you an idea of the relatively high number of "suspects" needed in order to generate a handful of "buying customers".
  4. By considering the different stages of this process it becomes easier to decide how to make the sales generation process as efficient and non-wasteful as possible. For example, all those classified as "future leads" can be put into a database and contacted in four months time. Likewise, all those classified as "potential leads" can be put into a different database that could receive three standard company mailings at Christmas, Easter etc.

The left-hand side (reactive activity) is relatively straightforward and demonstrates the process whereby a suspect contacts you following an advertisement such as Yellow Pages ® . As you would expect, you need a relatively small number of these suspects in order to generate a buying customer.
The other thing to note is that in the initial conversation with the suspect, the sales argument is likely to revolve around the products and services that you sell versus your competitors


  • A suspect telephones your company and requests information or an appointment.
  • 3 out of 4 of these prospects are sufficiently interested whereby you provide them with a firm proposal.
  • 1/3 of these proposals are taken up by the prospect and hence he becomes a buying customer.


The right-hand side (proactive activity) is a little more complicated and demonstrates the process whereby a suspect is contacted "cold" by your company and the mechanism that should be considered in order to verify that this "suspect" is actually a "prospect". The initial sales conversation is likely to require you to sell him the need for the sort of products that you sell; it is unlikely you would get into a conversation where your products are compared to those of the competition.

  • A suspect who responds to your proactive activity has not demonstrated any prior interest in your products or services. Hence you would expect a high failure rate. In the marketplace we were considering when we drew up the above model, we assumed that 50% of these suspects were happy with their current arrangements and were not interested. This does not mean that they will never be interested. You might wish to consider contacting them again at a later date.
  • We assumed that 35 % of these suspects expressed some kind of interest, but not for now.
  • We assumed that 10 % of these suspects seemed very interested and quite willing to have an exploratory chat on the telephone or an initial meeting.
  • We assumed 5% of these suspects definitely wanted to see us - we had contacted them at the right time!
  • Out of the 4 categories of A,B,C and D we assumed that only 10 % became a prospect.
  • 7 out of 10 of these prospects were sufficiently interested for us to provide a firm proposal.
  • 3 out of the 7 prospects actually became a buying customer.
Lack of credibility with your salesforce?

A common problem I have come across is where salesmen have little or no confidence in the sales leads that are being provided to them. Invariably this is because the sort of mechanism set out above has not been gone through. There is absolutely no point in your company spending valuable marketing resources on the sales lead-generation process if that process has no credibility in the eyes of the salesforce. Additionally, most salesmen do not respond positively to being given a list of "suspects" whereby they have to do the sifting process. Under normal circumstances I would recommend you use other (cheaper) personnel to carry out this sifting process and allow your salesmen to get on with their major task of selling.

Yellow Pages is a registered trademark of Yell Ltd

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