Differences Between Cold, Warm and Hot Leads
There is still a massive confusion amongst clients and marketers about what is regarded as a cold lead, warm lead and hot lead. Here we try and explain as simply as possible the differences between them.
Cold Leads $
At some point in time we have all been at the receiving end of a cold call. For example, a mobile phone company calls you out of the blue and tries to get you to sign up for one of their tariffs. You never contacted them, showed interest in their products or services, and were completely annoyed by them because they probably called you in the middle of dinner.
In general, cold leads are the cheapest leads and whilst there is nothing wrong with cold leads except that it requires a significant amount of sales legwork to convert the cold lead to a warm or hot lead.
Warm Leads $$
A warm lead is someone who has shown some interest in a product or service either by finding you through social media, signing up to your email newsletter, as a referral from a friend or previous client or some other expressed interest.
Whilst these types of leads are more valuable than cold leads, these types of leads are merely prospects who have shown interest in learning more about a product or service, but really only consist of someone whose contact information has now been captured. The goal with warm leads always is: convert them to a hot lead.
Hot Leads $$$
Hot leads are the best types of leads because these people tend to be closest to the buying stage of the sales cycle. For example, a person who does a Google search for a specific product or service and makes contact with your company is a hot lead because their need has brought them to go online and [intent]ionally search for a company like yours.
However, there are different stages of hot leads and these can be established using what is called the BANT approach:
- Budget: How much is the prospect able and willing to spend?
- Authority: Who is the ultimate decision maker?
- Need: Does the prospect have a problem your product can solve?
- Timescale: Is there urgency?
If you are in sales, your goal should always be to turn cold and warm leads to hot leads, plain and simple, but obviously easier said than done. To convert prospects to a hot lead you need to ask the prospect the right questions, ie: have a solid strategy and sales script.
Your marketing agency can probably generate warm leads all day long, but it’s your sales team who has the responsibility of converting them to the next stage of the buying process.
While a person landing on your website based on a search engine search or clicking on a facebook ad is a form of qualification it does not ensure a sale. The more you know about your prospects the closer you can get to closing a deal and the better prepared you are to determine if they are potential customers or tyre kickers.
Furthermore, there are distinct differences between facebook and google leads and we go into more about it in our article entitled “Difference Between Google Ads and Facebook Ads“. But in short, Google is about buyer intent which means that someone has gone online and intentionally searched for your company as they have a need for your product whereas someone on facebook is about awareness which means they have stumbled across your ad whilst looking at videos of cats.
On the other hand, for facebook, it does depend on how strong your lead capturing method is. If you have a strong ad and are sending the prospect to an optimised landing page clearly explaining your product and the user fills in the details and makes contact, then that lead is more closely associated with a hot lead than a warm lead.
Again, the key to conversion is how your sales process and closing strategy works using the BANT method.
Even now in 2018, people are still sending money to Nigerian princes so if you are generating warm leads, the excuse of “the leads are low quality”, is just an excuse for poor sales skills.