Five ways to determine which are good prospects

All prospects are not created equal; some are more likely to turn into sales. To avoid wasting time, you need to weed out the poor prospects and concentrate your efforts on prospects who will yield a return on your investment of effort, money and resources.

The following five steps will help you distinguish good prospects from bad prospects:

1) Define your target market precisely. Break your market down by demographics ie geography, market, company employee size etc. This will enable you to focus on the prospects that match your target audience.

2) Assess need, budget and the prospect’s purchasing authority. Ask basic questions that will allow you to determine whether a prospect is ready, such as:

What's the timescale for this project?
Who else is involved in making the decision?
What's the budget for the product or service?
How will the decision be made?
Is your company ready to purchase if the right product or service is found?
If you decide that our product or service meets the need, what will the next step be?

3) Ask for a “yes” or "no." Conventional thought says that as long as the prospect hasn't said "no," then the sale is still possible. However, when it comes to rating prospects, get a decision, even if it's no. It’s better to find out sooner rather than later that the opportunities of closing a sale are slight.

4)  Evaluate the prospect's financial position. Creditworthy prospects are better than high-risk customers. Stable prospects are better than customers going through widespread changes. A company that is merging or downsizing may delay buying decisions.

5) Develop a sales lead scoring system. Rate prospects by a letter or number grade, based on the possibility of closing the sale. Concentrate on A or B prospects, and upgrade or downgrade the other prospects as circumstances change.

B2B and B2C marketing

The differences between B2B and B2C marketing may seem obvious, but there are subtle distinctions between the two with substantial implications. B2B marketing generally entails shorter and more direct channels of distribution.

While B2C marketing is aimed at large demographic groups through mass media and retailers, the negotiation process between the buyer and seller is more personal in B2B marketing. Many B2B marketers commit only a small part of their promotional budgets to advertising, compared to B2B marketers.

Marketing to a business (B2B) trying to make a profit as opposed to an individual for personal use (B2C marketing) is similar in terms of the fundamental principles of marketing. In both B2C and B2C marketing situations:

Match the product/service strengths with the needs of a definable target market

Position and price to align the product/service with its market, often an intricate balance

Communicate and sell it in the fashion that demonstrates its value effectively to the target market.

Select the best channels for selling

These are the fundamental principles of the 4 Ps of marketing (the marketing mix) documented by E. Jerome McCarthy in 1960.

Business customers fall into four categories: companies that consume products or services, government organisations, institutions and resellers.

The first category includes original equipment manufacturers, such as car manufacturers, who buy components to put in their cars, and users, which are companies that purchase products for their own consumption. The second category, government organisations, is the biggest.

In fact, the UK government is the biggest single purchaser of products and services in the country. But this category also includes state and local governments. The third category, institutions, includes schools, hospitals, care homes, churches and charities. Finally, resellers include wholesalers, brokers and industrial distributors.

A B2C sale is to an individual. That individual may be influenced by other factors, but it’s a single person that pulls out their wallet. A B2B sale is to an organisation. And with that simple difference lies a web of complications that differ because of the organisational nature of the sale and which vary widely by firmographic (“demographic” for segmenting businesses) such as business size, location, industry and sales revenue.