Why I Stopped Caring About MQLs When I Became CRO
MQLs are broken incentives. Here's what I track instead.
I once sat in a meeting where we spent 45 minutes debating whether a webinar attendee should receive 10 points or 15 points. Yet, no one ever asked whether webinar attendees ever became customers.
MQLs are broken incentives
I came up through the marketing ranks to be CMO through demand gen. When marketers are incentivized to hit an MQL number, they’ll do anything to turn the dial up — from tweaking the lead scoring model, to doing more activities. (IYKYK, and trust me, I know!)
(BTW, I have given up on trying NOT to use the em dash. That’s how I write. You don’t like it? Tough.)
As I was saying….
So as a result of tweaking the model, suddenly lead scoring becomes important. However, as we’ve lived through, sales is then not happy because this often brings in lower quality leads for them to chase and follow up on. They start ignoring the leads. Marketing complains they aren’t following up on the leads. Sales they’re not following up because the leads are garbage, and thus the vicious cycle continues.
Why MQLs made sense historically
Don’t pretend MQLs were always stupid. Historically, they solved a real problem. Twenty years ago we had limited attribution, intent signals, and automation. MQLs were a reasonable proxy.
Today?
We can see pipeline, opp creation, conversion rates, revenue, retention. We just don’t need that proxy as much anymore.
What changed for me when I became CRO
Nobody asked me how many MQLs marketing generated. I mean, there was a “goal” but not one asked. Instead, they asked
How much pipeline did we create? What channels produced it?
What converted? What revenue closed?
The dashboards most of us stare at every day are the wrong things to be looking at. I don’t care about the number of MQLs generated. I care which of them went on to create revenue. I care about the win rates by source, and whether it was an anomaly or whether it’s a real lever I can pull for repeated growth.
I care about what’s driving pipeline ONLY if that pipeline converts. If I get a bunch of pipeline from an event, say, and it doesn’t convert within a reasonable time frame for the business (depends on sales cycle), then it wasn’t a good event.
I start with revenue conversion and work my way backwards. Because at the end of the day, no one gives a shit about anything else. Not the CEO, CFO, or the Board.
If you incentivize marketing to optimize for revenue, they’ll optimize for revenue. And once marketing and sales share the same number, lead scoring becomes far less important.
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Spicy opinion and I’m here for it. I think if marketing drives all this activity that drives pipeline and can be measured. What are we fussing about ? Attribution? I think it matters only or more so if marketing is on a variable comp plan - hence they need to prove their worth and that’s how.
But overall lead scoring is useless. 10 points for full form fill ;)