MQL vs SQL: Everything You Need to Know

Knowing how many marketing qualified leads and sales qualified leads are in your pipeline can give you clear insights into your sales and marketing effectiveness. 

And when you’re able to measure the number of leads you’re generating, and how qualified they are, you can make better decisions around the marketing activities you’re investing in.

In this guide, we’ll walk you through the differences between marketing qualified leads, sales qualified leads, how to measure your lead conversion rate and more. By the end, you’ll be ready to start tracking and optimising your marketing and sales efforts to generate more qualified leads and make more sales.

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What is a Marketing Qualified Lead (MQL)?

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A marketing qualified lead — or MQL for short — is any lead that your marketing team deems qualified.

What does qualified’ mean in this context, exactly?

Usually, it means:

• The lead closely matches the criteria of your buyer persona from a firmographic or demographic stance.
• They’ve taken action that marketing deems valuable, such as signing up to a webinar, downloading an eBook, or visiting your website multiple times.
  

However, there’s still no guarantee that your MQLs will buy from you. You won’t have had a conversation with them at this stage, and you’re simply qualifying them based on their actions or attributes.

The next step will be to hand the lead over to sales to nurture and engage with them further to determine if they’re truly qualified to be a customer.

Who’s responsible for generating MQLs?

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At most companies, marketing is fully responsible for generating MQLs.

However, the responsibility isn’t all on your marketing department. The quality of your MQLs is also dependent on your sales and product / customer success team. They will need to share information and insights from their respective areas to ensure that your marketing team focus their efforts on generating leads that are a perfect fit for your product or service. So there needs to be a link between marketing and sales for MQLs to be optimised.

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What is a Sales Qualified Lead (SQL)?

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Sales qualified leads (SQLs) include any lead that your sales team defines as being qualified to purchase from you and worth pursuing as a sales opportunity. Your SQLs are actively qualified by your sales reps, based on real conversations and information they have on the leads.

In general, the process of an MQL turning into a SQL requires your lead to: 

• Be strongly considering purchasing or have a pain point you can address
• Have the willingness to purchase within a realistic timeframe
• Have the authority to make a buying decision
  

There’s no single way to define a SQL, as it will depend on the unique factors that lead to people buying from you. The key is that your sales team is happy pursuing the lead and strongly believes they can become a customer.

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Who’s responsible for generating SQLs?

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MQLs become SQLs once your sales team confirms an opportunity is worth pursuing. However, marketing still has the responsibility of generating the lead in the first place.

To ensure your marketing efforts generate leads that match your SQL criteria, your sales and marketing team need to work together. Sales can share their knowledge of what makes someone an SQL, and marketing can use that to inform campaign decisions around targeting, messaging, and creatives.

To gauge if your marketing efforts are generating sales qualified leads, you can measure your MQL to SQL conversion rate, which we’ll show you in the next section.

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What’s the MQL to SQL conversion rate formula?

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The MQL to SQL conversion rate shows you how many marketing qualified leads turn into sales qualified leads.

To calculate your MQL to SQL conversion rate, use the following formula:

Total number of SQLs / Total number of MQLs = MQL to SQL Conversion Rate

If you have a long sales cycle, as is common in B2B, make sure to account for the entire length of the buyer journey when working this out.

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What’s a good MQL to SQL conversion rate?

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There’s no single definition of a good MQL to SQL conversion rate because it’s company-dependent. 

That said, if you have a high MQL to SQL conversion rate, it’s an excellent sign. It demonstrates that your marketing efforts are closely aligned with your target customer, and the type of leads your marketing is bringing in is exactly what your sales team is hoping for.

If your MQL to SQL conversion rate is too low, it can be a sign that your marketing efforts aren’t focused enough. If you’re attracting too many people to your business that aren’t a good fit for your product or service, you’re wasting time, money, and energy.

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Tracking MQLs and SQLs through your sales and marketing pipeline

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All good CRMs like HubSpot, Salesforce, and Pipedrive, will let you set up a system to manage your lead pipeline. With a CRM, you can create a lead scoring system based on the attributes you care about, such as:

• Website engagement and contact frequency
• Job title and company size
• Timeframe and budget
  

Having clarity over where your leads are in the buyer journey will enable marketing to hand over MQLs to sales at the right time, and give sales enough information to jump in, already equipped with all of the information they need to nurture your leads towards a purchase.

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In summary

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A healthy MQL and SQL pipeline is vital to ensure your marketing efforts result in qualified leads that you can nurture into customers.

You can quickly and easily calculate the number of MQLs and SQLs you’re generating with the formulas we’ve shown you. Although there are no clear benchmarks on what a good MQL to SQL conversion rate is, if you track your metrics over time and look for trends, you’ll soon develop your own.

If you want to generate more leads, Traktion’s network of vetted marketing experts can help. You’ll get instant access to marketers who can help you create effective lead qualification processes to grow your pipeline.