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franksteiner79
Key Advisor

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Hi all

 

I'm Frank Steiner, Principal Inbound Consultant at HubSpot (Germany). I've been with HubSpot since May 2018 and have been a HubSpot fanboy and customer since 2014/15 when I did my first HubSpot implementation whilst working as Marketing Manager for an IT Service Provider in the UK.

 

Lifecylce stages, lead status & deal stages can be pretty confusing, especially if you're learning about HubSpot for the first time. That's why I'll start with a few definitions first:

 

Lifecycle Stage: Describes a contact's relationship with your company

Lead Status: Describes sales activities during the qualification process

Deal Stage: Represent steps in  your companies sales process

 

I came up with this little visualisation, keep in mind I am not a designer! 😉

How lifecycle stages, lead status und deal stages are connectedHow lifecycle stages, lead status und deal stages are connected

 

 

1. Lifecycle phases

Let's first take a look at the lifecycle phases. These form the foundation for editing and categorizing contacts in HubSpot. The following points should be noted when working with lifecycle phases:

 

  • Lifecycle phases should "increase" incrementally, resetting an LC phase is possible but not recommended.
  • HubSpot Lifecycle phases cannot be modified or added to. (*yet…)
  • A lot of HubSpot features and standard reports use HubSpot Lifecycle phases, for this reason creating your own custom LC phases should be well considered.

 

Setting of lifecycle stages in HubSpot

My colleagues and I are often asked which of these phases is automatically set by the system and when:

 

  • Subscriber: Automatically set when a new contact: Manually created*, imported*, filled out a blog subscription form, or created via the conversation tool.
  • Lead: Automatically set when a new contact: was converted via a form*, was created via Salesforce Sync, or was created via the HubSpot Sales plugin.
  • MQL: Not set automatically by the system, but based on user-defined lead scoring criteria and through workflows.
  • SQL: The contact has been qualified by sales (according to BANT model or similar) and the purchase intent has been classified as probable.
  • Opportunity & Customer: Can be enabled in Deal Settings in HubSpot, and means: if a contact is associated with a deal, its lifecycle phase is raised to Opportunity. If a deal is later set to Won, the LC phase automatically changes to Customer.*

 

* Small addition: unless another lifecycle phase was set when manually creating, importing or in the form. Existing customers with which further deals are associated keep their lifecycle phase "customer" and are not reset by this setting.

 

 

When is an MQL an MQL and who sets the SQL status?

As soon as a contact has cleared the "hurdle" to becoming an MQL, in the ideal scenario the transfer of the contact to Sales takes place. But often the definition of the MQL already proves to be difficult. From experience I know that this question alone deserves an AMA, and there can and should be many different implementations. In the end, however, an MQL represents a lead that is more likely to become a customer than other leads.

 

Once we have defined our MQLs and set up lead scoring, we come to the next controversial point - how does an MQL become an SQL and who is responsible?

 

There is often policy discussion here, in some cases the marketing team defines and sets the SQL status, which I personally find rather questionable. This decision should be left to the sales, inside sales, pre-sales (whatever the team is called in the company). After all, this should ideally be the qualification of the MQLs according to proven models and criteria. BANT (Budget, Authority, Need & Time) is a well-known model here. While much of the marketing activity can be automated, direct and personal interaction via emails, calls, video conferencing is recommended here. And here we move seamlessly into the "Lead Status" topic....

 

2. Lead status in HubSpot

Is a detailed look at the MQL/SQL lifecycle phases of a contact. The lead status property is predefined, but can be fully customised and changed to meet the unique needs of each sales team and process. Ideally, the lead status represents the typical activities that are performed during the qualification process.

 

Furthermore, the Lead Status is not set fully automatically via HubSpot's system settings, but either:

 

Manually by the respective sales staff, or.

Via workflows (e.g. If a contact is associated with a new deal for the first time, then set Lead Status to "Open Deal").

By combining several properties, we are thus able to better segment our database, and in particular our leads, and can for example display contacts whose lifecycle phase is MQL, but whose lead status has not yet been set. These should be qualified by sales as soon as possible.

 

franksteiner79_0-1634890761956.png

 

Assuming a contact has been qualified, we are sure there is potential here to sell our products/services, then we create a deal....

 

3. Deal Stages & Pipelines

Are a detailed look at the opportunity lifecycle phase and yes depending on the business model a contact can spend several weeks and months in this phase and deal phases help us go into a bit more detail here.

 

Again, some general info here:

  • Deal phases are predefined but can be completely customized.
  • The phases are strongly oriented towards the sales process of the respective company, golden rule: Multiple pipelines only make sense if they are also based on strongly divergent sales processes.
  • Deal phases can be combined with mandatory fields for deal properties and workflows.

 

There are 2 options how we can ensure that the necessary deal information is captured and stored in the system during deal creation & during the sales process.

 

  1. System-wide definition of deal properties that are queried during the creation of each deal (no matter in which pipeline).
  2. Pipeline and deal phase specific deal properties that are queried when moving a deal to a specific deal phase, these can be optional or mandatory.

franksteiner79_1-1634890761927.png

 

Additionally, we are able to associate a variety of automation options with reaching certain deal stages. This is where I am often asked - "What is best practice? What do you need to do?" This is where my standard answer kicks in again - it depends... The more appropriate questions are:

 

  • What are your company's internal processes?
  • Are there mandatory and "nice to have" notifications?
  • Are there internal approval processes that need to be mapped?
  • Do we want to change or set default or custom properties based on where a deal is located?

 

franksteiner79_2-1634890762002.png

 

In the above example, we do the following:

 

  • When deal phase "decision maker brought in" is reached, then create a task for the sales representative: 
  • Within 3 days, the first quote should be created.
  • We add deal specific info like "Deal Name" & "Deal Stage" in the task title and notes.
  • Once set up, this workflow is triggered whenever a deal reaches the "decision maker brought in" stage.

 

Summary

My top tip after nearly 6 years of HubSpot experience (and especially 3 years as a HubSpot customer) is that the need to have an open discussion between sales & marketing (Buzzword - Sales & Marketing Alignment!) and reach a common understanding of these properties and categorizations are essential. Not only for the successful implementation of HubSpot, but also for better alignment between marketing and sales and the long-term business success.

 

  • If possible, always stick to HubSpot lifecycle phases, and use custom lifecycle phases only in the absolute exception and consider their impact.
  • Lifecycle phases should "ramp up" incrementally, and not be reset
  • The "Lead Status" property provides a more detailed look at the MQL/SQL LC phase.
  • Pipelines & Deal phases are a detailed look at the Opportunity LC phase.
  • Golden Formula: Deal Pipelines = Sales Process, only if there are fundamental differences in the sales process do multiple pipelines make sense.
  • Deal phases can be combined with mandatory fields for deal properties to ensure good data quality.

 

Additional resources & reading

 

Now it's your turn!

What questions do you have about lifecycle stages, lead status and deal stages?

What experiences have you already had? Are there any implementation scenarios that puzzle you? Or maybe you've built a "best thing since sliced bread" setup that saves your company time and money?

 

From October 25-29, I’ll answer your questions about Lifecyle Stages, Deal Stages and Lead Status! I look forward to hearing from you.

 

Cheers

Frank




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Frank Steiner

Marketeer | HubSpot Expert | CRM Consultant

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32 Replies 32
taylorrpayne
Participant

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Hey Frank! Really appreciate the insights here.

 

Let's say a deal becomes lost because through the opportunity process, we learned they were truly unqualified, or ghosted us.

 

We've been leaving the Lifecycle Stage as Opportunity (even though it's a Lost Deal) and using Lead Status set to Unqualified to indicate their status.

 

But, it seems lead status is only supposed to be used for MQL/SQL LCs. Is that the best way to handle it or should an unqualified deal be downgraded in lifecylce stage to something other than opportunity? 

 

 

franksteiner79
Key Advisor

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Hey @taylorrpayne 

 

That's a great point that was also raised during the German version of this AMA in the community.

If anything it's down to my lack of design skills. Ideally the lead status colouring would fade into the opportunity LC stage. And the way you described it is actually perfect.

 

We'd want to know when contacts became opportunities and didn't end up closing. As this provides insights - should we qualify better, what are reasons for not closing (price, lack of features, timing, budget, etc.). One report I find really useful is looking at time in lifecycle stages (which requires some manual setup) and Deal average time spent in each stage (which is available in the report library). This helps identify where prospects experience friction.

 

Personally I am not a fan of resetting or downgrading lifecyce stages as this would mean any reports we run on LC stages wouldn't be accurate.

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Frank Steiner

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taylorrpayne
Participant

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Oh man, that's awesome. Honestly, the validation is super helpful. I think I've learned that we're not using MQL/SQL properly.

We've been defining an MQL as anything our marketing has qualified. For us, this means a demo/discovery call is booked. 

Based on the graphic, it looks like when an appointment is scheduled, that doesn't necesarily qualify them as MQL. Is that right?

 

Our logic has been that the demo will result in one of three things: an SQL with no opportunity yet for further pursuit, it'll turn into an opportunity, or it'll be unqualified in which we leave the LC stage alone and mark lead status as unqualified.

 

So it made sense to use to make all website/ads meetings booked (demos, discovery calls) as MQLs. Are we thinking about this the wrong way?

franksteiner79
Key Advisor

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

I wouldn't overthink the naming. The default HubSpot deal stage just happens to be called "appointment is scheduled" but in this context that wouldn't equal someone booking a meeting. This is more, we've qualified you and have our first proper sales call.

 

To me your definition of MQL sounds spot on. Are you doing lead scoring already? Or how do you define and set the MQL status.

 

As a rule of thumb setting of MQLs is usually automated via lead scoring. One thing I've done myself in the past is to fast track leads when they submit high intent forms, i.e. request a demo. This makes them an MQL immediately, not needing to reach a certain score. 

 

Setting SQLs is always a manual step, done by the sales rep or someone equivalent. This can be done in various ways, the one I commonly see is BANT - Budget, Authority, Need, Time. If that hurdle is passed the contact is SQL. After that an Opportunity/Deal is created. In reality this can sometimes be done at the same time.

 

Sounds like you are doing all the right things!

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Frank Steiner

Marketeer | HubSpot Expert | CRM Consultant

InboundPro

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taylorrpayne
Participant

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Thanks for the info, Frank!

 

So we have some lead scoring, yes. We've also identified that at a lead score of 8, those are worth our sales team engaging with and reaching out to. Our customers generally have a lead score of 16+. 

 

I'm thinking that any discovery call or demo that gets booked should be an MQL and then I add a workflow that graduates people to an MQL when a lead score of 8 is acheived. I have a workflow that prompts my sales team when this lead score is acheived but I'm not automatically elevating their lifecycle stage.

P.S. as an inbound consultant, how does one engage you for consulting? Not sure if I can ask that here or not haha.

franksteiner79
Key Advisor

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Hi Taylorr

 

8 seems a bit low for a lead score. What are you scoring for and how high are the scores?

Are you scoring demographic and behavioural data points? Commonly I see 50 or 100 being the target score for an MQL, with things like "right industry" scoring 5 or 10 points.

 

I'm also a big fan of more but less complex workflows.

In the case of scoring this would mean:

  1. Workflow sets the MQL LC when the required score is reached.
  2. Workflow assigns and notifies the sales rep.

That way the second WF triggers whenever a contact becomes an MQL, regardless of if that change happened automatically or manual.

 

As for working with me, or one of my colleagues in the US, the best starting point would be talking to your Customer Success Manager (Shakarra McGuire). You can also have a look here at the consulting services we offer. The two major options are project based (limited amount of time and working towards a specific outcome) or ongoing (where a consultant works with you continuously for the duration of your contract).

 

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Frank Steiner

Marketeer | HubSpot Expert | CRM Consultant

InboundPro

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taylorrpayne
Participant

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Thanks, Frank.

 

We aren't setting lead score properly, I'd imagine.

 

We use smaller numbers for lead scores. 1 for opens, 2 for clicks, 1 for number of pageviews over a certain period of time, etc.

 

This results in lower lead score numbers. We didn't know how to gauge what each activity should be worth and chances are, we're missing out on opportunities to score in places we're not currently scoring. 

 

Thanks for the intel on the consulting. Really want to make the most out of everything we have so far!

 

Really appreciate this thread. Extremely valuable stuff.

franksteiner79
Key Advisor

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Hi @taylorrpayne 

 

Your score does seem a bit low. Lead Scoring is quite a comprehensive topic and maybe it's worth doing a separate AMA on it. 🤔

 

In a nutshell you want to score for fit, i.e. right job title, right industry, right region, etc. and then combine that with behavioural scores, i.e. are emails being opened overall, are specific emails being opened, are certain assets being downloaded, certain page views, repeated page views, demo request, etc.

 

Lead scoring is also inherently experimental and something that should be reviewed regularly, simply to test assumptions and see if the scores that are being assigned are correct.

 

Cheers

Frank

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Frank Steiner

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folked
Top Contributor

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Another question: If a contact becomes a "Customer", it is actually the company becoming the Customer. Would you set all contacts linked to that company to Lifecycle Stage = Customer?

TerryB
Contributor

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

I have the same situation as @folked at my company, we sell multiple products (5 Products) and a contact + company can have different lifecycle stages for each.

 

The only way I can get around this from my investigatations is to have a bespoke lifecycle stages built for each, based on custom workflows running for each.

 

Is this the usual practice across other Hubspot clients that have the same situation?

 

folked
Top Contributor

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Hi @franksteiner79 : Very useful, thank you! I completely understand this approach for potential/new customers. But what happens to LC and LS, if a Customer (Lifecycle Stage = Customer) comes to our page again some months after the first deal was closed, showing interest and/or requesting a quote for a different product or product line which is not related to the first deal? 

franksteiner79
Key Advisor

AMA - Demystifying HubSpot's lifecyle stages, deal stages and lead status

Hi @folked & @TerryB 

 

Great questions and it depends a bit on each business as well as your companies processes and preferences. I always prefer "simple" solutions so having seperate custom lifecycle stages for different products or product lines seems a bit like overkill to me; but I'm not totally dismissing @TerryB's idea; however I'd solve that via a customer property or properties.

 

Here is how would approach this:

 

  1. Fundamentally a contact (or company) is a customer as soon as they by any product from you.
  2. Depending on the type product/service and the breadth of products/services sold by your companies oervall, it might make sense to:
    • Just have the contacts you engaged with during the sales process and the company have the same LC stage
    • Make the company and only contacts in a specific region the same LC stage (i.e. you sold to HubSpot Germany GmbH, so only German HubSpot contacts are customers)
    • Make all associated contacts and the company the same LC stage
  3. Depending on the product/service you sell they may remain a customer forever, or until the contract expires, or until another specifically defined period of time; i.e. one off purchase, after 18 months we reset the LC to lead or just clear it. 

I would then work with the Lead Status and at least one other custom property to get a more granular view on contacts/companies.

 

  1. Lead Status - What see I quite often, and I think it works very well, is that it is only used for new contacts. Once I am a customer and somehow express interest in additional services/product it is then an immediate new deal - possibly in a seperate pipeline (in HubSpot we have an "additional services" pipeline for that). Who creates that deal depends on the org structure in HubSpot this is done by Sales Reps and/or Customer Success Managers. I also mostly see Lead Status being a "Sales Property" which is used to measure if and how quickly sales reps follow up. It should also be set manually by sales reps as they do their outreach/follow ups.
  2. Custom Property - This can be something simple like a contact property called "Is customer of" with a multi-select option or dropdown select that contains the @TerryB's 5 products. So my LC stage would be customer, the customer property would show I bought product A. A more complex approach, which totally depends on what level of granularity is required for reporting, KPIs and forecasting could be a set of properties that show us the interest that has been explictly or implicitly expressed and what has been bought. This can be done 2 ways:
    1. We create 2 custom properties. An "interest in" and "customer of" property, each lists the relevant products/service or maybe just product/service groups. The "interested in" can be set based on various tracked behaviours, i.e. contact downloads whitepaper on product B, set/append Product B in "interest in" property. This allows for nice segmentation or even personalising customer newsletters with relevant content for the products I expressed interest in.
    2. A custom property per product/service or product/service group, this time as single select option with differing status, i.e. Interested, Open Opportunity, Customer. Again we'd set the "interested" based on CTA clicks, form submissions, etc.; the Opportunity based on an open deal with a specific product/service attached, customer based on a deal with a specific product/service attached being marked "closed won".

I would also always encourage to consider the scalability of whatever approach our customers decided to implement, as well as the practicality. Having different custom lifecycle stages for different products is striclty speaking possible is likely to create an immense amount of overhead, which I'm not certain is worth the effort.

 

Let me know what you think.

Frank

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Frank Steiner

Marketeer | HubSpot Expert | CRM Consultant

InboundPro

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