When people talk about lead management, they’re often just talking about lead scoring. I’ll just take a stand and say that this is wrong. Lead scoring is one-sixth of Lead Management. A few weeks ago, we posted a blog about how to define a sales-ready lead. That comes back into play now as it is the foundation of lead scoring. This is a huge miss for so many organizations, as scoring is often built with criteria that Marketing thinks qualifies a lead as sales-ready. When we facilitate this in session, we always, always see that marketing defines a qualified lead in a very different way than how Sales defines a qualified lead. How then, can lead scoring – often built without reflecting on that agreed upon definition of a sales-ready lead be accurate? in this blog, we’re going to take an in-depth look at this essential stage of lead management.
Remember that a sales-ready lead (or qualified lead) is defined using a combination of digital behavior and demographic information. Lead scoring is built to auto-magically qualify leads based on this criteria. We assign a numerical value to specific actions (visits to the website, downloads of an asset, etc.) that a customer or prospect takes throughout their engagement with you coupled with key demographic information. When the sum of their scores meets a pre-determined threshold, the lead is considered to be sales-ready (or marketing qualified) and is passed over to Sales for follow-up.
The primary objective of lead scoring is to get higher quality leads to sales when the buyer indicates readiness. In time, and when the algorithm accurately reflects quality, this automation can improve Sales efficiency, Marketing effectiveness, and alignment between Sales and Marketing.
- Increased Sales efficiency and effectiveness
Because lead scoring focuses Sale’s attention on leads that digitally indicate that they are ready to buy, Salespeople spend considerably less time on ‘junk’ leads.
- Increased marketing effectiveness
Lead scoring is never complete. It needs to be tweaked and updated over time based on Sales feedback and funnel conversion metrics. With a lead quality feedback loop in place, Marketing is able to zero in on and nurture the right kind of leads for the business.
- Tighter Marketing and Sales alignment
The fact is, once Marketing starts sending higher quality leads to Sales that actually convert to revenue, the relationship changes. Anything that adds potential revenue to the sales pipeline gets the attention of Sales Leadership. In time, the relationship between Marketing and Sales is more symbiotic. But again, it all starts when you establishing a common definition of a sales-ready lead (defined in Stage 1 of the lead management process).
There are some best practices to abide by to develop a holistic lead scoring model. Most importantly, it is essential to establish a common lead language. Everyone must agree on what qualifies as a lead for Sales engagement, as well as the labels and definitions of lead statuses.
Next, create the lead scoring model along with key Sales staff in a 1-2 hour working session. Keep the lead scoring model simple at first. As you being to pass leads to sales, collect feedback from Sales on the quality of the leads. You will want to adjust scoring if too many unqualified leads get through (suggesting that your algorithm is too loose) or if not enough leads are getting through (suggesting that your algorithm is too rigid).
As you build out your scoring model with your Sales partners, be sure to cover the following questions:
- Which demographic variables are most important to your Sales team?
- What demographic attributes are most common in closed/won deals?
- Which behaviors represent buying interest?
- Which behaviors should be weighted highest?
- Which behaviors indicate negative buying interest?
- Can you classify your behaviors into buying stages (early, mid or late stage buying activity)?
It is also important to use one lead scoring model across the entire organization. You can customize the model for a business unit or product as needed, but there should only be one lead scoring model that everyone can refer to.
Once you have created your lead scoring model, it’s time to test and verify your new lead scoring design. We often suggest that our clients run a small pilot of sample leads through scenario tests with a newly designed lead scoring program.
- Example 1: Existing closed/won customers
- Example 2: Existing closed/lost opportunities/contacts
- Example 3: Leads that were unqualified by Sales
Ask yourself this key question – Would these leads have been assessed correctly by our new scoring model?
If the answer is yes, it’s time to move forward with the next steps. Build out new lead scoring campaigns and if you have an algorithm in place, retire old lead scoring campaigns. Reset your lead scores (demographic and behavioral), rescore on demographic information and then monitor your new scoring programs for the next four weeks.
Four weeks after launching your new lead scoring model, it’s time for a re-assessment. Assess the current state of your lead scoring algorithm by asking Sales for feedback. Verify your design through a pilot test. (Are qualified leads meeting the MQL threshold? Are the right leads qualifying for scores? Are they where they are supposed to be in the funnel?) Finally, update your scoring model.
Finally, lead scoring is an iterative process. Your lead scoring model should be reviewed, at a minimum, every quarter. As your lead quality and volume stabilize, you can push that back to every 6 months.
To reiterate, while lead scoring is not the entirety of the lead management process, it is an important part of the whole. Good lead scoring increases Sales’ efficiency and effectiveness, Marketing’s effectiveness, and helps bring Marketing and Sales into tighter alignment. World class lead scoring is:
- Reflective of the definition of a sales-ready lead.
- Created by Marketing and Sales.
- Inclusive of digital body language (behavioral data).
- Limited to one lead scoring model with customization for a business unit, ABM or product as needed.
- An iterative process.
Next week, we’ll look at Stage 6 of the lead management process, establishing and maintaining service level agreements. For now, take a look at our resource center for more information on lead management.
Colby Renton is a Senior Marketing Strategist at the Pedowitz Group. Colby consults with global organizations to redefine marketing strategies, drive organizational change, educate on Revenue Marketing processes, and optimize the marketing discipline overall. Previously, she worked for one of the worlds’s premier HR consulting firms for nearly a decade, where she developed her expertise in change management and global marketing strategy.
- Posted by Colby Renton
- On 08/30/2018
- 0 Comments