While checking out your favorite articles from the past year or so, I noticed that the most popular by far was the one I wrote last year on lead scoring. And as I've been traveling a lot the past few months, I hear folks asking more and more about how to get started with lead scoring.
I recently moderated a discussion at the Salesforce.com Dreamforce Conference on lead scoring and lead nurturing -- check out the video of What's Next: 21st Century Lead Cultivation -- and thought it would be useful to update and extend that last article.
So, what is lead scoring? Simple, it's a relative ranking of one prospective lead against another. Now you may already be ranking your leads A,B,C or Hot, Warm, Cold or numerically, but what we're trying to find out using lead scoring is who should marketing be continuing to communicating with, who needs to be sent to sales right now, and who will never buy from us at all.
At Eloqua, we use lead scoring to combine explicit data (what people say about themselves – e.g. job title, industry) and implicit data (their behaviour, e.g. web visits, email oepns) to allow you to make these decision. Based on who you are and what you do determines our communication with you. And we use co-dynamic lead scoring, meaning that we continuously update a cumulative score as people interact with our sales and marketing team.
Ask five questions to get started
Okay, so that's what lead scoring is, but how do you make it happen?
First, call a meeting. Buy doughnuts. Brew fresh coffee (the good stuff, not the premeasured dreck they give you in the break room). Make sure it's not the end of a quarter. Have sales come in, ideally inside sales and your direct field sales folks.
Here are five questions you ask:
1. What is your current process for lead follow-up?
2. What data is most important for the sales team to know about a lead to engage?
3. Can any of the data you need be captured electronically on the web site?
4. What data from forms on the web site do they receive today that is often inaccurate?
5. Can behavior on the web site imply interest and if so, what would they be looking for?
After you've whiteboarded the answers, it's important to come up with a standard lead definition, for example:
"A hot lead is a company that meets our target profile who has budget to spend, has looked at our price sheet online and has indicated they will be making a purchase in the next six months."
Once you’ve had this discussion, you’ve made a significant step towards creating a lead scoring program.
In an upcoming post, I’ll talk about the next step – Entering the Matrix.
Great post. Lead scoring is crucial to marketing and sales, it is important to do it often since you never know if a lead has moved from one group into another
Posted by: lrmtrainer | October 2008 at 11:25 AM
I would extend your 5th question, as well as Dominic's comment, and say that a lead score should really be two-dimensional (three-dimensional, actually...but let's not complicate things too much here). The lead's profile -- job title, company size, department, BANT, etc. -- is one dimension of the lead score. Most of this information is going to have to be collected explicitly -- either through a form submission, through previous form submissions, or through matching to external data sources. Theoretically, a lead's activity can provide clues on this as well...but that adds a lot of complexity. The profile-based lead score is a measure of, "the type of person Sales would like to talk to." Buy the donuts. Conduct the interview. Build your score.
The second dimension, though, is a measure of "how likely the person is to take your call and want to talk to you." Call that the "engagement score." This score has both implicit/activity-driven components, as well as explicit components. An example of an explicit component is if the lead request to be contacted or submits an RFQ/RFI. In these cases, the "engagement score" should automatically be set to whatever the threshold for "high" is. The more interesting measures on this dimension, though, are of silent engagement -- a combination of recency and frequency of visits to your web site, downloading of certain types of content, etc.
So, now, rather than thinking of A, B, C, and D leads, think of a 2x2 matrix. the x-axis is the engagement score, and the y-axis is the profile/BANT score. The top right quadrant is what we call "the buying zone." Those are the leads who you'd like to talk to AND who have indicated they would like to talk to you. Your top left quadrant are people who you would like to talk to, but who haven't really shown a whole lot of interest in you yet. the bottom right quadrant are people who would love to talk to you...but who don't appear to have any real purchase authority. Marketing should nurture these two groups very differently -- in one case, special offers to drive increased engagement are in order. In the other case, you're really looking to use the lead to get to someone with a more favorable profile.
I mentioned a third axis. I believe this exists, and it's a measure of where the lead is in his buying cycle -- is he early on just trying to educate himself...or is he looking to sign a check in the next month? We haven't cracked that nut quite yet. The reality is that a savvy salesperson is happy to talk to someone who is early in the buying cycle but isn't going to purchase this quarter -- locking in a relationship early on. And, adding in a third dimension definitely complicates things.
Two dimensions is manageable, though, and I claim that it's critical when it comes to truly qualifying leads effectively.
Posted by: Tim Wilson | December 2007 at 11:23 AM
Thanks, Dominic. You bring up a good point -- falling into the trap of assigning a score based on one criteron (whether implicit like web activity or explicit like declared information) can be dangerous. You want to look a number of factors -- but not too many!
What methods are you testing now on your site?
Posted by: | November 2007 at 02:36 PM
Steve,
Your lead scoring technique is very interesting. Measuring web activity has always been a good method to evaluate leads to a degree. Naturally, if a prospect submits an RFQ/RFI he or she would be considered a quality prospect, but that's not always the case. Right now we're still testing some lead scoring methods for our industrial supply auction site. I learned some good tips when you first wrote about it in your 2006 article at http://theinnovativemarketer.blogs.com/ideas/2006/04/how_to_get_star.html. Anyway, thanks for the info.
Posted by: Dominic | November 2007 at 11:07 AM