Hot Or Not? Finding Hot Prospects With Lead Scoring
As powerful as search marketing is for B2B lead generation, it has ironically served to increase the ages-old friction between sales and marketing. This is because when buyers use search to research solutions and find vendors, they are extremely early in the buying process—often long before they are ready to engage with sales.
Passing these early stage inquiries to sales only serves to annoy the buyer (who doesn’t want to speak with a sales person yet) and to hurt the relationship between sales and marketing (since sales reps don’t want to waste their time on leads that are not in an active buying cycle).
Of course, there will always be some leads that are truly “hot,” so B2B marketers need a way to find the hot leads and pass them to sales before a competitor contacts them or they go cold. At the same time, the majority of inquiries will require further lead nurturing before they become sales ready, so marketers also need the ability to know when to try to nudge the prospect to the next stage and when to pull back and give the prospect some space.
Enter lead scoring
This is where lead scoring comes in. Lead scoring is the process of determining a prospect’s level of interest in your solution (engagement), as well as your interest in a prospect (demographics targeting). When used effectively, lead scoring means you will pass fewer, but higher quality, leads to sales. By not wasting sales time on low quality leads, reps can focus on just the high quality leads—meaning wins rates and sales productivity go up. In fact, as little as a 10% increase in lead quality can generate a 40% increase in sales productivity. In a world where the sales department costs 20 or 30% of total revenue, this kind of improvement means a dramatic impact on the bottom line.
How can you use lead scoring to achieve this kind of benefit for your organization? Here are some practical tips you can use to get started with lead scoring today.
Define your ideal target
As I wrote in B2B Marketing: Blind Date to White Wedding, the job of building relationships with prospects has many parallels to the world of building relationships in the “real world” via dating. Just as in dating, you need to start by identifying your ideal target. You might decide that you are looking for a doctor between 35 and 40, in your geographic area, with his own practice and privileges at several hospitals. It would also be nice if he likes dogs, since you have two prize labradoodles. Over the course of your first couple of dates, your goal is to find the answers to these questions.
In B2B marketing, you must also identify (and document) your ideal target. However, unlike dating, you need to build consensus across the company—especially with sales—about your ideal target. This profile will typically include basic demographic and firmographic information such as company size (or other metrics to indicate potential deal size), industry, and job title or job role. The source of the lead can also tell you a lot about the quality of a lead (g.g., inquiries who click on a PPC ad are more likely to be hot than ones who came from a purchased list). Since you can’t always control who is going to respond to your demand generation programs (though good targeting can help), you can use lead scoring to float the top respondents to the top. Among other things, this can help your telequalification team know who to contact first.
The most common method for lead scoring is to use a basic points system. For instance, this might look something like:
- Lead source = PPC: +5
- Job Function = IT Manager or Director: +5
- Job Function = sales or account manager: -2
- In the US or Canada: +4
- More than 100 employees: +3
- Healthcare or pharmaceutical company: +3
Note that you don’t necessarily need to get all this information during the first visit. Remember, each additional field on a form reduces your conversion rate. Instead, just collect the basic information up front, and then buy the additional data or use “progressive profiling” to fill in the blanks. Progressive profiling uses smart forms to recognize existing contacts in your database. Forms are then automatically completed when the answer is already known so a longer form can be presented. This lets you learn about the prospect over time, just like in dating.
Identify BANT criteria
In addition to demographics and firmographics, it’s often important to identify where the prospect is in their buying cycle. This information is often called the “BANT” criteria, meaning Budget, Authority, Need, and Timing. In other words, does the inquirer have money to spend, can they make the purchasing decision, do they have an identified need that will lead to a purchase, and will they be purchasing soon?
This type of information is notoriously difficult to collect via a basic online form (though that doesn’t stop many misguided companies from trying), but it usually works to have a basic telequalification process that tries to connect with early stage inquiries to collect this information directly.
Measure engagement and interest
As important as demographics and BANT criteria can be, there are serious limitations to relying on them alone. In particular, they tell you only how interested you are in the prospect—and nothing about how interested the prospect is in you. Just as in dating, unrequited interest usually ends badly.
What’s needed is the ability to measure prospect interest and engagement. This is done by tracking their behaviors and assigning a value to each one. For example;
- Clicks link in email: +3
- Completes form: +5
- Attends webinar: +10
- Visits product benefits page: +3
- Visits any company web or blog page: +1
You can also subtract points if a prospect’s engagement goes down. For example, if the prospect has visited the website in 30 days, then subtract 5 points. Over time, this simple approach to lead scoring is great way to find which prospects are really engaging with your brand, and which ones aren’t.
Bringing it together
You can combine all these ideas into a single unified lead score, which is the simple sum across all the demographics and behavioral scores. For example, a total of 25 might determine a “warm” lead, while a 65 is “hot.”
However, you may want to create more than one category of score. For example, consider separating the score into “fit” and “engagement” categories. That way, you can separate the ones that are highly engaged but not a fit for your company, as well as the ones you really want to sell to but are not yet engaged.
Also, companies with multiple product lines may want to create separate scores for each major category, so you know which product the buyer will be most interested in based on lead source and behaviors. Finally, don’t forget that for B2B companies, the average sales cycle involves interacting with somewhere between six to 21 individuals in the buying company. Therefore, if you start seeing multiple contacts from the same company, that alone is another sign of engagement. So, you might want to increase the score for each of the leads up by a certain amount, as well as tracking a “company score” that is the sum of scores across all contacts in the company.
Jon Miller is VP of Marketing for Marketo, a provider of B2B marketing software that automates lead management processes including lead nurturing and lead scoring. The Strictly Business column appears Wednesdays at Search Engine Land.
Opinions expressed in this article are those of the guest author and not necessarily Search Engine Land. Staff authors are listed here.