What is the Purpose of Lead Scoring?
Lead scoring is the practice of ranking or rating your leads based on information known about the lead. The lead score is generally calculated using some sort of algorithm based on explicit (demographic) information the lead has provided you such as their role, industry, source, etc. as well as implicit (tracked) information learned about the lead by monitoring their website behavior or interactions with your company’s online content.
A lead score can be a number or a letter grade and the process of calculating it can be simple or complex, but first and foremost we must understand the purpose of scoring leads. Here are a few:
1. Identify the Best Fit for Your Organization
All leads are not created equal. If that were the case, every visitor to your site, every person who shared their information with your company would become a customer. One goal of a lead score is to determine who is most likely to purchase your company’s products.
If your products are worth hundreds of thousands of dollars, it is unlikely that a high school student will be on your site looking to engage with your sales team. However a student could be researching some information about your company or your products for a project. Identifying your best potential customers while filtering out your least likely customers is critical to a good lead scoring algorithm.
2. Figure Out Who’s Ready to Buy
Another important aspect of your lead score is figuring out who is ready to buy. Imagine all the leads in your salesforce database are a good fit to buy your products. It is still likely not all of them have budget approval, an immediate need or its the right time. By tracking your leads activity on your site or interactions with your company you could determine who is closer to making a purchase decision and use your lead score to prioritize those leads.
Calling all your leads can be a huge waste of time. A lead who has viewed a product demo, participated in a trial and reviewed your pricing page is probably more likely to buy than someone who simply attended an educational webinar. A lot of smart people just like to keep up with the industry but may not be interested in buying your product. Use the lead score to identify those folks and filter them out.
3. Make Your Sales Team More Productive
An unproductive sales team is a cost center for your organization. Calling all leads is a waste of time, especially if they are not a good fit and not ready to make a decision. The purpose of your lead score should also be to ensure your sales team is talking to the right people at the right time and they are having relevant conversations. More importantly this should happen in the right order so they are calling their best leads first.
4. Use Data to Determine Lead Quality
Famous, American stats professor, W. E. Deming said, “In God We Trust, All Others Bring Data.” While gut feel has its value in determining lead quality, it is not consistent and cannot be tracked easily. It is important to use the same criteria with the same weight to identify your best leads and using data is the only way to do that consistently.
5. Do Better Marketing
By using data to track quality, marketers can track which “scores” are culminating customers. With this information they can make intelligent decisions to put emphasis on one program over another and deliver a higher volume of leads that have a better chance of closing. This makes your sales team more productive and also reduces your marketing costs as you need only generate fewer, high quality leads to hit your sales targets.
There are various marketing automation tools available to score your leads such as HubSpot, Marketo, Eloqua and Silverpop and you can also use Salesforce.com to do lead scoring. In future posts we will cover aspects of each of these tools and their pros and cons.
How do you use your lead scoring to optimize your sales and marketing efforts? Please share your thoughts in the comments.
Photo credit: Ciccio Pizzettaro