Lead Scoring

Just as the score of a sports game determines which team is the best competitor, lead scoring allows companies to determine which sales lead is the strongest, or the most ready for sales. And, just as the score of a sports game tells a story of practice, teamwork, coaching, challenges, and failure, the score of a lead reveals a complex narrative of a company’s behavioral patterns, demographic information, and sales-readiness.

What Exactly is Lead Scoring?

After inbound marketing helps your business attract large volumes of leads, the challenge become separating the high quality leads from those that are just in the initial stage of research. This is where lead management, and specifically lead scoring, comes into play. Essentially, lead scoring is the process of enumerating a lead’s level of interest and sales readiness, or attaching a value based on the lead’s quality. While these leads can be scored in a variety of ways (such as with numbers, letters, or words), what is important is that the score takes into account demographic attributes, behavioral patterns, budget, need, and timeline considerations.The purpose of lead scoring is three-fold:

The Importance of Lead Scoring

Put simply: all leads are not created equal. Throughout the buying process, different organizations are at different stages of sales-readiness. It is essential for your business’ marketing and sales divisions to know where each company stands in order to increase productivity and, in turn, revenue. Companies that are close to buying, for instance, should be put in touch with a salesperson, whereas more hesitant prospects would benefit from further nurturing by the marketing division.Oftentimes, the marketing department will receive a list of thousands of leads. When searching through all the potential prospects, it is important for a business to be able to decide efficiently and accurately which lead is most important to pursue. In business terms, a high lead score will make a prospect MQL (or SQL; for the purpose of this post, we’ll use them interchangeably), which stands for a marketing/ sales qualified lead. When a lead is SQL, that lead is assigned a salesperson. The process of lead scoring ensures that a salesperson does not waste valuable time pursuing prospects that will not convert into lucrative opportunities.

Behind the Number: How a Lead is Scored

Companies must consider two different types of information when approaching lead scoring: explicit and implicit data. By definition, explicit scoring is based on data the prospect gives you directly, such as his or her contact information. Implicit data, however, is based on information that your company observes or infers about the prospect, such as his or her online behavior. By fusing together these two scoring categories, companies are able to gain a holistic view of the prospect’s sales-readiness and their future value to the business.Implicit and explicit scoring can be further broken down into two distinctive categories: Behavior (implicit) and Profile (explicit). Prospects’ behaviors are interpreted as actions that express their interest, such as opening an email, visiting a website, and downloading a white paper. Their profile, however, is their specific role or position within a company. For example, your business might be more interested in the profile of a Vice President than a student, who could very well just be completing a research project. More specifically:

Both behavior and profile are quantified, with more “points” being granted to the actions or roles that are most likely to convert to sales. In the example above, a Vice President would be granted far more points than a student, as they are more likely to invest in a business or product. If the behavior of the Vice President is similarly promising, such as prolonged website activity, he or she might be given a lead score of nine out of ten. In that case, a salesperson would contact him or her directly to convert the prospect into a lead.
Also thrown into this complex calculation is an acronym called BANT, which includes the following considerations:

The Lead Scoring Scale

There is no standard scale for lead scoring; the method of enumeration depends on the business or company. Teleark, for example, uses a scale from 0-10 (based on both profile and behavior) in order to determine the quality of a lead. A lower number correlates to a prospect that is less likely to pursue a sale, while a higher number means that a sale is extremely likely. Other companies might quantify their leads on a scale of 0-100, while others may even assign letter grades (and who wants a lead with an “F?”) Oftentimes, these numbers or letters are accompanied by words like “Cold” (0-2 on a 10 point scale), “cool” (2-6), “warm” (7-8), and “hot” (9-10). The exact number in and of itself is relative; what’s important is whether the number is generally high (warm to hot) or low (cool to cold).Action is determined based on these qualifiers. While the range varies by company, a sample business may, for instance, choose to send leads between 0-4 (or 0-40) to marketing in order to nurture potential prospects, leads within 5-6 to telemarketing for qualification, and then leads 7 and above to salespeople. Again, this varies by company and by the sheer quantity of qualified leads available.It is important to remember that, because a lead’s activity can change from day to day, a lead’s individual score can also fluctuate across time.

Lead Scoring = Lead Quality

Lead scoring allows a business to identify the highest quality lead possible by taking into account both behavior and demographics. The quality of a lead, therefore, directly corresponds to how high or low the lead score is. According to Stu Schmidt, the Vice President of Solution Sales at Cisco Webex, a 10% improvement in lead quality can have as much as a 40% improvements in sales productivity. Determining lead quality is absolutely essential, and it is nearly impossible without quantifiable lead scoring.

Approaching Lead Scoring: Basic and Advanced Techniques

Before a company begins implementing lead scoring, a few basic decisions must be made. First, marketing and sales should be aligned in what their ideal “target audience” is and in what constitutes a “sales-ready lead.” Then, this sales-readiness should be assigned a score threshold (such as 8+), so that the sales department will know when a lead is hot. This score should be within the chosen lead scoring methodology, such as using points (0-10 or 0-100), letter grades, or terms such as “cool” and “warm.”The next, and perhaps easiest, step an individual company should take in lead scoring is assessing the profile of each prospect. Numbers should be assigned based on this profile; for example, a Vice President might be assigned two points, a Director might be assigned one point, and a student might be assigned negative points. Location, as well as company budget, should also be taken into consideration.Scoring the behavior itself can be inundated with complexities. Straightforward places to start are by considering the number of events the prospect attended, the quantity of web pages visited, the amount of time spent on the web pages, number of downloads, and overall company engagement. Advanced techniques to begin approach the scoring can include:
1) assigning lead scores according to implicit data, such as the online clicking behavior of both known and unknown website traffic,
2) generating automated marketing campaigns, and then incorporating lead score triggers within them, and 3) setting up sales team alerts when lead score thresholds are met.

Common Lead Scoring Errors

The complex methodology behind lead scoring can sometimes lead to inaccurate scores. Three common lead scoring pitfalls to look out for are:

Teleark’s Lead Scoring Approach

The majority of the time, it is more cost-effective and time-efficient for a business to hire a lead generation company to develop an individualized lead scoring methodology. Teleark’s approach to lead scoring is two-fold, with input from both the marketing and the sales side. With the aid of marketing automation, Teleark is able to use email marketing to effectively reach a broad audience. This audience is then assigned a score based on their actions with the email campaign, such as clicking on links or downloading an attachment. From a sales perspective, Teleark then follows up with the warmest (7 and above) leads through personalized emails or phone calls. They then also attempt to set appointments for follow-up. By using this two-sided approach, Teleark is able to improve its chances of setting an appointment by only contacting the best leads after pre-established behavioral patterns. Software is then used to analyze and sort through the results.Teleark’s approach is distinctive from other lead generation companies. While other services require the client to set up the lead scoring system and to implement the marketing automation system themselves, Teleark packages these services together, making them responsible for both the lead scoring functionality and the follow-up email or call on behalf of the customer.

What Happens After the Leads are Scored?

Once the leads have been scored, they are delivered to the salespeople or placed into marketing’s nurture campaign. Now what? It is essential for companies to continuously review their lead scoring techniques in order to continue generating quality leads. Companies should continue to:

Lead scoring is a complex, ongoing process. But, when done correctly, lead scoring can drastically increase a company’s sales and revenues. Trusting lead generation experts, such as Teleark, with your lead scoring will ensure that no high-quality lead gets left behind.