Defining Leads and Implementing Lead Scoring

The First Step to Define How Many Leads are Enough

Let’s talk about what a real lead is. This is the first step you need to take if you want to end the debate of “how many leads are enough”. If you ask every person in both Sales and Marketing to define a lead you are likely to get different answers from everyone unless you have established a clear definition and are managing people to adhere to it. Think about the situation that real buyers are in. No matter what they are buying they commonly have five characteristics.
 

They Can Clearly Articulate a Problem

Generally, if lead can’t explain exactly what problem they are trying to solve it usually means they are not a real decision maker in the process and are just there to gather information for someone else. It also could mean they have not felt enough pain from this problem that they are really willing to take action to fix it. 

They are Part of a Decision Making Unit (DMU)

It you are not familiar with the DMU term it really means they have one of three roles: 1) they recommend which product(s) should be bought or evaluated; 2) they have a heavy influence on the decision in someway; or 3) they actually make the decision and sign off on it. Obviously, having the decision maker is best but the other two are fine for these purposes. 

There is an Impending Event Driving Them to Fix Their Problem

This can be anything ranging from a quarterly goal, to a need to use budget dollars before they lose them, or the fear of being fired. The commonality is that there is a painful consequence for the lead if they have not solved their problem before the impending event. 

They Have Money and are Willing to Spend it to Solve the Problem

This can be the toughest to discern of all. Sometimes leads will say they have budget but they really don’t. The best way to figure this out for sure is to ask questions about the buying process—i.e. “We commonly find when companies buy our product that there is a group of people involved and a series of steps that need to happen. Can help me understand how the buying process works with your organization?”  If the lead can articulate a credible response to this question, you will know if they actually have the authority to spend money and who your influencers will be. 

Your Product Solves their Problem

If the lead has all four characteristics except for this one it is still a great lead, just not for you. I can’t tell you how many times I’ve seen frustrated sales people try to make-shift their product into something it’s not to get a signed contract. Most often they end up wasting enormous amounts of time explaining away why their product comes up short in some critical requirement and they don’t get the sale. Once in a while they can be successful in fooling the buyer, but inevitably it hurts them in the long run. When the buyer figures out they have been deceived, they either want their money back or worse, they make sure all of their peers don’t ever buy from you. Don’t let your Sales team fall into this trap. Refer these buyers somewhere else. 

So, here is a way to score the leads based what you know about them. If a lead has four or five characteristics it can be considered a hot or “A” lead. If the lead has three of these attributes it should be considered a warm or “B” lead. If the person has less two or less it should be put back into a marketing lead nurturing cycle until it reaches three or more (I’ll talk about that in another blog).

If the person that runs marketing and the person that runs sales can agree on using this criteria to define lead scores, the next step is to hold everyone accountable to the new definitions. Start with training everyone in both groups about the new definitions for leads and rules for scoring them. Then comes the hard part, enforcing the rules. The Sales VP has to be the heavy in this situation, not the Marketing VP. Sales needs to be responsible for ensuring all leads are scored or it won’t ever happen. The best way is to track it in your CRM or sales automation system so everyone has visibility to who is scoring and who is not.

So what do you gain from this process? Well, there are some quickly realized benefits including visibility to the parts of the sales and marketing engine that are working and which are not. You will also immediately begin to see alignment between sales and marketing efforts. Most importantly, you will start to create history that you need to be able to discern exactly what types of the leads are really creating revenue opportunities and which ones are a waste of time. You need this to accurately create a lead goal, so it’s a very important first step. Next blog we’ll talk about the critical metrics you need to capture and maintain.

Before I end, here are a few side notes to think about:

> Sales people will naturally try to downplay the quality of their leads because no one wants to admit that they received a lot of hot leads and didn’t make many sales. Consider hiring a lead qualifier that is dedicated to scoring leads and passing them on to an account executive. They should work for the Sales VP but dotted-line into the Marketing VP. I’ll talk about the role of this person and how important they are for maintaining lead scoring consistency in a future blog.

> Sometimes it can be hard to score a lead quickly. There needs to be some time allocated to getting the lead on the phone and it may take two phone calls before you can discern whether they have all of the criteria. Give your sales team a week to score them but remember scoring should always happen before any opportunity is created. 

> Try not to customize your CRM to accommodate scoring. Most CRMs have this type of functionality out-of-the-box if you look hard enough and there are probably some canned reports to track scores.

Feel free to join the conversation by posting a comment. I’d love to hear from others that have implemented similar systems and how they have worked.