Lead the Way! A Comprehensive Guide to Qualifying and Scoring Leads
There’s an old adage that goes, "Not all leads are created equal."
In fact, some leads are downright gold while others are not worth their weight in dirt. That's where lead qualification and scoring come in. These essential processes help marketing and sales sift through the noise and zero in on the most promising prospects. But it's not just about identifying the "good" leads. Lead qualification and scoring can improve the customer experience, streamline the sales cycle, and boost your bottom line.
In this guide, we'll walk you through everything you need to know to become a lead qualification and scoring expert. From identifying the right criteria to refining your processes, we're here to help.
What is lead qualification?
Lead qualification is a crucial step in the sales process that involves assessing the potential of a lead to become a customer. In simple terms, it's the process of determining if a lead is a good fit for your business.
This requires gathering information about the prospect, their needs, interests, and pain points. By asking the right questions and collecting data through various means, such as online forms, social media interactions, and phone calls, you can get a better understanding of whether a lead is worth pursuing or not.
What is the lead lifecycle?
The lead lifecycle is incredibly important because it allows businesses to effectively manage their relationships with potential customers and move them toward becoming customers. Mastering the lead lifecycle allows businesses to develop strategies that optimize their interactions with leads at each stage of the journey.
Let’s take a look at our breakdown for each lead lifecycle stage:
- Lead: This is where it all begins. Someone stumbles upon your blog post, perhaps through a Google search or a social media share. They might read a few paragraphs, then bounce away. But if they're intrigued enough to take some kind of action -- such as filling out a form to download a free resource -- then congratulations! You have a lead.
- Engaged Lead: So, you have a lead. Now what? Well, you want to keep them engaged, of course. Send them a follow-up email, maybe even a personalized video message. Show them that you're not just a faceless company, but a team of real human beings who care about their needs.
- Marketing Qualified Lead (MQL): A MQL is someone who has shown enough interest to be considered a potential customer. At this point the lead has reached a certain threshold. They might have signed up for a free asset or downloaded an ebook.
- Sales Qualified Lead (SQL): A SQL is someone who has been vetted and deemed worthy of a more personalized approach. They might have expressed a specific pain point that your product or service can solve. Or they might have a budget and timeline that align with your offerings. Whatever the case, an SQL is someone who is ripe for a sales pitch.
- Opportunity: An opportunity is a lead who has expressed a serious interest in your product or service and is considering making a purchase. They might have asked for a quote or a demo. Now, it's up to your sales team to seal the deal.
- Closed/Won: A closed or won lead is someone who has officially become a paying customer. Congratulations, now there are more leads to nurture and more deals to close.
By focusing on the lead lifecycle, businesses can also identify and address potential roadblocks that might prevent leads from becoming customers. For example, if a high percentage of leads drop off during the MQL stage, it may indicate that the content being provided is not sufficiently engaging or relevant to their needs.
Types of lead scores.
You already know that lead scoring is a crucial tool for any business looking to streamline its sales process and identify the leads with the greatest potential for conversion. But not all lead scores are created equal.
There are two main types of lead scoring: implicit and explicit.
- Implicit lead scoring is about analyzing user behaviors, such as the pages they visit, actions they take, and the interests they show. This type of scoring can be incredibly valuable for identifying leads that are already engaged with your brand.
- Explicit lead scoring is based on matching prospects to your buyer profiles by comparing demographic data and other information collected from users, often through online forms. This type of scoring can help you determine whether a lead is a good fit for your ideal customer profile, even if they have yet to engage with your brand.
Once you've established your scoring methodology, you can slice and dice your leads even further with additional scoring and filtering criteria. Let’s take a look at each type:
- Demographic lead scoring: evaluates leads based on job title, company size, industry, and location.
- Organizational lead scoring: prioritizes leads based on the size and structure of the organization they belong to.
- Behavioral lead scoring: takes into account a prospect's actions and engagement with your company's website, content, or marketing campaigns.
- Product/Account lead scoring: based on a prospect's interest in a specific product or service offered or their connection to a specific account. This type of scoring is particularly useful for B2B companies that have a long sales cycle and need to focus on specific accounts or products.
- Predictive lead scoring: uses advanced analytics and machine learning algorithms to evaluate leads based on their behavior, demographics, and firmographics. This type of scoring can help you identify the leads that are most likely to convert and focus your sales efforts accordingly.
Lead scoring is not a one-size-fits-all solution. By combining different types of scoring and filtering criteria, you can create a custom lead-scoring methodology that's tailored to your business's unique needs and goals.
How to get started with the lead quantification and scoring process.
Let’s take a look at the key steps to get started with your lead scoring process.
1. Identify key criteria for scoring leads
This involves determining which factors are most relevant to your business when it comes to identifying high-quality leads.
The criteria you choose might include job title, company size, industry, website visits, social media interactions, email opens, and more. The idea is to identify the factors that indicate a lead is likely to be a good fit for your product or service and is highly engaged with your brand.
2. Assign point values for each criterion
Once you have identified your key criteria, you need to determine how many points each criterion is worth. For example, you might decide that a lead's job title is worth 10 points, while a website visit is worth 5 points.
The point values should reflect the importance of each criterion to your business and should be assigned in a way that accurately reflects the relative value of each activity or attribute.
3. Set a threshold for lead qualification
The next step is to set a threshold for what constitutes a qualified lead. This is typically known as the Marketing Qualified Lead (MQL) threshold. Leads that meet or exceed the MQL threshold are passed on to sales for further qualification and engagement.
The MQL threshold should be set based on your business's historical data and should reflect the point at which leads are most likely to convert into paying customers.
4. Regularly review and adjust your scores
As your business and market conditions change, you may need to adjust your lead scoring criteria to ensure that they remain effective. For example, if you notice that leads with a certain job title are no longer converting as frequently as they once did, you may need to reduce the point value for that criterion.
Regularly reviewing and adjusting your lead scoring criteria ensures that you are prioritizing the leads that are most likely to convert at any given time.
B2B Lead Scoring Examples.
HubSpot's lead scoring process involves assigning point values to both demographic and behavioral criteria. Here are some examples of the criteria they use:
- Demographic criteria:
- Company size
- Job title
- Behavioral criteria:
- Website visits
- Email opens
- Form submissions
- Social media interactions
HubSpot assigns point values to each of these criteria based on their perceived importance. For example, a lead with the job title of "CEO" might be worth more points than a lead with a job title of "Marketing Coordinator". Once a lead reaches a certain threshold score, typically around 40 points, they are considered a Marketing Qualified Lead (MQL) and are passed on to the sales team for further nurturing.
Marketo, a marketing automation software, incorporates a lead-scoring process that involves using predictive analytics and machine learning algorithms to assign scores to leads based on a wide range of data points. Here are some examples of the data points they might use:
- Demographic data:
- Company size
- Behavioral data:
- Website activity
- Email engagement
- Social media interactions
- Content downloads
Marketo's predictive lead scoring algorithm uses these data points to build a predictive model of lead behavior.
Based on this model, each lead is assigned a score that reflects their likelihood to convert. Once a lead reaches a certain threshold score, typically around 70, they are considered a Marketing Qualified Lead (MQL).
Why is lead qualification and scoring important?
By qualifying and scoring leads, marketing and sales teams can prioritize their efforts, enhance the customer experience, shorten the sales cycle, identify areas for improvement, and increase their ROI. This process allows both marketing and sales to work together by adjusting and optimizing the process for the best outcome.
Let's explore each of these reasons in greater depth.
Prioritizes sales efforts
By qualifying and scoring leads, sales teams can focus on the leads that have a higher likelihood of converting into customers. This allows them to allocate their resources to the most promising leads, ensuring that they are using their time and energy efficiently.
Improves customer service
Lead qualification and scoring help sales teams to better understand the specific needs of each lead and tailor their sales approach accordingly. This personalized approach creates a positive customer experience that can lead to increased customer satisfaction and loyalty.
Reduces sales cycle time
By focusing on qualified leads that are further along in the buying process, sales teams can reduce the time it takes to close a sale. This shorter sales cycle allows them to move leads through the sales funnel more quickly and frees up resources to focus on other leads.
Identifies areas of improvement
Lead qualification and scoring provide valuable data that can help sales teams to identify areas for improvement, such as targeting or messaging. This data-driven approach enables them to make informed decisions about their sales strategy and refine their approach to achieve better results.
By focusing on qualified leads that are more likely to convert, sales teams can maximize their ROI and drive revenue growth. This ROI-driven approach ensures that sales teams are operating at peak efficiency and delivering the best results possible.
All in all..
Lead scoring is not just a buzzword in the world of sales and marketing. It's a crucial process that helps companies identify and prioritize the leads that are most likely to convert. It also allows businesses to focus their efforts on the prospects that are most likely to become customers, ultimately leading to better ROI and a more efficient sales process.
As mentioned in this blog, lead scoring isn't a one-size-fits-all solution. Each company must develop a lead scoring system that works for its unique business needs and target audience. By regularly reviewing and adjusting the scoring criteria, companies can stay relevant and effective in their lead-generation efforts.
The goal of lead scoring is to create a more personalized experience for potential customers while also streamlining the sales process for businesses. By taking the time to understand the needs and behaviors of their leads, companies can provide better service and ultimately drive more sales.
For more on lead scoring please reach out to our team.