Lead Nurturing Guide Part 3: The Importance of Lead Definition & Determining Sales-Readiness with a Lead Scoring System
In the two prior installments, we defined the elements of an engaging lead nurturing program as well as goal setting in a lead nurturing program. Taken from the latest edition of The Definitive Guide to Lead Nurturing by Marketo (@Marketo), this installment will show marketers how to define the perfect lead so that they can “determine who to nurture and who not to nurture”.
Marketo defines a good lead as “a qualified prospect that is starting to exhibit buying behavior”. To create a universal lead definition that will be embraced by the entire organization, the sales and marketing departments need to brainstorm.
Some of the questions sales and marketing could go over during these sessions include:
- What does the target market look like?
- What contacts can be found in the existing database?
- What type of prospects are sales currently communicating with?
- What type of buyers are they closing?
Marketing and sales base levels also need to be established to help both departments identify leads that are good enough to get nurtured and passed on to sales for conversion. Of course, both departments need to meet on a regular basis to review and update their lead definition as the organization grows and priorities change.
Determining Sales-Readiness with Lead Scoring
In order to more objectively establish sales-readiness, lead scoring needs to be applied. Leads can be scored based on the level of interest they show in the business, their current place in the buying cycle, as well as their demographic fit. These key indicators will let marketers know “where each lead is in his or her buying cycle,” which in turn leads to proper segmentation and nurturing.
Lead scoring can help marketers determine if prospects need to be fast-tracked to sales or nurtured further. According to Marketo, companies that use lead scoring see a huge lift in ROI, and “their sales teams spend less time selling and more time closing deals.”
Marketing and sales need to collaborate in order to create a lead scoring strategy, as well as determine the scores that will be assigned to each corresponding action. The lead scoring strategy needs to be based on the business’s priorities and buyer readiness, and is intimately connected to the business’s lead definition.
The four dimensions of lead scoring—lead fit, lead interest, lead behavior, and buying stage and timing—can help marketers determine leads who should continue to be nurtured and those that can be fast-tracked to sales.
Explicit lead scoring is based on observable data or data that is directly obtained from leads (from online forms or the registration process, for example). Other indicators—such as demographics, firmographics, as well as BANT (budget, authority, need, and time)—can help marketers determine how well prospects fit their ideal buyer profile.
Demographics are quantifiable identifiers that characterize the marketer’s lead population, whereas firmographics refer to organizational characteristics that help marketers identify ideal customers.
BANT, which is a more advanced form of lead qualification, covers the following areas:
- Budget: Can the lead in question afford the product or service?
- Authority: Does the lead have the authority to purchase the product or service?
- Need: Is there a pain point that the product or service can solve?
- Time: What is the lead’s purchasing timeline? Does the purchasing timeline align with the sales cycle?
Marketers should also consider scoring for negative demographic fit; this could apply to leads with invalid phone numbers or generic email addresses, for example.
Implicit lead scoring is done by tracking the prospects online body language, which will help marketers measure the prospects’ level of interest in the product or service.
Marketers also need to track and score additional factors, such as behavior, to help them distinguish between early-stage prospects and more active leads that are ready to make a purchase. Figure 1 shows Marketo’s scoring system for latent behaviors that correspond with engagement and active behaviors that correspond with buying intent.
Buying Stage and Timing
Buying stage and timing can help marketers determine where leads are in the sales cycle—whether it’s the early stages or closer to conversion.
We’ll dive deeper into buying stage and timing in an upcoming installment of this series.
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