Lead Quality Is In The Eye Of The Beholder; Let’s Set Inbound Marketing Lead Quality Criteria
“Bad leads! These are bad leads!”
Many years ago, we had a client who shared this feedback. It still resonates with me to this very day. Is there such a thing as a “bad” lead?
There are different types of leads, including leads at different stages of the buyer cycle and differences in the level of qualification associated with the lead. But if someone fills out a form on your website, expressing interest in what you do and how you do it, is it still possible that’s a bad lead? I don’t think so.
I do think that having more leads at the bottom of the funnel is better than having more leads at the top of the funnel. Marketing’s job is lead generation and revenue. Bottom-of-the-funnel leads are ready-to-buy leads, which means a bigger, more dramatic impact on closed sales. I do think you want to generate as many qualified leads as possible and help the sales team focus its limited energy on the more qualified leads while letting marketing nurture the unqualified or top- and middle-of-the-funnel leads.
It appears the real question is this: How do we properly measure lead quality, define lead quality and then build a nurturing and sales effort to efficiently turn as many leads as possible into sales opportunities and revenue?
How Do You Define Lead Quality?
Lead quality is in the eye of the beholder, so no one can tell you what a quality lead is; only you know. Is it someone ready to buy today? Is it someone who has visited 10 pages on your website? Is it someone who has viewed the pricing page? Is it someone who has requested a consultation with your team? Each of these actions could produce a high-quality lead.
Is a high-quality lead defined more based on demographics or psychographics? A person from a bigger company might be considered a high-quality lead. Someone with a more important title might be a high-quality lead. Or perhaps someone with a certain career or educational background might fit your definition of a high-quality lead.
You have to set the bar and the criteria, keeping in mind that often qualification is a mindset or a desire to buy. This means your leads might move between categories, starting at a lower-quality category and over time moving into higher-quality categories. Your prospects’ ability to move across the quality spectrum is exactly why we encourage our clients not to discard low- or poor-quality leads. Instead, properly nurture them so they evolve and transition with your company into higher-quality leads that produce revenue.
How Do You Measure The Quality Of Your Leads?
Measuring quality is a lot easier than defining quality. Once you know how you want to define quality, setting up the systems to collect, track and evaluate data is relatively easy. For example, if we want to use some of the criteria discussed above, we just have to capture that data. Website page views? No problem. Execution of particular forms? No problem. Info capture like title, company size and other demographic info? No problem.
Now it might get a little more complicated if you want to bundle a series of data points together to create a more detailed lead-scoring algorithm. For example, your definition of a high-quality lead might be someone with a CEO title, from a company with over 1,000 employees, who visited the pricing page and who downloaded a particular e-book. This profile makes a lot of sense and can be built to produce a score that flags and responds accordingly to this data. This type of approach typically needs testing and tweaking to make it highly effective. Keep that in mind as you plan your marketing for 2017.
How Do You Qualify Leads?
Qualify is different than qualification. You can produce a high-quality lead that is not qualified. The lead might be the perfect type of business, the right size, with right person on the phone and you might have other customers just like them. Sounds like a high-quality lead, right?
But the person might not have the authority to make a purchase decision. The business might not have the budget to afford your services. The business might be a horrible fit for your company culturally. See the difference? It’s very important to understand this concept, and it’s especially important for sales to understand this.
When it comes to qualification, this is almost always a sales exercise, not a marketing exercise. Why? Because sales has the ability to drill down into the specifics and it’s rare for people to provide that level of information on a form via the web. However, they will almost always reveal this important information during live conversations with salespeople.
While you should apply lead scoring as we discussed above, you also have to apply a process to qualify the lead. The term marketing-qualified lead (MQL) is typically used to describe leads who have expressed interest in what you do. They’ve completed a form on your website and took the first move to identify themselves to you. The term sales-qualified lead (SQL) is typically used to describe the next level of qualification. Not only did they qualify by expressing interest, but sales had enough of a conversation to feel like the prospect is qualified enough to continue the conversation.
How Do You Score Leads And Have Sales Focus On The Best Leads?
Lead scoring can be simple or incredibly complex. In most cases, we recommend starting simple and growing into a more complex program. Here’s an excellent article on how to apply lead scoring at your company.
Basically, you want to look at data and use that to calculate a lead score. The challenge becomes determining what data indicates qualification and/or intent to buy sooner than later. Initially, you might think prospect demographic data leads to qualification and intent. CMOs might be more qualified and likely to purchase than marketing managers. Bigger companies might be more qualified and likely to buy your product/service than smaller companies. You get the idea. This isn’t always the best way to gauge intent, but it’s one way.
A better way, from our experience and from our research, is type of offer requested. For example, people who request top-of-the-funnel offers like e-books or infographics are usually less qualified and less likely to buy than people who register to attend a webinar, and those registrants are usually less qualified than people who complete bottom-of-the-funnel offers like “grade my website” or “assess my current inbound program.”
Finally, you can also apply scoring criteria to online behaviors like pages visited, number of times these key pages were visited, number of forms/offers downloaded and the types of offers requested (as we mentioned above). There could also be value in where the lead came from. For instance, leads that are referrals might have a higher value vs. those that simply found you online.
Once you’ve created your scoring criteria, you then have to apply a numeric value to each criteria and do the math. Most marketing automation platforms do that for you, producing a lead score that can then be converted into actions or tracks for your sales team.
How Do You Nurture High-Quality Leads Who Are Not Ready For Sales?
The first insight your new approach to leads, lead qualification and lead scoring is going to uncover is that most of the leads are not qualified and not high quality. This shouldn’t be any great revelation. When you consider the funnel concept, many go in at the top and only a few fall out at the bottom. By definition, more are going to be low quality and unqualified.
But this is where most people go bad. They ignore the top-of-the-funnel leads. They consider anyone who doesn’t want to buy something right now to be a bad lead or even an unqualified lead. This is a huge mistake, so big that it can torpedo your entire marketing effort. Instead of ignoring them, calling them bad or discarding them, try nurturing them.
I’m going to tell you that there is gold in those top-of-the-funnel leads, and if 90% of the leads are in the top or middle of the funnel, new customers are in there — you just have to find them. You do that systematically by creating lead-nurturing tracts for these leads.
When you start nurturing them, they move down into the funnel. You get more intelligence on the lead, increasing their lead score. You move them back to your website, which gives them access to more information. It works beautifully. Better yet, a lot of this nurturing work can be automated. Now these leads, who were previously discarded because they were bad leads or not ready to buy today, become some of your best prospects and potentially some of your best customers.
Lead quality is important, but what you do with your newfound leads is more important. It’s important to understand that having some leads (even bad leads) is better than having no leads. If your marketing is producing leads and they’re poor quality or not converting into opportunities, that represents an opportunity to tweak your marketing, not scrap the entire effort.
A big component of an inbound marketing program is optimization, and dialing in the effort to produce better, more qualified leads is done during this optimization effort. There are also various lead-scoring methodologies that can be applied too. While this is typically a more advanced approach to managing your leads, its application is more common today than five years ago. Software tools like HubSpot and Marketo are making it easier to score leads and then react accordingly. We’ll show some lead-scoring models in an upcoming blog article.
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