He Shoots! He Scores! Why Your Business Needs Lead Scoring
I just heard it again today… “All I care about is leads. Just send my sales team lots of email addresses and let them take care of the rest.”
But, that’s a quick way for your business to lose thousands of dollars, burn out your sales team, and not give you the ROI that you are looking for. Lead Scoring reduces or eliminates all of those, but more about that in a minute…
It’s actually pretty common when a company first starts marketing online. All they care about is how many names they can add to their email list.
So, they take every name they can get, and treat a fake name from half way around the world the same as the executive down the street who needs your service yesterday. They add pop-ups all over the place, and do anything possible to entice subscribers to give up their email address.
And then they rejoice every time a new name goes into their mailing list. I'll be the first to admit, that seeing lots of names is pretty exciting.
Weak Leads are Worse than No Leads at All!
But, that excitement doesn’t last. Soon, within a couple or months, or less, your sales team starts complaining. They grumble that your leads are crap.
They spend hours trying to sell to someone who isn’t ready. And meanwhile your hot and ready prospects are dropping off the radar and going with your competitors.
Eventually, they stop following up…
And all the money you are spending on a website is wasted. And no, it’s not because your sales team sucks.
According to raintoday.com, only 25% of new leads that come to your website and enter your sales funnel are ready to buy today. 75% are researching and need further engagement and nurturing. Some will never buy, and know it.
So, how do you know which customers are ready to buy? And how does your sales team know where they should be spending their time?
Lead scoring simply means applying a “score” to each “lead” in your system. The higher the score, the better the prospect. With a score, you know where and when to spend your time; individuals or business who are hot.
Pretty simple, right?
Ok, not quite. There is a lot of science and analysis behind effective lead scoring. But, as you will see in a moment, it is worth it when you can get it right.
In fact, according to Marketo, a leading marketing automation firm, a 10% increase in lead quality translates into a 40% increase in productivity.
Lets look at it another way. Imagine you have 1000 email addresses. And those leads have 1% close rate.
Your sales team needs to work with 1000 leads in order to close 10 of them.
That’s over 990 wasted phone calls, sales presentations, emails…
Some were “spammers” or competitors; others may have been interested but not ready to buy. Others may have been ready, but because you were busy with the other 990, they have since moved on.
Better Lead Generation
But, here’s another scenario. You gather more information on your lead page than just an email. This increases resistance, but gathers more information.
Because of this extra friction, only 100 people sign up. But, these are 100 people who have some interest in your product since they went through a little more work to signup.
In this case, you close 10%. This means you get the same 10 sales as before, but this time your team has only spent time with 100 leads, 900 less than before.
That’s good, but could be better.
Lead Generation with Lead Scoring
Now, let’s say the same hundred leads sign up, but you are able to assign a score to each. 25 of your hundred leads have a higher score than the others, which indicates a readiness to buy.
Now, your sales guys can focus on those 25, and close a large number of them, because you know they are likely to buy today.
Even better, the other 75 can be gradually nurtured, and when they move into the buyer stages, you know about it. And you can engage when they are ready. Prospects who are never going to buy keep a low score, and your reps never waste their time.
In a nutshell, lead scoring qualifies your leads; so you know exactly where, and when, you should be spending your time.
Using resources to try and push prospects that are not ready to buy – or worse, aren’t even a potential customer, wastes time, money and frustration.
In coming articles, we are going to discuss different lead scoring methodologies, getting started with Lead scoring and automation tools like Optify.
For more information, contact us for a free consultation. We will do a free audit of your existing marketing, and discuss whether or not lead scoring can be a benefit to your business.
Leads are the lifeblood of your business. But the days of trying to hard sell your product or service to cold leads are over. Spend your time with hot leads that are ready to buy now.