The concept of lead scoring has been around for several years, and many companies have begun some sort of lead scoring program. However, in a Dreamforce session today, I heard a surprising quote:
61% of B2B companies send all leads to sales but only 27% are qualified. (Marketing Sherpa)
Or, in other words, 73% of the leads sent to sales are not qualified, or not ready for sales contact. That seems pretty staggering since we have all heard about lead scoring in some form or another. I think there is still a perception that setting up lead assignment based on scoring is hard.
Another common response from my clients is that sales does not trust the lead score. Despite these common challenges, there is still hard evidence that implementing lead scoring will result in more revenue as evidenced by these session quotes:
Companies that automate lead assignments see 10% or greater increase in revenue within six to nine months. (Forrester Research)
High-performing sales reps are 4.5 times more likely to have a 360-degree view of customers than under-performers. (Salesforce State of Sales Report 2015)
Today, those companies that are using some form of lead scoring to determine the better leads to pass to sales are seeing better results. But, even better results are possible by adding lead grading to the mix. Here are clear definitions of lead scoring and lead grading that explain the differences between the two.
Lead Scoring: Used to quantify digital behavior with a numeric score. Then scores can be compared to other leads to identify the most engaged lead.
Lead Grading: Used to grade how interested, we as a company, should be in a prospect. It is based on explicit factors. The factors are typically demographic, firmographic and/or custom attributes important to your sales process. With Pardot, lead grading is designed to run on a scale of F to A+.
Applying the definitions to an example demonstrates how lead grading can enhance your efforts to find the best leads.
For example, take two prospects with different scores, prospect A has a lead score of 2 and Prospect B has a score of 4. It would appear you should follow up with Prospect B based on score alone.
However, when you apply grading, prospect A has a grade of B+ and prospect B has a grade of D.
Grading adds another dimension to pre-qualifying leads for follow up.
I thought the simplicity of this example is what makes it powerful. Instantly it is clear that grading will make it easier to find the best leads. But, how to address the problem of sales not trusting scoring? And, now I am talking about adding grading in addition to scoring.
I agree with the presenter that you must get the right people from marketing AND sales into a room and map out the scoring and grading on a white board. Then test various scenarios to see how the leads come through the process. Do they end up with the expected grade and score? If not, maybe you need to adjust the scoring or grading. Including sales in the discussion and planning will align sales and marketing on what a qualified lead looks like. This will also remove the emotion and subjectivity from qualifying leads. Using lead scoring and grading aligns those (prospects) interested in your company with those leads that your company is interested in.
Scoring in Pardot comes turned on by default, but, grading is not setup because it is so unique to each company. There are many great articles in the Pardot knowledge base to help you begin grading leads at your company.
Here are some typical grading criterion to help you get started:
- Company Size = 1/3 letter grade when crossing each range
- Location = 1/3 letter grade (based on your categorization)
- Industry = 1/3 letter grade (based on your targets)
- Department = 2/3 letter grade (based on your targets)
- Title = 2/3 letter grade (based on your targets)
Scott Roose is a certified Pardot Consultant and also holds an MBA in Marketing from Regis University.
