by
David Kirkpatrick, Reporter
CHALLENGE
Marketing is collecting leads through demand generation activities such as email list sign-ups, events and website registrations. Sales wants leads -- and Sales is probably asking for a lot of leads, and wants those leads to be high quality.
The solution to Sales’ needs is a lead scoring process, particularly for the longer, complex sale that is already being managed by a combination of marketing automation and CRM software to help take leads through the entire buying pipeline.
Lead scoring is the process of creating a point structure for various demographic, firmographic and behavioral attributes, such as:
- Job title of prospect
- Industry of company
- Size of company
- Type of email address -- corporate or free mail (Gmail, Yahoo!, etc.)
- Website activity -- webinar sign-up, whitepaper download, pages visited, etc.
A new lead is assigned a total score based on these attributes.
The attribute scores can be positive or negative. For example, a lead from the wrong industry might get a negative score, and a corporate email address could receive a positive score where a freemail address might get a negative score.
A threshold score is determined and once the lead gets to that level, they are passed on to Sales.
Of course, many B2B marketers know they should be doing lead scoring … the real question is, "How?"
To help you answer that question, we interviewed the marketing team at Bersin & Associates, a research and consulting firm focused on human resources and learning professionals that primarily brings in new leads through its website and live events. The company gets its revenue from selling research memberships and human resources consulting to large corporations.
As with any B2B company with a long sales cycle, Bersin had multiple prospect touches between the lead entering the pipeline and becoming a closed deal, so Marketing sought to identify and channel the highest potential leads directly to Sales at Bersin, but still be able to nurture those leads that needed more time to become sales-ready
However, before last year, Bersin had no lead scoring program in place and was sending a very high volume of leads to Sales, but not necessarily a high quality of leads.
Read on to find out the steps Bersin took to quickly implement lead scoring into its marketing automation and CRM environment, including working with Sales to set lead scoring criteria, what attributes the company values, what lead attributes guarantee an unqualified prospect never gets passed on to Sales, and how the marketing team has already refined and improved its lead scoring program.
CAMPAIGN
Paula Reinman, Senior VP Marketing, Bersin & Associates, joined the company about a year and a half ago and immediately realized there was an issue with the way new leads were handled.
"We had no lead scoring at all," she said.
Reinman added that Bersin was using marketing automation, but any lead that expressed interest in the company would be immediately funneled to Sales through Excel spreadsheets. These data sets would go directly into the CRM, but the leads just weren’t very useful for the sales team.
"They weren’t able to prioritize, and we (Marketing) weren’t tracking them in a systemized way," she explained.
Reinman added, "So we then put into place some very basic lead scoring, based primarily on demographics, and we began sending leads to Sales in a more systematic manner. But the lead scoring was still not a set of criteria that Marketing and Sales had agreed on together, so the leads were still being largely ignored by Sales."
Beginning in early 2011, lead scoring at Bersin began to change.
Step #1. Have Marketing and Sales determine lead scoring criteria together
Reinman first worked with the marketing automation manager to create a group of lead scoring criteria that combined demographic and behavioral attributes, such as website activities, based on learnings from a marketing automation vendor’s user group the Bersin team attended.
From there the team presented these criteria to the SVP of Sales, who shared the information with her team.
After some modifications to the scoring criteria so the set of data points were mutually agreeable across Marketing and Sales, the new lead scoring program went into effect in May.
Most companies name their lead definitions in their own way, and Bersin is no different. What sets it apart from some B2B marketers is instead of defining "marketing qualified leads" for nurturing and "sales qualified leads" ready for the hand-off to Sales, Bersin defines "marketing qualified leads" as ready for the hand-off.
Marketing at Bersin uses three basic lead definitions:
- Name -- someone who they know the name, but very little additional information.
- Engaged -- people who are interacting with the company and collecting lead scoring points. Bersin conducts what Reinman described as "progressive profiling" with these leads to continue learning more about them while engaging in lead nurturing.
- Marketing Qualified Lead -- these leads have scored enough points in the defined criteria to be passed on to Sales and enter the CRM.
Step #2. Determine the attributes to track for lead scoring
A key aspect of setting the lead scoring criteria is determining what attributes -- demographic and behavioral -- are most important to the business for uncovering qualified leads that are sales-ready.
Bersin’s demographic attributes include data points that most B2B marketers are going to use:
- From Bersin’s targeted organization type
- Level of the person (for example, C-level, VP, director, etc.)
- Interest level in Bersin’s product as indicated by the person
The behavioral attributes Bersin tracked were largely based around website activity and interaction with the company.
Reinman said to create these attributes the team looked at the website and its operational flow.
"We had a particular set of steps that we were looking to take people through on our website," she stated.
A number of behaviors were important attributes in the scoring criteria:
- Reading research and research summaries
- Signing up for a complimentary membership
- Asking for ongoing complimentary research
- Watching video on the website
- Registering for events on the website
Leads in Bersin’s "engaged" stage accrue points that combine the demographic and behavioral attributes. Until they reach "marketing qualified" and are ready to pass on to Sales, those leads are nurtured through email and other communication from Marketing.
Step #3. Determine the attributes that pass the lead directly to Sales, or permanently disqualifies them
In lead scoring, each attribute is assigned a score and a total score threshold is set, so once that figure is reached, the lead is passed to Sales and into the CRM.
For most attributes, the score is a small portion of the Sales threshold, but some attributes are so indicative of buying behavior or lead value that attributes score gets the lead either very close to the threshold, or even over the threshold.
On the other side, some attributes may automatically disqualify leads from ever passing the threshold to ensure they don’t reach Sales.
Bersin has lead scoring attributes that fit both of these criteria.
For example, a lead that comes in from Bersin’s defined target market in terms of size -- Fortune 1000 and more than 5,000 employees -- and type of organization, that lead immediately to becoming marketing qualified and going to Sales.
Reinman added the scoring is very generous with titles, so VP and above receive a large number of points.
Other specific activities that score highly in Bersin’s system include:
- Registering for, and actually attending, a webinar
- Registering for Bersin’s conference
- Buying individual reports
- Visiting the website from a search that originates with "Bersin" or "Bersin & Associates" rather than a keyword or phrase
What is common between these higher-scoring activities is they all indicate a higher level of engagement -- attending the webinar, spending money with Bersin for the live event or report, or specifically seeking the company in a Web search.
Because Bersin is a research firm that regularly publishes content, it also gets website visitors and registrants who it feels will never become customers.
Anyone who registers as:
- Student
- Individual consultant
- Self-employed
… is automatically disqualified from ever being passed to Sales.
Reinman said these visitors are typically looking for data points from Bersin research and are not in the company’s target market.
Another source for strong negative points is visitors to the career website, because they are most likely looking for job rather than looking to buy a product or service.
Step #4. Continue to refine the lead scoring process
Lead scoring is not a static effort. It takes planning and preparation just to launch the effort, but to continue to achieve the best results the basic framework of relevant attributes to track, the scores given to those attributes and even the threshold score to pass the lead on to Sales need to be continually refined.
Even though Bersin’s lead scoring program is less than a year old, it has already undergone several rounds of refinement.
Reinman explained the basic process:
- Set benchmark metrics
- Work with Sales through the process
- Look at the total number of leads sent to Sales
- Look at the total number of leads vying to reach the marketing-qualified threshold
Essentially, the idea is to be aware of the entire sales funnel and where all the leads are within that funnel. Reinman said in Q3, after the first several months of lead scoring, Marketing and Sales got together to determine the effectiveness of the process.
"They said, ‘You know, there is still a lot of junk in here,’ and we said, ‘Okay, we are going to tighten up the criteria," she stated.
The reason for the initial refinement was lead scoring at Bersin started with what Reinman described as a "fairly liberal scoring process," where Marketing was sending more, rather than less, leads to Sales.
After that first round of refinement, she said both teams found a better threshold to define a marketing-qualified lead by raising the number of points required to meet that threshold.
The company went through more refinement in Q4 to further improve its lead scoring.
Step #5. Use scoring to reengage cold leads in the pipeline
One of those Q4 refinements was to begin reengaging and scoring "cold" leads that were latent in Bersin’s database.
Reinman said, "We have a big database full of lots and lots of people who have gotten in touch with us and interacted with us before, and then they become latent."
She continued, "I am sure most B2B organizations have this."
The marketing team decided to reengage with these latent leads with nurturing, such as through email, and apply the new lead scoring program to the renewed interaction.
One rule the team applied to the reengaged leads was a time limit. Reinman said over three or four months many of the reengaged leads would very possibly accrue enough points to become marketing-qualified, but that the team determined reengaged leads had to reach that threshold within a 30-day period.
The reason for the time limit was Reinman said someone who was using the site and signing up for company offerings that aggressively was most likely "getting in the market to shop."
She added, "It actually turns out for us that the reengaged leads are the most valuable."
RESULTS
Because lead scoring went into effect in May, Bersin began seeing results in the third and fourth quarter of last year.
"Between the third and fourth quarter, the number of leads associated with a closed opportunity actually dropped by 18% -- we were sending fewer (leads) -- but the amount of revenue we got from those leads increased by 41%," stated Bersin.
Also between Q3 and Q4:
- Leads sent to Sales dropped 52%
- Converted leads increased 79%
- Closed and won revenue from reengaged leads increased 21%
Keeping track of lead scoring
To track the lead scoring activities, Reinman said the team uses dashboards that look at a number of elements:
- Number of new marketing-qualified leads
- Total new leads
- Total reengaged leads
For each column, the lead source is tracked along with the campaign that brought the lead in or reengaged the lead. These numbers are tracked daily.
She said the next step in lead scoring at Bersin is to create a service level agreement (SLA) between Marketing and Sales to define Marketing’s role in providing quality leads and Sales’ role in turning those leads into customers in a timely manner.
"The first step for us was to say, ‘Okay, we are giving good leads to Sales,’ and then we will work on quantity," stated Reinman. "We will work on volume and they will work on making sure they are moving through the funnel effectively."
If you found this case study helpful, sign up for the free weekly B2B newsletter.Useful links related to this article
Bersin & AssociatesMarketo – Bersin’s marketing automation vendor
Salesforce.com – Bersin’s CRM vendor
LeadMD – Bersin’s marketing automation and CRM consultant
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