Life of a Lead
Nobody will ever write the biography of a Lead. Leads are people we never
know that much about -- because as soon as we do know enough about Leads, they
will be promoted to Contacts. And that process of conversion is
complex and mysterious -- you wouldn't call Lead conversion a religious experience, but
most SFA users still don't understand its ramifications. Welcome to this month's excerpt from my
upcoming Addison-Wesley book on Salesforce.com best practices.
Today's excerpt covers the life of a lead from cradle to grave. I'm hoping that you'll find areas
in this one that I'm dead wrong about! Please email me with feedback where you think I'm full of it.
Through vigorous debate, the ideas will get even stronger. The best
argument of the month wins a prize.
What's in a Name
There's a reasonable amount of confused semantics in the lead processing world.
Before we can have a clear discussion about the Lead lifecycle, we've got to agree on nomenclature.
Here are the standards we use, and I hope you can adopt them at least for now.
- A Name is the identity of someone in our
target audience. You can buy names on a list (e.g., all doctors in
north America or attendees at a tradeshow), but they are of very little
value because they neither know nor care about your company and its products
or services. A Name is, at best, a receptive ear. But the
probability of Names being actively interested is so low that you should
communicate with Names only via bulk internet media. I am not
people -- develop a sequence of interesting, relevant material to send in a
- A Lead is someone who has specifically
expressed interest in your company's product or service, typically by
attending an event or registering on your website. We know a little
bit more about Leads than we do about Names, but typically the only thing
we know for certain is a valid email address from the time of registration.
If the Lead has come back to your website or taken some other follow-up
activity, all the details should be recorded in your SFA system so you can
do some behavioral targeting and lead scoring. We urge everyone to be
using Campaigns to cover any possible activity or response that a Lead could
be involved with.
- A Qualified Lead is someone who could
reasonably participate in a sales cycle, and we know this because somebody
in our company has had a highly directed conversation with them about their
level of interest, requirements fit, budget, and timeline. Typically,
a Qualified Lead should be converted to a Contact in a matter of hours,
thanks to a follow up call by Sales. If the sales conversation doesn't
go well, the Qualified Lead should be disqualified as
- A Rejected Lead is a lead that has been
rejected by sales as being unqualified, or a contact that has been
identified as uninterested or incompetent to participate in a sales cycle.
Rejected Leads should still be given the best treatment by Marketing, but
they will be ignored by Sales until they have done something new to prove their
worthiness of proper attention.
- Contacts come in two flavors: a
qualified lead that has been converted in order to initiate a sales cycle,
OR a person who works for a company that is already in a sales
cycle. Unfortunately, for zealous supporters of the named account
model of selling, this dual definition gets very blurry. For the sake of
clarity, let's ignore the needs of named account zealots, as they don't deal
in Names and Leads the same way we plebian types do.
- Customers are Contacts who work for a company
that has a contractual relationship with us, and who have paid us $1 or
- References are Customers who are foolhardy
enough to have their name bandied about in the press. Often, this has
as much to do with their status in the job market as it does with their
satisfaction with our company's product. Some references aren't
willing to be seen in public, but are willing to do private, one-one
reference calls. Reference status and usage must be carefully tracked to prevent their being over-used by Sales and Marketing
Who Lives Where
At first blush, you'd expect the SFA database to hold everything
having to do with prospects and customers -- names, leads, contacts, customers,
and references. But things aren't that simple in sophisticated organizations.
In larger operations, it makes sense to use a split-brain approach that
separates the marketing database from the
sales database. There are two reasons organizations do
this: they have a large number of low-quality Leads (really, they’re little
more than Names) that aren’t relevant to the sales folks, and they use a
marketing automation tool (service, really) that needs to operate from its own
copy of the data.
What’s involved with the split-brain? The marketing pool of Names
is stored in a separate database, and the transaction history of campaigns and
responses is managed there. When a Name starts behaving more like a Lead (as
reflected in its internal lead score), it is promoted from the marketing pool to
the sales Lead area. Its record is deactivated in the marketing Names database
and entered into SFDC as a hot Lead.
Leads also migrate the other direction. When a Lead has been
unresponsive, hasn’t been active recently, has been demoted by Sales (by
explicitly disqualifying them), or has simply been ignored by Sales for too
long, the Lead it is deactivated in SFDC and re-activated in the marketing Names
database. Neither Names nor Leads should ever be deleted from their databases
(to prevent dupes and to maintain history), but the inactive records should
carry flags marking them as such.
By keeping these databases separate, the metrics and operations of
marketing can be tuned more finely without interfering with the natural way that
sales works with Leads. However, there is a side effect of the split-brain
model: Sales will not be able to easily see all the activity from a
Big Account, because some of it will be done by Leads and some by Names.
If you’re already using a marketing tool like Eloqua, Vertical
Response, or Exact Target, you’re probably on the split-brain path.
If you aren’t using tools like these, you do have a choice
to make: do you need to have all your Leads – regardless of quality – in one
place, or do you want to create a category of Leads that are so low quality that
they’re handled outside of your SFA system? While there’s no overwhelming cost
advantage in going either direction, the split-brain approach allows for more
sophisticated marketing operations.
Unfortunately, changing the path you take after system
deployment will involve considerable one-time costs and changes to the workflows
Lead Cultivation Workflows
Most of the early cultivation of Leads is focused on
increasing their level of interest, to the point where they really qualify to be
Leads. The workflows for Names and demoted Leads should be nearly 100%
automated, using clever combinations of email blasts, web site materials, and
recorded webinars. Make sure the content is
relevant to the
audience! If you are doing
separate links there), you'll want to monitor individuals' activity levels in
the community, as well as their download history on your site. Your
marketing automation system should be managing this for you, and maintaining
behavioral scores for each individual.
Once a Lead is sufficiently warm to require human
attention, Marketing should almost never be involved. As I wrote 3 years
(or Telemarketing, or Inside Sales) should be doing the phone calls, demos, and
qualification steps. In most organizations, the final decision on
qualification is made by the sales rep, but the appointment for that call is
made by the Telesales team.
If you take the time to systematize your lead
cultivation (actually writing it down with a simple flow-chart and scripted
steps), it becomes much easier to outsource the process or supplement it with an
outside service. A very common mistake is to have too many sales reps for
the number of qualified leads, which means the reps won't be busy enough with
high-value work. It's usually a better business decision to invest more in
the Telesales/Telemarketing function (inside staff or outsourced) so that your
expensive sales reps have enough high-quality leads to keep them fully occupied.
Once a Lead is fully qualified, it should be only a matter of moments before it
is Converted into a Contact. Conversion does an amazing array of
things in your SFA system, and the user is typically given a few options at
conversion time. On conversion (and we recommend that this is
done by the Telesales group for the sake of consistency), best practices are to create
an Opportunity (typically, for $0 at 0% probability, unless the Contact is
being attached to an Opportunity already in progress) and to attach a
Contact Role and a Campaign to it (to support sales and marketing
What if the Contact turns out to be bogus, or falsely qualified?
Never, ever, ever (not ever? NEVER!) delete the Contact or
Opportunity. Instead, set their status flag as "rejected by sales."
Through clever report design, the Rejected items won't mess up anybody's
operational metrics yet they will provide quantitative feedback to the
Marketing and Lead Cultivation functions. Only by providing
unambiguous feedback can the Telesales and Marketing people get better at
what they do.
-- coming in August
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