When business is good, you can have more job leads than you have time to work on them. In many contracting businesses, a full 40 percent of sales leads are never followed up on by a salesperson. And when there is follow up, it often comes too late to make the sale.
Often I hear estimators expressing frustration over lousy leads. When good ones get mixed with bad ones, neither get attention.
Lead scoring allows companies to objectively decide which leads are the most sales-ready. It can also identify leads that can mature into future sales, so additional marketing can be done to nurture these customers.
If you find that you have too many leads and you can’t follow up on them all, you need lead scoring to help you pick the best. If you have a low closing percentage, lead scoring will point out where the best leads are coming from.
How do you start scoring leads quickly? Create a process that lets you assign scores in a few minutes. Start with 10 criteria and score each on a scale of 1-10, with 10 being the best. The perfect lead scores 100. (Convert to letter grades if you wish.) You could pick fewer criteria if you want to give extra weight to the most powerful indicators.
What criteria should you use? The classic scoring model is BANT, which stands for Budget, Authority, Needs and Timing. Budget is critical for project based work among irrigation contractors. Does the customer’s budget match with your typical project size? A low score indicates unrealistic expectations. Authority is critical in business-to-business selling. Does the interested person have the authority to make the purchase decision? Needs are associated with the fit of your offering to the customer’s requirements. Needs could also be interpreted as the fit to the services you offer most profitably. Timing is critical for businesses with constrained capacity. If the customer needs it sooner than you can supply it, no deal!
Here are some additional criteria to ponder. The first is geography. Is the customer within your company’s optimum service area? The second is customer planning. How long have the customers been contemplating (or been frustrated by) the project? If it’s been irritating them for months, the higher they should score. The third is length of time owning the home. Homeowners who have been in place for more than five years are simply more realistic about buying services. The fifth is the number of contractors they’ve talked with. The more they’ve “tire kicked,” the lower the score. Most important – and perhaps worthy of a higher weight – is the source of the lead. My studies show prospects referred by existing clients consistently convert to sales at a rate of about 70 percent.
Lead scoring is not going to fix a sales team that doesn’t follow through on any leads. And it won’t fix a lack of leads. But it will help the busy entrepreneur objectively decide which lead in the pile could be the fastest path to a profitable sale.
Jeff Carowitz is a respected advisor to leading landscape industry firms. Connect with him on LinkedIn or email Jeff@StrategicForceMarketing.com