B2B companies all experience similar problems when implementing lead management processes and technologies. However, few problems are as universal as how they define a lead. I don’t mean the definition of a qualified lead that marketing and sales agree on. I’m referring to what a lead is at its core. Is it a person or an event? Contact information or an expression of interest. This post discusses each type and when to use them.
Today the term “lead” seems to mean a record containing contact information about a person that we wish to connect with in hopes of further qualifying and selling to them. Now think back to the detective shows you watched as a kid. When Sherlock got a lead was it a person? Not likely. It was probably a clue such as a watch found at a crime scene that was leading him on a path to solve the crime. In marketing and sales terminology it was an expression of interest that will lead him to an opportunity and a sale.
Somewhere along the way CRM has made a swing from ‘Point of Interest’ to ‘Point of Contact’. I suspect this was driven by a demand from sales to have contact information to follow-up on and a supply from marketing of leads that required email addresses (and therefore a contact) to market to. I certainly don’t disagree with this methodology but I think it’s important to appreciate where you came from so you can understand where you are going.
Point of Interest Leads
Point of interest leads must be very broad in terms of the information they store. An interest can be a response to a marketing campaign, a person matching your target persona, a request for information, a website visit or many other expressions of interest. The lead record in your CRM must be capable of storing all of this information for any given situation. This can be done through a combination of lead fields or references to campaigns. An important thing to keep in mind is that it’s almost impossible to set any field to mandatory with this model since you never know what type of information you will get for a given lead.
Point of Contact Leads
Point of contact leads are simply records of people with fields such as name, company, phone number, and address. In most cases they are almost identical to the contact record in your CRM which makes conversion mapping a piece of cake. Any behavioral information such as campaign responses must be stored as a reference to a campaign record in the system. The upside to this type of lead is that there is a human being that can be followed-up with. The downside is it must reference another entity such as a campaign to show what interest the contact has expressed. This works well in situations where there are limited types of interests that can easily be tracked in campaign records. But if the interests are varied it may not be the best option.
Lead vs. Contact Confusion
There has always been a lot of confusion between leads and contacts – especially when using the point of contact lead methodology. Leads are often duplicates of contacts, information may be split between multiple records, sales reps don’t know what record to use when, etc. Sales reps may resist converting lead records to existing contacts which hurts data quality. Most CRM systems also force customers to call the lead entity a “Lead” despite the fact that it encompasses several stages in their lead funnel and possibly a contact as well. The CRM you choose and how you build your process into it have a big impact on this confusion.
Microsoft Dynamics CRM
Microsoft Dynamics CRM does a great job of handling both types of lead. It uses a customizable, pre-lead entity called a Campaign Response to capture point of interest data. It acts similar to an activity making it easy to follow-up on. It can be converted to a lead representing a point of contact or directly to an opportunity. You can also skip the campaign response step and create a lead from the start to represent a point of contact if there is no point of interest. The Campaign Response entity can also be used as a relationship between a lead and a campaign to store details about the point of interest even after the point of contact is created with the lead record. The good news is that Microsoft has come up with a method to capture the full process within their CRM. The bad news is things can get messy with all this data flying around in different entities.
Salesforce.com does not capture the process in as much detail as Microsoft (unless you undertake some massive customization). In this CRM you are required to determine upfront whether you will use a point of interest or contact methodology and build your lead entity around it. In some cases this may make it difficult to capture information that doesn’t fit the mold of your system. It also means that the system will function very efficiently if your process and system are inline. This makes it very user-friendly which keeps sales happy and adoption rates high. In the end you need to balance usability with data depth. Remember, having the most dynamic system in the world is useless if no one can use it.
What to Use When
Choose a model that works best with your business processes. Typically, the point of interest model works best when follow-up is heavily dependent on an activity or you may not be able to associate the activity with a person. It also works well when there are multiple people associated with a lead. CRM systems generally don’t allow leads to be grouped together in the same fashion that contacts are under accounts so combining multiple people into a single lead for follow-up may be something that works for you. This method also works well when every point of interest requires a follow-up. But, beware that creating a lead for every interest creates a lot of noise for your sales team.
Point of contact leads work best when follow-up is centered on an individual person that can be associated with standardized campaigns. Multiple campaigns which represent the points of interest can be associated with the lead while it is going through early stages of qualification. Point of contact also gives you accurate funnel reporting since people are only represented once.
How to Use Both
I prefer the point of contact methodology because I’ve experienced the mess that lead duplication can cause. However, I recognize the benefits of point of interest as well. Like me, you’re probably somewhere in the middle of each model. It’s possible to use some customization to get the best of both worlds. Something to consider is building your lead entity around the point of contact model then customizing it. If follow-up is required based on a point of interest you can create a task or notification and associate it with the lead instead of creating a brand new lead. This gives you the freedom to selectively trigger follow-up without duplicating leads.
It is also possible to track ROI and attribution using the point of contact model. Instead of tracking which leads converted to opportunities you will need to track which campaigns are associated with leads that were converted to opportunities. This allows you to specify which campaigns receive attribution based on data points like response date, type of campaign, and which contact responded. Salesforce.com does a great job at this.
What Do You Think?
I’d love to hear about your experiences. What other challenges have you faced with these methodologies? What solutions have you come up? How do other CRMs handle leads?