What’s more valuable?
100 leads who may be somewhat interested in buying from you or 1 lead who’s taken deliberate action towards becoming a valuable customer?
Probably the 1 lead, right?
You’re better off going after the lead you can actually close rather than wasting time with leads who will require a lot of energy and resources to finally persuade to buy.
Go where the money is, so to speak.
But how do you separate the mass of mediocre leads from the hot ones?
Every lead you generate gets a score based on what actions they’ve taken in the past, determining what actions they’re likely to take in the future – like buy what you’re selling.
We’ll take a look at what lead scoring is, why it matters, and how you can implement a lead scoring system into your business.
What Is Lead Scoring?
Lead scoring is an important part of the lead generation process.
It works by assigning values to every lead you generate, usually in the form of numerical points, although it can also take the form of alphabetical rankings like A, B, C, D or terms like “cold,” “warm,” and “hot.”
The values you assign to leads should correlate with actions they’ve taken in the past, like submitting information through a form on your website or downloading a free lead magnet and becoming an email subscriber. We’ll detail specific types of lead scoring later in this post.
Lead scoring is for the benefit of your sales team.
It helps them quickly identify high-value leads and prioritize them over low-value leads – increasing the rate at which they close new customers.
It also helps sales and marketing work better together. Hot leads should be passed on from marketing to sales.
Why Does Lead Scoring Matter?
The reason lead scoring matters, ultimately, is because it strengthens your revenue cycle.
It does this by:
- Increasing lead quality leading to a higher quantity of closed deals.
- Allowing salespeople to focus on the right accounts and engage with warm leads only.
- Providing deep data on leads by correlating a lead’s score with your win percentage, giving you insight into how likely a lead is to close.
- Encouraging and improving cooperation between sales and marketing, where marketing takes low scoring leads so sales reps can freely focus on the highest-scoring ones.
- Simplifying the lead follow-up process for instant clarity on where a sales rep should spend their energy.
What Are the Various Lead Scoring Models?
There are many types of lead scoring you can use.
Each one will vary based on what lead scoring factors you choose to track and measure.
The lead scoring models we’ve laid out below are suitable for nearly any business to include in their lead scoring process.
Gathering a lead’s name and email address is the most common and obvious demographic information you can gather.
But because of that…
It’s nearly useless in giving a lead a score right away.
If you want to dig a little deeper into a lead’s information right off the bat, then design forms for your landing pages and newsletter subscription that request additional information before they receive whatever you’re promising in exchange for their info.
Perhaps you need to know their location, like country, state, city, zip code.
When you receive a lead in your territory, they’re given a relatively higher score compared to leads entering information outside of your territory who will receive lower scores.
Here’s one way to get even more sophisticated:
Make a certain field on your form optional, like phone number. Then, if someone inputs their phone number, you know they’re probably more interested in what you’re selling than the lead who doesn’t.
2. Company Information
Company information is usually only necessary for B2B organizations to know.
And if you operate a business selling B2B, then this is particularly important information for you to know.
On your forms, you can ask for the number of employees they have, how long they’ve been in business, what industry they’re in, how much revenue in sales they rake in. Whatever helps you better qualify them before marketing ever reaches out are the best questions to ask.
3. Behavior on Website
Measuring a lead’s online behavior is critical to understanding where they’re at in the buyer’s journey.
Before you start analyzing data for new leads…
We suggest taking a step back and analyzing the data of your existing customers to create a benchmark for hot leads’ online behavior.
Meaning, you need to ask questions of this data, like:
- Where did customers come from when they found your website? Your Facebook ad or Google?
- Which pages did they visit, and how often, over what time period before becoming a customer?
- Which free offer did they download in exchange for their information? What information did they provide when they signed up?
- How many times did a sales rep have to speak to them before they bought?
Asking and answering these questions and more will help you gauge how to seal the deal with new leads.
Then, use this data to inform your initial lead scoring system.
You may give leads who visited consecutive blog posts in a day a higher lead score than one who only visited your home page.
On the other hand, you may notice a previously engaged reader of your blog stop visiting your website. In this case, you may deduct points from their score.
4. Engagement Through Email
Email engagement is one of the best measures of a lead’s interest in buying what you’re selling.
Think about it:
The average person receives 88 emails per day while the average office worker receives 139, according to the Radicati Group. If someone opens your email…that means a lot. And if they keep opening them, you know you’ve got a truly interested potential customer.
The question is, how interested are they?
Well, you can’t just measure open rates to find that answer.
You also need to measure click-through rates – the number of leads who are opening your email and clicking on the link inside of it.
Someone who is clicking your link and checking out your offer is obviously more valuable than someone who isn’t.
Now, you can get even more granular with this.
Some emails you send out are more focused and targeted than others.
For example, say you send out a promotional email advertising a demo of your product. You may receive lower open and click-through rates, but the people who did click-through should get a very high lead score, and maybe even handed off immediately to sales.
5. Engagement on Social Media
Social engagement is an excellent measure of how interested a lead is in learning more about your solution or company.
Track which leads like your posts most often. Or which ones share your posts. Or which ones frequently comment. And since you’re looking at comments, read exactly what a particular lead is saying about you. Are they excited? Curious? Apathetic?
All of this clues you in on how ready a lead is to buy, and in many cases, what they need to hear before they’re sold.
6. Inaccurate or Insignificant Contact Info
Accurate lead scoring requires collecting true information about leads.
If you receive leads through your contact forms that suggest spam accounts or unserious people, you should probably assign them a low lead score.
This doesn’t mean they can’t become legitimately hot leads.
But it does mean that sales don’t have to worry about them for a while.
Some things to look for are:
- First and last name or company name not being capitalized.
- Any form field filled in with “asdf” or some other quick, false information just to submit the form.
- A Gmail or Yahoo! email address, if you’re targeting businesses.
How Do You Implement a Lead Scoring System?
Implementing a lead scoring system will inevitably vary from company to company. Below are some lead scoring best practices we recommend following.
Start by Identifying the Broad Characteristics of Your Target Market
The first step is to look at the broad characteristics most of your customers (or would-be customers) share.
These are not necessarily the characteristics of your loyal customers.
They should represent the people who are likely somewhat interested in your brand or solution and at least interact with your marketing material, like reading your blog posts or opening your emails.
Start by looking at who has purchased from you in the past and who hasn’t (and why for each of them). Define the problems you solve and what segment of the market needs your solution. Figure out what messaging has worked in the past and what hasn’t.
Think of these people as the lowest in your lead scoring system, or your marketing qualified leads, most likely.
Identify the Characteristics of Your Ideal Customer Ideal Customer
Now define the characteristics of leads most likely to buy from you. In other words, your “buyer persona.”
Begin with the explicit information:
- Geographic location.
- Job title.
- Contact information (name, email, phone).
- Any past purchases.
This tells you who the lead is and if they’re a good fit for your business.
Then define their implicit behavioral information:
- Length of time they spend on your web pages.
- Number of phone calls with sales reps.
- Email open and click-through rate.
- Number of interactions on live chat.
- And any other metrics regarding their engagement with your marketing and sales material.
After you have the positive criteria, also define negative criteria that would lower a lead score, like:
- Low email open and click-through rate or unsubscribe from your email list.
- Long periods of inactivity.
- Low engagement on social media.
- And so on.
Create Your Point System
Once you have all the defined characteristics for your leads, you can assign point values to each of them.
- Opening an email is a relatively low level of engagement, so it should probably only get +1 point.
- Submitting a form on a landing page is a higher level of engagement, it could get +5 points.
- Attending a webinar is a much higher level of engagement, it may get +10 points.
- And visiting your pricing page shows a very high interest in your services that may get +10 or +15 points.
Once you have your point system laid out, you simply assign points to leads whenever they display the defined behavior.
The higher the total, the higher the likelihood they’re interested in becoming a customer.
The lower the total, the less likely they’re ready to buy and the more you should consider letting them go as a lead.
How to Improve Communication and Collaboration When Creating Your Lead Scoring System
Pulling together a lead scoring system or updating the one you currently have won’t happen overnight.
It’ll require many meetings, many discussions, and a lot of work.
Throughout this process, you’ll be communicating with many people who are collaborating with many more.
Smoothing out interactions and reducing confusion should be a high priority to complete your project on deadline.
One way to do this is through visual communication.
At CloudApp, we believe fast and easy collaboration is a great thing, not only for your bottom line but for your company culture as well.
That’s why we’ve built a tool that brings HD screen and webcam recording, GIF creation, screenshots and annotations to the cloud in an easy-to-use, enterprise-grade app so you can quickly create and share visual content.
We’ve been ranked by G2 Crowd as one of the top sales enablement tools.
Our software is easy to use and simple to share.
See how CloudApp improves lead scoring development today.