Every marketer knows that not every lead will turn into a paying customer. So how do you identify which leads will most likely convert? Moreover, how can you improve your campaigns so they generate high-quality and converting leads?
Enter lead scoring. Marketing and sales teams can use lead scoring to identify a lead’s worthiness by putting a numerical value to them based on their behavior toward a brand. Keep reading to learn what lead scoring is, why it’s important, the different lead scoring models, and best practices.
What is lead scoring?
Lead scoring is the process of identifying a lead’s sales worthiness using numerical values.
Each lead you generate is assigned a score based on a numerical scale that provides points for different attributes. Leads with the highest scores have the highest value or “worth” to your company because they will likely become your customers.
Assigning lead scores is based on various explicit and implicit attributes. Explicit attributes are information that your leads submit, such as their demographics.
Implicit attributes, on the other hand, tell you about how they engaged with your brand online. These attributes tell you the webpages they visited and whether they downloaded your whitepaper or subscribed to your newsletter.
The goal of lead scoring is to guide marketing and sales teams to determine the next best interaction to make with your leads. Your sales team can focus on leads with the highest points and are close to making a purchase and lead them to conversion. Meanwhile, your marketing team can focus on running nurture campaigns for leads with lower scores so that these leads can move through your pipeline.
Why is lead scoring essential?
Lead scoring can help more than just your marketing and sales teams. It can streamline your entire company’s processes as it allows the different teams to collaborate. Your organization can reap these benefits from practicing lead scoring:
Effective marketing campaigns: Lead scoring lets you determine the channels and campaigns that bring qualified leads. In addition, it helps you optimize your marketing campaigns.
Increased revenue cycles: An effective lead scoring system can decrease the time a lead stays in your nurturing stage, as it can pinpoint sales-qualified leads, which you can move further down your sales pipeline.
Increased return on investment (ROI): Did you know that 79% of generated leads don’t convert into sales? Many organizations have a solid lead generation strategy but don’t have a lead nurturing process in place. With lead scoring, you know which leads require nurturing and the lead nurturing strategies that work and result in increased ROI.
4 lead scoring models
Now that we’ve answered the questions “what is lead scoring?” and “why is lead scoring important?”, let’s look at the different lead scoring models you can employ for your business.
1. Demographic model
If you’re selling to a particular demographic, this lead scoring model suits your organization. Is your business offering products or services only in certain geographic locations? You can give negative scores to leads that aren’t within your business’s scope.
Find out your leads’ location by asking for demographic information through forms on your landing pages. Their responses will reveal whether they’re an excellent fit for your business or not. If a lead provides a location where your business doesn’t operate, you can deduct points from their score so that you can prioritize more relevant leads.
2. Company information model
This lead scoring model is helpful for business-to-business (B2B) organizations. Are you selling a product or service that’s meant for large enterprises? Or are you offering a product that’s best suited for specific industries?
This lead scoring model helps you weed out prospects who may not be a good fit for your offerings. If you cater to large enterprises, you can subtract points from SMBs.
For example, your scheduling software is best for veterinary clinics. Non-veterinary clinics get negative scores, so your sales team can prioritize the leads that fit your target audience and will most likely convert.
3. Online behavior model
How a site visitor navigates and interacts with your website says a lot about their interest in your offerings. Examine your leads who eventually became paying customers.
Which web pages did they visit before they became a customer? How many pages did they visit on average? Did they download white papers or studies along the way to becoming leads?
Consider giving higher points to leads who visited your high-value pages, like your pricing pages. Did they sign up for a free trial? These leads can get higher points, too. If they visited 20 pages in five days, they get higher points than leads who only visited five pages during the same period.
Do you have leads interacting less frequently on your site since their first interaction with you? You can deduct certain points after specific periods, say every 15 days. This strategy can help your sales team prioritize leads that are highly engaged and interested in your business.
4. Engagement model
This lead scoring model is similar to the online behavior model. The difference, though, is that the engagement model looks at how a lead is engaged with your campaigns. The more engaged they are, the more likely they are to convert.
If you’re running email campaigns among your newsletter subscribers, you can score them according to how engaged they are with your emails. Do they open your emails or click through the links within the email? Do they scroll to the bottom of the email?
Engagement behaviors like email open rate and click-through rate indicate how a lead engages with your business and how likely they are to convert.
4 lead scoring best practices
If you’re looking to start lead scoring, here are some best practices you can do for your business:
1. Consider using more than one leading scoring model
Do you offer more than one product or service? Create multiple models to score leads for different products if each product has different ideal customer profiles.
Because the buyer persona for each product is unique, they have different demographics, online behaviors, and engagement. It makes sense not to use a generic scoring model for various leads.
2. Use negative scoring
Negative scoring is deducting points from prospects or leads for every action or inaction. It is a critical practice so that you can focus on the right leads with the most interest in your business.
For example, if you use the online behavior scoring model, you want to count only page views that are relevant to their interest to convert. If you have a careers page, you’d like to exclude that from every additional point. You can also deduct points from leads who have stopped opening your emails.
For example, if you use the online behavior scoring model, you’d want to count your bottom of the funnel (BOFU) pages that your prospects visit. A lead gets additional scores whenever they visit BOFU pages like service or product pages. When a user visits your careers page, however, points get deducted. As a result, you can see which prospects are highly interested in purchasing your products or services.
3. Identify your sales-qualified threshold value
Determine the score that separates sales-qualified leads from ones that still need nurturing. No universal magic lead score exists because every company’s lead scoring model is different. Identify yours by consulting your sales team and getting feedback from your customers.
4. Regularly review your lead scoring process
Customer behaviors change. Your products or services keep up with your customers’ needs. Your ideal customer also evolves.
For these reasons, lead scoring is not a one-and-done activity. Regularly review your lead scoring process so that it still precisely scores your leads’ intent to purchase.
Convert more leads to paying customers with Nutshell
Lead scoring is an important process that helps streamline your business and benefits your bottom line. An affordable and easy-to-use customer relationship management (CRM) platform like Nutshell helps you with lead scoring through a simplified method of lead confidence.
Lead confidence is expressed as a percentage from 0% to 100% reflecting how likely the lead will purchase from you, so your team can focus on the leads with most value.Move your leads through your pipeline with Nutshell, a flexible CRM you can set up according to your business’s needs. Try Nutshell for free for 14 days!