Lead Scoring Techniques to Drive Higher Conversion Rates

Imagine being a sales representative who is drowning in a sea of leads. Some are hot and want to buy, while others are just window shopping.  Now, how would you tell which ones to invest your resources in? That is where lead scoring comes in and is changing how businesses deal with their leads.

These days, getting leads isn’t the problem; it’s pinpointing which ones are worth spending your time on.

Do you know that 67% of lost sales are attributed to poor lead qualification?

That is a lot of wasted effort and missed opportunities.

In this guide, we will talk in detail about lead scoring, starting from what it is and why it’s important, all the way to the best practices to change your business.

What is Lead Scoring?

In a nutshell, lead scoring gives your leads a report card.

It is one approach followed by sales and marketing teams to prioritize leads according to their perceived value to the company.

Think of it as a point system where the more points a lead builds up, the more likely they will turn into customers.

• Demographic information — This includes things like age, job title, company size, or industry. It’s the “who” of your lead.

• Behavioral data — This looks at how your lead interacts with your company. Are they visiting your website frequently? Downloading your whitepapers? Attending your webinars?

• Engagement metrics — This measures how responsive your lead is to your marketing efforts. Are they opening your emails? Clicking on your ads? Engaging with your social media posts?

The concept of lead scoring is, of course, nothing new; it has been in practice since sales took place, but now, with the explosion of digital marketing, it has dramatically remade itself around advanced analytics. 

Years ago, salesmen relied more on intuition or a simple criterion, which was often company size. 

Today, we have much more advanced algorithms and AI-powered tools that can analyze hundreds of data points to score leads with incredible accuracy.

In other words, it acts like a bridge in helping marketing teams identify what prospects are ready to pass over to sales, while it helps sales teams concentrate their efforts on the most promising prospects.

Why is Lead Scoring Important?

Let’s break down why lead scoring is not just important.

First, lead scoring is all about efficiency: in a world where time translates into money, you cannot afford to get your sales team’s effort diluted on leads that are not ready to buy. 

With a good lead-scoring system, your sales representatives can invest their energy in leads most likely to convert.

Lead scoring is also a potent tool to align your marketing and sales teams. Many of us have heard the age-old story of marketing and sales not seeing eye-to-eye. The grumble from the marketing is that the salespeople do not follow up on their leads, while the grumble from the salespeople is that the leads are just not qualified.

Lead scoring gives them a common vernacular and a common set of criteria on which both can agree. It’s like giving them a common playbook if you will.

Companies using lead scoring see a 77% lift in lead generation ROI versus those that don’t.

Equally impressive, lead scoring brings real data-driven decision-making to your lead nurturing process. You aren’t going to merely rely on your gut or do things a certain way because that is how you always do it. You base your strategy on very real, quantifiable information.

This not only enhances your current results but also provides the ability to refine and improve over time your approach.

6 Lead Scoring Best Practices

Here are six best practices that will help you create a lead scoring system that’s not just good, but great.

1 — Define Your Ideal Customer Profile (ICP)

Before you can start scoring leads, you need to know what you’re scoring them against. 

That’s where your Ideal Customer Profile (ICP) comes in. Think of your ICP as the north star of your lead-scoring efforts.

So, how do you build an ICP? First, look to your very best customers. 

• What’s common about them? 
• Is there a particular industry that they’re in? 
• What’s the size of the company? 
• What kind of problems are they trying to solve that your product or service helps?

When you have all this information, you can develop detailed buyer personas.

These are fictional representations of your ideal customers, complete with demographic information, job responsibilities, goals, and pain points.

Having an accurately defined ICP is important because this guides every bit of your lead scoring. It helps you understand which characteristics and behaviors truly determine a high-quality lead for your business.

Your ICP isn’t set in stone. As your business evolves and as you continue to capture more data, don’t be afraid to enhance your ICP. 

The more accurate your ICP is, the better your lead scoring will become.

2 — Establish Clear Scoring Criteria

Now that you have your ICP, it’s time to set up your scoring criteria. That’s where you come to a decision insofar as what you want to count against a lead when giving it a score and how many points each of the particular factors is worth.

Your scoring criteria should include numerous types of information such as:

• Demographic information — This could be everything from job title right down to company size and location.

• Firmographic data — This may include industry, annual revenue, or the number of employees.

• Behavioral data — This reflects how the lead behaves regarding one’s company, such as website visits, content downloads, or webinars.

• Engagement metrics — This measures how responsive the lead has been to your marketing attempts through email opens or social media interactions.

When you are setting up your point system, you should consider how much more important one criterion may be than another. A lead that downloaded a product brochure can be worth more points than one that visited your homepage.

It’s also very important to establish threshold scores that define different categories of lead. You could ascertain that leads in the 0-50 point area are cold, 51-80 are warm, and 81+ are hot and ready for sales contact.

3 — Align Scoring Criteria with Your ICP

Having identified your ICP and then your scoring criteria, it’s time to have them work in tandem.

This is so that your lead scoring system will identify your ideal customers.

Ideally, this will involve mapping your scoring criteria directly into the characteristics of your ICP.

If your ideal customer is a marketing manager of a mid-sized company in the tech industry, make sure your scoring system gives proper weight to these factors.

Of course, it’s more than just matching criteria. You also need to consider the relative importance of different factors. Maybe company size is more important than industry for your business. In that case, you’d want to assign more points to the right company size than to the right industry.

As you’re doing this alignment, be on the lookout for inconsistencies. If your ICP values one thing but your scoring system rewards another, you’ve got a problem. 

For example, if your ICP is focused on enterprise clients but your scoring system gives high points for small business characteristics, you’re going to end up with misaligned leads.

Remember, as your ICP evolves (and it will), your scoring criteria need to evolve with it. 

4 — Incorporate Both Explicit and Implicit Data

When it comes to lead scoring, you want to use all the information at your disposal. That means incorporating both explicit and implicit data into your scoring model.

Explicit data is information that leads voluntarily provide. 

This could include:

• Form submissions on your website
• Survey responses
• Information shared during sales calls

This data is valuable because it comes straight from the source. If a lead tells you they’re the decision-maker at their company, that’s pretty reliable information.

Implicit data, on the other hand, is information you gather based on the lead’s behavior. This might include:

• Website engagement (pages visited, time on site)
• Email engagement (opens, clicks)
• Social media interactions

Implicit data can sometimes give an indication of the lead’s interests and intent that they might not state explicitly. 

For instance, in the case where a lead has visited your pricing page repeatedly, this will actually be a good estimator of purchase intent.

The key is to find a balance between these two types of data within your scoring model. Explicit data is almost always more credible, yet implicit data completes the picture as far as the lead’s actual level of engagement and interest.

5 — Use a Balanced Scoring Model

A truly effective lead-scoring system isn’t one-dimensional. It takes into account multiple factors and weighs them appropriately. 

This is what we call a balanced scoring model.

We recommend combining demographic and behavioral scoring. Demographic scoring looks at who the lead is, while behavioral scoring looks at what they do. 

A lead might have the perfect demographic profile, but if they’re not engaging with your content, they might not be ready to buy. Conversely, a lead might be highly engaged, but if they’re not in your target market, they might not be a good fit.

Another important concept is decay scoring. This involves adjusting scores based on time and relevance. A lead who downloaded your whitepaper six months ago isn’t as hot as one who downloaded it yesterday. 

Your scoring system should reflect this by gradually decreasing scores over time if there’s no new activity.

6 — Align Sales and Marketing

Last but certainly not least, one of the most crucial best practices in lead scoring is ensuring Not least but most importantly, one of the best practices of lead scoring involves aligning sales and marketing. Remember, lead scoring isn’t just for marketing or sales; it bridges them together.

For that reason, you need to ensure the sales and marketing teams agree on the scoring criteria and thresholds constituting a sales-ready lead, and strategies like appointment setting. This improves handoffs and prevents unqualified leads from reaching sales.

In other words, you should involve both teams in the development of scoring criteria. Sales teams often have valuable insights into which lead characteristics are truly predictive of conversion. Marketing teams can provide data on which actions indicate serious interest. 

When you combine these perspectives, you can create a more accurate and useful scoring system.

Conclusion

To wrap up, lead scoring is a powerful tool that can help your sales team focus on the most promising potential customers. 

Remember, lead scoring isn’t a one-time task – it’s an ongoing process that requires attention and fine-tuning. 

And as you continue to develop more data and experience about your leads and customers, yes, update your scoring system.

By applying these best practices in lead scoring, you’ll know who the hottest leads are, which automatically means better utilization of your sales team’s time and thus more conversions to boost revenues for your business.