Not all leads are worth pursuing. Even if you’ve worked hard to generate tons of leads for your small business, it doesn’t necessarily mean you’re guaranteed to make tons of sales.
What is Lead Scoring?
Lead scoring is a concept that helps you focus on the leads that are most relevant and likely to buy. Essentially, you assign points for various qualifications or touchpoints that customers normally complete in order to buy from you.
That information allows you to focus your energy on those that are most likely to result in sales. No more wasting time on super remote opportunities.
Getting Started with Lead Scoring
A CRM tool with lead scoring can help you with the logistics. But you first need to make some important considerations:
1. Define What Makes a Lead Qualified
“Not every lead is one that you’ll want to pursue,” says Brent Leary, co-founder of CRM Essentials, LLC. “So as leads come in, you need to have an idea of how qualified each one is. If you have a scale of 1 to 100, maybe your lead needs to be scored at least a 70 to be worth pursuing. If you have a software company where you sell to businesses in three specific industries, a lead could get points for working on one of those industries, for being in senior management, and for having an actual budget and the ability to make buying decisions.”
Essentially, this is about knowing who your target customer is. You need to consider multiple facets, including, but not limited to:
- Job title
- Demographic data
- Income or budget
2. Identify Buying Milestones
Even if a lead doesn’t start out as qualified, it doesn’t mean they won’t ever be worth pursuing. You can also assign point values to different activities that indicate willingness to buy.
Let’s say you’re hosting a webinar for people on your email list. New leads could earn points based on how interactive they are.
Ivana Taylor of DIY Marketers explains, “You might get 1 point for opening an email, 5 points for clicking a link, 10 points for registering, and 20 points for actually showing up.”
Those who come to a webinar or event are probably more interested in your offering than those who just opened the email. So focusing your efforts on those with the highest point values can increase your efficiency.
3. Assign Values to Each Quality or Milestone
When you determine what qualities or actions are important, you need to determine how important each one is.
This will look different for every business. But generally the actions that are farther along in the buying process should have higher point values. Anyone can open an email. But actually attending a webinar and interacting with your brand shows more of a willingness to buy.
With these numbers in mind, you should have a decent overall picture of what is needed for someone to be nearly ready to buy. This can help you determine the threshold or baseline number that a lead must score in order to be worth your attention.
One last point: Be careful not to let wishful thinking cloud your judgement. Once you’ve established a lead scoring system, stick to it. No matter how excited you may be about a particular prospect, avoid wasting time and effort on a sale your scoring leads you may be unlikely to turn into customers.
1. Create an ideal customer profile. Outline the specific qualities that a person should have in order to fit into your target audience.
2. Map out the customer journey. List the steps that your customers normally take
3. Score those milestones. Assign point values to each quality and step in the buying process based on their overall importance.
1 thought on “What is Lead Scoring and How Can You Use It in Your Business?”
Good explanation. I will implement it with my own work.