Lead scoring is a sales management strategy that helps to identify prospects most likely to make a purchasing decision using a combination of factors that measure level of interest and quality of fit. This then allows sales managers to sort leads from hottest to coldest so that they can better prioritize follow-up activities.
While you can score leads by hand, using a customer relationship management (CRM) is usually a better option when scoring generated leads. This is because they often come with tools that help you determine a score based on how a lead interacts with you. Freshworks CRM, for example, even offers an artificial intelligence (AI)-powered lead scoring feature that helps your sales team reach out at the right time to close deals more effectively.
That said, the following will show you how to use lead scoring to better prioritize follow-up sales activities:
1. Understand How Lead Scoring Works
Effective lead scoring evaluates sales leads on a point scale and assigns each lead a score based on the likeliness it will turn into a sale. For example, a set number of points can be awarded when a lead opens an email or clicks a link to your website. When a certain score is reached, your system can automatically label them a “hot lead” and put them above your lead list so your sales reps can easily view the most qualified leads.
A CRM tool can help you score leads based on a prospect’s behavior. For example, Freshworks CRM can automatically score your leads based on if they open your emails, click links in your email, and fill out forms on your website. To learn more, sign up for a free trial today.
Once you’ve defined the characteristics you’d like to use to measure your company’s leads, you can set up the parameters within a CRM, such as Freshworks CRM, which will evaluate each user’s behavior based on the score you assigned.
2. Identify the Characteristics of a Hot Lead
Hot leads are prospects or deals that are both a good fit for your product or service and have shown interest in your company. However, what makes a lead a good fit or what activities indicate interest varies significantly between companies. This is why it is important to identify the characteristics of a hot lead for your specific business.
To determine what makes a lead a good fit, start by reviewing your typical customer profile. For example, a company that installs security systems for retailers might find that a lead’s industry, store size, and existing security system can indicate how likely a lead will convert into a sale. If you don’t already have a customer profile, the following are often characteristics that can be used to determine fit:
Characteristics that show a customer is a good fit (business-to-business (B2B)):
- Number of employees
- Store or office size(s)
- Do they already have a system or specialist and what does it offer?
Characteristics that show a customer is a good fit (business-to-consumer (B2C)):
Interest is how much a lead interacts with your sales outreach. This can include email opens, phone calls, website visits, and so forth. Basically, anything that indicates a lead is aware of and interested in your product or service.
Did you know?
According to Statista, 50% of survey respondents believed email to be the most effective channel in producing a high return on investment, followed by search optimization and marketing.
Actions that indicate interest are generally the same for B2B and B2C businesses. They can also be tracked, which is another reason CRMs are so useful for lead scoring. For example, Freshworks includes built-in email tracking capability, but unlike other tools, can also monitor your lead’s application activity, such as creating a ticket, and web activity, such as viewing a specific page on your site.
Examples of actions that show a lead is engaged:
- Opens email
- Clicks link to your website
- Submits webform
- Downloads white paper
- Views web page or video
3. Design a Point System
Once you have a list of positive characteristics and measurable actions in mind, the next step is to design your point system. Consider using a simple scale of 100 points as your top score. Points can then be assigned based on how closely a lead matches a customer profile or interacts with your sales and marketing campaigns.
With Freshworks CRM, you can also assign ranges in your scoring system to determine whether a lead is hot, warm, or cold. For example, if a customer fits your profile and has engaged with your emails, the person might score between 70 and 100 points. This would be the threshold to label them hot leads. If the score is a little bit lower, say at 50 points, you can categorize them as warm leads. If leads score around 30 points, make them a cold lead.
Many CRMs can automate lead scoring for you, but you can also use your own system. We’ve created a lead scoring template your sales team can use to score each individual lead. Download the PDF here.
Your point system will likely take some trial and error to perfect. You may not know how much weight to put on each characteristic and action until you try it out. Too much weight on email opens, for example, could lead to “bad fits” ranking highly. Likewise, assigning too much weight on the wrong characteristics could result in “hot leads” who’ve never actually interacted with your business.
Here is an example of a point system a security system installer might use:
Lead Scoring Example: Security System Installation
Imagine you install security systems for small retail shops. Your ideal customers are small luxury stores who need protection for their expensive products. Your scoring system will reflect these preferences. Luxury shops will get an immediate 25-point bump. Other retailers will get a modest 10 points, and non-retailers will start in the negative.
You could avoid non-retailers unless they show an exceptional level of interest in your emails. Furthermore, you serve stores in the 2,000 to 5,000-square-foot range most often, but can work with those a little smaller or larger, so customers with stores in that size range also receive a point bump.
The other half of the scoring system is based on how engaged potential customers are with my email marketing campaigns. Using a system such as Freshworks, you can set up email campaigns and track when emails are opened and links are clicked.
Let’s see the point system in action:
A lead comes through that is a luxury store (+25) with an interior that’s 1,800 square feet (+25) and does not currently have a security system (+10), so they’re immediately at 60 points. Now, let’s say they’ve opened two promotional emails (+10) and clicked at least one link (+10). They now total 80 points and would be classified as a “hot” lead.
You should now keep a close eye on this lead and allot extra resources toward them—whether that’s marketing materials, free samples, or a sales presentation.
4. Set Up the Lead Scoring in Your CRM
One great feature about many CRMs is that points are added automatically if your lead meets certain characteristics. For example, if you want to award points for matching your profile, such as their industry, location, or job—you can do this by adding rules in the platform’s lead customization option.
However, before your CRM can automatically add points, you can either use the auto-enrich function so the CRM can enrich leads with social and publicly listed details, or you can manually add these details based on email sign-ups or client calls. Likewise, points are also automatically added for visiting a page on your website, downloading a whitepaper, or registering for a webinar.
Since a CRM consolidates your leads and helps you manage contact with them, it’s the ideal place to set up your lead scoring system. While every CRM is different, we’ll show you how to set up a scoring system using Freshworks CRM. In this example, we’ll start with automatic email scoring, and then learn how to configure the platform to automatically score leads based on their characteristics. You can also try this for yourself by signing up for a free trial on their website.
Create Scoring Rules
You’re not limited to email interactions because Freshworks CRM also allows you to add or subtract based on lead characteristics. To do so, you have to set up the rules just like how it’s done for email activity. Take note that the automatic scoring will only be triggered after you enter the lead’s basic information.
Follow the step-by-step instructions below to score leads based on characteristics:
- Click “Add Rule.”
- Choose a field from the drop-down box. There are around 50 fields that you can score for.
- Select a condition from the drop-down.
- Depending on your lead field, you’d either have to enter the value or select the value from the drop-down box.
- Select add or subtract points from the drop-down box. Enter the value in the next box to determine the score.
- Hit “Save.”
Pro tip: To learn more about how to create engaging email introductions, check out our article that includes nine sales email introduction templates that get responses.
Add Points for Email Interaction
First, log into Freshworks and click “Admin Settings” at the bottom of the left-hand side of the screen. Click “Lead Score Customization,” and then click the “Email Activity” tab. Here’s the step-by-step instructions on how to score leads based on email activity:
- Click “Add Rule.”
- Choose a field from the drop-down box, e.g., opened or clicked.
- Input the subject line of the email. Be sure that it is the exact subject line of the email that you plan to send and score your leads.
- Choose a time limit for your email.
- No Time Limit: The lead clicked a link or opened an email at any time, and no score will be subtracted.
- Last 7 Days: The lead clicked a link or opened an email within seven days and after that, the score will be subtracted.
- Last 30 Days: The lead clicked a link or opened an email within the last 30 days and after that, the score will be subtracted.
- Then select add or subtract points from the drop-down box. Enter the value on the next box to determine the score.
- Hit “Save.”
Filter Leads Based on Lead Score
As your leads begin collecting points, filter leads based on their score. This feature enables your sales reps to quickly see which of your contacts are ready to buy and which of your contacts need more nurturing. To filter leads, do the following:
- Click “Leads” at the top left-hand side of the screen.
- Click “Filter” at the top right-hand side of the screen.
- Hit the “+” button to add “Lead Score.”
- From the drop-down under lead score, choose a condition. For example, if you want to see all warm leads, choose “between” to indicate a range.
- Enter the values to specify the covered range. For example, you could enter between 40 and 70 to filter for hot leads.
Lead scoring takes the guesswork out of determining your most promising leads. At a quick glance, you can find the leads who best match your criteria. Furthermore, you can save even more time by filtering your leads based on their lead score. As a sales manager, you can ensure no promising lead slips through the cracks.