Lead Scoring: What It Is, Models, Best Practices, and Top Tools

The more leads, the better, right? Not necessarily.

In sales, time is money. And there's no bigger waste of both your sales reps’ time and bandwidth than pursuing dead end leads. A lead is any individual or business that expresses interest in buying what you’re selling with the hope that they'll eventually become a new customer.

The catch? Not every lead that shows interest in your product is ready to buy.

Now, imagine having hundreds of leads to work with – less than half of which will likely ever convert to customers. As a time-strapped sales rep, how are you supposed to find and prioritize the leads that are sales-ready? This is where lead scoring software comes into play.

The main goal of lead scoring is to save salespeople time and maximize the overall efficiency of the sales prospecting process. If you’re able to visualize your highest and lowest quality leads before you begin reaching out to them, then your plan of attack can be much more strategic.

The key to successful lead scoring is strong alignment between marketing and sales. At most companies, marketing is responsible for bringing in a steady stream of inbound leads. Sales is then responsible for converting those leads to prospects and eventually, to customers. 

Why is lead scoring important? 

Lead scoring helps companies understand the path visitors takes in between landing on their websites and becoming paid customers. For example, an inbound marketing lead may interact with your website content, product features page, and a video demo before considering your product. Scoring these prospects' interest lets you find serious buyers showing buyer intent signals. 

Using a lead scoring software system aids sales and marketing professionals in optimizing lead management efforts, finding the right leads with the help of the right metrics, and having a better picture of the sales pipeline. 

Lead scoring models

Lead scoring is customizable and highly adaptable to many different types of businesses and industries. Since there are many ways in which you can apply this method, it’s important to understand exactly how your business will adopt a lead scoring strategy. 

Documenting the lead scoring process ensures that all team members know exactly how to follow the model, ensuring alignment across all departments that are affected by it. To get started, you need to create a lead scoring process. 

Here are five common lead scoring model systems you can use depending on the type of data you collect from leads.

1. Demographic lead scoring

Demographic lead scoring uses explicit data given to you outright by the lead, often by filling out a lead capture form. These attributes fall directly in line with many of the characteristics that are built into your target prospect profile. 

Collecting this information early in the sales cycle lays the groundwork for the rest of your lead nurturing strategy. These data points can often indicate the difference between high-value prospects who fit your ideal customer profile and consumers who are just interested in the free content your team is putting out.

2. Behavioral lead scoring

Behavioral lead scoring relies on the collection of implicit data from your contacts. Implicit data refers to any sort of interaction or behavior that implies that the buyer is interested in your product or service. This information isn’t intentionally provided by the lead but is implied through their online and offline behaviors.

Gathering this type of data requires a bit more research but allows you to gauge how interested the lead actually is. Some of these actions may be better indicators of interest than others, so use your best judgement when assigning point values to them.

A good lead scoring model will take into account both explicit and implicit data. Combining these two data sets helps paint a much clearer picture of the value of a lead, and will help sales reps prioritize their outreach more effectively.

3. Point value lead scoring

The point value lead scoring model is pretty straightforward. Marketing and sales teams work together to create point values for certain marketing efforts. The marketing team then tracks leads as they navigate different lead generation channels. Each action a lead takes is assigned a certain score. When a lead reaches a certain cumulative score, they’re considered a hot lead. This scoring criteria will change depending on individual buyer journeys. 

The highest ranking leads are going to be first priority. These leads fit your customer profile and have expressed an interest in your product or service. Ensure that the sales reps follow up with these leads as soon as possible.

From there, sales and marketing should collaborate to determine the best approach for following up with leads of lower rank and priority. In most cases, leads with lower scores will be placed in lead nurturing campaigns to ensure your brand stays on their radar should they become qualified in the future.

Remember, a lead’s point value is only meant to act as a benchmark for prioritization. Don’t forget that you’re still interacting with real humans, not numbers. Every lead should feel valued, even if they’re not a good fit.

4. Predictive lead scoring

Predictive lead scoring is a lead scoring strategy that uses predictive analytics and historical company data to identify which leads are the most likely to become customers. The benefit of predictive lead scoring is that it removes the human elementing from lead qualification, reducing both time spent on scoring leads and human error. Predictive lead scoring also helps your sales forecasting efforts by using predictive modeling to project future outcomes based on your current data.

Most organizations that use predictive lead scoring invest in predictive analytics software to help them manage their workflows. These software solutions offer sales teams an easy way to collect and manage all of their prospecting data in one platform. They also allow for data to be imported from other sources, such as your CRM, ERP, or marketing automation platforms. 

5. Negative lead scoring

Because it takes awhile to nurture high-quality leads, there’s always the chance some leads will lose interest in your product or company. To weed out outliers, you can choose to subtract points for leads that fall into the categories you don’t sell to. This is called negative lead scoring. 

A negative lead score is when you subject points from a lead score based on negative actions they take while interacting with your brand. These negative interactions often signal that a prospect might be creating distance between themselves and your business.

If you notice certain leads taking actions that indicate a bad fit for your product, it’s important to account for those negative points as well. Continuing to nurture these leads is not only a waste or your time, there’s the potential for annoying or even angering these leads.

How to use lead scoring to find ideal prospects

In order for a lead scoring method to be successful, both sales and marketing need to be on the same page about what constitutes a high quality lead.

The first step in creating a quality lead scoring model is to identify your ideal prospect. This can be done by looking at your target customer profile, which is created by the marketing team. 

Pinpoint which characteristics qualify an individual to be a potential customer – look at demographics, company size, geographic location, and more. This is the criteria that separates a good lead from a great lead.

If you build the foundation of your lead scoring model on a flawed customer profile, it could tremendously impact your overall scoring method. For this reason, make sure that both sales and marketing are familiar with the qualifying criteria before moving forward.

How to calculate lead score

Follow the steps below to manually calculate a lead score.

• Calculate lead-to-customer conversion rate. This conversion rate is the benchmark of how many leads actually become customers compared to the numbers of leads you capture. 
• Find attributes of high-quality leads. This is the stage where you talk with sales team and look at analytics to finalize the attributes for evaluating leads.
• Calculate close rates. Now, it's time to find out how many people actually become customers based on the attributes you finalized in the previous stage. This analysis tells you which attributes are capturing qualified leads more efficiently.
• Compare all close rates. This stage involves assigning point values based on close rates of each attribute. If your overall close rate for all attributes is 1% and 'free trial' close rate is 15%, you can assign 15 points to leads who sign up for free trials. 

Lead scoring best practices

Now that you know different lead scoring models and how to calculate lead score, let's look at some lead scoring best practices that can help your sales reps hit the sales quota every quarter.

• Define lead conversion factors: You must decide lead conversion factors early on, so you clearly know when to qualify or disqualify leads. For example, B2B lead scoring may consider factors like company size, budget, funding rounds, location, etc.
• Analyze conversion behavior: Lead behavior analysis helps you understand and predict when a lead is likely to convert into a paying customer. For example, if most leads sign up for free trials before contacting the sales team, it's best to schedule a discovery call after they sign up. 
• Assign points for each attribute: Start by assigning more points to attributes for leads that display higher buyer-readiness. For example, a lead signing up for a demo should get more points than a lead simply visiting articles on your website.
• Optimize lead scoring model: Nothing is set in stone when it comes to lead scoring. You must revisit and optimize the lead scoring process as the customer journey keeps changing. 

Best lead scoring software

Lead scoring falls to both marketing and sales teams, which means having a centralized location for tracking leads is crucial for your collaboration.

Lead scoring software is used for creating lead benchmarks, tracking where leads are along the sales funnel, and determining when leads are primed for sales outreach. Lead scoring software offers an easy-to-use and scalable platform that can grow with your business.

In order to be included in this list, a product must: 

• Help users create and manage lead scores based on company goals and market position
• Allow users to use predefined criteria for assigning scores to leads
• Compare and analyze lead scores to help salespeople find the right opportunities
• Integrate with lead intelligence and other sales and marketing solutions
• Provide data import/export options

*Below are the top five lead scoring software solutions from G2’s Fall 2023 Grid® Report. Some reviews may be edited for clarity.

1. Salesforce Sales Cloud

Salesforce Sales Cloud offers a single source of truth to sales teams looking to manage engagement activities, leads, accounts, and opportunities. This platform also provides real-time forecases to help sales professionals better manage sales pipelines. other features include workflow automation, contact approvals, and sales performance management. 

What users like best:

"I enjoy the flexibility and customizable nature that Salesforce Sales Cloud provides to its users. It can sometimes lead to functionality issues due to the highly customizable nature of the product, but this is definitely alleviated with helpful support. Whether it is a development related issue having to do with complex systems or a user experience problem, Salesforce Sales Cloud Support is always available to quickly assist. Their support reps are knowledgeable, friendly, and efficient. Overall, I highly recommend their product due to its ease of use, friendly UI, and quality staff."

– Salesforce Sales Cloud Review, Alexander K.

What users dislike:

"Even though they say no code, you do need some type of technical knowledge/thinking ability. Yes, you don't use code but you are creating technical processes that for some are harder to grasp."

– Salesforce Sales Cloud Review, Kris G.

2. Freshsales

Freshsales is a comprehensive sales force automation platform that helps sales teams with identifying high-intent leads, personalizing engagement, and optimizing sales strategy with AI-powered deal insights. The platform also lets you create intelligent workflows for sending emails, assigning leads, and creating reminders.

What users like best:

"Freshsales offers a central view of all sales activities done from a single dashboard. Plus, that the tool is accessible from a mobile device as well. This solution is a great CRM solution that helps in following through the sales process using event tracking, prospecting activities, customer interaction tracking, sales activity management, information sharing, and reliable customer support. Freshsales also offers an overview of sales activities to the sales manager and keeps accurate track of reports."

– Freshsales Review, Oluwatimilehin O.

What users dislike:

"While the support team is quick to send out links to articles, this approach falls short of providing the personalized help needed for successful implementation. It becomes evident that the representatives are not well-trained, as they often resort to generic articles rather than directly addressing the specific issues at hand. The end result is a frustrating and inefficient support experience, exacerbating the challenges of using an already complex CRM system."

– Freshsales Review, Santiago H.

3. ActiveCampaign for Sales

ActiveCampaign for Sales is a sales solution helping sales professionals with sales pipeline automation, lead qualification, and lead capturing. It also integrates with 900+ apps and features 900+ pre-built automations to help you drive sales growth.

What users like best:

"ActiveCampaign for Sales keeps my leads organized, helps keep my pipeline full and allows me to see things I couldn't on a spreadsheet or other software I was seeing before, lie deal values, number of days in the pipeline or stage and helps me automate things from notification, texts, emails , etc to advance the sales process."

– ActiveCampaign for Sales Review, Allen E.

What users dislike:

"There are some aspects to be improved in the use of integrated emails (signatures, overall design) and automated emails. Also, the system does not take into account the correspondence if it is handled from one's own mailbox. Integration with LinkedIn Sales Navigator and/or the ability to enrich contacts, accounts and deals with information taken from the web would be very useful. These features I mentioned, which are available on other platforms, would make the platform 100 percent irreplaceable."

– ActiveCampaign for Sales Review, Attilio G.

4. 6sense Revenue AI for Sales

6sense Revenue AI for Sales is an AI sales intelligence platform that helps organizations to discover hidden sales opportunities, identify buyer intent data, and prioritize ready-to-buy accounts. 

What users like best:

"6sense Revenue AI for Sales is mostly helpful as a jumping off point, as far as seeing what technologies or psychographics apply to other companies that you want to reach out to. It is not difficult to use and as someone familiar with databases, I found it straightforward to learn. Our newly assigned contact has been responsive in matters of support."

– 6sense Revenue AI for Sales Review, Heather K.

What users dislike:

"The onboarding process could have been easier. We got the information we needed, but we did most the learning by doing it ourselves."

– 6sense Revenue AI for Sales Review, Jonathan H.

5. VanillaSoft

VanillaSoft is a queue-based sales engagement platform, helping sales professionals crush the sales quota with step-by-step omni-channel sales outreach. The platform features capabilities such as lead routing, logical-branch scripting, auto dialing, lead tracking, appointment setting, and sales intelligence.

What users like best:

"VanillaSoft is an amazing CRM. It keeps all your contacts in one place. The clients you need to call back are sent directly to your email so you can see them on your calendar. Also if the clients are on DNC, it takes that lead right out of your CRM. Another amazing thing about VanillaSoft, is it is integrated into the marketplace, where I buy leads. Once I buy a lead it is automatically placed in my CRM to call."

– VanillaSoft Review, Jeff K.

What users dislike:

This is a tool designed for large teams of people dialling. If you are an individual and require call/sms/email contact for all prospects, it can be challenging to use VanillaSoft.
The sms tool only goes back 7 days so it's not useful for long term follow up or searching for message threads beyond a week. For context, I wasn't the administrator for the account and am not aware of which settings could be changed to fix this.

– VanillaSoft Review, Tyler W.

Higher-quality leads, better conversion rates, more sales

If you notice your sales pipeline is getting stagnant, adopting a lead scoring methodology might be exactly what your team needs to pick things back up again. Building out an effective lead scoring model will take time, but the payoff is well worth it. 

Still struggling to attract new leads? Learn how to build a lead capture form that actually converts.

This article was originally published in 2020. It has been updated with new information.