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What is Lead Scoring?

Article Details
  • Written By: Malcolm Tatum
  • Edited By: Bronwyn Harris
  • Last Modified Date: 02 December 2016
  • Copyright Protected:
    2003-2016
    Conjecture Corporation
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Lead scoring is a strategy that is sometimes used by sales professionals to evaluate and classify sales leads prior to actually beginning to contact those leads and attempt to earn their business. The idea behind lead scoring is to provide the salesperson with some concept of how likely the lead is to be interested in the products that are available for sale. This form of qualification can often help salespeople focus on more promising leads and thus increase their chances for earning new business that generates profits for their employers as well as healthy commissions for the sales professionals.

As with most sales tools and strategies, there are different ways to approach the lead scoring process. Most methods rely on a system of awarding points to each lead, based on various factors. For example, if the lead is engaged in a particular type of business operation, the salesperson may award that lead a given number of points. Should that lead be a leader in that industry, additional points may also be accrued. Factors such as location, market share, company size, type of products offered, and the position or job title held by the lead may also affect the number of points awarded.

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While many forms of lead scoring focus only on awarding points, some also employ the practice of removing points when certain factors apply. For example, the lead may represent a company that has a number of locations in operation, and be a major player in its industry. Along with those advantages, the structure of the business may preclude any decision maker at the corporate level from mandating usage of a particular vendor throughout the company. Depending on the goals of the salesperson, this factor could mean that points are deducted.

Generally, a lead that accrues less points is considered to be less likely to result in a sale. This does not necessarily mean that the sales professional will abandon the lead altogether. Instead, the data generated by the lead scoring allows the salesperson to prioritize the current batch of leads, devoting more time to those that show greater potential of moving from lead status to that of a prospect, and ultimately becoming a customer. When and as time allows, leads with a lower lead scoring are worked, but the amount of time and resources devoted to those leads is limited.

There is some difference of opinion on just how effective lead scoring actually is. Proponents note that the process allows them to focus more on leads that are actually decision makers, based on their positions within the targeted company. Others note that a difference in corporate culture sometimes means that less obvious contacts actually have the influence necessary to help the salesperson earn the new account, a factor that may be overlooked if titles and position are considered a key criteria. For example, if a lead scoring is lower because the contact person is an administrative assistant rather than a department head, and the input of that assistant happens to be extremely valuable to his or her manager, the salesperson could overlook a lead that has the potential of becoming a very profitable client.

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