U.S. businesses spend billions of dollars generating sales leads every year only to lose more than 70 percent of them simply because they don’t make contact quickly enough or follow up consistently, according to one study.
But that’s not the only way they’re losing out on opportunities. A study of more than 600 companies by James Oldroyd, Ph.D., of MIT found the odds of a lead entering the sales process were 21 times greater if the business made contact within five minutes of generating the lead versus contact in 30 minutes. Another study, this one by the Harvard Business Review, found the average response time by businesses to a generated lead is 42 hours — and that’s just for responses that occurred within 30 days.
Generating sales leads is big business, with more than $23 billion spent on Internet leads alone. Financial advisors and other professionals also spend money on direct mail, invitations to seminars, TV commercials and/or print ads. How many leads are being generated, and at what cost per lead, only to have them be lost?
Working with companies as a financial advisor, I’ve found four ways professionals commonly lose sales leads. The good news is, they can all be fixed!
Advertising calls to action that are all-or-nothing. Most sales people primarily lead with the offer of a face-to-face meeting or a telephone appointment as their call to action in their advertising. But it’s important to understand that’s asking a lot of prospects who are simply exploring options and aren’t yet ready to engage in the sales process. Too many businesses treat all leads alike, approaching and attempting to immediately close every lead they generate. Most professionals have no system in place to determine a given lead’s particular buying stage. In fact, most don’t even understand that there are buying phases.
For a quick overview, consider the following phases that prospects almost always move through, beginning with the “cold” leads and progressing to “hot.” Most cold leads start at a stage I call “Unaware.” There are many consumers a business may be marketing to that are unaware they even have a need. However, at some point they move to the point of awareness; they become aware that they need a particular product or service. Then they move into the research phase. There, they begin the initial process of looking for potential vendors or professionals who offer the products or services they need. After that, they move into comparison, which is where they begin comparing price, quality, providers, etc. Finally, they move into the action phase where they are ready to make a buying decision.
Too many companies and professionals market to everyone as if they are all in this final phase. The tragedy of this approach is, neither the business nor the consumer is served very well, as the lion’s share of the marketing dollars the company spends falls on deaf ears. And yet, for the professional thinking strategically, there is a silver lining: Those who will excel in today’s market are those who devise marketing plans to speak to all prospects at each of the different phases and learn to “cultivate” prospects as they move up the pyramid of engagement.
No lead capture on the website. This is a huge problem! Many sites have no strategy for capturing information about visitors to the site, such as an email address. As a result, businesses spend thousands of dollars driving traffic to their websites, but capture none of the prospects’ information. Prospects come to the site and leave, and the business never knows they were there.
A free report or series of reports or videos with useful information based on the professional’s expertise and the visitors’ interests make good lead-capture tools. Buyers today turn to the Web for information while doing research, so that’s what a business should be providing them. Offering free resources in exchange for a small bit of information for future follow-up is a great way to ensure a business maximizes the traffic it is driving to its site.
Indifference in interactions. No matter what the individual’s profession, it’s likely there is a lot of competition. For consumers, shopping includes researching, and they’re comparing services, expertise and experience before deciding who best deserves their patronage. If a businessperson’s interactions with prospects fail to “wow” them, they will quickly move on. But most professionals don’t have a storyboarded plan for giving prospects that experience, which is what is needed for consistent results. An automated system that delivers carefully planned interactions is a great way to achieve this.
Using social media without a plan. Many professionals have discovered that delivering consumer-friendly, useful content through social media is an effective means of attracting followers and cultivating prospects. However, one of the biggest problems with how businesses use social media is, they post a lot of high-level, one-way communication with no call to action. Having a call to action in the posts that lead prospects back to a website designed to capture leads is critical for producing tangible results through social media.
A lot of these issues stem from a common problem: businesses focusing on only the hottest leads — the people who are ready to buy today.
Instead of allowing those “cooler’’ leads to fall by the wayside, businesses should capture and cultivate them. Eventually, they’ll find that instead of constantly chasing leads, they’re harvesting new clients.
Brandon Stuerke is a business coach and cutting-edge marketing strategist, specializing in innovative new tools that save professionals time while building their practices. He is the founder and president of Advisors Edge Marketing, Inc., which produces Automated Advisor, a new program that strategically streamlines prospect cultivation. He is also the creator and president of the Strategic Alliance Program “Winning with CPAs,” which teaches financial advisors how to build their practices by partnering with CPAs.