Businesses often set aside a large budget to generate leads. But they don’t follow up with enough eagerness, vigor or persistence. That’s lead waste, and it’s preventable.
Consider a farmer who has gone to the trouble of tilling his soil and planting, watering and fertilizing his crops, but come harvest time, neglects to pick the crops. After all that time, energy and money, the produce is dead on the vine.
No business owner wants to be that farmer, which is why it’s so important to eliminate lead waste. Evaluate your processes and sales strategies to ensure that not only are you harvesting new leads, but you’re also cultivating them in ways likely to convert them to sales and long-term customers.
The Causes of Lead Waste
You may be losing money and opportunities simply because there is no efficient system in place for following up on leads. Re-evaluating your processes could reveal ways to make more meaningful and lucrative connections with prospects.
Poor communication between departments can result in lost leads. For example, marketing teams are often expected to generate interested customers, while sales teams are expected to convert them. This multi-department process can cause miscommunication, accountability problems and finger-pointing — not to mention wasted budget dollars.
Leads need to be nurtured and encouraged to opt-in — not just by well-crafted automated emails. Phone calls or in-person meetings will provide you with far more information about where prospects stand on your offers, what their financial circumstances are, and what might be needed to convert them into paying customers.
Assessing Lead Waste
It’s smart to establish incentives for your sales team to go after shiny new leads, but don’t forget about existing contacts. Look at how you’re doing with customers you’ve already brought in. This can tell you a lot about where you’re falling short and likely losing money.
Simple reports from your customer relationship management system (CRM) can highlight lead waste in the following areas:
- Leads with no activity
- Leads with no activity in last X days
- Leads with no future activity set
- Lead inquiry date to first lead activity date
Another option is to run reports on the number of inquiries in the past month, the number of introductory meetings based on those inquiries, and the number of opportunities created. Use this information to develop a strategy for gaining traction on lapsed leads.
Preventing Lead Waste
Now that you’ve raked out lead waste, you can work on yielding more sales than before. Here are four ways to do so:
- Establish a clear process to assign, manage and track leads. Make sure there’s a backup plan for every process. Don’t let the system break if one person doesn’t follow up with a contact.
- Research industry metrics and set realistic goals for lead creation and conversion rates.
- Make sure sales and marketing are aligned and playing nicely. Streamline their communication processes and clean house when it needs to be done. If something doesn’t work, say so, and fix it. Avoid finger-pointing.
- Allow for an amnesty period during which everyone who committed a lead-related sin gets a do-over.
Slow Down and Smell the Revenue
Nobody’s suggesting you turn off the faucet for new leads in order to revisit existing leads; you need to do both. Consider splitting your teams in two:
- New/active leads team
- Older/reinvigorating leads team
This division of duty can lend focus to your sales team and ensure that every type of lead is being touched or revisited regularly. And if anyone’s ever suggested that nurturing email marketing is good enough, I can tell you firsthand that it’s not. Our company has made millions in revenue running inside sales campaigns behind failed email-only campaigns.
Before you tell your sales team to chase those new leads, stop and see what actually makes sense. Are you converting when you bring in leads? If not, why? When it comes to marketing, get your people in the habit of having live conversations with prospects. Follow-up based on accurate intelligence gets leads unstuck.
Most importantly, consult your books. The numbers will show how well you’re doing with leads. If the bottom line stinks, it’s time to rethink your approach.