I’ve said it before: sales are the lifeblood of every business. So it’s natural that business owners include increasing sales at the top of their list of priorities. One of the best ways to strengthen your sales process and increase your bottom line is by improving the quality of your leads. It’s just a fact of business: you can’t have sales if you don’t have leads. Today, I’m talking about why all of your leads are not created equal and how you can maximize your most valuable leads.
Some Leads Are More Expensive to Acquire
We all want more leads because more leads equals more sales, right? Not always. In reality, all leads do not have the same value. You may find an inexpensive way to generate a large number of leads, but if they don’t meet your qualifications, they are not your ideal client, or they will never buy from you, these leads have little or no value. Rather than boosting your sales, too many of the wrong leads end up costing you time and money. As you determine the value of your leads, here are three things to consider:
- Is the lead source predictable?
- What is the cost of the lead?
- What is your return on investment?
1. Is the lead source predictable?
As I ask people about their different lead sources, one of the first things I hear is, “Oh I’m getting lots of referrals.” I love it. Referrals are great! Whether you offer a reimbursement plan for people who send you referrals or give another incentive, we all appreciate referrals. These leads are essentially free to acquire, and they come in warm because they have already heard about your business from someone they know.
The problem with planning on referrals as your main lead source is that they are not predictable. If you are strategizing to meet goals or boost sales, you can’t control when those referrals are coming in. On the other hand, using predictable leads will give you predictable results. Predictable leads include measurable marketing activities. If you know how much the lead costs, what your return will be, and then how many of those leads will close, you can better plan on those leads. These predictable leads are the ones that can directly impact your sales goals and results.
2. What is the cost of the lead?
When you are considering lead sources, you need to know the cost of the lead. For example, if you know how much you are spending on networking, then you can determine how effective that lead source is. Consider how much time and money you put into attending a networking event. Then note how many leads you get from that networking opportunity. Do a quick little division and figure out the cost per lead. You can do the same thing with social media ads and other areas where you are spending time and money to collect leads.
3. What is your return on investment?
Your return on investment measures how well your lead generation efforts are working. Make sure the time and money you spend to acquire leads are actually getting you the kind of leads you need. You may get a large number of leads at a low cost, but if those people aren’t your ideal customer, if they aren’t going to purchase from you, then your return on investment is still really bad. To understand your return on investment, you need to know the cost of each lead and then be able to track how many of those leads close.
Some Leads Are More Qualified Than Others
I recently read a study that said that on average and across industries, only 27% of leads are qualified to buy. This doesn’t necessarily mean that they are going to buy right now, but that they are qualified to purchase your products or services at some point. There are so many other factors to consider. Do they have the budget? Are they your target customer? Do they recognize that they need what you have to offer right now? It is important to consider how you are qualifying each lead.
Once you know which leads are qualified, don’t spend time on leads that don’t meet your criteria. It might seem like a good idea to spend a free hour consulting with every lead you get. But in reality, you don’t have the time or the team to maintain this if you want to grow. This time is better spent on a qualified lead who has the higher potential to close. Make sure you are focusing on the people you can help and who are ready to work with you.
Buy Now Leads vs. Buy Later Leads
I see advertisements on our local TV all the time for an attorney who works with people who have been in a car accident. His call to action is “Call right now!” Well, I haven’t been in a car accident. I do not need to call. This isn’t for me. This type of advertising is targeting only a small group of people who are “buy right now” customers.
Most marketing efforts focus on the buy-now customers, which make up just 10% of the market. If you are only reaching this type of lead, you are missing the other 90% of your target market. 90%, of these buy-later customers are still your ideal clients who still need your products, just not right now. An effective marketing strategy will nurture the other 90% of the market for buy-later leads.
There are several different ways to nurture a buy-later lead. Offer free products that they can opt into receiving. Deliver an email drip sequence with tips, solutions, and other valuable content. The goal is to support your lead and keep your business top in their mind so when they are ready to buy, you’ll be the first person they think of.
Keeping Track of Your Leads
We’ve talked about knowing the cost of a lead, how to qualify a lead, and the importance of nurturing those buy-later leads. The piece that ties this all together is tracking all of these leads in your CRM. There are a few essential things you need to have:
- A comprehensive list of lead sources in your CRM. Enter and track every piece of marketing and collect each generated lead. Be specific as you identify your lead sources. That way you will know how effective your marketing campaigns are and be able to measure your return on investment.
- Track leads and opportunities separately. Leads are your people. They are cold, fresh leads that have just entered your system. You want to track all of their information so you can nurture and support them until they are ready to buy. Opportunities are warm. They are actively looking for the solution you provide and are ready to enter your sales process.
- Track your lead source through to opportunities. This is not built into a lot of CRMs. When a lead is created, there should be a record of where that lead came from. As leads are converted to opportunities, you do not want to lose that information. Make sure that lead source tracking is included in your CRM.
The right tracking not only helps you understand where to focus your marketing, it also helps you know where those leads are in your process. You’ll know which leads are qualified, whether they need nurturing, and when they are ready for a sales conversation. Tracking your leads and opportunities shows you how many sales you are winning, how many you are losing, and where each of those are coming from.
For more examples of how to maximize your most valuable leads, watch the video below. I’m also excited to share new ways I can help you get more of the leads you want. Whether your sales funnel is clogged, overflowing, or empty, I want to help you get it moving smoothly and automated.
Schedule your free 15-minute strategy call here and lets get you more of the leads you need!