Leads are part of the lifeblood of the car retail business. When managed well, they form a critical artery of health that ensures ongoing success and profitability as well as increased advocacy and thereby self-generation of future customers.
Lead management should be straightforward enough, but often it is overcomplicated with businesses making assumptions about what is really happening with those precious requests.
Let’s take a look at the lifecycle of a lead.
Leads can come in many forms; web, e-mail, phone, 3rd party provider, walk in, etc. Handling these and putting them in a recorded and recognised form is not easy unless you are using a recognised third-party system which can aggregate all the above into a workable dashboard.
Effective systems are a plenty, but they still need diligent management to ensure they provide a credible output.
Input delivers output
Before we look at the above, let’s take a step back. How many leads do you expect to receive in an average month?
Do you know how many leads are required to give you an effective sales funnel to sell the right number of units given your current conversion ratio?
These two pieces of information are critical and a fundamental starting point in having a great lead management process.
For example, if you need to sell 100 units in a month and convert appointments at 40%, then you need 250 appointments.
If your lead to appointment ratio is 25%, then you need 1,000 leads a month to make 250 appointments.
As a starting point, look at your conversion rates to ascertain your own sales funnel requirements.
Now back to those leads. Let’s assume that a lead comes in and then sits in the showroom system. Is it auto allocated to a salesperson or is only the sales manager allowed to pass the leads to the team?
Best practice would show that only the sales manager and maybe controller should allocate leads, which makes it easy to follow up in daily meetings and retains both visibility and control.
Additionally, they should be the only ones who are able to ‘lost sale’ a lead to ensure that this is not being done assumptively or erroneously by any of the team.
Consider how many attempts to contact are appropriate for each lead.
Many businesses don’t have a set number of attempts, but if five were the benchmark, they should be made at different times of day and maybe out of hours, especially if attempts are failing.
Contact could be by e-mail or phone, but speed is key and a one hour or quicker response should be the objective.
Even when contact is made, how many conversations are the right amount? Research shows that increasing from under four to between five and eight contacts, where needed, improves sales conversion by circa 15%.
Once contact has been made with a customer, it is also highly important that the salesperson logs details of the conversation, most importantly around the qualification and part exchange details (if any). This allows for an informed conversation with the sales manager about next steps. It could be that there are other opportunities to do business that are not immediately apparent, and this helps a second pair of eyes have informed input.
What about the quality of those contacts? By e-mail, are you using set scripts which have keywords to improve conversion? Freehand e-mails can be less impactful and sometimes even counterproductive. If phone calls have been made, what was the quality?
Listen to the team members’ calls as part of their monthly appraisal. Coaching can then be given to improve their conversion to appointment ratio.
When listening to calls, it is also important to get into the mindset of the salesperson. Experience shows that sometimes, if the specific car is not available, they will confirm this and lost sale the customer as opposed to qualifying why it is the customer wants that specific car and then offering alternatives.
The objective always being to get a physical appointment.
Don’t burn bridges
Finally, ensure leads are not removed completely. It could be that today you could not fulfil a customer’s needs, but suddenly in a week or so, you get the perfect vehicle.
Always maintain any leads for a time to ensure you can revisit for a sale or part exchange opportunity.
Leads are costly and precious, so it is worth ensuring that your processes are robust and sustainable.
Don’t allow your leads to slip through your fingers or someone else will snap them up.
Author: Chris Roberts, managing director, Roberts Corporate Associates