Are you letting online leads go cold?
In particular, I wrote of their tardiness in responding to online leads. Well, it seems this is still a problem – only the other week one of my coaching clients told me about his dealings with a prestigious car brand. He contacted a dealership to arrange a test drive, only to have someone get back to him seven weeks later – well and truly after he had bought another car from another brand.
The feedback I received from car industry sources in 2010 was that if a warm online lead was not followed up within six hours, it were lost to that dealer. How things have changed. This isn’t just an issue for car dealerships; it’s now an issue for any business generating online customers leads. Harvard has highlighted this issue in an article, The short life of online sales leads.
So are you confident your company is effectively handling potential customers’ online queries? Think hard. Harvard research shows most companies are not responding nearly fast enough.
This issue is not just a problem for automotive sales; it seems to be an issue for software, healthcare, banking and financial services, professional services and many other industries. With many companies now using the internet and other associated technology to generate warm customer leads via ‘push-and-pull’ prospecting strategies such as direct and targeted online advertising, discussion groups, community forums and the like, as well as online brokers offering consumers group-buying opportunities and access to a range of companies in the B2B and B2C space, warm lead generation has never been hotter. New businesses are emerging to help other companies turn leads into sales by providing technology and services that help maximize this space.
However despite all of these wonderful sales opportunities, the sad news is that many of these warm and hot leads never get followed up by the salespeople and companies who seek them out in the first place.
Harvard’s research shows many organisations are too slow to follow up these leads.
“We audited 2,241 US companies, measuring how long each took to respond to a web-generated test lead. Although 37% responded to the lead within an hour, and 16% responded within one to 24 hours, 24% took more than 24 hours — and 23% of the companies never responded at all,” the report states.
The average response time, among companies that responded within 30 days, was 42 hours.
“These results are especially shocking given how quickly online leads go cold — a phenomenon we explored in a separate study, which involved 1.25 million sales leads received by 29 B2C and 13 B2B companies in the US. Firms that tried to contact potential customers within an hour of receiving a query were nearly seven times as likely to qualify the lead (which we defined as having a meaningful conversation with a key decision maker) as those that tried to contact the customer even an hour later — and more than 60 times as likely as companies that waited 24 hours or longer.”
This was a big wakeup call for Barrett as well. This research has certainly put us on notice because we are seeing a steady increase in the number of enquiries via the web. Have we missed the boat because we were too slow in responding to online leads? Probably in some instances, especially if we were out on assignment and working on other projects and do not get back to people quickly enough. Working out what is the right timeframe to follow up on is challenging and responding immediately can be problematic – for instance, receiving an overseas enquiry overnight for companies without a 24-hour helpdesk or customer service line.
So what do we need to do to capture these important sales opportunities?
If companies are making big investments in order to obtain customer interest from the internet and the expectation is that they should be responding at internet speed, why aren’t they? Harvard states: “Reasons include the practice of retrieving leads from CRM systems’ databases daily rather than continuously; sales forces focused on generating their own leads rather than reacting quickly to customer-driven signs of interest; and rules for distributing sales leads among agents and partners based on geography and 'fairness'.”
Harvard is conducting further research to better understand the causes and identify possible solutions. But it’s already evident that most sales organisations need new tools and processes to meet the demands of the online age. With companies making huge investments in online marketing and lead capture, we need to work out how we respond. Watch this space.
Remember, everybody lives by selling something.