What all successful salespeople in any niche know is that in order to close to the maximum number of leads you need to develop an effective lead system that works for you. Unfortunately, too many salespeople lose more business than they might want to think about because they do not have such a system in place. If they are unable to form one themselves, there are a lot of lead management software available to help with that.
Either they do not have a good lead management system or they have an ineffective sales pipeline. It may even be that they do not really understand how to best use the tools that they already have at their disposal.
Building an effective sales pipeline not only helps you close on more of your leads but it can also help you gauge what your sales figures might be in the future. A well-tuned lead management system will tell you exactly what your closing ratio is. Then you can use that particular metric to help determine just how many new leads you will need to generate or purchase to successfully meet your goals.
Here is an example:
If an insurance salesperson can improve their close ratio to submitting 5% of their leads, then they also know that 1 out of every 20 leads turns into a deal. So if their sales goal is 30 closes a month ( a lofty one but still), then they need only to adjust their lead flow to 600.
So how best to make sure your sales pipeline delivers the best possible close ratio on a regular basis? By creating a leads status system. Here are some pointers for creating, and maintaining, an effective one.
DEVELOP A WAY TO MANAGE LEAD STATUSES EFFECTIVELY
Very few salespeople have a paper-based lead management system anymore so the days of prospect folders and lead bins are over. And as there are so many different ways that leads can be effectively generated maintaining a single database is a must.
Ensuring that all of your leads are added to your leads database – whatever tool you choose to use – is only the beginning though. To make the most effective use of your time, resources and to increase your close ratio you should also make the effort to categorize all your leads within your automated system. How? Here are some of the categories you should consider using:
Those people who have fairly clearly indicated that they are ready to close and are in the process of making a final decision. Hot leads know what they want and have a timeline and budget in mind. These are the leads that have probably already researched your company and the competition.
Brand new leads that you have yet to make contact with. This is where all new leads should be placed as you receive them from your various sources. They should not stay there too long, but we think you know that already.
CURRENT CLIENTS AKA QUALIFIED LEAD
Too many salespeople file their current clients away, moving them from their leads database to a static contact list. This is a huge mistake. Not only are these the people most likely to buy again but they are also always going to be one of your best sources of referrals. Even if it is only the occasional email, these are leads you need to be in touch with.
These are the leads that are qualified but are not ready to buy just yet. Human resources managers doing competitive research perhaps to determine if they might need to make product switches in the future. Even though these people are not about to buy just yet they should still be put onto a drip marketing email list at the very least.
These are leads that you have had contact with in the past but they have now stopped responding to your communication attempts. It probably makes little sense to spend a lot of time on these leads but adding them to an automated email list will take just seconds of your time and they will not be abandoned altogether- just in case.
LEAD STATUS SYSTEMS – LIFECYCLE CHANGES
Once you have this kind of a lead status system in place it will only work if you update it frequently. Doing so whenever you have contact with the lead is probably the easiest way to manage to do so on a daily basis. Don’t throw away your lead generation strategy just because you can’t keep up with the potential customer!
Tracking leads is very beneficial for sales activity. Your lead conversion rate will increase. Every converted lead will prove to you that your sales funnel is very effective.
Lead statuses are somewhat dynamic due to their lifecycle. They can change at any time from an opportunity stage to an actual sale. The only way to make a leads system work for you is to make sure you maintain it well, however busy you are.
Could you use help with Lead Generation? Give us a call today and let’s talk about what Lead Generation can do for you.