Our company uses many types of lead sources, including SFI, show/event leads, direct mail, marriage mail, and canvassing. Yet the productivity of those lead sources depends as much on company culture as anything. We know this because we track our leads in two ways: we benchmark productivity by the lead source as a whole (i.e., SFI leads close at, say, 21%) and by individual salesperson.
Except for referral, previous customer, and self-generated leads —which close at atypically high rates — other lead sources tend to produce within about a 10% range. You keep them from varying wildly by training reps to manage different types of leads and objections.
Take show leads, for instance. The objection is going to be that the homeowner needs to get other estimates. Reps need to know how to respond to that. Or SFI. The homeowner went to that store thinking milk and eggs, and your demonstrator caught them off-guard. They may not have been in the market for windows or a sunroom, and now you've brought them into the market. Since this wasn't something they were thinking about, your salesperson needs to know how to deal with procrastination and to deliver a sense of urgency in his or her presentation.
Benchmark by Sales Rep Besides benchmarking by lead source, company-wide, we also benchmark individual reps by types of leads. This is in addition to their overall closing rate and slugging average. The reason is simple. Say a guy closes store leads at an efficient rate, but not show leads. By comparing his performance in that particular area to the company benchmark, we see how he stacks up. Say the company average on show leads is 22% and a particular salesman is closing show leads at 15%. If that's trending out over months, that salesperson is having problems with that particular lead source.
Knowing that, you can identify the training issues that have to be addressed with that individual. Salespeople who perform well with most types of leads but below average with one or two types may have a mental block when it comes to that kind of lead. But you'll never know unless you benchmark both your lead sources and your salespeople's performance by lead source.
We also track leads-to-demo rates by lead source. If a salesperson's closing rate on a particular lead source is low, chances are good he's pre-qualifying the lead. If we identify that as a trend, we bring him in to talk about it and help him identify the mental barriers that stand between him and closing that type of lead.
Evaluate Our job, as owners and managers, is to develop these guys. Benchmarking individual salespeople on their overall performance and their conversion rate is the only way to make them better. Identify individual strengths and weaknesses, then leverage those strengths and improve on those weaknesses.
A poor performer in one lead category can affect the overall evaluation of that category and the basis on which marketing dollars are invested and decisions made. (Say we produced ‘X' inquiries from a show, but converted those leads to sales at a low rate. So we decide not to go back. Are we taking into account the fact that those leads were handed off to rookies, whose close rates were well below average?)
In today's world, home improvement companies will not be bringing in leads by the bagful. That means success will come by being able to hire those most likely to become high-performance sellers. —Brian Leader is president and co-owner of Improveit, a home improvement company in Columbus, Ohio, and the owner of Ennovation, developer of ImproveIt 360 software.