I’ve been in the online lead generation industry for four years now and, in our business, it makes me a senior citizen. I’ve worn many different hats at Reply!—from starting out on our retail automotive sales floor, selling to single dealerships, to managing our entire Retail Automotive business. I’ve also worked with real estate agents, selling face-to-face at the National Association of Realtors Convention in 2004. While I’ve never directly sold cars or real estate, I speak to lead buyers all day long. In all the feedback I’ve received, there’s one thing I hear time and time again; Internet leads only work when they are worked.
Most lead buyers are constantly hiring and firing lead providers because "the leads don’t close." Six months down the road, they get a call from the provider they left, and the salesperson discusses changes to lead generation techniques and validation processes. The dealership or real estate agent gives the provider another chance—six more months pass and the leads "still don’t close," and the cycle repeats.
Why don’t leads close? Is it the lead buyer not properly working the leads, or is it the leads themselves? I believe the answer is, "Both." Some of our clients tell us our leads were a waste of time, while others depend on us to hit their monthly sales targets and are very profitable. Both are right, depending on how leads are called and nurtured.
The lead provider has two responsibilities: setting the right expectations and offering controls for the buyer to segment. It is the provider’s job to communicate that Internet leads need to be worked and, when a buyer closes 10 of 100 leads, the other 90 will never transact. It is the provider’s job to explain the follow-up process that is most successful when applied to Internet leads and discuss that lead validation is imperfect, so the lead buyer understands invalid leads are part of the game. Ultimately, it’s the provider’s job to send leads that are intentful.
Assuming the right expectations are set, the buyer has the responsibility for working the leads. Our most successful clients tell us that Internet leads are no different than floor traffic or face-to-face appointments—they need immediate attention. Their auto-response emails are immediately sent to the consumer, and a phone call is placed within five minutes of a lead being received. Often, three to four phone calls at varying times of day are required to reach a consumer. Following the initial contact, the consumer should be placed in a drip campaign—coupled with phone calls—until an appointment is set, with continued follow-up until the lead buys or is unworkable.
From time-to-time, one of our customers becomes angry over "poor lead quality." I have a rule that I follow before I call a client back. I take a snapshot of the last ten leads we’ve sent, and I call them myself. The same result happens every time; I’ll be unable to reach one lead, leave voicemails for six, and I’ll speak with two to three people that want to talk about a car or real estate transaction. Two to three appointments set from ten leads should ideally result in one sale, and we arrive at our 10% closing ratio.
If you’ve decided to invest in online, performance-based marketing, create a game plan regarding how you’re going to work the leads. One of our top clients is a Toyota dealer in Southern California that closes 14% of their leads each month! They call every lead four times-per-day, and keep the consumer in their database for up to six months, with frequent contact that is gradually reduced as time passes. Our top real estate agents work leads for much longer; for most agents, one sale will cover their marketing costs for an entire year.
Many variables can affect your experience with Internet leads. One thing is clear—Internet leads are a predictable and measurable marketing investment, and will only work for you if they are actually worked.
Senior Manager, Sales & Service -Automotive