Lead Conversion: Stop burning marketing budget without sales

To increase the lead to sales conversion rate, you must focus on each step of the conversion process. It involves strategies of marketing, sales and customer experience, and each one must be aligned. Also, the follow-up it’s extremely relevant, because it defines if your lead will become a client or not.

There are some steps in the lead conversion process that must not be ignored. We will talk with more details about them on the following subtopics, but we can split them into First Conversion and Second Conversion. The steps are:

• Attract the lead through digital marketing strategies, like Google Ads or Social Media.
• Allow this visitor to make contact with you, through forms, pop-ups, chatbot or other platforms.
• Make the first contact with the visitor, based on the information he shared with you.
• If he showed some interest, but is delaying to answer, make a follow-up with him, answering doubts or offering personalized products/services.

There is always some conversion rate between each stage but you could always determine two major stages – the conversion between target audience to lead (someone who showed their interest in your products or services) and conversion between lead to sale 📈. We call this First and Second conversion.

In the lead conversion process, the first conversion is all about your marketing. You can do a lot of things to attract your target audience. However, not everybody will become a lead. For example, if you use web and Google AdWords to attract new leads 🧲, you have web-ads, clicks and visitors with only some of them showing interest in your business by filling web-forms or giving you a call. This first conversion has a direct effect on the overall cost of your leads. The better your first conversion is, the lower your cost for leads will be.

Most businesses, especially among SMB’s, are very concerned with getting more leads and the cost of acquisition. They are spending a lot of money and resources to buy more clicks or to get better first conversion. But here’s the thing, leads do not equal customers. You will never grow your sales until you begin to focus on 2nd conversion, from lead to customer 🎯. For example, for an e-commerce business, implementing checkout page optimization techniques can significantly enhance your conversion rates and turn more leads into paying customers, ultimately boosting your sales revenue.

Obviously, the better 2nd conversion you have the more leads you close 🎖. The trick is, if your second conversion is good, you become less sensitive to lead acquisition cost. You can pay more for each lead, become more competitive in lead generating and finally get more leads. This is a very self-sustaining model. But, if your second conversion is poor, you will always find yourself concerned with lead acquisition cost and focused on first conversion 🙅‍♀️. Now, you are chasing your own tail generating new leads rather than closing.

As you can see, lead conversion is not just creating an advertisement and waiting to happen. We can summarize the steps of how to convert leads to sales on the following parts:

• Use a pipeline and design each stage.
• Create digital marketing strategies.
• Get in touch with those who contact you.
• Try to know their needs and problems.
• Understand what kind of service they need.
• Reach them again through a follow-up.
• Build a relationship with the leads.
• After understanding their needs, create personalized offers.

Since we here at Kommo provide an affordable, easy-to-use lead management solution that emphasizes 2 conversion, we found a way to illustrate why it is important to manage your leads, not just acquire them and how businesses on average fail to do so.

To see how some enterprises are conducting their strategies of lead conversion, we decided to use real cases. It was made a research involving 20 enterprises to see how their processes convert leads and which insights could we take from them. 💭

The idea of our research is very simple - We take one competitive industry and act like a mystery shopper. We did a popular search request and gather 20 businesses through their AdWords campaign. Now that we have 20 businesses that buy clicks and visitors to their website, we contact them and measure how they deal with new prospect.

First we try to reach them by web-form if available on their site. If there is no web-form or if they failed to reply, we start calling and try to reach them by phone. We attempt several times before we can say that we failed to reach them.

Our goal is to have one quality conversation with a business representative in which we act like a real lead interested in their services. In every case, we give them an idea that we are going to make a visit or purchase next week, so we don’t mind if they call us back. Afterword’s, we wait several weeks to measure who will follow-up and call.

So once again, we have 20 companies who purchase very expensive clicks on Google AdWords. We contact them as a potential customer and measure how they deal with leads, how do they reply and if they follow-up or not.

As you may have expected, it’s a minority of the enterprises which followed the ideal steps to improve the lead to sales conversion rate 🤦‍♀️. But that experience made us have some good insights of lead conversion.

In essence, the process of how to convert leads to sales involves tracking the lead on each pipeline step. You can’t simply answer the lead a first time and wait for him to buy, but you must follow-up, to be available for him for everything he needs, to register each relevant information he shares with you to use on strategies, and, if possible, send a personalized offer.

So this time we decided to research how small tax consultant firms. So the story is: we need to file tax returns for 2014 and would like to find someone to help us 💡. We enter the lead conversion process wanting to find a firm that can actually help us with our taxes.

We used a couple popular, but quite narrow search queries (tax return services San Francisco, CA; tax preparer San Francisco ca; tax preparer Oakland Ca; tax return services Oakland ca; Bay area tax services; independent tax preparers; Tax services alameda ca; Tax return services Marin county) and found 20 companies that pay for AdWords for it. Here they are: 👇

• Audit and Tax Solutions CPAs Inc — www.auditandtaxsolutionscpas.com
• BOOKS IN BALANCE — www.booksinbalance.com
• Chahal & Associates, Inc. — www.chahalassociates.com
• Cornerstone Tax Systems — Link not available
• Dimond Tax Services — www.diamondtaxservices.com
• Elmwood Wealth Management, Inc. — www.elmwoodwealth.com
• Hoang Le Tax & Financial Services — www.hoangleservices.com
• Hunter & Company CPAs — www.accountingwalnutcreek.com
• Mcmillen & Associates — www.rpmcmillen.com
• MEYER & ASSOCIATES — www.meyeraccountancy.com
• Pillar6 Advisors LLC — www.pillar6.com
• Putney-Klein Associates, Inc. — www.pkatax.com
• Raymond Palmarini CPA — Link not available
• Safe Harbor LLP. — www.safeharborcpa.com
• Simon C. Wong CPA — www.dnb.com
• Summit Accountancy Group — Link not available
• TC Financial Group — www.tcfingroup.com
• The Lee Accountancy Group, Inc. — www.theleeaccountancy.com
• Thomas P. Cooper, PFP — Link not available
• Valley Bookkeeping & Tax Service — www.valleybookkeepingservice.com

So with the same story, we started to reach out to these companies.

80% of websites had a webform to fill, which is good. Because, we think that webforms are more efficient than just receiving calls because you will definitely gather enough data to follow-up with the lead.

You also have some time lag to give a response to customer, and in some cases (for example if you use Kommo build-in web-form) web-forms can give you more data about the source of the lead, so you can measure which marketing channels are generating leads and sales, so you can really optimize your marketing budgets. Anyhow, let’s get back to the story!

And here we go, for some surprising results. Though the fastest response we got came in within 15 minutes 😱 (and looking ahead, I have to say that this company was one of 20 that completely passed the test), only 30 % of filled forms called back or contacted within 24 hours.

Can you imagine? 70 % of the tax consultants buy clicks and visitors but don’t call back for filled webforms. That affects really badly the lead to sales conversion rate, because people want to get their needs attempted as fast as possible ⚡. When you answer your visitors fast, it’s an excellent differential, but when you delay, you run the risk of losing a lead for your competitors.

But as we said before, we put more effort than the average customer to get our quote 💪. And we called those who had no webform or those who didn’t reply. And guess what? 3 out of 17 just failed to answer, with several attempts. That’s really bad for lead conversion 😫.

Have to say that among them was one complete outsider, who first ignored our request and webform, and after that failed to answer our calls. We have only one question – why do they pay for adWords? They were literally burning money 🔥.

BTW, 50 % of calls made resulted in very little effort from their part to sell us anything, not even themselves – they just write down our information and promise to call back (not all do, actually), so why they want customers to call instead of using webform is also a mystery. Those are mistakes that an enterprise that knows how to convert leads to sales doesn't make.

Anyways, we finally have reached everyone we could and spoke with them. Some said that this was not a service they provided, but most of them were eager to sell and propose I drop by their office to close the deal. So we promised that we would schedule a visit to their office the following week and gave everyone the idea that we would like them to remind us.

So, 14 companies promised to give us a call and follow-up 📲. And guess what? Nobody did! Just imagine. They all buy very expensive leads from google adwords, burn money, finally have their lead which just ask them to give a reminder, and, they just throw it away!

So among all 20 companies, we got only one company who actively pursued the sale: fast reply to webform, follow-up and gave a call back.

The Tax consultants illustrated the antithesis of lead management, but as we said, it was good to give us insights about the lead conversion process. Here is what we believe should be the steps to improve the lead to sales conversion rate.

1. Collect leads primarily with webform, so you could have more information regarding customers and opportunity for a thorough answer and follow up call.
2. Track the lead through their pipeline – from initial contact to visit, negotiations and final sale.
3. Set-up reminders and keep promises you give, or give follow-up calls to every lead they just bought.
4. Have sales and customer service professionals ready to answer the visitors and leads.
5. If you have the budget for it, consider having a team focused on attending leads and doing follow-ups.

You see, just 5 easy steps to grow your second conversion that tax consultants do not do 🚀. If you are a small business, think about how much resources and attention you pay for lead generation, online marketing and how much you do with managing the leads you have – Probably, you are among the majority of business who could benefit from using a lead management service.

Kommo is a pioneering Messenger Based Sales CRM software that helps businesses achieve more sales and create long-lasting relationships with their customers. It is a tool that enables companies to reach better results and increase their profits.