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According to Andy Paul, author of Zero-Time Selling, studies show that 60% of businesses don’t follow up with the leads they receive.
That’s a devastating number when you consider that 45% of B2B and 55-60% of B2C leads will actually end up buying. They may not buy from you, they may not buy right away, but they will buy and research from Marketo confirms this.
If 45% or more of leads, let’s define a ?lead? as someone that inquires and shows interest in buying a product or service, end up buying and 60% of companies don’t follow up with those leads there must be a good reason, right?
Let’s look at the most common reasons.
Why People Fail to Follow Up
Reason #1: Value of Follow Up Misunderstood
People that fail to follow up usually do so because they don’t believe there business will really benefit from it. Their expectation of how quickly they’ll close business doesn’t match reality.
The graph below from Marketo clearly shows the typical expectation and what actually occurs in most sales processes.
With the ‘Assumed’ line you can see that people expect to convert most leads in the first month and then slightly fewer over time.
That rarely happens, especially in mid to large sales. The ‘Actual’ line depicts the more common scenario where sales are made somewhat evenly over time.
Why does this happen? This occurs because different buyers have different buying cycles. If you have a pipeline of 20 leads, 45% or more of them will buy, but they will likely do so at different times.
If you’re expecting your sales to mirror the ‘Assumed’ line you’d likely be disappointed with your results in the first month. Feeling discouraged, it’s not hard to see how you might be tricked into thinking that something you’re doing isn’t working and not proceed to work those leads.
That would be a big mistake.
In fact, there may be nothing wrong with your sales process. Except that you’re not prepared to continue nurturing your leads and following up with them.
Data from the National Sales Executive Association supports this. It shows that:
- 2% of sales are made on the 1st contact
- 3% on the 2nd contact
- 5% on the 3rd contact
- 10% on the 4th contact
- 80% of sales are made on the 5th-12th contact
These numbers aren’t going to be the same for everyone. But the one thing you can count on is that if you stop following up with your leads too early, you’ll lose many potential sales.
Reason #2: No Time
If your business is doing so well that you’re too busy to follow up with sales leads you have two choices. One, stop reading this article and get back to doing whatever it is you’re doing – because it’s working. Or, two, hire someone to build and work your follow up strategy for you so you can increase your sales even further.
If you’d like more clients and think you’re too busy to work on following up with those leads I’d like to you take a minute of pause. Enjoy some deep breaths. Feel better? Hopefully that’s restored your sanity…because if you want more clients and you’re not following up with your leads you need to wake up and start dedicating more time to this or assign someone to do it for you.
Following up with leads, assuming they are qualified ones, is one of the most important functions of business.
Reason #3: Technology Fear
Another common reason businesses don’t follow up with their leads is because they don’t know how to? in an efficient manner. Luckily, there are many technologies you can choose from that will help you to automate your follow up process.
How important is it that you automate your follow up? A Gartner Research study found that companies can expect a 10% or higher increase in sales within 6-9 months when they take steps to automate their lead and follow up process.
I’m going to share some of the most popular tools to do this in just a minute.
Before we get to that, let’s look at how you can prepare for effective follow up…
Tips for Effective Follow Up
Tip 1: Speed
A Harvard Business Review study found that companies that respond to their leads within 1 hour are 7 times more likely to have a positive response from the lead upon follow up.
Research by InsuranceAgents.com found that ?leads convert over 20 times more when contacted in the first 5 minutes.
Tip 2: Have a Plan
Make sure that you are ready to provide your leads with the information they’re looking for. First impressions do count. The person following up with the lead should have an in-depth knowledge of your product/service and should have a script, process or plan to work off. It’s critical that you aim to follow up with all of your leads. Having a system in place to manage your leads will help with this.
Tip 3: Educate
At Business Consulting Buzz, I’ve found the most effective ways for us to turn leads into sales is to educate our prospects. We provide them with free valuable and educational information that will answer their questions and help to build trust and establish our business as an authority in the market.
If you run a newsletter, you can use it to share ideas, insights and new research with your leads. This is a well established practice that has been proven to work. Jill Konrath suggests that you send a short email like the below when sharing new insights:
“Pat, I’ve been thinking more about how we can help you increase sales (reduce costs, speed up productivity). I thought you might be interested in what we did with XYZ organization when they were dealing with the same challenge. Do you have a few minutes for a quick conversation?”
Tip 4: Test, Track, Adjust
As with all your marketing, it’s imperative that you constantly test different approaches in your follow up. And that you track the results, analyze them and then adjust them as necessary. The goal here is to continually fine tune your follow up process so that you close more and more sales over time.
Hubspot suggests that you keep these four questions in mind:
- How many sales leads do you receive each week?
- How long does it take to respond to each sales lead? (the time between when the lead is received until a sales person talks to them for the first time)
- What percentage of your inbound sales leads are converted into qualified prospects?
- What percentage of your inbound sales leads are converted into customers?
Technology for Follow Up
As I mentioned earlier, there are many options you can choose from to help you with your follow up. Here are a few popular options:
Mailchimp – Collect online inquiries, send newsletters and automate follow up emails.
Infusionsoft – A complete online commerce and CRM system with extensive customization and automation options.
Hubspot – Handles blogging, online marketing, lead management, CRM and more. A complete solution for companies doing business online.
Contactually – Syncs with your email accounts and allows you to sort your contacts into buckets. Easily add new contacts automatically when you send emails. You can schedule how often you want to follow up with your contacts. The web interface makes it very easy to send customized messages in seconds to contacts. Great for service professionals and those in sales.
Boomerang – A Gmail extension that allows you to send emails at a specified time into the future. Also reminds you if someone you’ve contacted hasn’t responded so you can get in touch with them again.
Other services of note include: Aweber, Campaign Monitor, Get Response, and Ontraport.
If you don’t have a formal follow up plan in place and are letting leads slip through the cracks now is the time to patch that hole and start increasing your sales. Create your plan, follow these best practices and choose a technology platform to automate and make your follow up even more effective.