The importance of converting leads is clear to anyone who understands the concept of ROI (return on investment). The internet has changed the game in insurance sales, and anyone thinking that the old business models will continue to work is clearly living in the past. However, internet leads can be expensive, making it all the more important that as many of these leads be closed eventually as is possible. In the ongoing effort to close as many of these leads as possible, Jeff Solomon, one of the founders of the Leads360, has identified the Three Key Drivers to Lead Conversion.
The first driver that is essential to success in lead conversion is speed, and if any one element is the most important, this is probably it. The metrics are fairly clear in indicating how essential speed is to lead conversion. A whopping 78% of leads will close with the company that contacts them first, meaning that every missed second could easily mean a competitor is closing one of your leads. Add to this the fact that you are 500% more likely to make contact with a lead if you call within the first five minutes, when compared to the ten minute mark, combined with the fact that leads are qualified nearly eight times as often when contacted in the first three minutes, than within the first six hours, and the value of speed should become easily quantifiable.1 Speed means your sales staff can spend more time focusing on what they do best, selling and closing leads. But speed is an essential factor here as well. An MIT study reveals that leads are 22 times more likely to close when contacted in the first five minutes.2 By focusing on speed, your sales staff can jump on leads and beat the competition to the sale, spend less time trying to contact and qualify the lead in question, and enjoy a higher conversion rate on those contacted leads.
The second key driver to lead conversion is Process. Taking a uniform and structured approach that is a part of a uniformly designed sales process, is essential to ensuring long term success. By creating a consistent and repeatable approach, your salespeople can ensure that each and every lead is worked the same way, and sales managers and marketing executives can effectively track the results. Research has shown that lead quality is only 57% of the reason why leads convert, while 43% can be attributed to your sales process.3 This means that simply relying on the acquisition of high quality leads will prove expensive and ineffective in the long term, and you will see your sales staff easily outpaced by those organizations that are dedicated to maximizing their ROI through a consistent and metrics driven sales process. Or, as a Leads360 Whitepaper on adapting to the changing world of insurance sales puts it: “Buying the right leads is only half the battle. Knowing what to do with them makes the difference between wasting money and making it.” “…You have to make some fundamental changes in your process to be successful with internet leads, though it is not as difficult as it may sound – just work quickly and call diligently. Adhering to these two principles will see significant increases in revenue and profitability.”4
Finally, the last key driver to lead conversion is persistence. As the speed of business accelerates in the internet age, it’s easy to let leads fall through the cracks if they aren’t immediately contacted or qualified. This would be a big mistake. Only 5% of even the highest quality leads are converted immediately.5 Leads360 data indicates that repeated call attempts will dramatically increase the number of leads contacted. By making at least six calls, a salesperson can increase their chances over contacting a contactable lead from 39% on the first call to 93% on the sixth. Even a second call will increase the chances of contact by 87%.6 What’s more, as many as 50% of leads can be closed eventually with a persistent and dedicated approach.7 Persistence is the key to ensuring that every lead that can be closed is eventually closed. Thoroughly pursuing every lead to the finish ensures that you will get the most out of your leads regardless of their quality.
How does one focus their efforts on these three key drivers and maximize the ROI on their leads? One of the best ways to increase speed, formulate an efficient process, and ensure that salespeople are persistently pursuing every lead, is to implement a lead management system, sometimes referred to as an insurance CRM system, like Leads360. Lead Management will give your staff clear goals and a means to meet them, by tracking and routing your leads for maximum efficiency and keeping a series of metrics so that you can fine tune your process. There is no better way to attack these three key drivers to lead conversion than by implementing a system like Leads360.
1 First to Call: Why You Can’t Afford to be Second; Leads360 Whitepaper, June 2008
2 Click to Dial Study; Leads360 Whitepaper, November 2009
3 What Planet are you On?: How B2C and B2B Sales and Marketing Differ; Jeff Solomon; Leads360 Presentation
4 Insuring Success: How to Use Internet Leads to Reach Insurance Buyers; Leads360 Whitepaper, May 2009
5 Making Money on the Other 95%: How Lead Nurturing Triples Sales; Leads360 Whitepaper, June 2008
6 Six Calls Equals Success: The Surprising Impact of Call Frequency on Lead Conversion; Leads360 Whitepaper, November 2009
7 Making Money on the Other 95%: How Lead Nurturing Triples Sales; Leads360 Whitepaper, June 2008
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