This year’s annual study of lead response behavior conducted by InsideSales.com on 696 companies with online lead forms revealed that sales reps were, on average, attempting their first call to a newly submitted web lead after 39 hours had passed. This second-day contact strategy delivers a high degree of “lead-no-contact” experiences among reps responding to inbound web leads, typically causing sales managers to complain about the poor quality of leads. As a result, sales managers continue to pressure marketing to produce more and more leads to fill the gap. However, without reporting visibility into when first sales-initiated call contact was made, the sales complaint to marketing remains somewhat hollow.
Another alarming piece of data: Nearly 36% of those audited never responded to a submitted lead during the entire two-week tracking period. To restate this, a large amount of marketing budget spent on generating web-leads simply decays with no value because no one bothered to follow up on those leads. Of the 696 audited companies, less than one-third (23.9%) responded to a web-generated lead within the high-value, five-minute window. Within the first four hours, 42% of audited companies had responded. However, when email auto-responders were removed from the analysis, only 0.9% of audited companies attempted first contact to a lead during the critical five-minute response window. Only 29% had attempted first contact within the first four hours.
This year’s study also revealed that persistency remains low even when including auto-response emails. Two or fewer attempts were made to contact a new lead before the rep gave up. Those companies that made two or more attempts via email or a call fall into the 75th percentile of the audited companies.
Overall, this year’s results indicate that sales management still has not made rapid lead response a priority. This issue is at the crux of the marketing/sales standoff. Marketing departments across many industries have heavily tilted their spend toward online lead generation activities. Lead response management research proves that rapid response – in under five minutes – and persistence deliver better contact and lead progression results for web-generated leads. Sales departments around the country have not yet stepped up their processes and technologies to address the behavior of web-generated leads.
Why does a call attempt initiated by a sales rep matter? According to the lead response management research conducted in 2007, a sales rep is 100x more likely to make contact with a new lead, and 21x more likely to progress that lead into the sales pipeline, if live contact is attempted within the first five minutes of a lead being submitted. These original findings have since been updated and later published in Inc. magazine and Harvard Business Review in 2011, and on Forbes.com in 2012.
This recently completed annual Lead ResponseAudit study highlights two areas that have an effect on whether or not a lead ever gets contacted and progressed into the sales pipeline—response timing and persistency. Persistency refers to how many times an individual rep attempts to contact a new lead before giving up. Lead response timing refers to the period between when an electronic lead has been submitted and when first contact is attempted.
There are two types of response contact methods this study tracks: email contact and first call attempt made by a member of the sales or inside sales team. Because auto-email responders are typically not strong mediums for moving the opportunity forward — instead they represent the end of the automated marketing process, offering a thank you for submitting the lead and links to specific marketing materials — a rep-initiated call attempt is the contact method executives and managers should track.
To download the Executive Summary, click here.
Comments from Dr. James Oldroyd, Original Researcher on the 2007 Lead Response Management Study
“Since my groundbreaking study first published in 2007,” said James Oldroyd, PhD. “I have periodically been monitoring the speed of response of online sales leads. Five years and thousands of leads later, I again partnered with Insidesales.com to assess the state of the industry.
Based on this year’s results, continued Oldroyd, “I began to wonder how firms were responding to these leads. Digging deeper into the data demonstrated a shocking discovery: while at first glance companies seem to be doing OK at online lead response, separating automated email response from human directed phone and email response revealed they are actually very poor in rapidly responding to online leads.
“These auto-generated emails in customers’ eyes are like a door chime that signals to a potential customer that the firm recognized (or at least should have recognized) that someone entered the store. However, our leads were “ready” to purchase. All that was needed was a contact to finalize the deal. Imagine signaling to your customers that you recognize they entered your store, but 84% of the time not speaking to them until after eight hours. Only 16% of the audited companies attempted a phone call within eight hours of the lead being submitted.”
Parsing the auto-responder emails from other forms of human directed response “painted a very different picture than we reported in the 2009 study,” observed Oldroyd. “While firms are spending tremendous sums in generating online leads, few firms have any sort of a dynamic capability to rapidly respond to those leads.”
How good is your company? Request a free Lead ResponseAudit on your own sales team and find out: http://www.responseaudit.com/