Phil Cash believes that a good Internet sales manager is more likely to sell 16 units a month if he’s working 65 leads than if he’s working 120. How can that be? Why doesn’t more leads turn into more sales?
Phil, the Internet director at San Tan Ford in Phoenix, is an Internet pro. He has his team work leads for 30 days with an established process. He delivers a store-wide Internet close rate of about 20%.
Here’s why fewer leads per Internet Sales Manager (ISM) per month drives more sales: an ISM will become easily distracted if he is saddled with more leads than he can effectively handle. Like a Chihuahua chasing too many chickens he jumps to and fro, always baited by the chicken at the corner of his eye, never catching a feather. Sixty-five leads per ISM drives more sales because his team can remain more focused. Each lead receives its due. And the ISM, whose income satisfaction level depends on 15-20 deals a month, has a powerful economic incentive to work his leads persistently.
That’s a good word for it. The diligent pursuit of 65 leads a month yields respectful persistence. Your customer will quickly notice the difference between you and the competitive store down the road. You’re checking in regularly. You’re discovering where the customer really stands in her car buying process. You’re still there when she gets back from vacation. She sees the difference; she knows the other guys peeled off after a week.
It all comes from the understanding that leads are precious. Phil knows how hard it is to generate lead flow. To realize strong ROI from San Tan Ford’s leads investment, a high close rate is essential. Phil’s belief is that if an ISM receives too many leads in a month, he inevitably “cherry picks”. Phil is determined to do away with cherry picking at San Tan Ford. Once a lead comes into the dealership, Phil ensures the lead receives the attention it deserves: a rapid initial price quote response (presenting within 10 minutes a quote that includes multiple new and pre-owned vehicles), a phone call within 30 minutes and an effective ongoing follow-up process.
The 30-day live lead management process Phil has implemented is easily double the length of most solidly-performing Internet departments, and it delivers the goods: high close rates.
With strong close rates on existing leads, it’s time to test the boundaries of opportunity. With confidence in your lead management process, the time may come to drive your close rate back down by expanding your lead radius. Bringing new lead volume into a sound lead management process is a sure way to drive up profit. Remember—it’s not close rate that pays the bills, it’s margin. Even so, limiting the leads per ISM per month enables you to ensure your team works each lead for all it’s worth. That is Internet sales best practice.