To emphasize the variation in "Bad" lead interpretation here is a perfect example.
Yesterday, a friend of mine, who is a BDC director for a large group in a major metro, called me. He was calling to request some OEM data from me but I took the opportunity to pick his brain. Great guy, and doing a great job, but is fairly new to his role. (and if he reads this, feel free to correct me if any of my recalled facts are incorrect) He said they currently have a 16.5% close rate on 1100 leads with 91 sold this month. *insert question here* He is touching every single lead initially to make sure the first response is quality. He was concerned about his 23% Bad Duplicate (VinSolutions term) number wondering if that was too high. My point to him was that is a metric you can't really control or manipulate so chalk Bad-Duplicate leads up to the price of doing business (but they indicate a pretty low funnel shopper). That leaves 847 leads left. My next question was how many Bad-Other leads were there. He didn't have that number upfront so I just asked him how many leads are Bad in total? He said 50%. So that would mean 27% of his gross leads are being marked as Bad-Other. When asked what defines a Bad Other for them the answer was fairly typical "no intent to buy, didn't respond, etc". The first two are the ones that concern me. "No intent to buy", to me, is the digital equivalent of a lot-up that says "just looking" or "just driving through". You have to know what to say in order to offset that objection. To me those are Lost Leads if you can't overcome it. The "didn't respond" to me is also not a Bad lead, it becomes a Lost Lead which would allow me to still add them to my email marketing list for future opportunity, including fixed ops. In our group, I have a 10% Bad-Other limit. Most stores in the group are at the 4%-8% range now. Prior to my return they were in the 20-30% range.
So, back to the math, he has 1100 gross leads with 91 sold and a reported 16.5% close rate. 253 are Bad-Duplicate and 297 are being marked as Bad-Other. If they were at a 10% Bad-Other rate (legit bad contact info, spam, service, etc) that would give them 737 "Good" leads. 91 sold from 737 leads is 12.2% (still pretty great for his area).
This story really highlights the point of this forum post; what is everyone's definition of a bad lead? Not for the sake of comparison of the Lead Close rate but for the sake of confirming our industry's loose standards of reporting.
What is your definition of a Bad lead?
Are you asking how to manage lead sources that don't buyGreat conversation as usual. I'm curious, how do you manage lead sources that won't let you disable non productive leads, (TrueCar generic) that are not expecting contact, Cars.com leads that never engage, or purchased leads that want to know how you got their information?
In general, everyone I ask says "it's up to you, but be consistent". How do we get a real measurment if everyone has their own method? Currently, I'm looking at leads that don't open anything, say "don't contact me", or have bad data as a bad lead.
There's no real way for us to track show rates, as we are a vendor, and not on the sales side. We don't instruct the dealers we work with to track any other metric other than vehicles sold from our advertisements. However, we are on our way to create a platform which will track leads to appointments, appointments to walk-in, and walk-in to sold.So your Lead Closing is at 11.9% IF 100% of your Appointments show up. What is your Appointment Show rate?
I don't think any lead is a lost cause. Contact information is invaluable in the sales world, no matter what sub-industry you're from. Just look at affiliate promotions online - these people THRIVE from building lists for mass SMS outreach, email blasting, and typically remarket to these consumers quite frequently.Are you asking how to manage lead sources that don't buy
We get in front of the leads sources that tend to get the most "I wasn't looking to buy" replies by using a track like "TrueCar provided us with your information..." or "Ford asked that we reach out to you..." since people seem to trust the TrueCar's and OEM's of the world more than the dealer. It takes the initial level of pissed down from a 10 to a 4. After that statement, then it is just a word-track like "well Bob, I'm obviously a sales person and would love to earn your business when you are ready on either a New or pre-owned vehicle for yourself or anyone you know....". That is a Lost Lead and still gets added to the email marketing list.
For "don't open", you can't make that determination since not all email providers enable read-receipts. I would look at the quality of the Day 1 reply and contact if you get a lot of non-responsive leads. Regardless, if there wasn't a hard bounce on the email and/or the phone number wasn't bad, those are also Lost leads and stay in our marketing list. My rules are basically what @Timothy Main said above. One other item that I have discovered over the years is your people need to be aware of which lead providers have the phone field as a Required fill. If a shopper wants to contact us via Form/Email and isn't ready for a Phone call, they may put in a bogus number just to get the Form to submit...
You are exactly right with your statement, @BillH, "How do we get a real measurement if everyone has their own method?"
No thanks, I practice CYA. Mass texting is a no go with us. Precedent was already set years ago with lawsuits in the millions i.e. https://www.autonews.com/article/20111219/RETAIL07/312199993/lithia-faces-2-5-million-tab-for-textingI don't think any lead is a lost cause. Contact information is invaluable in the sales world, no matter what sub-industry you're from. Just look at affiliate promotions online - these people THRIVE from building lists for mass SMS outreach, email blasting, and typically remarket to these consumers quite frequently.
The real problem is how this information is handled. And I'm telling you, email marketing is not where you want things to start. I would argue that this is the last step that should be used in your outreach process, when contacting a dead lead.
SMS is booming right now. And if you're not sending out mass messages to your dead lead lists, you could be missing out on some awesome sale opportunities.
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What we've done to be compliant, when sending SMS messages to these people automatically, is getting consent prior to sending messages.Have to be careful with SMS though.
Those laws are coming in hot and fast.
Up here in Canada you can't do jack with SMS unless you want to pay the fines.
I've seen a few cases come and go - sometimes the dealer wins, sometimes they lose.
Automating the messages appears to be part of what leads to a loss. If the messages are sent manually they tend to be "compliant".
I don't disagree with this, but it's also still risky. All it takes is one customer who knows their rights and didn't opt-in and you've got a lawsuit.What we've done to be compliant, when sending SMS messages to these people automatically, is getting consent prior to sending messages.
This is just bad advice. Literally just spam.SMS is booming right now. And if you're not sending out mass messages to your dead lead lists, you could be missing out on some awesome sale opportunities.