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It's 2019. What is a good Web Lead Close Rate? [Insert "yeah but our leads are different" here]

Discussion in 'CRM, ILM, Chat, Desking, Emails, Phone, SMS' started by Dan Sayer, Apr 24, 2019.

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  1. Timothy Main

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    I believe goal closing percentage should evaluated on a store by store basis.There are so many variables, internally, and externally that influence a stores potential closing percentage that it would be unrealistic to set a group wide goal percentage.

    Here is an example to support that statement:

    Two stores in a major metro owned by the same group are in the same Auto Mall and receive over 1000 unique leads per month.

    Store 1 has 10 same brand dealers within a 20 mile radius. Several stores, and specifically one is a major price leader. Store 1 does not want to dive down the rabbit hole to chase VGP or push brackets to hope for UA's and F&I to make up the difference.

    Store 2 has 6 same brand dealers within a 20 mile radius one of which they own. They are the price leader in that area.

    Knowing this information is it realistic to expect the same closing percentage from store 1 as store 2?

    Many of us including myself have searched for the answer by breaking down the numbers from leads to sales or from sales to leads. At one point I even made a model that would calculate sales based on improvements to CRM utilization in regards to phone calls, appointments set, shown, etc.

    If I were running a store today I would set goal closing percentage based on the profitability of the department. Establish a baseline performance average by person using at least 3 months data. Data points include department costs, gross profit, sales, leads, phone calls, appointment set, appointments shown, emails sent, and emails received.

    Starting with individuals that have the lowest net profit per deal average determine the cause of the outcome and set a goal that is reinforced by training to improve. Goals should be incremental and obtainable by making small adjustments in their processes or word tracks.

    The goal should NOT be you are at 12% close and we want to see a 14% close. An example of the goal should be you are setting appointments on 10% of your contacts and based on your conversations we would like you to say X instead of Y. Additionally a manager will be working with you directly to speak to customers when you need help. This is not a punishment this is an opportunity to help you succeed and make more sales.

    Making improvements with individuals through out the process is the key. Increased profits and closing percentage is a byproduct.

    I've seen many GSM's, internet directors, etc get hung up on closing percentage. The goal shouldn't be number 1 in sales, or the highest closing percentage.

    The goal should be to be number 1 at the bank.



     
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  3. John.H

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    Spam is sending messages to people in an unsolicited manner. For instance - crawling a bunch of web profiles, scraping information, and sending SMS messages or emails to people you do not know or have never had contact with your business prior.

    1. They never submitted their information to you.

    2. The information does not belong to you.

    In 2015 the FCC clarified that the same laws governing phone calls also govern text messages. So if you believe texting customers is illegal, so is calling them without getting consent first.

    Last time I checked, dealers call a lot of their leads. Old or new... :poke:

    If you ask me, this law was established to prevent unwanted phone calls from unknown entities. Let's not forget this:

    "Lithia blasted a list and their Opt-Out wasn’t working and they kept sending text messages to customers who requested that they stop. It was also a “Text Club“, not direct communication with customers. You do want to make sure you have a vendor who has a functioning opt-out system so you don’t end up in this same situation. Also, under that same law you should also keep an opt-out list for people who ask you to stop calling them. They basically kept blasting people who said stop and that got them in trouble and spooked our entire industry." - Techobi
     
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  4. craigh

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    This doesn't really go both ways like that.
    Just because text messages are governed by phone call laws, doesn't mean phone calls are governed by text message laws.

    My understanding of the telephone laws is that "spam" is effectively legal, but scams, fraudulent calls and calls to people on the Do Not Call list are illegal. Text messages laws appear far more severe and are changing rapidly.
    Same thing is happening with Ringless Voicemail - as we're rolling this out across the US we're running into lots of fun legal discussions.

    To be clear, my reference is a direct response to you suggesting they contact "dead lists".
     
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  5. Dan Sayer

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    Well, yes, hopefully no one is setting close rates to "win" at a close rate. The goals are set at each stage to measure where people are struggling; lead to appointment set, appointment set to show, show to sold. Each stage requires a different set of skills/coaching opportunities. Curious to know what each of those stages should look like, or did look like, at the store scenarios you stated above @Timothy Main@Timothy Main ?
     
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    #34 Dan Sayer, May 1, 2019
    Last edited: May 2, 2019
  6. yagoparamo

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    Anyone here in a dealer group that can also show differences between their BMW or Audi store VS. their Ford or Dodge store?
     
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  7. Dan Sayer

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    Initial Internet-Only Numbers for April without all deals being capped are below @yagoparamo@yagoparamo :

    No we aren't firing on all cylinders so our goal is still 15%. If I have a store that is following process 99% of the time and is peaking at 13%, then we'll accept that is the ceiling. Visa-versa if a store is hitting 15% and aren't following the process 99% then our ceiling may be 18%. We don't freak out over or have a target on "Bad-Duplicate" but I do watch, and have a target limit on, "Bad-Other" of 10% (of total gross leads). They all have pretty great Appointment/Show and Show/Sold rates but we universally are off on Lead/Appointment rates. Mix of Used and New is all over the place between stores even though all sources/vendors are similar.

    Kia/Mits store small market 45 minutes from major metro is at 14.3% with 19 Sold and 11.3% Marked Bad-Other
    Ford/Lincoln/Kia store small rural 90 minutes from large market is at 13.3% with 21 Sold and 4.8% Marked Bad-Other
    Ford/Lincoln store in large market 45 minutes from major metro is at 10.0% with 45 Sold and 10.6% Marked Bad-Other
    Ford/Lincoln store in small market 45 minutes from major metro 13.7% with 30 Sold and 11.7% Marked Bad-Other
    Mazda store in large market 45 minutes from major metro is at 9.4% with 30 Sold and 5.3% Marked Bad-Other
     
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  8. joe.pistell

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    Fascinating, great question and answer!
    thnx!
     
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  9. Timothy Main

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    I personally look at closing percentage as a byproduct of the process good or bad. Some individuals get hung up on improving the end number without understanding all of the steps that lead to that result.

    The stages should be based on the store averages for specific metrics. For each metric an individual maybe above or below the averages. There are instances when it is good to be above or below the averages.

    I would start with calls, calls per day, call to appointment, appointment set, appointment shown, shown to sold, closing percentage, emails sent, and emails received. Some metrics correlate with performance to others, some tell a different story once you put it all together.

    Here are some things to look for:

    Calls per day. What does the productivity look like? Break it down in your head to calls per working hour. You might have an individual who is a rock star here on paper but if they aren't setting appointments that high call count could be an indicator of a different problem. Is the individual actually making the calls?

    Call to appointment. How many calls does an individual average before setting an appointment. You could find yourself with 2 different issues here. Say one individual has a 20 to 1 call to appointment ratio and another has a 45 to 1. Does the individual with a low call to appointment ratio appointments show? Is the individual with the high call to appointment ratio struggling to set appointments when he speaks to individuals on the phone?

    Appointments show. If an individual has a 90% show are they actually scheduling all of appointments? Go back and see call to appointment ratio. Did the appointments actually show or was the button just clicked? Seen this too review the customer records for details on their visit. If shown percentage is low are the appointments real? Do we have activity within the customer record that supports the appointment being created? Is the individual struggling in having quality conversations with customers that is affecting their show rate?

    Shown to sold. Remember to only use sales from appointments here. High numbers here are a good thing and don't require much scrutiny. Low numbers could have multiple areas of improvement or exploration. What is the conversation with the customer prior to setting the appointment? Is the individual over promising? Do you have a BDC style department and the customer is helped by a retail consult when they arrive at the dealership? Is there a break down in the turn or does the sales consultant not care to make the deal? Do you have a desk manager who is not interested in making internet deals because it affects their GP per deal average?

    Emails sent vs emails received. Did the individual answer the customers questions? Did they provide the customer a quote on the first day if they did not make initial contact over the phone if a number is available? How fast are the responses to a customers email or did they not respond to an email? Is an individual over using a generic template to show CRM activity? What is the quality of the individuals emails? Are we always ending an email with a question?


     
  10. Dan Sayer

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    @Timothy Main@Timothy Main great breakdown BTW. Spot on!
     
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  11. BillH

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    Do you think there is a correlation between larger market and lower close rate, versus a small market and a higher close rate, similar to lower conversion rates in large metros with more competition?
     

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