Why keep track of lost leads in CRM software?
This is a continuation in our series looking at fields to use in CRM software.
The final status is that of “lost leads”. Although this sounds counter intuitive as why would you want to track someone who is no longer interested in your services, but it is important. First and foremost, if they are no longer interested then you know not to contact them. Think of the number of times you get phone calls from home insurance salesperson or, “I have heard you where in an accident” and how infuriated that makes you feel. People don’t like being contacted by organisation once they have indicated that they are not interested and all that does is cause bad blood and they bad mouth your organisation amongst your network. Its the best form of negative advertising. It gives the impression not only that your organisation is disorganised but that you don’t care about the clients. It sends the message that you are just focused on money and makes looks desperate. Sales should be about how you can benefit the customer not how they can benefit you. This also has GDPR implications as you should have procedures for deleting personal information from your system upon request.
Essential information gathered from lost leads in a CRM.
The other reason is that it indicates your success rate by segment, source and initial priority of client. Failure should be a good thing as it will give you an indication of where you stand within the marketplace. Is there an underlying cause? Are you loosing leads to your competitors? Do you have a service delivery problem? Is the client concerned with price, or quality, availability, don’t like colour, what? From that you calculate a conversion rate. This is particularly important when you come to quote or tendering stage as the sales cycle becomes that much more intense. This also presents an opportunity for greater information gathering on the client’s requirements. Even if you lose that sale, the information may be relevant for other potential clients within that sector. Of all the contacts you connect with, how many become customers? Do they make one off purchase or are will they continually order off you for years to come? How much effort is required to get that conversion, or does that vary depending on the sector or the source established? This can be measured against a different metrics of time spent if staff fill out timesheets linked to that client or project. In other words, it gives you tools and insight to manage your business.
About the author
Malcolm Ford has had 10 years experience installing and customising ERP packages to business’s across the UK. He advises business owners and sales teams on how to best make use of the technology.