28 August 2020
Converting leads through an inbound sales call funnel
Current mood: Excited to share, humbled by the opportunity.
Our CEO and CO-Founder JJ Huang was recently invited to speak at Singapore MarketingFest 2020. He spoke about the factors affecting conversion rates and how businesses can fix a leaky sales funnel.
Welcome to the Lost & Founder blog. It serves as Novocall’s founders’ diary, to chronicle our start-up journey, share our successes (and failures) and most importantly our learnings. The start-up world is tough, and we don’t always have the answers. But in true startup spirit, we won’t stop till’ we find it. Here’s to future startups that might tread the same path.
L&F entry written by
Huang Jing Jie (JJ)
Founder, CEO, Thinker
Let’s not shy away from the elephant in the room.
Whenever an economic downturn is upon us, Marketing is almost always the first business function to be deprioritized. One of the most common reasons is that it is hard to measure marketing ROI.
But as the CMO of Chipotle Chris Brandt said, “I just don’t think that’s true anymore, because you can measure so many things”. In fact, Chipotle even ramped up its digital marketing efforts during the pandemic to keep customers engaged.
The role of marketing in driving sales and lead conversion is undeniable.
Earlier in July, I was invited by MarketingFest Singapore to speak at an online conference organized by Exabytes.
And what might a tech startup specialized in converting inbound sales calls into leads be doing at a marketing conference?
Well, your inbound sales calls do come from somewhere, don’t they? Callers generally find your company’s number in two main places. On your website and on the digital ads you put out.
In the first scenario, the callers are led to your site via your inbound marketing strategies. In the latter, well, nothing screams marketing more than ads.
As you can see, marketing never left the equation. It will always be part of a good lead generation strategy.
During the conference, I shared more about the factors affecting conversion rates and how businesses can fix a leaking sales funnel. Let’s delve into these topics, shall we?
Factors affecting lead conversion rates
Different channels are used to optimize sales for different types of products. For instance, salespeople selling a tour package would use channels that are different from those selling a laptop.
There is no one-size-fits-all channel where salespeople can use to share all types of products. We can categorize the products into four different quadrants separated by two axes — a value axis and a complexity axis.
The value axis indicates how much the product or service costs.
Meanwhile, the complexity axis indicates how complex the transaction is. For example, are your customers simply going to pay for your product or service as it is? Or do they want some customizations?
It’s important to understand the axes that divide these quadrants so that you can figure out what channel will be used for which type of product. Certain channels can only work for certain types of products.
Let’s look at the four categories of products and services.
1. Simple & Transactional, Low-value – Consumer Products
These are products that are very low-value. And because these are low-value products, they have to be sold at high volumes for the business to survive. They can be sold through e-commerce platforms.
You want to make sure that the channel used to sell these kinds of products allows your customers to make self-service purchases. For example, a buyer can buy a book from Amazon without the need for a salesperson to clarify any inquiries.
There’s no reason for businesses selling products in this category to have a dedicated sales team to serve as a communication channel between the buyer and the business. An e-commerce site’s landing page, for example, would suffice.
2. Simple & Transactional, High-value – One-off purchases
In the second quadrant, we have one-off purchases that are of high-value. These products and services can also be purchased through simple transactions.
These products are bought slightly more than once per year. For example, beds, phones, and other tech products.
As with consumer products, products, and services in this category can rely on simple channels.
3. Customized & Complex, High-value – Services and Packages
Products and services that fall under this category include marketing and financial services, or tour packages.
These products and services tend to cost a lot and potential customers would want to ask as many questions as possible. This helps them to make informed purchase decisions.
Apart from costing a lot, these products and services are also more customizable and complex. For instance, services provided by a marketing agency have to be tailored based on specific needs.
In order to convert these leads, you would need to use channels that fulfill two criteria. They not only need to provide a personal touch but also the opportunity to ask all the questions they need. An example of such a channel would be a call with a sales lead.
If you are selling products or services in this category and were to use a more automated channel like a chatbot, prospects are less likely to convert.
4. Customized & Complex, Low-value – Services and Packages
We haven’t yet come across businesses that sell products or services that fall under this category.
And the reason is that it is simply unprofitable.
Lead Response Time
Lead response time is the amount of time taken by a business to get back to its lead after the lead first reached out to the company.
And according to Harvard Business Review, it is crucial to lead conversion. Let’s take a look at some statistics:
Furthermore, the odds of making a successful contact with the lead it’s 100 times greater when you attempt to contact them within the first five minutes of them giving your information.
This means that there is a direct linear correlation between your lead response time and lead conversion rates.
This is especially true in ore competitive industries where leads are more time-sensitive. They tend to seek out your competitors if you take too long to respond.
So lead quality actually deteriorates by the minute, resulting in a lot of dropped-off leads.
Bearing all that in mind, it is essential that you set lead response time as a key metric as it directly affects your conversion rate.
Having a sales rep on standby 24/7 is cost-ineffective. You’d be better off providing a streamlined and automated process for a sales team to receive inbound sales inquiries. For example, a call-back widget!
If you’re selling complex products to your leads via inbound sales calls, you’d want to be able to track these calls to specific marketing campaigns.
If your campaigns consist solely of Google and social media ads, then it’s easier. But if you are selling complex and customizable products are services, your leads are contacting your business via calls.
And they’re a lot harder to track.
This provides our users with in-depth insights as to which marketing campaigns are doing well and which is not. Businesses can use this information to make adjustments to their marketing efforts.
Call attribution also helps our clients calculate their marketing ROI.
While marketing-sales attribution does not directly affect lead conversion, it helps businesses adjust their marketing strategies, which in turn can drive conversions.
How to fix a leaking sales funnel
Bearing all that in mind, how can we go about fixing leaky sales funnels and increasing lead conversion rates?
Use a personal touch
Despite all the talk of e-commerce eventually becoming the dominating form of commerce, you still can’t deny the importance of more traditional forms of commerce. Having a strong personal touch is still important for some types of products.
The x-axis on the Product-Channel Fit chart should serve as a good indicator as to which types require a stronger personal touch.
If you are selling the high-value products you want to use personal touch as much as possible.
Let’s take a look at one of our clients, Validus Capital.
Validus is an online aggregator platform for SMEs to secure short term and medium-term financing. They connect borrowers (SMEs) and lenders (investors).
They initially used a live chat and messenger for their website to sell expensive loan packages. But loans fall under the third quadrant as they are considered more complex, customizable, and high-risk services. Using such an impersonal channel of communication did not help Validus build trust with potential borrowers. This resulted in high drop-off rates.
The channel used should have a stronger personal touch. It should provide those who use the platform with the opportunity to ask as many questions as possible.
Novocall Conversations allows potential borrowers to schedule a call with one of Validus’ call reps. This ensures that all their doubts can be clarified. After using our software, they experienced a 20% increase in the number of conversions within the first 5 months of usage.
Providing the right amount of personal touch to the right type of products can definitely help businesses drive conversions.
Respond to a call in less than 25 seconds
As I’ve already established, lead response time is everything.
The channel businesses use should shorten it as much as possible to increase lead conversion rates.
Let’s look at an example of how Loola Adventure Resort did it.
Loola traditionally gets its leads from TripAdvisor. TripAdvisor then directs the lead to a webpage on Loola’s site where there is a web form and live chat. Once Loola receives a message, their agent will start replying to the lead.
This entire process took up to 24 hours and resulted in high drop-off rates.
Novocall Conversations can be integrated with your sales reps’ personal schedules.
Interested prospects can simply select a timeslot using the widget. The software then automates a call between them and Loola’s sales rep. This ensures that leads will definitely get a call-back within a short period of time.
Attribute your inbound sales calls
You invested time and money into several marketing campaigns and noticed that you have been receiving more calls.
“It worked!” you exclaimed to your manager. Then comes the million-dollar question.
“How many of these calls can be attributed to which campaign?” or “how can you be so sure that this is not the results of our PR team’s work?”
You’re stumped. And so was iClick Media when their client asked them that question.
As I’ve said, it can be difficult to attribute calls to specific campaigns. That was why call tracking solutions were invented.
Novocall Conversations provided them with a unified call tracking system that was able to attribute their calls to multiple platforms.
This resulted in a 30% decrease in cost per conversion and a 16% increase in leads.
As you can see, marketing is indispensable in your inbound sales process. It directs leads to your company where they eventually schedule a call with your sales reps. Ideally, they would convert.
However, along the way, several factors might affect your lead conversion rates. Conversion might decrease because of several reasons.
Businesses used the wrong channel to sell their products, were slow in responding to leads, or did not adjust their marketing strategies as they did not make marketing-sales attributions.
All these result in a leaky sales funnel in which leads are lost along the way.
To address this, businesses should make their channels more interpersonal, shorten their lead response time, and take marketing attribution more seriously.
I hope that I’ve provided you with useful and actionable advice. If you need help in driving conversions, feel free to reach out to us! We’ll be glad to help 🙂
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