How Many Leads Do We Need?

One of the questions that I am asked on a pretty regular basis is “How many leads do we need to purchase on a daily, weekly or monthly basis?  It should be fairly obvious that there is not one correct or simple answer to that question.  I usually try to get more information before we begin discussing my opinions on the subject.  I am going to take a couple minutes to give you some of my theories on the subject.

 

You and I, even if we have super-human abilities, are capable of accomplishing just so much in any given period of time. Pushing or overloading our ability beyond reason can impact the quality of our work if not the overall quality of our lives.  Each of us is sort of like a funnel.  It really doesn’t matter how much is poured into the hopper, the diameter of the outlet determines what comes out the bottom.  That outlet, with some modification, equates to the time we have to dedicate to the job each and every working day.  Someone else has referred to this as the garden hose effect; no matter how much pressure you pump into the hose, the nozzle at the end determines how much water is sprayed.

 And don’t neglect to factor in those external influences that take up part of that bottleneck at the bottom of the funnel.  Please don’t think that I am attaching a negative connotation to walk-ins, phone calls, paperwork issues, deliveries, lunch, etc., but they do take up time and if you are estimating the time you have available to work third-party leads, you need to calculate them all.

As someone who sells third-party leads and Loan-by-Phone systems, one would think that I would be trying to dump all the leads into the hopper that the budget will allow.  That would be the conventional wisdom of an average salesperson, but I, and many like me, am aware that if our product sits on the desk, it spoils rapidly.  Leads, whatever the source, have a very short lifespan usually measured in hours.  My clients’ basic view of the value of my leads is the number of deliveries that are produced.  Old, spoiled, leads very seldom produce sales.  How many times have I heard, “most of those leads you sent me have already bought” or some similar statement?  More often than I would like.  Sure, occasionally, that should be the response.  After all, everybody can’t be first!  And normally, most internet prospects visit more than one site.  But more than likely, the reason is that the lead has languished on the desk or in a drawer until the salesperson has time to follow up.  That is sort of like buying a bunch of bananas, eating one and leaving the rest on the counter to spoil.  Only buy what you can eat!

I ordinarily recommend that my clients begin with two leads per salesperson per day.  That should be a comfortable number.  We can always increase or decrease the number as experience dictates.  And I don’t know of any supplier who, if you are having an unusually slow week, wouldn’t be glad to ship you a dozen or so extra leads.  So the answer to the original question is that there is no firm answer.  Work with your supplier, and I’d be happy if that was me, and, using a realistic work plan, calculate a conservative number that you know will be worked.  Follow up within a week or so and see if your plan is working.  If not, and don’t be stubborn, make adjustments either to the number of leads or the personnel working them.

Just my two cents worth!

 

About the author

Dick Hassberger, of Lake Orion, Michigan is a veteran of over 50 years in the Automotive Financing and Leasing industry, starting his career with the former Wayne Oakland Bank in September 1960.  Dick currently represents VOISYS in Michigan.  He has held executive positions with Major Banks, Lending Institutions and Leasing companies and has accumulated a vast store of knowledge in the automotive financing industry, which he regularly shares with his client dealerships as well as readers of this blog.  Dick was a regular author for World of Special Finance Magazine.