Last month, I spoke about lead metrics and ROI at the B2B Leads Conference in New York. Several smart speakers brought up the issue of why the time to respond to inbound leads is a key success metric. Most had case studies or industry data to support their claim that lead response time is a key B2B leads metric.
Likewise, I have lots of data to show the impact of fast versus slow lead response. Earlier in my career, I had a sales development team that was qualifying 4,000 inbound inquiries per quarter and generating over 380 sales-ready leads. My standard was that every inquiry was answered via telephone within 8 business hours or 24 calendar hours. Fortunately, the sales development group was able to accomplish this and consistently met their lead response metrics.
The following chart, courtesy of Jeff Hoogendam, co-founder of 360 Partners, illustrates the huge impact of following up inbound responses quickly, and the price you pay if you delay your follow up. Note the tremendous drop off of the contact rate and close rate you get when you delay your follow up calls to 30 minutes instead of calls within five minutes.
If these statistics aren’t sobering enough, consider the following:
- 51.4% of B2B leads are never called.
- The average number phone calls made to new leads is 1.
- The average number of emails sent to new leads is 0.9.
- The average call response time for leads is 46 hours.
- 85% of sales teams don’t track call response times.
Here’s the really bad news – if these lead response data points are similar to what you are doing, you are definitely losing business. But there is some really good news. First, the steps you take to contact and process your B2B leads in a more expedient manner will reap large rewards. Second, if your competitors fail to follow up their leads quickly and you are a lead response speed demon, you will gain serious competitive advantage.
I often talk about how improvements in singular lead metrics (conversion ratios) can have a large impact on bottom line results. If you can restructure your sales development process to achieve a much faster lead response time, you will find much greater value in your B2B leads. For more about this subject, read my blog post titled Sales Lead Management: Are You a Victim of FTFU (Failure to Follow-Up).
Christopher, these stats are indeed surprising, if we’re talking about B2B leads. Are we?
B2B buyers are more deliberate. If a B2B marketer promoted a thought leadership white paper or webinar designed to generate early stage leads, I find it very hard to believe that buyers are more likely to buy if they get a call in 5 minutes vs. 30 minutes. Frankly, even 30 minutes seems awfully quick, if someone is just trying to educate themselves on a topic. A quick call could be annoying, not relationship building.
Further, you seem to be saying that it’s bad that 51.4% of leads are never called. Isn’t that the point of lead nurturing? Why waste time calling people that don’t have the right demographics and lead score that indicates they might be a buyer? Maybe only 30% of leads are worth a call, and the rest should be electronically nurtured.
It seems to me that the type and speed of lead response would vary greatly depending on the B2B campaign. A late stage campaign with a time-sensitive offer might warrant an immediate call. But other types of campaigns, a quick phone call could do more harm than good.
I’ve seen some research in B2C lead generation that shows speed is important. In B2B, I’m skeptical the same applies. Can you share any more details on the source of your statistics?
I find these statistics completely credible, and consistent with past data from other sources (I remember a similar study that Knowledgestorm ran a few years back.) It's not that most business leads (to Bob's concern) are "ready to buy.” They're not. But if you respond more quickly to someone who only moments ago expressed interest in any topic, and if you can interact with that person while he/she is still in that same mindset, then it stands to reason your chances of engaging, qualifying, and ultimately closing the deal (however long the sales cycle) are increased exponentially.
To me, the need for faster inbound lead response is mostly an argument for marketing automation. Even the best, most committed, inside sales team isn't always going to be able to respond to every lead within minutes. (Say you come back from a major trade show and dump 1,500 leads into the system. Some of those leads aren't going to get calls for days, no matter how dedicated your reps.) It's why we always recommend that clients incorporate a series of auto-response emails to new leads, emails that complement phone outreach by ISRs. Only then can you truly guarantee consistent, prompt lead response, and the types of results Chris describes.
Great, so all I need to do to get a 78% close rate is have enough staff to call all leads <5 minutes after they sign up for something?
I'm sure improving the close rate from 3% (30+ minutes to call) to 78% (< 5 minutes to call) would more than justify hiring an army of telesales people. How is this credible? Have you heard of any B2B campaign getting a 78% close rate under any circumstances?
Bob, you make a good point. I still find the increase in engagement rates, qualification rates, etc. – and the general notion that immediate response to B2B leads is critical – completely credible. But a 78% close rate? Not so much.
Bob and Howard, thanks for the thoughtful comments. As I mentioned in the post, my statistics on B2B inquiry follow-up measured the impact in time periods of 24 hours vs. 48 hours, not five vs. 30 minutes. Like Bob, I was surprised by the data presented in the chart I referenced. However, there were multiple speakers who talked about the "need for speed” when it comes to inquiry follow-up and these speakers referenced case-study data that reinforced the need for very fast lead follow-up.
Howard's points about lead follow-up are spot on. The 51% failure to follow-up figure that I mentioned means that respondents were not followed by either phone or email. We have seen this happen quite often in the B2B space. You need to have an automated way to contact all inquiries immediately, especially if you can't contact them by phone promptly. More often than not, our outbound campaigns request only a name and company email address. Not sending at least an auto-response email to these individuals is poor marketing practice. You can't nurture a prospect that you never contact.
Bob, good point about the 78% close rate. I will need to get that clarified since it also doesn’t make sense to me.
If we are talking about B2B leads for more strategic products or solutions then I think a more considered (and perhaps considerate) approach would be to research the prospect and their company and respond with a special insight you have uncovered. Perhaps the prospect has written a blog about a related subject – or spoken at a conference. Perhaps the CEO of the company has made a related initiative a company mandate (for example an initiative to get closer to the customer and improve product development, delivery and customer service…).
B2C audiences and more commoditized B2B offerings (where there are multiple competitors without much differentiation) may differentiate on the basis of speed of contact. Follow-up on more complicated offerings may benefit from a more intelligent (based on intelligence) approach – which may slow down the follow-up. Our clients' prospects state that our approach to the follow-up and our persistence beat immediacy every time.
I’m with Christopher and Howard — a quick call certainly improves chances of reaching someone while they’re at their desk, and that initial contact should in turn lead to higher engagement and eventually a higher close rate. Maybe not 78%, but still high enough to justify the effort.
I wonder how these stats will change as people do more research from mobile devices, where they are NOT at their desk to answer a call? That would be something to test and possibly use in response handling.
There are assumptions all over the place with ‘fast lead response,’ but nowhere in all of this statistical hype does anyone ask “what do prospects want?” That’s wrong, and could backfire.
Broad brush interpretation of stats isn’t limited to this scenario, but here is a great case to point out what can happen when you internalize something like correlating contact rate to close rate success and mistakenly think it applies to every buyer in every scenario.
How about this one: At 11:45 am, I’m scrambling to get out of my office to make a 12:30 pm meeting. At the last minute, I remember I want to download a white paper about “Big Data” that I need for a presentation I’m preparing. I pop onto a landing page, populate the information. Phew! Done!
I rush out the door, remembering to call my sick aunt who just broke her hip. Two minutes into the call, her feeble voice is broken up by my call waiting tone. It’s the rep for the company giving me a courtesy call to “just follow up on my inquiry.”
Now you tell me – how is that call going to go?
A little empathy goes a long way. Seems to me that by simply asking on the web page “when would it be convenient for you to talk with us,” –and not assuming it, you would send a loud and clear message about how you view customer relationships.
Yes – timely responses are important. But if your only interpretation of ‘timely’ is ‘fast,’ and not ‘at the right time,’ you’re not thinking hard enough.
Interesting conversation. As often is the case in the business world – there can be situations where there are no clear cut right or wrong answers. This points to the need to know what is right for a company’s industry and marketplace. Applying to B2B calls for multi-dimensional thinking.
For example, in vertical A, a company may find following up on a lead within 8 hours to be critical. Whereas, in vertical B, the situation is more complex and deliberate as Dan mentioned.
There are also factors of whether a company’s product or service is suited for transactions or do they involve complex buying scenarios. If a buyer has a “transaction” mindset, the perception can exist where an immediate response is expected. Other situations, we may find buyers have a “complex” mindset and may not have as urgent an expectation.
So, what does it come down to? It comes down to gaining a deep understanding around buyer expectations and perceptions. Having this deep insight will then inform exactly what response is appropriate in helping buyers. And, the ability to shape the response to fit each segment as oppose to one size fits all.
Tony Zambito
Interesting discussion. I think too often, people confuse speed of response with quality of the engagement.
Here’s an example from personal experience. While it’s B2C, I think we can see the same dangers in B2B. Several months ago, I was buying a new car. I leveraged a couple of “buying services,” to get the best deals on the vehicles I was looking at.
Within 2 minutes of submitting my requests, I received 5 calls from various dealerships—clearly they are reading the same articles and data we are looking at.
Each of the responses was the same, “I want to earn your business, we can get you the greatest deal, call me before you buy……”
18 hours later, I get an email–not from the original 5. It started with, “I know you must be busy and I know you probably don’t want to waste a lot of time buying a car. I’ve taken the liberty to price the car you want–here’s the very best deal we can offer…..” Without talking to me, this seller knew I was an informed buyer, appropriately assessed my “persona” from the data I submitted, and responded to my need with a fair deal. 2 emails later, I bought the car.
Technology, speed of response, regardless of the market, is no substitute for the quality of engagement. When will we stop forgetting this fact?
More good comments. Just to be clear Dave, this is not a case of quality vs. speed of follow-up. For example, companies selling customized and big ticket items would be well advised to do a bit of research on the prospect before calling. And no BDR or sales rep should call in a haphazard or ill-prepared way. But I have never seen a case where delaying the follow-up produces better results or produces better prospect engagement. In fact, the worst type of engagement is practiced by companies who fail to follow-up their leads. This annoys me as a prospect and offends me as a marketer.
As I mentioned before, most of our outbound communications for clients ask for an email address, not a phone number. Forcing the phone number always depresses results significantly. We always send an auto-response email immediately and follow-up with a personalized email communication within 24 hours. The nurturing process then kicks in. We have found this softer-sell approach, combined with speedy follow-up, to be very effective.