Marketing and sales can be split into two activities:
- Generating leads
- Converting the leads into sales orders and customers
Is this where marketing and sales divide with the marketing staff responsible for generating leads and the sales department responsible for turning the leads into money?
Sometimes it is but often a lot of conversion can be done in the marketing.
This article will focus on the conversion side of the process but if you want to first look at lead generation, I recommend the following:
>>> Understand The Customers In Your Market And Find Unexploited Opportunities
>>> How To Help Prospective Customers Find Your Business
>>> Where To Promote Your Business To Your Target Customers
>>> Reach Out To Your Target Customers
The Basic Principles Of Lead Conversion
A business can design different lead conversion systems from trying to sell at the first point of contact to persuading qualified prospects to hold up their hands.
>>> One Step, Two Step And Three Step Lead Generation And Conversion
In one step marketing, you are handicapped with a one way communication. You have to tell the potential customer enough to make him or her want to buy your product as an urgent priority and then push the person into taking action.
This is hard as you just make the best presentation you can, dealing with the main benefits and common objections.
In two step marketing, you can create two way communication if you choose (two step may be by an opt-in and a series of email auto-responder messages that don’t create a dialogue.).
The conversion gives the sales person the chance to question the customer, adapt the presentation to the particular needs and then respond to questions and queries.
This makes selling or converting leads easier but more expensive. Whether it is worth it depends on the profitability on the first transaction and the ongoing value of the customer.
>>> Customer Lifetime Value And Why It Is Important
The Big Factors Of Conversion
You can’t legitimately convert a customer if there isn’t an underlying want or need for your product or service and the benefits it delivers.
Sometimes manipulation is possible but this isn’t good practice and will create a bad reputation for the business now that social media makes every customer, potentially a powerful critic.
The Conversion Factors can be broken down into a few categories:
- Techniques to give the customer more confidence.
- Uniqueness – if you have a unique product or service, if the customer wants it, she has to buy from you.
- Making the offer look good – higher value, more attractive product, lower price, easier payments, quicker delivery.
- Positive actions by sales and customer service staff.
These cover the four main reasons why the lead doesn’t convert:
- The customer feels uneasy about making the sacrifice of losing the money or sacrificing the opportunity to buy something else.
- There is no feeling of uniqueness so the customer is encouraged to shop around for a lower price.
- The basic offer isn’t good enough.
- The business was let down by the sales and customer service staff.
Conversion Factor 1 – Reduce Uncertainty When The Customer Is Thinking About Buying
Rather than focusing purely on the points that I have written about below, I recommend that you ask yourself two questions:
- What makes the customer feel uncertain when buying your product or service? If you don’t know, do a customer and/or general market survey?
- What techniques have you seen in action to give the customer more confidence about buying?
Here are some of my thoughts (coaching clients get everything appropriate).
- Money back guarantees
- Customer testimonials and case studies
- Try before you buy offers
- You pay what you think is right
- Services to take away uncertainties about installing, using and maintaining the product.
Conversion Factor 2 – Uniqueness
I talk more about the need to differentiate your business and products/services on another blog at www.DifferentiateYourBusiness.co.uk
If a customer doesn’t feel that what you’re selling is unique and different from what’s offered by your competitors, the only sensible criteria to use for the purchase decision is to find the lowest price.
Low prices usually mean low margins and that’s bad news for your profitability and cash flow.
Some of the factors covered elsewhere in this list can be part of your uniqueness and I can help you to develop your USP and strategic positioning and differentiation with my USP coaching service.
Again before rushing into my ideas, take the time to think about how you’ve been persuaded that products you buy are unique?
When hasn’t uniqueness mattered?
I ask that second question because you can sometimes get hung-up on having a unique product when it is something like convenience that brings people into your business to buy. Think of a newsagent or a petrol station where you know the products are commodities.
If you think about it, what you’re doing is buying a product solution to solve a problem with particular benefits.
Thinking of your business in terms of problem – solution – benefits, gives you three levers to think about uniqueness.
- Do you have a unique diagnosis of a problem from the symptoms?
- Do you have a unique solution? Is the product unique or the system by which you deliver the service?
- Do you offer unique benefits? This one is often the hardest to establish and explains why, if you’re a buyer and you listen to a series of salespeople pitch their solutions on benefits, everything starts to sound incredibly generic. Think about the big problems – losing weight, looking younger and more attractive – the claims are often very similar but how the solution cures what underlying problem is often very different.
Conversion Factor 3 – Make The Offer Great
If you think about it, value for money has two elements and you can work on one or both if you want to win customer preference.
- You can increase the value
- You can decrease the cost including making the payments easy to deal with by spreading them out, either in advance or arrears of the service.
Even with commodities, where you can buy the same thing from a number of different suppliers, the speed of delivery can be a major order-winning factor.
Look at Amazon and how it offers a number of delivery options that help give it a value advantage (because you can have it tomorrow morning) or a price advantage because delivery can be slow but free.
Conversion Factor 4 – Actions By Sales And Customer Service Staff
In my report, The Six Steps Profit Formula, I talk about moments of truth where your customer comes into contact with your product and service.
These can be moments of delight or moments of dread.
Each makes an impression on what the customer thinks about your business. Some can be automated but many depend on the personal interaction between your customers and your staff who deal with them.
They can win or lose you the order.
It’s well worth thinking about your own experience as a buyer and how you’ve been influenced. It’s perhaps a sad reflection on society but I think that there are more negative experiences than positive.
Staff who are rude, ignorant of their products or disinterested. or perhaps jobsworths who refuse to apply common sense as follow the rules to the letter, even if it harms the customer relationship.
Converting Enquiries And Leads Into Sales Orders And New Customers
There’s a lot to think about in this area and I wanted to show you that lead conversion is much more than sales training for staff although that’s obviously an element in factor 4.
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