Leads are potential clients who interact with a brand through various channels, such as referrals, similar brand patronage, or an interest in your product or service. Effective follow-up on leads is crucial for converting them into paying customers.
This article outlines what lead follow-up is, the systems used to do it, the reasons for conducting it, and the advantages involved. It also provides practical steps and best practices to get the most out of this opportunity.
Lead follow up. Image Credit: Shutterstock.com/Rawpixel.com
What Is Lead Follow-Up?
Lead follow-up is the process of engaging with potential customers after they have shown interest in your brand by taking action on your content or making contact with you through other channels. It involves a series of actions taken to nurture and guide leads through the sales funnel, with the ultimate goal of converting them into booked sales. Lead follow-up is an important component of successful sales and marketing strategies. It helps build relationships, address concerns, and provide the information needed for potential customers to make informed purchasing decisions.
What Is Lead Management?
Lead management refers to the process of attracting, qualifying, nurturing, and ultimately converting potential customers into actual customers. It involves guiding prospective client throughout their journey, from the first point of contact with a brand to the final conversion — where they make a purchase.
What Is a Lead Management System?
A lead management system (LMS) is a software solution that automates and streamlines the processes involved in capturing, tracking, and nurturing leads. It facilitates the efficient management of potential customers passing through the sales funnel, from initial contact to conversion. It provides tools for lead generation, capture, qualification, segmentation, growth, and analysis. The goal of the system is to enhance collaboration between sales and marketing teams, optimize lead-related workflows, and improve the overall efficiency of converting leads into sales. These systems allow the in-house teams to focus on selling and customer or lead engagement rather than time-consuming administrative tasks that leave room for oversight, or overlooking anything, and human error.
Lead Follow-Up Process: How to Follow Up on Leads?
Listed below are some effective follow-up processes that can help with responding to new leads to increase your conversion rate:
Use a CRM
Managing sales leads is a growing challenge for businesses. Customer relationship management (CRM) software addresses this challenge by enabling companies and sales teams to record, organize, and manage information about prospects, clients, and leads throughout the customer lifecycle. CRM platforms often integrate with other tools, like Gmail, slack, social media platforms (e.g. Facebook and LinkedIn), Survey Monkey, and more, and give access to the same data for various team members, including customer service reps and marketers.
With a CRM, sales reps can input details about a prospective client, such as contact information and product interests. This information facilitates the development of effective workflows for guiding leads through the sales funnel.
Assigning specific leads to individual reps prevents overwhelming prospects with sales calls and ensures coordination among sales team members. For instance, if a potential customer expresses interest in product liability insurance, this data can create a CRM entry with the lead's details and challenges, including industry, company size, and product types. Each interaction is recorded in the CRM for that client lead to manage contact frequency, preventing either excessive or inadequate communication from the sales team.
Group Your Leads
Grouping leads is another way to improve lead follow-up efforts to get the best possible response from potential clients. Proper segmenting can significantly enhance a company’s lead management process. It involves grouping leads based on factors like interest level, source, and the potential customer’s stage in the sales funnel. This can help businesses tailor their marketing and communication to fit each group, which can improve the chances of conversion.
A common way to segment leads is to divide them into three groups based on the interest that they have shown how close they are to buying your product, and how likely they are to follow through: hot, warm, or cold. Cold leads are potential clients that have shown little to no interest in what you have to offer. In some cases, cold leads might not even be aware of your company yet. Warm leads are people or businesses that know about your product and have shown some interest but appear to feel no urgency about making a purchase. Finally, hot leads are potential clients who are ready to make a purchase.
Find Correct Right Point of Contact
Connecting with leads involves choosing the right person based on their preferred communication channels. Social media, phone calls, emails, and physical promotions like flyers are all common ways to generate new leads. The right point of contact depends on the situation, meaning the type of client, their age, their interest level, where they spend most of their time online, the type of product you offer, etc. A safe way to engage with leads is usually through email — this is the contact point that most businesses start with. These emails usually start with an introduction and a special offer followed by a call to action (CTA). This is a casual yet direct way for companies to reach leads and it gives the potential client the time to think things over.
A phone call is a more direct way of making contact and in this day and age could be seen as old school. Most people are not comfortable making purchasing decisions in such a short timeframe and not to mention you might be calling them at a very inconvenient time. This is why emails are the preferred, and safer, point-of-contact option. Emails allow potential clients more flexibility in responding while building a personal touch that can build trust.
Avoid Pestering the Lead
Lead follow-up involves a balance between reaching out to the potential client and knowing when to stop. Even if a prospective customer expresses interest in further communication, excessive follow-up contacts can be counterproductive, potentially harming the chances of a sale. To avoid overwhelming prospects, it is crucial to space out contacts based on their preferences. If a lead specifies a follow-up timeframe, adhere to it and schedule subsequent contacts in your CRM. For situations where a lead's preferences are unclear, establish a reasonable follow-up time frame based on their position in the sales funnel.
Tailoring follow-up frequency is essential for both cold and hot leads. With cold leads, it's advisable to space out follow-ups over a week or two, preferably at different times, to maintain top-of-mind awareness without overwhelming them. For hot leads, the follow-up frequency can be more spaced out, aligning with the prospect's preferences. Adjust the frequency based on factors such as internal feedback timelines (or internal processing timelines within your own organization, especially within the sales and marketing team) or the urgency of the lead's response in terms of their buying needs.
Knowing when to stop following up is also crucial for maintaining a positive relationship with leads. If a lead stops responding to follow-ups, it's important to respect their lack of interest. Placing non-responsive prospects into a special "uninterested" category will help to avoid annoying them. Irritated potential customers can result in negative word-of-mouth information being passed around about your business. By respecting a prospect’s current lack of interest, you leave the door open for potential future engagement. Unless explicitly requested to stop contact, consider reaching out once or twice a year with check-in or a personalized offer, demonstrating your ongoing interest and providing value without being intrusive.
Follow a Schedule
A schedule is another practical way to stay on top of your follow-up game. A structured follow-up schedule is essential, considering that conversions typically require 7-10 touches. A schedule not only ensures consistency in your communications, it also prevents valuable leads from slipping through the cracks. The goal is to stay top-of-mind without becoming a nuisance to the prospect. A sample schedule might involve weekly emails, monthly phone calls, and quarterly face-to-face interactions. It’s important to strike a balance and not to overwhelm or irritate your leads. Too much interaction is not a good thing and could lead to a bad client relationship.
Use Sales Templates
Consider templates to ease your workflow. Developing sales scripts and templates simplifies the lead follow-up process for your sales team while also ensuring consistency and increased effectiveness. A well-designed template should:
- Introduce your company and sales rep.
- Acknowledge and confirm the lead's interest in your product or service.
- Invite the lead to move forward with a CTA.
- Ensure that your message remains concise and relevant. For instance, email templates include a captivating subject line and succinct responses to the lead's pain points.
- Provide actionable suggestions for ongoing engagement. This makes it easy for the lead to stay connected with your business.
Add Value
It’s important to focus on adding value to your prospects in your follow-ups, not just generic information. Adding value in follow-up interactions means focusing on providing solutions to the lead's pain points, rather than simply promoting product features. The point is to make each interaction beneficial and relevant to the lead's needs. Adding value to the conversation distinguishes useful follow-up communications from mere sales pitches. By addressing the lead's specific challenges and offering meaningful solutions, businesses build trust and credibility. This not only enhances the potential client’s interest but also positions the company as a valuable resource, which increases the likelihood of successful follow-up and conversion.
Automate The Process
Manually following up on leads can be very time-consuming and leaves room for a lot of errors and potential oversights. Automating the process can save a lot of time and reduce the opportunity for human errors. Use software to handle repetitive tasks, such as generating CRM entries for new leads. By automatically generating CRM entries or handling routine follow-up activities, businesses ensure efficiency and consistency in their follow-up process. This can help the sales staff by allowing them to direct their time and energy elsewhere, like engaging with leads.
Why Is It Important to Follow Up on a Lead?
Following up on leads creates trust and builds positive relationships, which could turn prospects into loyal, paying customers. It allows companies to capitalize on initial interest, nurture relationships, and guide potential customers through the sales funnel. Timely follow-up also addresses a prospect’s concerns, demonstrates a commitment to customer service, and sets your business apart from competitors’ operations. Some of the direct outcomes of effective lead follow-up are maximizing sales opportunities and building brand loyalty. The process also provides valuable data for iterative improvement, ensuring ongoing optimization of lead management strategies.
Advantages of Effective Lead Follow-Up
The benefits of effective lead follow-up are numerous, but some of the most important are outlined and discussed below:
Increased Conversions
One of the main goals of most sales and marketing teams is to convert potential customers into actual, paying customers. One of the best ways to achieve this goal is through effective lead follow-up. If done correctly, lead follow-up will cultivate relationships and trust between your targeted lead and your brand or company. Once the relationship is established and kindled, leads are more likely to convert to paying customers. This can have a snowball effect, leading to loyal customers who repeatedly buy your products or subscribe to the services you offer. It can also result in referrals to your company by word of mouth, or at the very least get your company some good reviews that increase the impression of your technical expertise in a certain niche and build trust with other potential clients — which in turn could lead to more sales.
Revenue Growth
Revenue growth and conversion rate go hand in hand. If more leads were converted into paying clients your company would see a corresponding increase in revenue. This effect can be exponential. In the initial stages, it might take a lot of effort from sales and marketing teams, but after a while, after establishing relationships and following up on promising leads the same efforts will lead to better results. Once trust is built and your brand starts building a name that customers trust and rely on, less effort will be required from your internal team to convince leads to trust your brand or to convert into paying customers. The key is to stay consistent throughout, value leads, and prioritize lead follow-up, especially during the initial stages of a business.
Enhanced Customer Relationships
Effective lead follow-up can lead to better customer relationships. This is crucial in the business world. As a business, you want to build relationships with your customers. Customers who feel valued are more likely to recommend your services to other clients. Word of mouth is one of the best advertising a business can receive. Trust between a client and a company also results in loyal customers who are likely to buy again or renew their subscriptions to the services you offer. This leads to a continual flow of revenue. A good customer experience can also result in a good image on various platforms through customer reviews, page shares, social media interactions, or recommending your service on social channels.
Gaining a Competitive Advantage
Companies that prioritize lead follow-up can gain a competitive advantage over companies that don’t necessarily put in the same efforts. Individuals or companies that feel seen and valued are more likely to engage. One major factor that enters into whether or not lead follow-up can be turned into a competitive advantage is response time to customers' questions. Timely responses can make or break a prospect’s purchasing decision. If your company prioritizes lead follow-up and customer relationships and combines them with timely responses, customers will be more likely to buy from your business as opposed to a company that gives sluggish responses and doesn't necessarily respond or follow up on leads.
Making Data-Driven Decisions
Effective lead follow-up is an adaptive process. Companies might decide to run different marketing, lead generation, lead follow-up, and lead management strategies simultaneously to see which one has the highest success rate. This allows the business to make data-driven decisions, applying the company’s resources and efforts to strategies that work and convert. Customer relationship management (CRM) tools and analytics can be used by businesses to gain valuable insights into the behavior and preferences of prospective clients, and the effectiveness of various follow-up strategies.This data-driven approach enables continuous improvement by allowing businesses to refine and optimize their follow-up processes.
Data-driven decisions can also include adding or defining a new ideal customer profile based on interactions with marketing material and website content. The main focus should be to be adaptable and to evolve as a business based on market and client needs. Check what is also working for you and your brand based on the analytics. This is a continuous process, which ensures that your company grows and adapts to changing market demands.
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