What is a good ratio for our industry? I've never found any benchmarks on this, and with good reason: It likely varies widely by firm, service areas, markets served, etc. The important measure is to see that your leads-to-sales ratio improves. So if you're not currently tracking it, let me encourage you to do so.
Here's an interesting number to contemplate: According to a survey by BPM Forum, about 80% of sales leads are dropped or mishandled. Their study didn't focus on our industry, but do you think we fare any better? Not in my experience, in large part due to the following factors:
- Most firms have no structured lead management process
- Firms often do a poor job of focusing their efforts on their best sales opportunities
- Technical professionals tend to relegate sales to leftover time, which in practical terms deems it a lower priority than project work
- Most leads in our business are "long term," meaning they take months to close (and to lose our attention)
- A/E firms generally don't market well, which limits their ability to indirectly engage the prospective client--an important lead management technique
If you see the above tendencies in your own firm, take heart--your competitors face the same challenges. So the opportunity is there to revamp your lead management practices and significantly improve your leads-to-sales ratio. Below are a few tips:
Don't just track leads; track lead follow-up activity. For many of you, this raises the age-old challenge of getting people to use the CRM system. The problem with such tools is that unless they're widely used their value as corporate resources is limited. I gave up relying on the technological solution long ago (I know, a heretic) and opted for a more direct approach: Organizing sales teams that meet regularly to review progress, devise strategy, and assign actions. The accountability and collaboration that comes with such an approach can dramatically increase productive sales activity.
Develop a plan for your best sales opportunities. One of my overarching business principles can be stated simply as "fewer better." This certainly applies to how I've long approached sales. I'd rather out-work the competition on 10 solid leads than try to spread attention across 50 of them, many of which will inevitably be long shots. The main problem with the volume strategy is that it typically fails to allocate enough focus on the sales opportunities you really need to close.
No matter how many current leads you have in the funnel, be sure to give special attention to your most important ones--those with the best odds, best revenue and profit potential, most promising clients, most needed. Develop what I call a "key opportunity plan" for each that outlines the client's primary needs driving the project, the key decision makers, your positioning with the client, and critical actions needed to advance the sale.
Of course, this plan will need to be regularly updated as things progress and new information is uncovered. You can download a template of such a plan, based on the best-selling book Strategic Selling, from my website at this link.
Bring value to every conversation with the client. Since most sales leads in our industry take months to close, you need several interactions with the client to stay firmly in the competition. That's your motive, but what's in it for the client to have multiple conversations with you? Don't assume that your ability to schedule a sales call with the client (especially in the public sector) indicates real interest in meeting with you. If you want to solidify your firm's position with the client, be sure to bring something of value to every client interaction.
This is what I call your entree: Sharing information, advice, or something else of value in exchange for the client's precious time. Ideally, every meeting regarding an active lead advances the problem solving process. It's the "pre-project," if you will, where you use your expertise and connections to help the client get off to a good start--and position your firm for winning the job!
Always try to establish the basis for the next meeting. If you're helping the client, he or she should be favorably disposed to continue the conversation. But the best way to keep the dialogue going is to schedule the next meeting or phone conversation each time you talk with the client. Have a good reason to meet, of course. For example: "Let me run some numbers on that design option and look a little deeper into the regulatory issues, and how about we meet to discuss what I find in about two weeks. What dates would work for you that last week of the month?" This is a simple step that can really help you stay engaged with the client.
Don't overlook the benefit of indirect client interactions. You can only expect so many meetings with the client, and you certainly want to avoid being a pest. So how do you stay in front of the client in between sales calls? Email. That's another way to deliver your helpful information and advice, and to keep the problem solving process active.
In some cases, this will involve doing some client- or project-specific research and reporting the results via email. Yet over several months, there may not be enough such opportunities to keep the momentum going. That's where your content marketing can come in handy. When you're constantly creating and collecting valuable content, you have a ready storehouse of information to draw from.
Much like you, the lead time on many of the consulting contracts I pursue can drag out for many months (if not years). As a sole proprietor, I have neither the time nor the money to travel much to make sales calls. So I rely on phone conversations and email exchanges. When things bog down and there's not much new to talk about, I've found it really productive to stay in front of the client by emailing relevant articles and white papers.
These often prompt the client to pick up the process again in moving towards closure. In fact, I just received an email from a large engineering firm out west, telling me to expect a call this week. This came shortly after sending them links to a couple of relevant articles. We started talking last summer and haven't had a conversation since November. But I've drawn on my content library to stay in front of them indirectly over the months.
It's well established in the literature that effective marketing can substantially help you not only develop new leads, but close on them. Don't overlook it's role in maximizing your sales leads.