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How Do You Set, Monitor and use Lead Response Performance Benchmarks to Optimize Sales Results from Internet Leads?
The question posed by Mark King of Owensboro, KY is significant and most likely to be of interest to other ADM Community members, so I decided to turn the dialog between Mark and I into a fourm discussion. My responses to Mark are my own professional opinions, they are not facts... So, I would like other ADMers to provide their own opinions in response to Mark's question, copied and pasted below:
1. Unacceptable Performance; Immediate Intervention Action / Shut Off from Leads
2. Acceptable; Must Improve to Good Level by Next Month / Not Eligible for Bonuses-Spiffs
3. Good; Requires Mandatory Meeting Attendance/Online Training / Eligible for Bonuses-Spiffs
4. Superior; 1 Mandatory Meeting Waiver / Online Training Required / Bonuses-Spiffs @ +10%
5. Excellent; Mandatory Meetings and Online Training "Optional" / Bonuses-Spiffs @ +20%
If you want to implement an objective performance benchmark based management system such as the one listed above, then you had better start measuring BEFORE you determine what those benchmarks are going to be, or the metrics based rules you implement will be pure unadulterated B*******, and will not be credible... Which means the stated consequences will not be enforced and your plans to implement an objective and dynamic metrics based performance incentives program will simply fail. Let me paraphrase what I believe to be a better question to ask...
"How do you set lead response time and quality performance benchmarks after you get the dealership or group's historical lead response time performance data?"
Great question, glad you asked... Here are a few guidelines:
1. The data you use to establish a dealership's initial lead response time performance and quality benchmarks should be sourced from the same system (CRM, Lead Management Tool, OEM reports, etc.) that will be used going forward to measure, monitor, evaluate, plan and coach the people tasked with handling Internet leads and responding to them.
"How do you set lead response time and quality performance benchmarks after you get the dealership or group's historical lead response time performance data?"
Great question, glad you asked... Here are a few guidelines:
1. The data you use to establish a dealership's initial lead response time performance and quality benchmarks should be sourced from the same system (CRM, Lead Management Tool, OEM reports, etc.) that will be used going forward to measure, monitor, evaluate, plan and coach the people tasked with handling Internet leads and responding to them.
2. Use AT LEAST 3 months of data to determine historical performance levels, if you have more, up to the previous 12 months would be preferred. Resist temptation to use last month by itself, or to cherry pick a particularly good month from last year. The key is to have the best measurement of where your team is at today, based on enough data generated over a long enough recent time period to qualify it as being indisputable. You want the historical data that shows how your team performed while getting to where they are today over the past 12 months, but at least 3...
3. Generate and export to Excel the Average Lead Lead Response Time for all leads that were assigned to THE PEOPLE WHO THE BENCHMARKS WILL BE APPLIED TO... Do not include leads routed to the floor because they came from previous customers, Service and Parts, or Commercial/Fleet if you are setting benchmarks for an Internet Sales Team that has not been handling those leads.
4. Generate and export to Excel an individual report showing (same as #3) Average Lead Response Time performance metrics for each individual user who handled at least 100 leads in same time period (3-12 months). I recommend >100 leads as a statistical qualifier.
5. The Average Lead Response Time for the individual performance measured (subject to qualifiers in 1-4) that is the longest amount of time, or the slowest (biggest) average response time to Internet leads now becomes the Performance Level Benchmark for "Unacceptable Performance". This benchmark is a level that triggers disciplinary action when an Internet Sales Specialist drops to this level or falls below it for either a month or the most recent 100 leads. The "Unacceptable Performance" benchmark is the level which results in an Internet Sales Specialist being suspended from receiving new leads by being pulled from lead routing rotation until corrective action is taken. An individual performing at or below this level is no longer qualified to serve as an Internet Sales Specialist/Manager.
6. The Average Lead Response Time for the individual performance measured (subject to qualifiers 1-4) that is the shortest amount of time, or the fastest (lowest) average response time to Internet leads becomes the initial Performance Level Benchmark for "Excellent Performance". Performing above this benchmark qualifies an ISS or ISM to receive a bundle of rewards and preferred status in lead routing rotation, mandatory meetings and whatever is determined by management to reward and encourage this level of performance. An individual performing at or better than this level is qualified to lead and train others to become an Internet Sales Specialist/Manager. This benchmark should be periodically reviewed and adjusted when metrics used for initial benchmark indicate higher performance has normalized.
7. The Average Lead Response Time for the aggregated total of individuals who are the top third (33%) in performance measured (subject to qualifiers) for shortest amount of time, or the fastest (lowest) average response time to Internet leads becomes the initial Performance Level Benchmark for "Superior Performance". Individuals that perform at or above this level, but below "Excellent" are in the "Superior Performance" lead response category.
8. The Average Lead Response Time for the entire team, after removing the bottom third (33%) of individual performance measured (subject to qualifiers 1-4). Removing the bottom third who have the longest average response time, the slowest (biggest) average response time to Internet leads is used to establish the initial Benchmark for "Good Performance". Individuals that perform at or above this level, but below "Superior" are rated as being at the "Good Performance" level of lead response performance.
9. Performance levels above "Unacceptable" and below "Good" benchmark levels are "Acceptable"... The "Acceptable" rating and range of performance benchmark should be used to indicate a need for performance improvement. The "Acceptable" benchmark becomes unacceptable when an individual performs at this level without improvement or a plan to improve.
QUALIFIERS ARE CRITICAL TO SUCCESS
Establishing a set of performance benchmarks to use in determining levels that result in either rewards, improvement coaching of disciplinary action can be very counter productive if the minimum standards for what constitutes an acceptable quality level of that response are not implemented and monitored.
Responding to leads quickly, but not providing the customer with all the information requested, and following the established dealership process defining what is included in an Internet Sales Specialist's email sent in response to that lead, DISQUALIFIES THAT LEAD RESPONSE FROM "STOPPING THE CLOCK" WHEN DETERMINING AVERAGE LEAD RESPONSE TIME.
This can be done, I have personally been successful by spot checking the responses that have been sent and defining EXACTLY what must be included, as a minimum level of content in each ISS/ISM first response to every lead, by category of lead based on source, form completed and what the customer's expectations are as indicated the web page they used to submit that lead.
Ford has established a set of standards for a "First Response Quality" that is based on the performance metrics and attributes that measurement proves are what determines whether or not a sale is made... These lead response QUALITY attributes have been simplified and boiled down to the five most important criteria, and executing at least the items numbered 3, 4 and 5 on the list below should be considered as a qualifier for each initial lead response to "Stop the Clock" when measuring average response time:
Another approach is to use a point system for qualifying "First Response" to Internet leads, which can be applied to a dealership as a whole, and individual ISM's lead responses, or each individual response to a lead. Here is an example of a point system:
Based on the following categories and point system, check the boxes that correspond to initial Lead Management Process as is actually being performed. Then, tally up the total score and enter that score into the box provided at the bottom of the section.
Average Personalized Email Response Time to New Leads:
6 Hours or Greater…… 0 Points
Under 6 Hours……….... 1 Points
Under 3 Hours………… 2 Points
Under 1 Hour…………... 5 Points
Add the indicated points if the dealer, ISS, ISM or BDC Rep provides the following information in their initial personalized Email Response:
Confirm Availability (Specific Vehicle)…............... 1 Point
MSRP (Reference Price)………….…...........………. 1 Point
Selling Price……………….....……..................……... 1 Point
Price “Good Until” Date…….....….………..……….. 1 Point
Hyperlinks to dealer web site features….............. 1 Point
Provide info on at least 3 additional vehicles as alternatives in addition to the information (price quote) for vehicle customer inquired about in their Lead....................................... 15 Points
Dealership reviews each Lead, details and comments submitted by customers, then answers specific customer questions in the initial email response…….............. 5 Points
Dealership’s Autoresponse and the first personalized email advises customers why direct contact (phone) is a benefit, and that phone contact will be attempted........................ 5 Points
Call each customer (look up number) after sending email, with the call made on SAME DAY lead received.......... 15 Points
ALTERNATIVE TO SAME DAY; call made to customer on next day after lead received and email sent.................. 5 Points
Total Lead Management Process Points (50 Maximum)
Tags: How Do You Set, Internet Leads, Lead Response, Monitor and use, Optimize Sales Results, Performance Benchmarks
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