Coffee for Closers | Leads360 Sales & Marketing Blog 

The necessity of speed in sales is more apparent on the internet than anywhere else. In order to maximize the results on your leads, it’s essential that companies be able to react at the speed of business. This is especially true when it comes to internet leads. High quality internet leads are expensive and cannot be wasted, making it all the more important to be the first agent contacting a lead/potential client and to do so within five minutes of receiving that lead. The first salesperson to contact a quality lead is the one that makes the sale the majority of the time, and those that can get there inside of five minutes further improve their chances.

Leads that are contacted within the first five minutes are converted at a healthy rate of 19.86%, a number that drops to 4.96 percent in the first ten minutes, 2.12 in the first 15, and continue to fall precipitously the longer it takes to contact the lead. Of course, a higher rate of conversion isn’t the only reason speed in contacting leads is so important. There’s also the fact that contacting a lead within five minutes of their completing an online application increase contact rates by over 500% when compared to those attempting first contact at the 10 minute mark. Contacting in the first three minutes also improves the rate of qualifying high quality leads to as high as 76% while only 10% reached in the first six hours can expect the same results. Finally, over three quarters of buyers wind up closing with the company that contacts them first. Beating your competitors to the punch is essential and the most effective way to convert leads into business.

The early bird gets the worm, and a sales staff that can move immediately on high quality leads is more efficient and sees much better results.  Not only will they convert their leads at a much higher rate, but they will make a first contact more often and get in ahead of any competitors. Especially with the current state of the economy, it’s essential that neither time nor money be wasted on leads that don’t convert, and the best way to convert leads is to beat your competitors to the punch and get to potential buyers in the first five minutes.

When dealing with internet generated mortgage leads, the typical agreed upon conversion rate is between 1.5% – 2%. At this rate you can and should be profitable. Of course we’ve seen many clients that are converting much lower and we’ve seen some that convert quite a bit higher. One of the unique aspects of internet leads, in particular mortgage, is that they are often generated once and sold 3-4 times. This is pretty typical and widely accepted by the market. This practice however is the root of what I call the conversion conundrum. That is, even though the industry average for a mortgage lender to convert an internet lead is 1.5% – 2%, the actual average conversion rate of an internet consumer is actually 4.5% – 4.75%. That’s a 2-3% spread in the conversion rate. The reason for that is if a consumer goes online and submits their information as a lead to LowerMyBills.com for example. That lead is then sold to 4 mortgage lenders. Only one of those four companies can actually close that lead and if you calculate the conversion rate across all four lenders, it comes out to about 1.5% – 2%. But, when you calculate the actual conversion rate of that consumer, not taking into account which lender they chose, the internet consumer actually converts at about 4.5% – 4.75%. Interesting right?

Let me put it another way. If there is a 3% gap between conversion rates as I described above, what does a lender have to do to access that increase in conversion? That 3% is won purely by the behavior of the lender. In other words, the difference between the 1.5% and the 4.5% is the activity that a lender does when they get a lead. It’s about how fast they call that lead and how many times they follow-up.  It’s about what offers they give, what the loan officer says on the phone and so on. It’s all about the behavior of the lender after the lead has been given to them. That’s 100% controlled by the lender, not by the quality of the lead. So if a lender wants to reap the spread, they need to improve the behavior. That’s where we come in. We give our clients the tools and the training to get that extra 3% conversion and squeeze out the competition.

So, when we talk to mortgage lenders about conversion, and that’s really all they care about, we typically say shoot for 1.5% – 2%. But now, we tell them there is a 3% conversion spread just waiting to be grabbed. It’s all about what they do with the lead and we’re here to help them do it.

As some of you know, we’ve hired a lot of people lately in several departments all across Leads360. In January alone, I had four new individuals join the sales team. This is very exciting, but it’s also a lot of work. A lot, of work. Back in the day, Leads360, like many other companies, would bring in a new salesperson and throw them into the shark tank, and they would either sink, or swim. This approach is highly ineffective and is a complete waste of time and money. Getting good sales people is about identifying the strengths and weaknesses that you can work with, and nurturing them.

With this in mind, we’ve implemented a new training regimen up to and including pushups. Ok, I’m kidding, but we’re close, and I am still considering it. The plan is to expose these individuals to all facets of the organization, but focus heavily on what they will be doing when they start so that they hit the ground running, proficient with their assigned tasks. This way, they can play an integral part in the company from day one, and learn at the same pace as their assigned tasks require them to. Sales people who are thrown into the pit with everyone else often feel as though they are not contributing, and this idea permeates their entire being, and rather than contributing and learning, they scurry toward every possible deal whether it is a good one or not. We won’t be having that issue any longer.

We are building a professional sales force. Not a boiler room. A department that is not only reliable, but ethical, well learned, and helpful. How would you rate your sales force? Can you walk out of the room and trust that your people will do their job? Can you comfortably leave for a few days and trust that your sales staff will take care of your prospects and clients and treat them with respect and professionalism? We’ve mirrored our Best Practices ideals in house so that we actually walk the walk. Relationships always start in the sales department, and in order to have a long and fruitful relationship, it has to get off on the right foot. At least that’s what we think here, so I’m proud to say that we have a professional sales force, not a boiler room.

I read a very interesting blog this morning over at the XBroker. Jeff over at the XBroker talks about some radical changes needed in this market to run a shop, keep your head above water, and most importantly gain consumers trust. No doubt, he will take flak from people who are stuck in the past, but still worth the read.

We all have goals. Personally, I want to win the lottery one day. Every time there is a huge lottery payout won by someone whom I don’t deem deserving of it, I sit back and think “Man, if that were me who won that…” and go off into a day dream. True, a goal of mine is to win it, but I will never achieve that goal.

Why?

Well, because I don’t play the lottery.

How can I win the lottery if I never play it?

This post is about setting realistic goals that help you achieve your end goal. In order to close a deal, you need to lay out a goal path that will allow you to do so as efficiently as possible. You need to play the lottery if you want to win it. And you need to set systematic goals in order to close a deal. The shotgun approach is for amateurs, and the days of the one call close are over. It takes a goal oriented process, a series of milestones relevant to your sales cycle, to close a deal.

At Leads360, on the Sales 2.0 floor we’ve taken a step back from the old way of selling, interwoven the new “selling for success” [of our clients] method, and put together a process of mapping out goals and milestones in order to close good deals…not just any deals. And it works, our clients are successful, so we are as well.

2.0 this, v2.0 that…whatever you want to call it, it’s evolution. Survival of the fittest. Only the strong survive. And other aphorisms that make you think of 80′s era Schwarzenegger and Stallone films.

At Leads360, our Sales Department is evolving swiftly into a true Sales 2.0 team. We’ve realized that our company, and our clients are one in the same when it comes to our experiences in selling. As the market changed, you changed the way you sold a loan. It got more challenging to match your offerings to a prospective borrower, much as it got more challenging to match our offerings to a lender or broker.

The old approach of ABC – Always Be Closing! just doesn’t work any longer. There has been a shift in the concious of the buyer that neccessitates a shift in the concious of the seller in order to see any positive results. With this in mind, we’re undergoing a rapid evolution into the mythical Sales 2.0 team. Selling for the success of the client has trumped the ABC approach. The stages of the sale are now mapped out strategically, with the success of the client in mind. You know, an old sales trick which works a lot is the take-away. You know what I am talking about, the guy who seems to always be sitting on the fence but refuses to tip in your direction, so you just take it away, and all of the sudden they wany to buy. Yeah, that guy. Well, we’re working with a modified version of the take-away, but unlike the traditional sense of the tool, it is not geared to make a prospect lean our way. It is a straightforward – “Jim, I don’t think we’re a good fit at this point. Based on my experience, I think you should contact [name of software company] and discuss [name of software solution] with them.” Yes, you really did read that. If we do not think a client will see the success that they are seeking with our platform, we will not do business with them. And we will go so far as to refer them to a competitor if we think they will be able to offer a better solution. Now don’t get me wrong, it’s not like it happens often and when it does, it is normally because the prospective client doesn’t need much more than a basic contact manager, but still…unless the prospective client will extract the value that we offer, and see the success that we make possible, we would rather send them somewhere that can give them what they are looking for. It’s all a part of selling for the success of the client, and we’ve also realized that the more you do this, the better the relationship you have with the client.

Over the past few months Leads360 has changed from being a company that had a killer piece of software to offer, to a company that has a killer piece of software to offer along with 40+ talented professionals from all walks of business-life with experience and knowledge to lend to clients who are hungry for it…and it all starts on the Sales 2.0 floor.

You sell to live, but you also live to sell. You are the kind of person who plans to stay in the mortgage industry even though things right now are…well…challenging. While your former co-workers have elected to take the easy way out, you have decided to be steadfast and continue doing what you love.

Now before we go any further, let’s take a step back and come to a realization: Your title is Senior Mortgage Consultant, Real Estate Lending Professional, Home Loan Consultant, etc. When you wake up in the morning, you’re a Sales Professional. When you go to sleep at night, you’re a Sales Professional. When someone asks you what you do for a living, you should feel proud, and tell them that you are a Sales Professional. It seems like sales $@%# is a four letter word, and right now, it seems like ‘mortgage anything’ is even worse. Before you can take control over your present and future, you need to be comfortable with the fact that you are a salesman, or saleswoman. There’s nothing wrong with that.

So with that in mind, you need to understand how certain traits of a good salesperson will help you sell, and live in a down market. There are many key traits to a typical Type-A sales professional. If you do not currently possess them, you need to align yourself with a mentor who does, and pick them up. Some of them are as follows:

- Dogged persistence: so you’ve called a good lead or referral three or four times with no response…so what, they have a life too, don’t stop calling them until you have identified that there is no opportunity for business, and this does not mean that you called three times in one day, and never got a hold of the prospect.

- Hunter mentality: you see an opportunity, and you capitalize on that opportunity. You cannot rely on someone else to do all of the gruntwork for you and deliver the picture perfect prospect. Find your business, it is out there, but you need to open your eyes and absorb.

- Cannot be backed into a corner: know your products, and know what kind of questions, comments, and concerns are typical with each kind of borrower. The last thing that your prospect who is preparing to make the largest financial committment in their life wants to hear is “Ummm, hrm…uhhhh….well lemme…..hold on…………ummmm……I don’t know.” One trait of a good salesperson is being able to admit that you do not know the answer, but you will make every effort to get that information to the prospect as expeditiously as possible. So, know your information…and if you don’t know it, don’t pretend you do. Be honest.

- You are refined and organized: these are vital. Disorganization promotes lost opportunity. Of course, the first thing that you want to do is call us and talk to us about a Lead Management System. Cut the fat. Get a process in place and stick to it. Don’t clutter your workspace, make a schedule to check and return emails and phone calls, and only set appointments and meetings that you have to be at. Everything is good in moderation, but don’t overwhelm yourself.

- Understand your value proposition: and communicate it accordingly. Why will Mr. and Mrs. Smith have the best and easiest transaction with you and your organization? What will you do to make their situation better? Make them understand that.

- Know your competition: this goes with the previous. But don’t ever trash them. And if you cannot do anything for your prospect, refer them over. I know, this sounds crazy, but your prospects will respect you, and will think of you in the future. Here at Leads360, we do our best to qualify a prospect before we sell them a Lead Management System. If the prospect is qualified, bring it on! If they are not qualified, we will refer them off to our competition if we think that there may be a synergy there. Of course we want everyone’s business, but we are not greedy and find it to be more advantageous to the prospect and ourself if we keep their best interest in mind. On the flipside, our knowledge of the competition allows us to steer fence sitters in our direction more often than not. See where I am going here?

- Network!: www.linkedin.com, www.facebook.com, www.myspace.com, www.wannanetwork.com, these are all great places to network if you do it correctly. Carry your business cards with you when you go to a bar, a restaurant, the mechanic, Disneyland, etc. But don’t be pushy. Be suave, and make friends and acquaintences. The referrals will start coming in. Go on Realtor caravan’s, go to local NAR meetings, bring Realtors cookies, print up flyers for them to use on open houses, offer to sit their open houses for them, etc.

These are just a few traits of an effective salesperson who will see success in this and every market. We’ve all got to live with the fact that it isn’t as easy to close a loan as it was a couple of years back. But we all have to eat, right? The above are some ingredients that need to go into the meal to make it delicious. Sure you may be able to make it without them, but you know what happens when you sway from the recipe…you never know what you’re going to end up with, and when it comes to getting a paycheck…predictability can be a nice thing.

More to come. Stay tuned to the blog and tell your friends.

- Morelli