The complexity of business now requires advanced methods of monitoring, and lead conversion rates provide just that. It is an important process that provides reliable feedback based on the performance of B2B sales lead generation of sales teams.
What is lead conversion rate?
Lead conversion is a process when a lead turns into a client. It encompasses various marketing processes that instill a desire to buy a product or service and motivate a lead to finally make a purchase.
Leads are generated when sales teams perform their outbound marketing activities. Leads are people who have interacted with the service platform through browsing the company's website. Also, they can be those who have responded to the content of the business on social media. The leads are grouped into two distinct groups, depending on the interest shown in services or products.
The two groups are:
- Warm B2B leads - these are people who have shown much interest in the company's products through constant interaction with the company's platform or those who have at least contacted the sales teams. These B2B leads have a high likelihood of being converted into customers.
- Cold B2B leads - these are people who have shown less interest in the company’s services (for example, a person who has visited the website only once a month.) These have slim chances of being converted into customers.
Lead conversion rate is the percentage of leads who have finally acquired the services or purchased a product. These are potential clients who have turned into paying customers.
How do you calculate lead conversion rates?
Conversion rates differ from company to company, depending on what their goal is. For a business that sells products and services, a lead conversion rate is the percentage of B2B leads who have converted into buying customers. For example, let us say, a new business has 10,000 website visits per month. Out of those visits, only 357 leads are now your customers.
To find the lead conversion rate, you should divide those who are now customers by the total number of monthly visits. The resulting figure is then multiplied by 100. Therefore, using the above-mentioned figures, the conversion rate will be calculated as follows:
357/10 000 = 0.0357 x 100% = 3.57%.
For that particular month, this company's lead conversion rate is 3.57%. A new business must thrive to have an average B2B lead conversion rate of 3-5%.
Why is it important?
It unlocks new insights into the strengths and weaknesses of the sales team's outbound marketing strategies. Moreover, it provides a platform for the new business to improve their B2B sales lead generation by identifying where the gaps are. The lead conversion process is essential because the more people use the product, the more appealing it will be to future potential clients.
Numbers don't lie. People tend to go with the flow. As such, with more clients, you are guaranteed even more. As a result, the business experiences more profits.
Also, it is a quantitative method to measure the performance of the B2B sales leads generation strategies. Performance measuring B2B sales lead generation allows you to know if your sales process is making progress or not.
What is lead conversion process in Salesforce?
Salesforce uses the data from the leads being converted to create accounts, contacts, and opportunities, but what is lead conversion process in Salesforce, exactly?
Salesforce moves converted leads to new contacts. Accounts and contacts sharing names with the leads can be updated without altering any important information. Salesforce adds information on the leads to empty fields. It retains the intact news of the existing information as it does not override the present data. It allows easy management of leads as default settings can be customized to preferred parameters.
The activities of the leads are attached to accounts, contacts, and opportunities. These new records can then be assigned to someone responsible for a follow-up. Most importantly, Salesforce enables you to customize fields to monitor specific data that is unique to your industry, business, and customers, thus enabling you to maximize your lead conversion and lead marketing. Now you know what lead conversion process in Salesforce is.
Advantages of conversion for lead generation
Understanding your target market
Lead conversion rates help you to know which people are interested in your services. With that information, you can customize your sales process service delivery to suit your target market. With improved delivery, you can then attract the right audience and improve the quality of your leads. Being in a business means that your sales teams know who their customers are. Only then can you provide solutions that meet their expectations and satisfy their needs.
Higher conversion rates are a result of improved B2B lead quality. With more customers, a new business can grow.
More leads who turn into customers will increase the purchasing power of your products and services. It entails more profit to your business and increased growth as well.
Decreased customer acquisition costs
In every new business, there is a certain amount of money that is used to cover the expenses associated with getting a customer to purchase your products. Those include:
- Marketing costs
- Service costs
- Delivery costs
With a good conversion rate, you will attract more customers and be able to reduce these costs significantly. With decreased acquisition costs, profits will increase considerably.
With better outbound B2B sales lead generation and conversion strategies, you will increase the number of customers. The financial position of the company will improve, and so will the perception of the company to prospects. A large number of customers using your services will instill confidence in other potential customers to also try out your products and services. Lead conversion rates will help you increase the overall user experience and service delivery.
Being a trusted brand will result in more people wanting to use your services. The financial rewards will increase, and you will have enough resources to further prove your marketing and service delivery strength to your clients.
How does measuring the lead conversion rate help B2B sales
Measuring lead conversion helps the company to identify critical areas of outbound B2B generation. The critical areas are those concerned with extreme reactions from leads. By identifying likable areas, you can then focus more on those to reach a wider audience. It enables companies and new businesses to increase the number of leads and, potentially, the number of clients. With underperforming areas, you can then strategize and improve to gain more from the weak spots.
Importantly, lead conversion rates help you track the company’s progress. In case of a performance decrease, you can then investigate your outbound sales funnel to find out which stage is the cause of the decrease. Then, you will be able to implement corrective sales process measures to ensure that the conversion rate improves.
However, you should know that conversion rates are just indicators. They are not the solution to your problems, but they help you figure out where you need to focus and improve. Lead conversion rates show you areas of concern, and the strategic implementation of new marketing plans is solely the responsibility of the company.
To achieve increased conversion, lead generation methods must be strategically implemented. The company may take advantage of the data obtained from the lead conversion rates to increase the efficiency of their B2B sales leads generation strategies. A business must target an average lead conversion rate of above 5%. With the increased conversion, the company will experience accelerated growth and more profits. Therefore, always ensure that you have programs that monitor the conversion rates so that you will notice the weak areas and quickly take corrective measures. And if you need help, feel free to drop us a line — Belkins experts are eager to share their knowledge and experience with you.