ExecutiveSummary:

(a7pagesummaryoftheoriginal35pagestudy)

HowMuchTimeDoYouHaveBefore WebGeneratedLeadsGoCold?
ThispapersummarizesresultsfromasurveybyKelloggSchoolof ManagementatNorthwesternUniversity,andastudybyDr.James OldroydofMIT,onthetopicofLeadResponseManagement(LRM).

Originallypresentedby: DaveElkington, JamesOldroyd,PhD CEO Professor InsideSales.com MIT At MarketingSherpas BusinesstoBusiness DemandGeneration th 4 AnnualSummit2007 October16th,2007

NewResearch LeadResponseManagement BACKGROUND AnneHolland,founderofMarketingSherpa,invitedustotheBusinesstoBusiness4thannualDemand GenerationSummittosharetheanswerswehavefoundtothefollowingquestion: HowMuchTimeDoYouHaveBeforeWebGeneratedLeadsGoCold? Duetothelackofexistingresearchonthistopic,wehadpreviouslycontactedProfessorJamesB. Oldroyd,whowascompletinghisPhDdissertationatKelloggUniversitysManagementand OrganizationsDepartment,tohelpusdesignandcarryoutanewLeadResponseManagementsurvey thatwouldprovideanswerstothisquestion.(SeePART1.) Notfeelingthesurveyadequatelyansweredthequestion,wesoughtoutDr.Oldroydagainafterhehad leftKelloggandhadtakenapositionasaFacultyFellowattheSloanSchoolofManagementat MassachusettsInstituteofTechnologyandaskedhimtostudythisquestionmoreintently.(SeePART2.) PART1THEKELLOGGLEADRESPONSEMANAGEMENTSURVEY KELLOGGLEADRESPONSEMANAGEMENTSURVEYOVERVIEW Overthecourseoffourmonths(JunetoSeptember2007),Dr.Oldroydreceived495responsesfrom companiesthatdrivewebleadstotheirwebsites.Thesurveyedgrouprepresentsover40industries. Thesurveywasprimarilyrespondedtobysalesormarketingmanagers/executivesandrepresentsa broaddistributionofeverycompanysize(rangingfromunder$10millioninannualrevenuetoover $1billioninannualrevenue.)Thesurveyaudienceconsistedprimarilyofcompaniesthatare headquarteredinNorthAmerica. 22surveyquestionsfocusedonidentifyingWHENthebesttimewastoefficientlycontactweb generatedleads,andHOWtogeneratewebleadsthatqualifyandcloseatoptimalrates. KELLOGGLEADRESPONSEMANAGEMENTSURVEYCONCLUSION TheKelloggLeadResponseManagementSurveyintroducesmanynewanswerstothefieldoflead responsemanagement.Someofwhichareasfollows: Companiesintuitivelyunderstandthatspeedislikelytoimprovequalificationandcloserates.Moreover, theyunderstandthatgreaterefficiencyinrespondingtowebgeneratedleadsallowsthemtocontact moreleadswithlesseffort.(SeethecompleteKelloggSurvey/MITStudyforspecificdatapointsfound inthisstudy.) 1 Thewaysleadsarecapturedanddistributedseemtohaveagreatimpactonresults.Moreover, themethodsusedfordemandgeneration,aswellastheoffertype,allimpactleadqualification andcloseratios. 2 2007InsideSales.com,allrightsreserved

NewResearch LeadResponseManagement 2 Delayedresponsesandunproductivecallbackattemptsarecorrelatedtolowerlead qualificationandcloseratios. 3 Ifacompanydisplaysbothissuestheydemonstrateanegativesynergisticeffectthatsuggests theproblemgetsworsethanifeitherproblemexistsonitsown. 4 Companieswhodontknowordontmeasurethesekindsofstatisticsmaycorrelatewitheven lowerqualificationorcloserates. 5 Largercompanies,whethermeasuredbyemployees,representatives,orrevenue,mayneedto bemoreawareoftheseissuesthansmallercompaniesastheytendedtohavelower qualificationandcloserates. 6 Companieswhobreakuptheirsalesprocessintospecialties(likeleadgen,insidesales,and outsidesales)correspondwithhigherqualificationandcloseratios. 7 Companieshavenoideawhatisthebesttimeoroptimaltimelinesstocallleadsback. Frankly,instudyingtheresponses,wecouldntfindANYstatisticallysignificantanswerstoourquestion ofWHEN(besidesgenerallyfasterandmoreefficiently)weshouldrespondtowebleadsbyaskingthe marketingdepartmentsofcompanies. ThesurveyclearlyrevealsthatmarketersandsalesrepresentativesDONOTKNOWwhenandhow efficientlytofollowuponwebgeneratedleads.Sincethiswasthereasonforthesurvey,Professor Oldroydrecommendedamoredetailedbehaviouralanalysisonactualcalldata.Toperformthiskindof study,weneededrealdatathatwouldallowustoanalyzetheeffectsoncontactandqualificationratios basedonthetimefromwhenleadsarecreated,toattempted,tocontacted,toqualified. PART2THEINSIDESALES.COM/MITLEADRESPONSEMANAGEMENTSTUDY ThetopicstudiedissimilartotheKelloggLeadResponseManagementSurvey,butthedatawasfar morestatisticallysignificant. Tobeginthestudy,weengagedwithProfessorOldroydagain,whowasnowaFacultyFellowatMIT. Thestudywasdesignedtoidentifywhatdayofweek,timeofdayandtimefromcreationtocallbacka webgeneratedleadforoptimalcontactandqualificationrates.Thisstudydidnotaddresscloseratios. WeusedthedatafromtheInsideSales.comsystem(criticaltothispurposebecauseitgeneratesand storesquantitativecalldatalinkeddirectlywithqualitativeleadprocessandflowinformation). Weexamined3yearsofdataacrosssixcompaniesthatgenerateandresponsetowebleads,fromover fifteenthousandleadsandoveronehundredthousandcallattempts. Thebehaviouralstudyrevealedwhensalesrepresentativeshadsuccessaround callingwebgenerated leads.Tofindthesefacts,welookedatleadsthatwerecapturedthroughawebform,andattemptedor calledatleastonetime. Summarizedbelowaresomeofthemoreinterestingfindingsrelatedtospeed andtimingwhenrespondingtowebgeneratedleads:

3 2007InsideSales.com,allrightsreserved

NewResearch LeadResponseManagement 1 Wednesdays and Thursdays are the best days to call in order to contact (by 49.7% over the worstday)andqualify(by24.9%overtheworstday)leads.Thursdayisthebestdaytocontact aleadinordertoqualifythatlead(by19.1%betterthantheworstday). 2 4to6pmisthebesttimetocalltomakecontactwithalead(by114%overtheworsttime block).89amand45pmarethebesttimestocalltoqualifyalead(by164%better12pm,the worsttimeoftheday).45pmisthebesttimetocontactaleadtoqualifyover1112amby 109%). 3 Theoddsofcallingtocontactaleaddecreasebyover10timesinthe1sthour.Theoddsof callingtoqualifyaleaddecreasebyover6timesinthe1sthour.After20hoursevery additionaldialyoursalespeoplemakeactuallyhurtsyourabilitytomakecontacttoqualifya lead. 4 Theoddsofcontactingaleadifcalledin5minutesversus30minutesdrop100times.Theodds ofqualifyingaleadifcalledin5minutesversus30minutesdrop21times.
Response Time from Creation by 5min Initial Dials to Leads that become Contacted 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 min min min min min min min min min min min min min min min min min min

Response Time from Creation by 5min Initial Dials to Leads that become Qualified
30000 25000 20000 15000 10000 5000 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 80 85 90 min min min min min min min min min min min min min min min min min min

Howsignificantisa100xincreaseincontactratiosonthevalueofleads?Howmucheffectdoesa21x increaseinqualificationhaveontheoverallsalesrevenueofacompany?

4 2007InsideSales.com,allrightsreserved

NewResearch LeadResponseManagement TheMITStudyrevealedthefollowing: 1 Timeofdayanddayofweekeachhavesignificantimpact,withtimeofdaybeingthegreaterof thetwo. 2 Immediacyofresponsefarovershadowsbothtimeofdayanddayofweekinitseffecton contactandqualificationratios. 3 Waitingtoolongandcontinuingtopushforcontactunsuccessfullyactuallyhurtsyourabilityto evermakecontactandqualifyalead. Dr.Oldroydemphasizesthathefindstheseclearpatternsinthedataonlywhendatafromseveral companiesiscombinedtogether. Wefoundhugevarianceinthekindsofoffersonacompanywebsite.Welearnedthatarequestfora pricequoteneedstobehandleddifferentthanawhitepaper.Welearnedthatthekindsofproductssold requiredifferentapproaches.Andfinally,WHYisresponsetimesoimportant?Thoughwedont exactlyknowforsure,wehaveafeweducatedguesses: 1 YouKnowWhereTheyAre Whenapersonsubmitsaleadinawebform,youknowwheretheyareatthatexactmoment:theyare attheircomputerdesk,probablyrightneartheirphone.Wecallthispresence.Ifyoucallthem immediately,theyanswer.Ifyouwait,theymoveontosomethingelse,oftenawayfromtheirphone. Salespeopleknowthatsimplybeingabletocontactsomebodycanmakethedifferencebetweenasale ornot.Marketersmaynotbeasawareofthis. 2 YouContactthemattheHighestPointofInterestorNeed PeoplesearchtheInternetbecausetheywantthingsnow.Interestandneedwanequickly.Afewdays latertheyoftendontevenremembertheysubmittedalead.Immediacyofresponsehitsthe respondentattheirhighestpointofinterestorneed. 3 TheWowEffect OursalesrepresentativesoftenexperiencetheWoweffectwhenourwebformcallbacktechnology contactsapersonwhosubmittedaleadinlessthan5minutes.Therespondentquiteoftenreactswith, Wow,thatwasfast!Youareimpressive.Wehavebeentoldthattheyfeelthatthesales representativemustbereallyontopofthings,andthatisthekindofpersonandcompanytheywant servicingtheiraccount. Weareremindedoftheearlydaysofcalleridwhenpeopleansweredacallandsaidthenameofthe callerwhentheyanswered.Whatsurprisedinitiallyisnowcommonplace.Firstimpressionscontinueto haveastronginfluenceontrustandrelationships. 5 2007InsideSales.com,allrightsreserved

NewResearch LeadResponseManagement ABOUTINSIDESALES.COM InsideSales.comistheleaderinLeadManagementandthepioneerofLeadResponseManagement solutions.Thisstudycausedasignificantshiftinourcorporatepositioning.Ourpatentpendingweb formcallbackdialertelephonyopensnewfrontiersinwebmarketing,leadgenerationandsales. Toillustrate:Googledrivesclicks,Omnituredrivesconversion,andSalesforce.comdrivesclosure. InsideSales.comintegrateswithallthreemarketleaderstodrivequalificationofprospects. WesitbetweenacompanywebsiteandtheirCRM,captureleadsrealtimewiththeresultingWeb analyticsdata,andoptimizethehandoffofleadsfrommarketingtosales. Weincreaseleadqualificationratestolowercompanyscostperprospect.Companiestypicallyseea 24xincreaseincontactratiosandleadqualificationratesusingtheInsideSales.comtechnology.

DavidElkington CEO,InsideSales.com delkington@insidesales.com www.InsideSales.com 6 2007InsideSales.com,allrightsreserved JamesOldroydPhD NorthwesternUniversity,MITandSKKGSB oldroyd@MIT.edu www.MIT.edu