One of the things that my partner Shane and I do is work with businesses helping them increase profits. Shane addresses areas like systems and sales and I overhaul their marketing.
One company that Shane helped transform was a Sydney-based home extensions company.
The business in questions was struggling to make sales. They were getting leads from their advertising but those leads weren’t being converted.
Conversion rates in the building and home improvement industries are traditionally very low due to the nature and cost of the purchase. The industry average at the time was running at approximately 8% -10%.
This company’s conversion rate was also at 10%. After making some changes to the sales process, Shane increased their conversion rate to 26% … a 160% increase.
In real dollar terms this had a dramatic impact on profits. They made around $7,500 in commissions on every $100,000 building project.
Prior to the changes, out of every 100 prospects they saw, they earned $75,000. After the changes, the figure was $195,000 – an increase of $125,000.
Let’s take a look at how Shane achieved these results … In most situations when a home owner is thinking about an extension they will telephone and arrange a “quote”. Normally, the only questions they’re asked during the initial call are “where do you live”, and “when do you want us to come?”
Instead, Shane went through a specially scripted qualification process at the initial point of contact.
He’d find out their needs, their likes and dislikes and a bunch of other critical information, and he would also give them a little strategically engineered information which was designed to pitch the company as being head and shoulders above the competition.
This served three purposes:
1. It provided Shane with information which assisted in the sales process;
2. It qualified the potential customers or disqualified them so the design consultants wouldn’t waste their time needlessly;
3. It pre-sold the prospect so they were virtually sold before the design consultant even visited them.
Shane then developed a comprehensive sales system which was followed to the letter each time a sales call was made.
The system addressed everything that took place from the time a potential customer first called until after the sale had been completed.
It included:
The system was so comprehensive that someone could virtually walk in off the street read their sales system and start selling successfully. All sales people within the company adopted this system and all achieved an enormous and sustained increase in sales conversions as a result. What can we learn from this? It doesn’t matter how effective your lead generation techniques are, if you can’t convert them into sales you’re pouring money down the drain. Before increasing your advertising spend, it will pay huge dividends if you firstly maximise the return you’re currently getting on your existing marketing dollar by enhancing the effectiveness of your sales systems.
Kris Mills of Words that Sell ( http://www.wordsthatsell.com.au/ ) is a top selling copywriter, trainer and author of numerous how-to guides including Proposals and Tenders (Bids) that Sell. Kris has also produced a FREE ebook entitled “11 Bid Writing Sins and How to Avoid Them”. To arrange a FREE copy, visit:http://www.wordsthatsell.com.au/tendersebook.htm
