Is Your Hiring Firm Wasting Sales Leads?

 Most recruiting managers would have a hard time believing that sales leads in their business were being wasted and allowed to go cold. It’s one thing to spoil a lead through limited business development skills, but entirely another thing to completely waste a lead by not picking up the phone. But, it happens, and more often than you think.

Research by Insidesales.com, reported in an HBR white paper, has revealed that a surprising amount of companies do let sales leads go cold. The study looked at 2,241 U.S. companies and assessed how long they took to respond to a web generated sales lead. They found the following response times:

• 37% responded to the lead within an hour
• 16% responded within one to 24 hours
• 24% responded after 24 hours
• 23% did not respond at all to the query
• Average response time for companies that responded within 30 days was 42 hours.

Of course, on the face of it, this looks like most companies have quite a sluggish approach to dealing with sales leads, which is surprising considering what’s at stake.

But, the devil is in the detail here as what really matters is the negative impact on sales of these sluggish lead responses times. This was shown by Dr. James Oldroyd from Kellogg Business School who did some detailed big data analysis of the Inside Sales survey results, and found that sluggish lead times will negatively impact sales. His key findings were that:

• You are 100 times more likely to contact a lead if you phone in 5 minutes as opposed to 30 minutes.
• You are 21 times more likely to contact a lead if you phone in 5 minutes as opposed to 30 minutes

Now, Dr Oldroyd did admit that there were dramatic variations in optimal response time according to industry sector and he did not have a specific hiring data cut for recruiting agencies; so, we are admittedly positioning recruiting in with the crowd here. Barring you doing your own analysis of optimal response times in your own recruiting firms, this is probably the best fit analysis available to recruiters.

So, how should recruiting professionals respond? Ideally, you would assess your response times to determine the optimization level of your lead responses times, and if they are proving sluggish, it would be prudent to take action. Because, Insidesales found through their own trials with an IT company that their close rates increased from 3.2 percent to 7.5 percent after reducing the lead response times from six days to one day.

Now, I am not going to try and tell you how to bring your response times down in such a short article, but the sort of interventions that could help are using a more sophisticated CRM to track lead and monitor responses and highlight queries that have not been responded. You could look at greater multitasking capabilities so that more staff, (including the office manager, for example) are able to contact and qualify leads, which should increase response times.

At this stage however, the most important thing is to assess what your lead response times are and the likely impact on your agency business and then you can take corrective again.

Good luck in growing your agency business in 2014!