DECEMBER 11, 2012 CLOUDFORCE RESPONSEAUDIT EXECUTIVE SUMMARY INSIDESALES.COM RESEARCH DIVISION PERFORMED BY KYLE DAVIS

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1 DECEMBER 11, 2012 CLOUDFORCE RESPONSEAUDIT EXECUTIVE SUMMARY INSIDESALES.COM RESEARCH DIVISION PERFORMED BY KYLE DAVIS

2 2 No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of InsideSales.com. Requests for permission should be addressed to the Legal Department, InsideSales.com, 34 East 1700 South, Suite A113, Provo, Utah InsideSales.com All rights reserved, including the right of reproduction in whole or in part or in any form.

3 CLOUDFORCE RESPONSEAUDIT 3 RESEARCH PAPER CLOUDFORCE EXECUTIVE SUMMARY EXECUTIVE SUMMARY VS FULL REPORT The executive summary of the Cloudforce ResponseAudit includes only the summary information of the full research. The full report includes everything in the executive summary and additional analysis on companies by revenue, tradeshow, industry, employee count, and much more. Additionally, the full report includes more information on ranks, including companies fastest to respond by phone, , and those that contacted the most persistently. The full research report is available for purchase ($495) at store.insidesales.com. OPTIMAL LEAD RESPONSE MANAGEMENT Response time and persistency are two areas that have an effect on whether or not a lead ever gets contacted and progresses into the sales pipeline. Lead response time refers to the period between when an electronic lead has been submitted and when first contact is attempted by a sales rep. There are two types of contact methods this study tracks: contact and call attempts made by a member of the sales team. Persistency refers to how many times a company attempts to contact a new lead before giving up. In 2007, Dr. James Oldroyd published the Lead Response Management Study, which shows that sales agents do not have much time to respond before their leads become cold. In fact, the odds of contacting a lead after it is submitted and having it enter the sales cycle are 100 times greater when contacted within 5 minutes versus 30 minutes after the lead was submitted. Similarly, the odds of the lead entering the sales process, or becoming qualified, are 21 times greater when contacted within 5 minutes versus 30 minutes after the lead was submitted (Oldroyd, 2007). In the March 2011 issue of the Harvard Business Review (HBR) an article entitled The Short Life of Online Sales Leads reported that companies are spending more on Internet leads, but their systems and processes are not keeping up. Between 2005 and 2009, the amount companies spent on Internet-generated leads increased 82%. However, of companies audited in the study referenced in HBR, only 37% responded within an

4 CLOUDFORCE RESPONSEAUDIT 4 hour, and almost a quarter 24% took over 24 hours to respond. The average first response time of companies that responded within a month was 42 hours (McElheran, 2011). In May 2012, Forbes.com came out with an article about lead response time entitled When it Comes to Inbound Marketing Time is Definitely of the Essence. The article discusses how companies are essentially wasting money on poor lead management. B2B companies spend an estimated $30 to $200 on each marketing lead generated, and B2C companies spend an estimated $2 to $25 per generated lead. Company executives likely do not realize the money they are losing by taking too long to attempt first call contact or by never attempting to contact a new lead (Olenski, 2012). The speed at which a company responds to a lead is not the only factor that matters; the day and time of response also have an effect on the odds of contacting a lead. An article in Inc magazine, published in July 2011 entitled How to Best Harness Inbound Marketing Leads, mentions that for a group of 42 companies, Wednesdays and Thursdays between the hours of 4 pm and 6 pm are the best times to contact a lead (Markowitz, 2011). Another factor in successfully contacting leads is persistency. Based on ResponseAudit research conducted by InsideSales.com, across 7,960 companies between the years 2008 and 2012, sales reps make, on average, only 1.3 call attempts to a new lead before giving up. Ken Krogue, president and co-founder of InsideSales.com, has blogged and spoken on this topic and on how to improve this metric, among others, at a number of events such as the Sales 2.0 and AA-ISP conventions (Krogue, 2012). He advocates making 8-12 calls in order to dramatically improve contact rates. Companies will likely increase the number of leads moving down their sales pipeline by being more persistent in contacting them. CLOUDFORCE The Cloudforce Conventions are part of a worldwide tradeshow tour put on by Salesforce.com. This research focuses on the companies attending the 2011 tours in New York, Atlanta, Washington DC, Boston, Chicago, Minneapolis, and San Fransisco. The event provides an excellent opportunity for those in the sales industry to network, attend trainings, show off their products, and find leads. These companies come from all sorts of industries, with the biggest being business services and software. Similarly, these companies come in a variety of sizes, ranging from companies with under five employees making under half a million in

5 CLOUDFORCE RESPONSEAUDIT 5 revenue, to large companies with thousands of employees making billions of dollars. METHODOLOGY RESPONSEAUDIT TECHNOLOGY The patent-pending ResponseAudit technology is used to conduct research. Its purpose is to test how quickly and persistently companies are contacting Web leads. The process begins with a secret shopper who creates an alias name, , phone number, and company website. Next, this shopper visits a website, locates a Web form, fills it out using the alias information, and submits it. As the company responds to the lead, the ResponseAudit system records all call attempts, messages, and timestamps for when each response is received during the following two-week period. THE RESPONSEAUDIT PROCESS The ResponseAudit system is automated. Audits are only performed during the standard business hours of 8:00 am to 5:00 pm (accounting for time zones), allowing companies to have the best chance at responding quickly. At the end of the process, a report is compiled for each company, complete with a list of response types (for call attempts and s), counts, response times, and summary statistics. CLOUDFORCE RESPONSEAUDIT For the Cloudforce ResponseAudit, 565 attendees to a 2011 Cloudforce Convention in New York, Atlanta, Washington DC, Boston, Chicago, Minneapolis, and/or San Francisco were tested for how quickly and persistently they responded to Web leads. RESULTS IMMEDIACY Immediacy refers to how quickly companies make their first call attempt. If a company attempts phone contact no more than 5 minutes after the lead was submitted, the odds that the lead is contacted are 100 times greater than if it is contacted 30 minutes after submission. The median first call

6 0-5 Mins 5-30 Mins Mins 1-2 Hrs 2-4 Hrs 4-8 Hrs 8-12 Hrs Hrs >24 Hrs Number of Companies CLOUDFORCE RESPONSEAUDIT 6 response time of all companies that responded by phone was 2:14:37. The average for the same group was 21:50:01. In this case, the median is more informative than the average the average is unduly influenced by bad response times. The median, on the other hand, shows the time in which half of companies responded faster. Thus, about half of companies that responded by phone are responding in under two hours, as shown by Figure 1. First Call Response Times First Phone Response Time Figure 1 First Call Response Times InsideSales.com 2012 PERSISTENCY As previously explained, persistency refers to how many times a company attempts to contact a lead before giving up. Most Cloudforce companies are not persistent in contacting leads. In fact, 44.1% of companies did not respond at all, the median number of responses was 1, and the average number of responses was 1.5. Figure 2 illustrates the persistency of companies. The most common number of attempts, unfortunately, was 0.

7 Number of Companies CLOUDFORCE RESPONSEAUDIT 7 Number of Attempts < Number of Attempts Figure 2 Number of Attempts InsideSales.com 2012 RESPONSE TYPES Companies could either respond via or phone for this study. is the primary method that companies use to respond to leads, especially on the first attempt. Figure 3 shows that 75.0% of companies make their initial response through . First Response Medium 16.5% 8.5% Call 75.0% Voic InsideSales.com 2012 Figure 3 First Response Medium

8 CLOUDFORCE RESPONSEAUDIT 8 ACTION ITEMS COMPANIES NEED TO RESPOND FASTER One of the key takeaways from this study is that companies need to respond more quickly to their leads. This has been the message for every ResponseAudit study; however, the message is not getting across. Most companies in this study did not respond during the highly effective first 5 minutes after the lead was submitted. In fact, only six companies attempted a phone call during this period. Many companies did send s within 5 minutes, but as stated, is not as effective in most cases as phone. While making phone contact with the lead within 5 minutes after the lead is submitted is the most effective practice, only 4.4% of companies that responded by phone actually did this. As previously mentioned, rapid response to a lead is necessary for effective lead management. It is likely that companies are wasting marketing budget and ultimately losing prospective customers by not responding fast enough. Businesses that respond quickly to leads will increase contact and qualification rates, and therefore increase the number of leads coming into their sales pipelines. COMPANIES NEED TO BE MORE PERSISTENT The other main take away from this study is that companies need to be more persistent in contacting their leads. Companies likely do not realize how poor their performance actually is. Companies are giving up very quickly in responding to their leads 69.4% made only one attempt or none at all. Surprisingly, 44.1% never responded. Not only are companies losing business by not being persistent, they are wasting an enormous amount of time and money invested in marketing, equipment, sales, website design, etc. Thus, companies spend large amounts of time and money to attract, capture, and convert leads, and then they do not effectively manage their lead response strategies.

9 CLOUDFORCE RESPONSEAUDIT 9 ABOUT INSIDESALES.COM The InsideSales.com platform accelerates efficient lead response management and qualification. Key features include: PowerDialer, integrated with the InsideSales CRM or the Salesforce CRM; ResponsePop, the ability to respond to web leads in under 10 seconds; automation of standard sales functions, such as the ability to leave a voice message or with the click of a mouse or through one or more pre-defined trigger events, otherwise known as sales workflow automation; extensive sales analytics that enable visibility down to the sales rep level. ResponseAudit is a unique service offered by InsideSales.com for analyzing a sales team's response time and persistence to an Internet-generated lead (request a free ResponseAudit at A brief list of our enterprise clients includes: ADP, Cisco, Dell, Gannett, and Marketo. To learn more, visit

10 CLOUDFORCE RESPONSEAUDIT 10 WORKS CITED Krisitna McElheran, J. O. (2011, March). The Short Life of Online Sales Leads. Harvard Business Review, p. 28. Krogue, K. (2012, February 23). Inside Sales Best Practices: 7 Ways to Increase Contact Ratios. Retrieved from Markowitz, E. (2011, July 6). How to Best Harness Inbound Marketing Leads. Retrieved from Oldroyd, J. (2007, October). Lead Response Management Study - Oct Retrieved from Inside Sales Best Practices: Olenski, S. (2012, May 5). When It Comes To Inbound Marketing Time is Definitely Of The Essence. Retrieved from

11 CLOUDFORCE RESPONSEAUDIT 11 APPENDIX TOP 20 FASTEST CALLERS The following list gives the ranks, names, and times of the top 20 fastest responding companies by phone. Rank Company Name Time 1 Light Industries Services Corporation 0:01:16 2 Cask Technologies 0:01:20 3 Aflac Key Accounts 0:01:30 4 Synaxis 0:01:31 5 Enterprise Strategy Group 0:02:05 6 A1 Foundation Crack Repair, Inc 0:04:45 7 Teplis Travel Service 0:05:09 8 Athenahealth Inc 0:05:31 9 Keystone Business Services 0:05:47 10 Train by Cell 0:06:44 11 CS Stars 0:07:37 12 AIROOM 0:08:26 13 Moose Exhibits 0:08:39 14 Vocalocity 0:11:11 15 M5 Networks 0:12:43 16 AXIS Data Solutions 0:13:27 17 Configero, LLC 0:13:50 18 Salesforce 0:14:18 19 Informatica Corp 0:14:30 20 IT Computer Support of New York 0:15:08 Callers