Setting the Lead Limit

With respect to inquiries from new- and used-car shoppers, is there such a thing as too many? The answer may be yes, a recent internal review by Asbury Automotive Group found. Read more to find out if you can close more sales with fewer leads.

To understand how the quantity of leads salespeople manage affects their sales, Asbury’s ecommerce director, Steve Stauning, recently analyzed monthly sales figures for the company’s more than 90 dealerships. The results, he said, were surprising.

“When we began to check for patterns in the data, we noticed that those stores with both the highest closing percentage and greatest number of sales per person also handled more manageable lead counts,” Stauning said. “That is, those stores with the highest number of leads per person did not sell more cars per person.”

“In fact, just the opposite was true,” he said. “Our top stores were selling an average of 12 to 15 cars per person per month while managing just 65 to 70 leads each. Conversely, our lowest performing stores were selling only five units per person, though they were managing 95 to 140 leads per person per month.”

The findings, Stauning said, led him and his colleagues at Asbury to re-evaluate how many leads each person should handle and put new recommendations in place. They did not look for ways to reduce the number of inquiries coming into their dealerships each month, an option he described as “contrary to our goals. What has changed is how we look at staffing our in-store teams. Where we used to divide the number of monthly leads by 100 or 120 to determine whether we were properly staffed, we now divide by 70 or 80.”

So how many leads should you and the salespeople at your store manage? The answer, according to industry consultant David Kain, can vary based on a wide range of variables — from the source of the prospects themselves to the effectiveness of your internet sales processes and individual work styles. While he agrees that Asbury’s 65 to 70 leads is a good rule of thumb, Kain also recommends you make allowances in your program for the outliers. Stars need room to shine, and more modest talent room to grow.

“Some salespeople are good at multitasking, whereas others are more linear and need to follow a strict regimen. They cannot work the same volume,” Kain explained. “In the end, they can both have success, but one can have success with many leads while the other has success with fewer leads.”

What kind of reception did Stauning find for his less-is-more recommendations?

“Everyone at Asbury wants to sell more cars, so when the argument is compelling enough, everyone will climb on board,” Stauning said. “We’ve always enjoyed closing rates well above the industry average, and we expect moving to more manageable lead counts will help us maintain that advantage.”

“Clearly higher closing ratios are to be expected with fewer leads, simply because it allows our teams to concentrate on each customer. What is surprising is that the sold units per person increases as leads decrease. This,” he concedes, “is a little counterintuitive.”

One thought on “Setting the Lead Limit

  1. This rings so true with the change our store made from having me handle solo 120ish leads and getting about 5-10 cars, and our current results of 15 out of 120 by distributing them among the sales force and having me manage their results. Make your Internet sales manager a manager instead of one of the worst performing and grossly overwhelmed sales agent/ manager and see your profits soar.
    dhughes@keystonemotors.com

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