Follow the leads

During one of the most memorable scenes in the film adaptation of the Pulitzer Prize-winning play “Glengarry Glen Ross,” a character berating a group of unprofitable salesmen pauses to hold up a stack of red envelopes wrapped with a golden ribbon, then says the following:
“These are the new leads. These are the Glengarry leads, and to you they’re gold. And you don’t get them. Why? Because to give them to you is just throwing them away. They’re for closers.”
Many in the boating industry understand the importance of leads and how correctly managing them increases sales.
Many more do not. They will spend hundreds of hours and thousands of dollars trying to convince strangers to take a look at what they’re selling, then mishandle the few who demonstrate actual interest — the leads.
Becoming a consistent closer isn’t that difficult when you’re regularly working with customers who are looking to buy. Effective lead generation and lead management systems help you do that, and they’re fairly simple to set up and maintain. A bit of organization and a little common sense is all it takes.

Missed opportunities
Mismanaged leads are one of the biggest self-imposed obstacles a dealership must overcome if it’s serious about increasing sales. How some marine businesses attend to Internet inquiries is a prime example of lead management gone wrong.
In many instances, e-mailed questions or requests go unanswered at dealerships where the immediacy of a person on the lot or a voice on the phone overshadows a request from an Internet customer.
How bad is the problem?
Bob McCann, director of customer service for Channel Blade Technologies, which provides tools and training to marine businesses, says that when his company conducts mystery-shopping studies for its manufacturer partners, it doesn’t hear back from the majority of marine dealers it contacts.
“We send the leads out to different dealers from their manufacturers or from their own Web sites, and we can say with authority that with 60 percent of the leads, you never hear from the dealers,” McCann says. “I’m talking leads generated by e-mail, which is a pretty popular way of getting leads around today. A manufacturer offers a brochure request or a request to contact their dealer or request a quote, those type of things, and we find that about 60 percent of those go without any kind of reply whatsoever.”
Furthermore, McCann says that of the four in 10 dealers who do respond, half don’t supply the correct information.
“So if I ask for the price of a boat, out of 10 opportunities, I’m going to get my price twice,” McCann says.
Whether or not those numbers are representative of the industry as a whole, there’s no doubt that when you’re competing with other industries, where Web sites provide customer service representatives ready to answer any questions in real time via instant messaging, delays of any kind can be costly. Not replying at all is disastrous.
“World-class companies are setting the bar high and then when you submit a lead on a $50,000, $75,000 or $100,000 boat and you don’t get a reply, that’s more or less the state of the industry today,” says Charles Lewis, Channel Blades’ executive vice president of sales.

Taking care of business
One way to begin ensuring prompt responses to leads, Internet or otherwise, is to track them using a management system of some kind. Whether purchased from a vendor, supplied by a manufacturer partner or devised internally, a system that allows leads to be compiled in a centralized location is vital. Once this is done, businesses can monitor how the leads are handled. How quickly was the lead responded to? Who responded? What was said? What was the result?
Organizing and tracking leads are two fundamental steps every business must take if it wants to maximize profits, and many aren’t doing it.
“I would say the number is 75 percent of boat dealers have no published process on what these leads should look like,” McCann says. “We can show how customers were doing no lead management and then they started doing it and got really good, and it’s responsible for 20 percent of their business.”
How leads are assigned is another important process to examine. Some dealerships assign leads to salespeople on a rotating basis so whoever is up next gets the next lead that comes in. But what happens if that person has the day off? A quick response shouldn’t depend on who is or isn’t in the office.
Another issue faced by some dealerships is that all the leads that come in are routed to one person — the owner or another high-level manager — who then distributes them to the sales staff. But, again, what happens when that person is at lunch, or late, or out sick?
An effective lead management system needs to be set up with customer service in mind if a dealership is to maximize its sales potential.
Stay in touch
Once contact with a lead has been made, it’s also important that the seller maintain it. Current customers are the best leads of all.
Joe Verde, a sales and sales management trainer who has worked with many in the boating industry, believes the average car dealership would improve sales 67 percent if it did all the follow-up it could after the initial sale. And he says that number “is the same at least, probably even higher” when it comes to boat dealerships.
Joe Lewis, general manager of Mt. Dora Boating Center in Mt. Dora, Fla., says he agrees with Verde “100 percent” that dealers would sell more boats if they did a better job of following up with past buyers.
“[Focusing on follow-up] is something we’ve only started to formulate within the past two years,” he says, “but it’s a direction we’re going to be going in and pursuing more and more as we go down the road.”
Mt. Dora uses Genmar’s Internet-based lead management system to help with its follow-up process and to maximize the potential of its leads. Lewis says that once a person asks for information about a specific boat, that contact, and all the interaction with that person thereafter, can be tracked by the system, which he really likes.
Verde’s company, the Joe Verde Group, gets more than 90 percent of its business from repeat and referral customers. It does almost no advertising. The company, which recently held a sales seminar for all of the MasterCraft dealers in the country, has had an average growth rate of 66 percent for each of the last 22 years. Verde believes that taking proper care of its leads is the most profitable thing a marine dealer can do.
“That’s got to be No. 1,” Verde says. “I don’t think there’s anything more important than ongoing customer relations for customer retention.”
Verde tells dealers that they need to start focusing on their most lucrative customers, reminding them that it’s five times cheaper to keep an existing customer than find a new one.
“That’s the guy that’s out there in service now, twiddling his thumbs, wishing somebody would give him a ride home or buy him a cup of coffee, and nobody’s talking to him,” he says. “[The salespeople are] standing out front waiting for a new customer and ignoring the best customer in the store.”
Emphasizing the importance of current or past customers to everyone at the dealership can payoff in future sales. As many have noted, a dealership doesn’t make as much money on its first sale as it does on its second, third and fourth.
“We’re not in the business to sell a boat.” Lewis says. “We’re in the business to create a customer.”
Until everyone at a dealership understands and embraces that philosophy, it’s hard to reach the full sales potential that solid lead management provides. And that comes when employees are taught the value of all leads. But change works best when it comes from the top down. And, in many instances, that’s not happening.
“It’s getting better,” Verde says. “Don’t misunderstand. The boating industry is not in the stone ages, but they just haven’t had access to training like ours before. It’s a lack of awareness, a lack of education and it all starts at the top.
“Most car dealers I know started out as the untrained salesperson, and then became the untrained sales manager and then became the untrained dealer.”
But that training is out there, as are all of the tools necessary to make lead management a breeze. Understanding its importance is the first step toward closing more sales.
“I had a dealer tell me one time, ‘We really like your stuff, but I’m not telling any of my competition about it,’” Verde says. “Now that’s crazy. When everybody is good, we all win.”

Ideas for the ’net

Here are six different ways that Boating Industry’s Top 100 Dealers approach leads generated via the Internet.

Slalom Shop Boats & Yachts (Ranked 6) sends all Internet leads to one e-mail address, which the owner, Darrell Wilson monitors. So that he’s not tied to his keyboard, Wilson has his cell phone set up so he can receive the leads regardless of his whereabouts. “Internet leads are very time sensitive,” he says, “so we react quickly to the questions.” More than 50 percent of the dealer’s used boat buyers use the Web site to select a boat before they arrive at the dealership.

Similarly, Sima Marine (Ranked 45) views its Web site as its single-most-important selling tool. “We continue to see more activity,” says John Sima, owner and president. “In fact, we have shipped several boats to Europe and Mexico and many parts of the United States, something we had not seen before the Web came along.” All of Sima’s leads are directed to the company’s e-commerce marketing manager, and he divides them up and distributes them to the sales personnel.

At Texas Marine (Ranked 84), the follow-up system is automatic. The dealer uses a customized software program as part of its custom Web site. The software generates and sends automated letters to leads and customers at specified times.

One of the most advanced dealers we’ve seen when it comes to the Internet is Link Rec (Ranked 22). Noted for a best practice in this year’s Top 100, Link employs an Internet manager whose job is to oversee the “Web process.” This includes a weekly metric of closing ratios by salesmen and percent of inventory by store owned vs. what is on the Web site. “At each store the sales person who has the highest closing rate agrees to carry a cell phone that rings when leads are assigned,” says Bob Steinway, president. “We believe speed in answering is a key to success.”

A director of business development handles all leads generated by the Internet at Colony Marine (Ranked 25). This full-time employee fields and assigns all leads to a dedicated sales person, and they are responded to on an hourly basis. This person also tracks the lead process for each salesperson and issues a monthly report card that grades them on response time, quality of response, continued follow-up, appointment generation and, ultimately, sales. Sales people who lag in this process are given additional training to help improve the process.

At Port Harbor Marine (Ranked 27), 30 percent of the dealer’s leads begin with the Internet. “We attack these leads very aggressively,” says Robert Soucy, president, “and our closing ratio is very high. We continue to reap the benefits of our competitors’ non-response to these leads.”

— By Matt Gruhn

Six Steps to Better Lead Management

Track your leads – You track sales, inventory, expenses and just about every other aspect of your business. If you’re not also tracking your leads, you should be. These are the people that have demonstrated an interest in what your business sells. You need to keep track of their interests, their questions, who at your business is talking to them, when they’re talking to them and what’s being said.

Assign leads effectively – When a potential buyer walks in the front door or calls, you don’t ask them to have a seat or hang on until so-and-so comes back from lunch. Why is an Internet lead treated any differently? When a customer takes the time to contact you, don’t make them wait for a response. Make sure their request gets to someone who can help them NOW.

Train your employees – Teaching your staff the how and why of lead generation/management gives them the tools to make it happen and the understanding of its importance.

Institute accountability – Once a workable system to assign leads has been put in place and the tools have been provided, implement standards for how, and how quickly, employees must respond to leads, then track who does or does not meet those standards.

Follow-up – Sales expert Joe Verde says repeat or referral customers are the best prospects for your next sale, with a closing ratio of 60 percent. Cultivate an ongoing relationship with your customers. A call, card or email will return the investment of time and effort many times over.

Boat shows aren’t just for sales – You’ve spent the money to buy space at a boat show. Maximize your investment with a drawing or giveaway — a personal watercraft perhaps — that helps you collect names and numbers to follow-up with later on.