Tilting at Windmills?: There is a success formula for lead generation
We all know a sales process is mandatory for successful recruitment. But many continue to tilt at windmills with their marketing, not realizing that successful lead generation also demands an effective, step-by-step process. Those who embrace this methodology and performance metrics can increase prospecting success by 30 percent or more. Here's a time-tested, four-part approach to lead generation that can deliver more qualified buyers for your sales team at lower costs.
Step 1 - Who is your ideal franchise buyer?
Define your market of qualified prospects. You can't effectively advertise until you understand who your franchise candidate is. If you don't, marketing efforts can be disastrous! It's like being in a boxing match blindfolded with the lights out, with no clear target to punch. You'll be working with the wrong prospects and wasting a bundle of money and time. Worse yet, you'll award franchises to unqualified owners, a painful mistake not easy to resolve. Craft your franchisee success profile first, before you even think about promoting your franchise opportunity. If you lose sight of your buyer, you can't generate the quality leads you desire.
Step 2 - What message motivates your buyer?
Once you know your market of desired prospects, how can you influence their thinking to take a look at your franchise concept? Approaching key buyers with a misguided message is a recipe for failure. Selling Power magazine published a landmark survey of 445 top sales executives representing 31 different industries. The research was conducted by sales experts and scholars from leading business schools. The study revealed an astounding fact: "Only 56 percent of the sales organizations say their marketing collateral is designed the way their customers buy." Franchise companies are often guilty of building lead generation programs without defining what successfully prompts their buyers to respond. The best way to drive leads? Know what drives your buyers! Promote the benefits they want and you can deliver. Survey your successful franchisees to help discover what the "wow" factors of your opportunity are.
Step 3 - What lead generation sources reach your buyer?
Successful franchise recruitment requires building a marketing program that produces qualified prospective buyers at acceptable costs. This isn't an easy task, especially in our new media age, where franchise buyers now access multiple recruitment and educational sources to research franchise opportunities. There are no shortcuts. Developing a lead generation strategy requires sound planning and intelligence.
- Use sales performance history - What was your cost per sale for each of your lead generation sources over the past year? What was or wasn't acceptable? The current overall median is $7,000 per franchisee sold, according to Franchise Update research. But you can't always rely on other franchisor's experiences, because what works for them may at times be a bust for you. Success varies by industry, size of investment, brand strength, franchisee profiles, qualifications, etc. (If you are interested in marketing intelligence that can help benchmark your advertising performance, order the Annual Franchise Development Report at www.franchiseupdate.com/afdr.)
- Use multiple media sources - According to survey results, the 28 percent of franchisors meeting or exceeding their 2008 recruitment goals are largely multi-media advertisers. Using only one medium confines your message to just a portion of your buyers, limiting awareness and consequently the potential of your sales growth. Betting your success on a single source can be dangerous. "I only use the Internet" or "Brokers are the only way to go" puts your franchising expansion in a vulnerable, high-risk position.
- Increase winners, dump losers! - Beef up what's working, get rid of what isn't, and try alternatives. Ride the winners as long as they continue to produce franchisees, upgrading your presence while the going is good. Always set aside a few dollars as an "opportunity fund" so you can take advantage of special promotions, and test new marketing avenues without overspending your budget limits.
Step 4 - Measure results to produce more buyers
Invest in marketing and monitoring tools to 1) determine your most productive selling sources; 2) create compelling, direct-response advertising for each media source selected; and 3) stay ahead of the competition.
How costly can lack of tracking performance be? After an audit, a home cleaning franchisor realized the few thousand dollars they thought they were spending in "cheap" secondary ad sources had become quite expensive, totaling more than $40,000 annually-and with no real ROI to show!
- What is it in your marketing that's not working? - Sometimes an advertising source takes the fall for underlying weaknesses stalling franchise development. I have seen one franchisor sell qualified franchisees through brokers, while a direct competitor failed miserably; a service franchisor dump a print publication claiming "poor and unqualified leads," yet two similar companies ranked it as their leading sales source; one franchise executive get caught hiding international leads in his drawer because it was too much hassle to contact them; and a franchisor stop advertising because none of the initial prospects responded to his five-page, photocopied follow-up letter plagued by bad grammar.
The lesson in these extreme examples is to monitor performance in all areas of your recruitment program. This includes mystery shopping your sales team at least once a year to ensure quality performance in follow-up on all leads. At the median cost of $50 per inquiry, you can't afford not to in today's highly competitive, tight economy.
Work the plan and the plan works
There are four steps to lead generation success. Use the process and you may enjoy greater payoffs in reduced costs, more qualified lead activity, and increased sales.
This article is an excerpt from Steve Olson's new franchise development book, Grow to Greatness: How to build a world-class franchise system faster!, published by Franchise Update Media Group. Order information is available at www.franchiseupdate.com/gtg, or by contacting Sharon Wilkinson at 800-289-4232 x202.
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