As we continue to talk in our series about leaking profits, leak number three goes hand and hand with our previous leak about measuring conversion rates. Your salespeople are paid for action, not sitting and waiting. If you don’t have a Customer Relationship Management (CRM) program—and USE it daily—you’re the one responsible for some major profit leaks.
A CRM program is not an option for your business.
I know. I hear the loud groan. “It’s so time-consuming to keep up with the data.” You know, it’s time-consuming for me to get regular health check-ups and take my car in for scheduled maintenance, but I will pay a much bigger price if I don’t tend to these details. You have a huge investment in your business. Are you going to skate by on insufficient upkeep?
A CRM measures the sales activities—who’s coming in, follow-up efforts (methods and frequency), and results: who bought and who didn’t. By keeping up with the input into this database, you can keep your sales team informed, give them reminders for follow-up, track progress, and identify opportunities. You’re monitoring and measuring. Isn’t that worth a little time each day?
Half of the builders I talk to don’t have a CRM. Of the 50 percent who do have one, 70 percent don’t keep it up. About three percent are a slave to the numbers. All the others are pouring profits from a running faucet.
- Measure against pre-determined goals.
- Work backwards: If you need 3 sales per month and have a 10 percent conversion rate, then you need to bring in 30 prospects.
- Measure by conversion rate.
- Measure by set/return appointments.
- Did the salesperson set appointments? Did the prospects keep them?
- Measure by bank/lender appointments.
- If you can get the prospect to the bank, they’ll buy.
- Measure by Internet Sales Counselor appointments: Set/Kept/Converted to Sales.
- Measure by registration.
- Measure Realtor showings, and Co-op percentage of sales.
- Measure number of visits, from initial visit through contract.
- Measure fall-through and cancellation.
- Remember: If you penalize honesty on the traffic report, this number will be skewed.