What is the value of a lead?

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Every firm needs customers, and every customer begins as a lead. So leads are fundamental to business success. But too many executives don’t understand what leads are, or how to value them well enough to make smart investment decisions.

Leads are blocks of information connecting seller and prospect. Unless your business makes all its sales during a first inbound contact, you are going to have leads. But how you handle them—that’s where the profit lies.

Leads are valuable. Firms invest a lot of money generating or buying them. But what should you pay for a lead? What is the price at which are you equally willing to purchase the lead or let it go to a competitor? Sales and marketing managers must understand a lead’s value to avoid over-paying or under-buying sales leads.

Several approaches to lead value calculation are available, based on your firm’s primary sales objective. Are you going for growth, market share, or profit? Your answer to this question will influence not only how you pursue sales, but also how to evaluate your sales leads.

Companies Going for Growth

Growth firms typically set their growth strategies by planning to generate a fixed number of sales. For example, a 1,000-customer firm targeting 30% growth wants 1,300 customers. Adding a few hundred to account for lost sales or cancellations, this firm may determine that it should try to acquire 500 new customers in the period.
To back your way into the number of leads required, divide the number of new customers by your close rate. If this hypothetical 500 new customer firm has a close rate of 10%, they need 5,000 leads. The marketing department’s mission is to acquire them at the lowest possible cost. The value of a lead to this firm is the next highest price from any alternate lead source until the 5,000 lead target is met, and then zero once the full 5,000 leads are purchased. In short, the value of a lead for a growth firm is a step function: The lead value is very high until the growth target is reached, and zero thereafter.

When Your Objective is Market Share

Market share oriented firms are looking for their slice of the industry; it’s not a fixed number of new customers. They will approach leads similarly to a growth-guided firm, but the target number will shift periodically as the market size shifts. Thus, the market share firm’s goal will differ month to month.

The calculation is similar to the growth firm scenario, but it requires some fancy footwork to apply. Lead value will still be a step function, but the step size moves very quickly. You will still divide the number of new customers desired by the close ratio, but you’ll be working with a very short term lead target. Because this target moves, the marketing department needs considerable flexibility to keep adjusting the lead requirements.

Firms That Strike a Balance

Most firms seek the highest number of profitable customers, irrespective of whether they are going for growth or share. These firms purchase leads to the point at which customer acquisition cost equals customer lifetime value. When these two goals reach equilibrium, the firm stops buying leads.

In such situations, you can compute the value of a lead by knowing your salesperson costs, your close rate, and the value of an account, and applying the following formula.

Lead Value = (Account Value – Salesperson Cost) * Close Rate

This is the lead pricing formula. With this in hand, plus an understanding of your primary sales goal, you will be well on your way to an accurate assessment of how much to pay for a lead.

Source: Jeff Feuer

Complete Media Inc is a Sioux Falls marketing, advertising, website design and web hosting company specializing in web design, maintenance and hosting services.

We help small businesses make more money. Learn more.

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Client Success Story: Hilltop Custom Cabinets, Doors & Trim

Sioux Falls Marketing Advertising

Hilltop Custom Cabinets, Doors & Trim has been a staple in the region for several years, providing custom cabinets, millwork, furniture, flooring, and countertops.

Hilltop partnered with Complete Media to rebrand their brand and increase sales. We have helped them develop a complete, new brand, including a new logo, signage, wearables, vehicle graphics, promotional items, website, and much more. Through our strategic marketing planning and digital marketing, we have helped Hilltop reach clients and prospects using online strategies, e-marketing, social media, environmental marketing and print campaigns. Working with Hilltop Custom Cabinets, Doors & Trim has been a great experience, and we truly value them as a client.

Hilltop’s definition of “custom” is a little different than most. For Hilltop, “custom” means the entire process — It doesn’t matter if you know exactly what you want or if you are not sure of anything, they will walk you through the process and provide you with information and ideas to help you visualize your project.

Their design process is simple, and they’ll always listen and take into account your lifestyle. Hilltop Custom Cabinets, Doors & Trim can help you choose a wood species, cabinet profile, countertop, finish, and hardware, and has the ability, people, and tools necessary to accomplish almost anything you can envision. In any endeavor, education is important. Hilltop believes the more informed their customers are when they leave, the more perfect their project will be.

To find out more about Hilltop Custom Cabinets, Doors & Trim, call 605.231.4094 or visit their website.

Improve Your Closing Ratios with Marketing

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On average, it takes 75 cold calls to make one sale to a net new customer.

Recently I was speaking at an event and a sales rep selling training services noted that in her industry the number is closer to 1 in 125. Either way, the numbers are high!

On average, clients see a closing ratio of 1:2 for referred leads and 1:5 for call-ins. Knowing that, wouldn’t it be better for everyone to change your sales strategy to focus on increasing referred leads and calls-ins?

How can you get more referrals? As a quick tip: ask for them every day. Most sales people I coach don’t have a habit of asking for referrals regularly, nor do they have a referral strategy that is consistently executed. Therefore, most sales reps don’t have a consistent flow of referred leads into their business.

How can you increase call-ins? Write. Take some time to write a few quick tip articles that are relevant to your client base and can help them grow their business. If you have convention space at a hotel, write about the “Top 10 Things to Consider When Booking Your Next Convention;” if you sell lawn tractor equipment, try “The Best 5 Ways to Ensure a Healthy Lawn This Summer.” The options are endless, and the trade magazines that serve your customer base are hungry for content.

I have found that writing and publishing articles are the best ways to get customers to call you. Why? Because the articles you write define you as an expert in your field and position you as a valuable partner, not just a sales person. The more often your articles appear online or in print, the more relevant you become to your clients and prospects, and the more they will want to do business with you.

Don’t wait for your marketing department to write for you. Do it you yourself. Start with a five-tip article that focuses in your area. Write out the five points first, and then add a paragraph or two of detail below each. You will end up with a 250-500 word article perfect for publishing. Be sure to send to all the relevant trade publications (online and off) with your contact information and website!

Source: Colleen Francis

Complete Media Inc is a Sioux Falls marketing, advertising, website design and web hosting company specializing in web design, maintenance and hosting services.

We help small businesses make more money. Learn more.

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Client Success Story: Hjellming Construction

Sioux Falls Marketing Advertising

Scott Hjellming began building and remodeling homes with his dad, Orlie, who began the business in 1962. Now, Scott, along with his two sons, Cory and Bryan, continues the tradition of crafting uniquely designed homes from the ground up or enhancing homes with remodeling mastery. Complete Media has helped define the Hjellming brand through a new website, online marketing and identity pieces.

To find out more about Hjellming Construction, call 605.610.2170 or visit their website.

Top 7 Strategies To Improve Profit

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Making your business more profitable involves looking at ways to increase sales revenue as well as decreasing your costs and benchmarking your business to see where you can save money.

Here are seven effective strategies to improve profit:

1. Remove Unprofitable Products and Services

The products or services with the highest gross profit margin are the most important to your business.

Once you have identified your most profitable products or services you should concentrate on these.  You will need to determine if the unprofitable products or services should be removed completely or reviewed for areas of improvement.

2. Find New Customers

New customers can help grow your business.  However, this can sometimes be the most expensive strategy for generating additional revenue. On average it costs eight times the amount of money to acquire a new customer as it does to retain a current customer.

The simplest (and most cost effective) way to get new customers is to offer incentives to your current customers and motivate them to initiate referrals for you.  Word of mouth is the most powerful form of advertising.

3.  Increase your Conversion Rate

Generating new leads is an important part of business growth.  But do you know what percentage of these leads eventually convert to a sale?  Increasing sales conversion in your business is one of the fastest and lowest cost methods to boost your business profits.

4.  Review Current Pricing Structure

Raising prices can be a terrifying prospect; however a small increase in your prices can make a significant impact on your gross profit.

Therefore, correct costing of your products and services is very important.  You should review the costing of your products regularly and adjust your prices accordingly.

5.  Reduce your inventory

Stock control is a good way to streamline your business and improve cash flow.

With less money tied up in slow-moving inventory and fewer losses due to expired or discontinued inventory. Ordering more frequently allows you to compare prices and take advantage of seasonal clearance or overstock discounts.

6.  Reduce your overall direct costs

Reducing your overall direct costs will have a significant impact on your gross margin.

One way to reduce your direct costs is to negotiate better prices or discounts for everything you buy. Provided the quality is comparable, finding the best prices may require finding a new supplier.

Another way to reduce your direct costs is to eliminate unnecessary purchases.  A thorough review of your direct costs should highlight any areas where overspending has occurred.

7.  Reduce your overheads

For many businesses overhead expenses have a way of creeping up over time.  Regular review of your overhead expenses is a simple and effective way of improving your net profit.  Benchmarking your business to similar businesses in your industry may highlight areas for improvement.

Source: Altitude Advisory

Complete Media Inc is a Sioux Falls marketing, advertising, website design and web hosting company specializing in web design, maintenance and hosting services.

We help small businesses make more money. Learn more.

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Client Success Story: Landshark Scuba

Sioux Falls Marketing Advertising

A scuba shop in South Dakota? Landshark Scuba owner Colonel Echols said, “Why not?”

Landshark Scuba and Snorkel has since become a regional leader in everything scuba diving, from beginner training and river trips to local spear fishing and all inclusive scuba adventures abroad. If you are interested in scuba diving, the Landshark team is the team to call!

Landshark Scuba partnered with Complete Media Inc. several years ago to enhance their brand and name recognition. We have helped them go through a complete rebranding, including logo updates, all-new marketing materials, website, and much more. Through our marketing planning and digital marketing, we have helped Landshark Scuba reach clients and prospects using online strategies, e-marketing, social media, environmental marketing and print campaigns. Working with Landshark Scuba has been a great experience, and we truly value them as a client.

To find out more about Landshark Scuba and Snorkel, call 605.339.DIVE or visit their website.

Client Success Story: Elite Limousine

Sioux Falls Marketing Advertising

Glenn Fenwick with Elite Limousine has been providing his Sioux Falls clients nothing but a luxurious experience for nearly a decade now. When it came to picking up new business, he knew he had to be easy to find without his budget running empty. Elite Limo has a fleet to accommodate special events, including a variety of limos and a party bus, as well as black-car services for you to travel in style while you’re in the area.

Complete Media worked with Glenn to get him a mobile-friendly website that is easy for potential clients to navigate and conveniently contact him. Glenn knows every time the phone rings or an email comes in means another potential customer, so it was vital to have a website that’s accessible anywhere and shows up at the top of the search engines. Complete Media’s search engine marketing efforts have escorted Glenn and the Elite Limo team towards the top of the search results.

“Complete Media keeps me where my clients need to find me,” Glenn says, “and that keeps my phone ringing!”

To find out more about Elite Limousine, call Glenn at 605.728.4409 or visit their website.

Client Success Story: Arrowhead Automotive

Sioux Falls Marketing Advertising

Arrowhead Automotive owner Chris Sweeney has been repairing cars and trucks since high school. As a seasoned business owner, he came to Complete Media wanting to step up his game. He recognized that his business seemed to have plateaued. In a highly competitive field, Chris realized it was time to either shift into a higher gear or coast. He connected with Complete Media in 2016.

By partnering with Complete Media, Chris injected some much-needed marketing activity through the creation of new identity materials, a re-imagined website, online advertising, and social media management. Now, Chris is busier than ever, recently achieving a 25% increase in business over this time a year ago. “Complete Media helped me refocus,” Chris said, “and business is way up.”

To find out more about Arrowhead Automotive, call 605.610.1572 or visit their website.

The Big Impact of Small Business Marketing in Sioux Falls

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Collaborative Effort with Clients Reaps Economic Dividends

Recently, our marketing and advertising agency in Sioux Falls put a pencil as to how the clients we represent impact the local Sioux Falls economy. What we discovered is a multi-million dollar ramification that cannot be ignored.

In 2016, the combined trackable revenue growth among our just over one hundred clients was $6,306,893.91.

Additionally, if one assumes the typical business designates 1% of their profit towards charitable giving, that translates into $643,068.00 in donations among Complete Media clients. The typical client staff averages fewer than a dozen.

For over fifteen years, our Sioux Falls advertising agency has been working to assist our clients with all aspects of marketing, advertising, and business development by offering services including graphic design, copywriting, web development, video production, media services, public relations, campaign management, and event planning.

Several years ago, our owner and president, Matt Luke, recognized a certain segment of the local business community was being underserved when it came to marketing and advertising. Small businesses often do not have the luxury of hiring traditional agencies, so they either do little to no marketing, have only sporadic, piecemeal campaigns, or try to manage marketing efforts themselves, along with all of the other day-to-day business operations. Matt decided rather than continue to cater to any and all businesses, our company would focus on those businesses which needed marketing support and a feasible option by which to afford professional agency services.

Over the past several years, we have courted, attracted, and partnered with small- to medium-sized businesses, many family-operated, and all but a few locally based. Our agency focuses on trackable strategies providing the best return based on the client’s budget. This approach tends to emphasize online positioning and branding versus promotional product development and intermittent media campaigns — not to their exclusion, but rather implemented on an investment return basis and affordability to execute with necessary frequency. It’s a win-win for the business and the community.

Complete Media Inc is a Sioux Falls marketing, advertising, website design and web hosting company specializing in web design, maintenance and hosting services.

We help small businesses make more money. Learn more.

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Client Success Story: Elite Cafe and Catering

Sioux Falls Marketing Advertising

Chef Daniel Myers is battle tested in the field of catering and upscale cuisine, having received numerous awards and commendations. Not one to beat his own drum, he did acknowledge that, when it came to marketing, his presentation was a little under-cooked. Chef Daniel struck out on his own, opening Elite Cafe and Catering.

When he teamed up with Complete Media, Chef Daniel was minus an online presence and was looking to spice things up. In just under a year, we developed a sleek and appetizing website, rebranded the business with a new logo, and provided hands-on consultation to help Dan increase the business’s visibility. “Complete Media have helped me understand marketing is more than just logos and jingles,” Chef Daniel said. “It’s about building my business.”

Now, Chef Daniel is reaching a whole new demographic of catering clients, and the cafe business is rapidly increasing.

To find out more about Elite Cafe and Catering, call 605.593.9339 or visit their website.