KPI-Class: Sales Leads conversion through Telemarketing

Definition:

This KPI class measures the %age of telemarketing calls which got converted into final sales or into different intermediate conversion steps (like client meeting, product-demo..) in the sales process.

Business Objective behind this KPI-Class:

Maximizing Tele-marketing Effectiveness on Sales Lead Generation

Explanation & Specification

Depending upon the product and the sales process, there can be various conversion steps between a sales lead and the final sale. Example of a simple case could be selling a weekend getaway tour package, whereby there is a single step of conversion. You sell the package in your telemarketing, take the persons credit card number and send the tour confirmation papers. Example of a complex case will be selling of IT services to a company. The conversion process will go through sending brochures & profile of the IT service provider, followed by introductory meeting, demonstration, reference checks, price negotiations, service contracts, purchase order etc..

Example of KPIs in this KPI class and level of linkage with the business objective

• % age Sales leads converted into warm sales leads through telemarketing (next conversion step)- High
• %age of Sales leads which got converted into an intermediate conversion (say product demonstration )- Low to Medium
• % age Sales leads converted into sales through telemarketing Low to high, depending upon number of intermediate conversion steps. More are the conversion steps, low is the linkage.

Overall, farther away is the conversion step from the telemarketing step, less is the linkage.

Inclusions

This KPI, typically includes the sales leads which are cold or not asked for OR the first verbal contact with the customer. Example of a cold lead will be when you pick-up a name from the telephone directory and call. Example of first verbal contact will be when you call the customer on the basis of 'Please call me' coupon filled by a customer on one of your point of sale.

Exclusions

Clarity is needed on

Different conversion steps need to be defined, in terms of what will be considered as completion. If not done, the metrics go misrepresented. For example, when we say something as ,'cold lead conversion' to warm lead through tele-marketing, the definition of warm lead should be defined. A warm lead can be:

• A customer asking to call-back again OR
• A customer asking for the brochures to be sent OR
• A customer agreeing for a meeting etc.

Success factors for this KPI-Class

As mentioned above, more are the conversion steps between telemarketing and final sale, less if the impact of telemarketing effectiveness for the sale closure. The success factors for this KPI-class are:

• Strength of your telemarketing script.
• Training and Orientation of your telemarketing staff
• Ready FAQ, to be prepared for any queries by the customer.
• Information you have about the lead before you make a telemarketing call
• Level of customization you do in your telemarketing scripts depending upon the customer profile
• The level of information you gather on the customer in the telemarketing. This helps in the next line of conversion steps.
• A good brand-recall value. If customer has heard about your product, he or she will be more receptive.

Root Cause Analysis and interpretation

If the value of this KPI is low, it means that one of the above success factors is not working. You can do a root cause analysis by:

• By applying different training and telemarketing scripts and analyze the results.
• Conducting a survey of customers who converted and did not convert, to understand the customer voice.
• Analyzing the accuracy of information in the telemarketing database by sample checks.
• Look at your brand-recall results.

Measures-Facts associated with this KPI (Refer dimensional modeling in data Warehouse section)

• Number of Sales Leads
• Number of calls made per sales lead (You may be making more than one call for a sales lead)
• Number of telemarketing staff

Dimensions and some of their attributes (or 'cuts')over which you can slice and dice the KPI.

• Product
• Location
• Sales Channel
• Telemarketing company (a telemarketing unit is internal to an organization and it may be hiring the telemarketing companies)
• Tele-marketer (specific tele-marketer team or an individual person)
• Lead value-slab (high value, medium value)
• Lead priority (high, medium, low)
• Lead Source (external database, existing customer, point of sale..)
• Time period

Direction of improvement

Maximize

Industry Relevance

All

Functional Relevance

Sales & Distribution