What is a Lead?
In a recent post, I heard this question, “Where can I get valid internet leads?” Valid lead? What makes a lead valid or not valid?
What exactly is a lead, anyway?
Well I guess that I should be providing some answers and not just questions, but there seems to be some difference of opinion on what actually constitutes a lead.
In my vocabulary, a lead is nothing but an indication that a person or persons have an interest in the the product or service you are selling. Simple enough! The source of that “lead” can be anywhere from a telephone book (geographic) to a personal referral; to a credit bureau report; to a consumer input internet lead; to a response to a print ad or direct mail via Loan-by-Phone. A lead can be a response on your own dealership website. A lead can also be from an internal source, i.e., a note from the Service Department or Body Shop that a customer mentioned that he/she was thinking about a new vehicle. What about a similar note that indicates that a customer talked about keeping their current vehicle even though the warranty was about to expire. Or how about the customer in service who happened to mention that they would like to get a new vehicle, but that they have had some financial difficulties and don’t think that they would qualify? These are just a few examples of lead sources and response triggers.
The bottom line is that a lead can pop up anywhere if you are looking or listening. The unfortunate part is that many have either not bothered to build a referral network within their dealership or more likely are just not listening. That is why third-party leads have become so popular and prolific in today’s business climate. So today, we are going to discuss those third-party generated leads.
As you might expect, my interpretation of what constitutes a lead is going to be vastly more expansive than that of the average salesperson. He or she is looking for the 1 out of 100 leads that is ready and able to purchase right now. You have heard, from many sources, “a lead is a lead is a lead.” Perhaps a better statement would be that a “lead is what you make of it.” What types of leads are you now talking about purchasing? My focus today will be on Internet leads, Trigger leads and Direct Mail leads.
A direct mail lead is generated as a response to mail sent to persons on a geographic or socio-economic list, as well as other defined (think bankruptcy) lists. These responses can be, depending on the skill of your mail source and the quality of the list, anywhere from .5% to 10% of the total mailing. These prospects have responded positively to the mail piece. They have some interest in your product!
Internet leads are generated as a response to either specific websites or redirection via pop-ups or drop-downs or links on various auto or non-auto related sites. For instance, I was reading a photography blog recently and noticed a link to a well-known Bad Credit site. These prospects have gone to the trouble of completing an application with personal information indicating that they have some interest in your product. Those of you who have followed up on a lot of these leads know that many times the person answering the telephone will indicate that he or she did not make the application. But someone with access to their computer did and, believe me, they know who it was. Someone in that household has some interest in your product.
So called, “Trigger leads” are lists of prospects whose credit reports have been accessed by an auto lender today. Those leads ordinarily reach you, the dealer, within 24 to 48 hours.
These prospects definitely have an interest in your product. Yes, they are difficult to contact, occasionally irate and in many cases, have already taken delivery of a new or used vehicle. But there are enough who would be sufficiently interested in your product to make the effort of contacting them worthwhile.
Do you see a pattern developing here? All these leads, third-party or otherwise have an interest in your product or they would not have bothered to respond. Granted the level of interest is going to vary, but all have or have had enough interest to take the time to respond. How you handle the lead may well determine the ultimate value of the lead.
But that is another story for another day.
Just my two cents worth.
About the author
Dick Hassberger, of Lake Orion, Michigan is a veteran of over 50 years in the Automotive Financing and Leasing industry, starting his career with the former Wayne Oakland Bank in September 1960. Dick is National Sales Director for VOISYS. He has held executive positions with Major Banks, Lending Institutions and Leasing companies and has accumulated a vast store of knowledge in the automotive financing industry, which he regularly shares with his client dealerships as well as readers of this blog. Dick was a regular author for World of Special Finance Magazine.