Lead Conversion: Turning Prospects into Customers

What is lead conversion?

As the name implies, lead conversion refers to the process of turning a lead into a paying customer or, otherwise, someone who makes it through to the end of your marketing or sales funnel. This is also the process you need to convert website visitors into customers.

Some entities aren’t specifically selling something but may seek leads to facilitate some other goal. When the lead takes the desired action, a conversion occurs.

You can also consider a lead’s transition through the stages leading up to the actual sale as a form of conversion as well.

For example, when a lead goes from lead to an MQL, that’s also conversion and it’s measurable. When an MQL becomes an SQL, you can also consider that a conversion.

But, for the sake of explanation, it’s best to look at lead conversion through the lens of making a sale.

How to calculate lead conversion

You can easily calculate your lead-to-sale conversion by understanding how lead conversion rates (LCR) works.

The rate, sometimes called the lead-to-customer conversion rate when used as a KPI, gives you the percentage of leads that become customers. To calculate your lead conversion rate, use the following formula:

New customers/leads*100

For example, if your marketing campaign has 100 leads, and 20 of those leads convert to customers, then you have a lead conversion rate of 20%. The ideal lead conversion rate varies by industry and the costs associated with your marketing efforts.

Generally, across most industries, obtaining an LRC of 10% or more means your marketing and sales efforts are going exceptionally well. In most cases, 3% to 5% LRCs represent a good lead conversion rate.

Why is lead conversion important?

A higher conversion rate means your marketing and sales efforts are performing well. A lower lead conversion rate can mean there’s a problem somewhere in your marketing or sales process and gives you a place to start investigating what it might be.

Your lead conversion rate and lead conversion metrics can also help you set your customer acquisition cost budget accordingly.

In addition, your rate can help you remain more realistic about your marketing budget in general.

How to build a lead conversion process

There are four steps of a lead funnel: the awareness stage, the interest stage, the decision stage, and the action stage. All of these steps are important in turning a potential customer into a paying customer and illustrate the entire customer journey.

But to understand conversion rate optimization, you should start with the fundamentals of the lead conversion process. The path from prospect to customer isn’t always the same for all businesses or people, but the lead-building process isn’t radically different between implementations.

Here is how to build a lead conversion process that works for your business:

Generate leads

You’re already converting leads, so you should have a good grasp of lead generation. Nevertheless, you can always improve on generating leads. It’s always possible to increase lead generation and optimize the process to capture more quality leads.

Remember that not all leads are the same. Some prospects have a far greater interest in what you’re offering than others. So, utilizing techniques designed to generate more qualified leads will directly translate to more lead conversions.

Capture leads

You need to capture leads in the way that makes the most sense for your brand or business. The lead capture method might not be ideal for your goals and objectives.

You may have a great content marketing strategy utilizing a blog and podcast, but if the most suitable prospects spend most of their time on social media, then you’re not capturing the right leads, or you’re not leveraging the additional platforms available to you.

You need to figure out which platforms your target audience spends the most time on and create a marketing strategy that appeals to them.

Qualify leads

Once leads enter the ecosystem of your business, you need to qualify them.

How a business qualifies a lead will vary, especially between marketing qualification and sales qualification. Nevertheless, using a lead scoring system to vet leads can help.

Nurture leads

In truth, lead nurturing should occur at every step of the lead conversion process. You want to guide your leads and give them what they need.

How are your relationships with your leads? Some leads may fail to convert because they feel your brand or service isn’t trying to speak to them as an individual.

More personalization in your lead nurturing may just lead to more conversions. Many lead nurturing automation tools can help you with this process while also ensuring your efforts don’t come off as impersonal or generic.

Present the product or service

Are you showing off your product or service in the best light? Can your leads understand the value you’re offering them?

How you present the product or services you're selling plays an important role in the lead conversion process. One way to figure out what might work best is to look at successful competitors in the industry.

Handle objections

Don’t disqualify a lead because of a sales objection. Instead, handle the objection.

By handling sales objections efficiently, you can still move a lead along the funnel. Or, you can use the situation to learn if you truly have an unqualified lead or if a little more nurturing can push the lead to convert.

But under no circumstances should you let a sales objection turn into an automatic disqualification of a lead.

Close the sale

If you have leads falling off right before closing, then something in the conversion process went wrong. From beginning to end, the lead conversion process should give your sales team all the insight they need about your lead.

If they’re not closing the sale once the lead makes it to that point, they need to reevaluate their lead qualification criteria and closing methods.

In some cases, you can lose a lead before closing for other reasons, such as losing out to a competitor at the end or having a website that makes it difficult to navigate or shop from.

Follow-up

Marketing and sales funnels don’t end with lead conversion. You should always follow up with converted leads and do what you can to keep the goodwill and potential return visit from your customer.

Just as lead nurturing exists at every part of this process, it also exists at the end of the process as well. A satisfied customer can and will bring you other prospects just as likely to become qualified leads.

Just by revisiting your lead conversion strategy, you’ll likely see numerous ways in which you can improve on the individual parts of the process. When you break it down into steps that you can look at individually, you can more easily figure out where things work best and what things might cause your lead conversion process to break down later.

How to optimize lead conversion rates

Going through your lead conversion strategy will help you to optimize the process. However, you can still make use of some best practices when it comes to lead-generation campaigns and conversion optimization.

Never stop nurturing

Sure, your new leads need all that initial pampering, but what about the person who already showed they have an interest in your business or service?

If you want to convert leads, never stop nurturing. Figure out new ways to engage them and move them along your funnels.

You likely have a nurturing stream that starts with one thing and ends with another. But after that last email or invite, do you just leave your lead alone?

If so, then this practice is for you. Create a lead nurturing strategy that encompasses other scenarios and includes additional nurturing methods for different situations.

Make sure sales and marketing work together

Sales should support marketing and marketing should support sales. The more these two groups engage with and work with each other, the better the chances are of increasing lead conversion.

Keep everyone’s goals aligned and allow each group to work together on figuring out what a qualified lead means to both groups. It can also help to have shared tools, such as CRM portals both teams can utilize.

Of course, if you’re a small business or single operator, you may not have marketing teams around. But, these things still apply. Make sure your marketing and sales goals align.

Revisit, revise, and refine your targeting

You can always refine your targeting efforts. Always revisit your targeting strategy to see if you can improve it. Your marketing and sales data should give you insight into your market and customers. Use your data to fine-tune your approach, and continue to do so periodically.

Always track and measure performance

Track what’s important to your business and use your data to create better lead conversion strategies. Make full use of the analytic and tracking tools provided to you by your marketing and sales platforms. Your data will clue you into many potential problems with your lead conversion strategy as well as offer you potential solutions for them.

Utilize common sense practices

In some cases, improving lead conversion only requires that you practice some common-sense marketing and sales techniques. For example:

• Make sure your website or apps have a clean and responsive design
• Produce quality content and strive to make it evergreen
• Finetune your landing page until it’s a high-converting landing page.
• Test and try new approaches when appropriate
• Always seek ways to offer more value to leads and customers

Generally, if it improves the customer experience, it will likely also improve lead conversion rates.

Maximize your sales potential with lead conversion

Working on lead conversion involves working on all the other aspects of your marketing and sales strategies. In this way, you can think of lead conversion optimization as a way to improve your business as a whole.

However, to fine-tune and optimize your lead conversion methods to boost sales, you need the proper tools and insights.

Mailchimp offers a host of services and tools to help you find leads, measure lead conversion, and make the necessary changes to email marketing to help improve your conversion rates. Look at Mailchimp’s available tools, services, and resources and you’ll find they have everything you need to optimize and increase your lead conversions.