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It is All About The Numbers Your Closing Rate
By
Lorraine Ball |
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It is All About the Numbers ¡V Your Closing Rate
There is a popular misconception, held primarily by the financial managers, accountants and bookkeepers of the world, that marketing professionals can not add. They believe marketers simply treat numbers as graphic elements, selecting a number which looks pretty, with no basis in fact.
But the truth ¡K Good marketing is all about the numbers. If you develop marketing without paying attention to the numbers what you end up with is ¡§Award Winning Advertising¡¨ which doesn¡¦t sell product.
Good marketing requires a thorough understanding of the numbers which drive your business. And one of the most important numbers is your closing rate!
Know Your Closing Percentage
If you are face to face with a legitimate prospect how often do you walk away with the sale? That percentage, 10, 20 or 50% is your closing rate. It is a benchmark measuring the performance of marketing activities. Translation: The Closing Rate measures how effective all the elements of your marketing process, including sales skills are working.
Why should you care about your closing rate? A business with a high Closing Rate is less dependent on advertising to drive traffic. When you are closing well, you need fewer leads to generate sales.
Begin by Monitoring your Closing Rate
Initially you may have to guess at this number. Over time, this measure becomes more precise as you track and compare proposals and sales. If you have multiple sales people, monitor individual closing rates to see who is more effective. Also look at lead sources; are you more likely to close a lead from a direct mail promotion or the yellow pages. Over time these trends and patterns will direct changes in your marketing.
Improving your Closing Rate
What if your closing rate is too low? There are several factors which can contribute to a low closing rate including misdirected advertising investment or improper sales techniques.
„© Misdirected advertising - Examine the quality of leads being generated from a particular media. Are you attracting serious customers or price shoppers? Not all leads are good leads, and watching your results will help you determine if money is being spent well.
For example ¡V local radio stations offer desirable rates on specific programs or time slots. Magazines, newspapers and other publications will offer discounts on ads in specific sections or on certain days. Be wary of these discounts! If your target customer does not read the publication or listen to the program you are wasting money on unqualified traffic.
„© Improper sales techniques - Low conversion rate may also be indicative of poor sales presentations or proposals. Improve you "Closing Rate" by analyzing the sales process.
Do you ask potential customers probing questions, and then really listen to their answers? Are you presenting a solution to the customer's needs, or a standard pitch designed to be a "one-size-fits-all" solution?
Invite someone to ride with you on a sales call, and give you feedback. They will see things which you miss in the heat of the sale!
Monitoring your closing rate is an ongoing process, not a one time event. But the payoff ¡V the ability to make more intelligent marketing decisions and improve your sales ratio are well worth the effort!
Author's Bio
An award winning marketing professional, Lorraine Ball and the team at Roundpeg help small business owners become big business owners. She frequently shares her expertise in public seminars, and presentations around the country. In addition, her articles on marketing planning and business development have been featured in numerous including Contracting Business, The New York Forum, The Indianapolis Business Journal, and Carmel Business Leader
For more information about Lorraine and the team at Roundpeg go to: www.roundpeg.biz
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