Good Leads, Bad Leads: Making Sense of Lead Quality

As a home-improvement contractor, you know that great leads are vital for growing your business. But that doesn't mean there are days you aren't frustrated as hell. In fact, sometimes the leads drive you crazy!

The truth is, while lead generation can be exceedingly profitable, many contractors have a love-hate relationship with lead generation services for several reasons:

The competition is fierce. Contractors need to work harder to sell themselves to close jobs.
There are more unknowns. Contractors need to chase down customers and get them on the phone, which requires persistence and patience.
The internet is a big place. There will be leads that won't turn into jobs and customers who won't even allow a contractor to schedule an appointment or give an estimate.

So when things don't go as planned, it's only natural that contractors will point to the quality of the leads as the source of their issues. It shouldn't surprise you that "bad leads" is the number one reason contractors cancel their lead generation services. But is poor lead quality really the widespread epidemic contractors claim it to be?


Networx by the Numbers

Let's take a look at some numbers from over a recent 4 week span, June 23 to July 21.

_{(Disclaimer: The goal of this segment is to reveal what our percentages are to help drive home the point of this article. To that end, the percentages are absolutely factual. However, the amounts listed below - leads sent, credits requested, and leads credited - are for illustrative purposes only and aren't our true numbers.)}

Leads sent: 60,000
Credits requested: 9,510...that's 15.85% of all the leads sent.
Leads credited: 5,925...that's 62.31% of all credits requested.
Overall bad lead percentage: 9.87%...let's round that up to 10%.

If 90% of the leads are good, it begs the question: How is "bad leads" the biggest reason for canceling? Are the contractors who are canceling because of bad leads getting all their leads from the other 10%?

It's common for contractors to blame their struggles on bad leads. In reality, the majority of their leads were good leads that weren't handled in the best way.

Lead Management

This message appears at the bottom of every new lead email Networx sends out: "Did you know that 78% of web based leads are closed by the first responder? CALL this lead immediately!
If you don't reach the lead, try back in 10-15 minutes. Don't rely on the leads to return your calls. Remember, More Dials = More Closed Jobs."

But calling the leads immediately is only the first step. Our most successful contractors apply a disciplined call process for every lead they receive. If you haven't yet, it's well worth your time to read Paul Munn's informative and illuminating articles on the subject. Paul delves into the best ways to...

Reach the leads...Why Won't My Leads Answer?!
Set appointments...My Lead's On The Line - Now What?!
Close jobs...The Art Of The Close

The way you approach the leads will dictate how successful you become with lead generation.

Expectations

Okay, so you're doing everything right and you're still not seeing the return you were looking for. It's important to realize that, when all is said and done, lead generation is a numbers game.

Remember that list of reasons I mentioned above about contractors and their love-hate relationship with lead generation? The competition is fierce, there are more unknowns, and the internet's a big place.

There is no easy way to say this: You're not gonna close every job. Nobody does. Focus on the positives - the leads you reach, the appointments you set, the jobs you close - and worry less about the leads you didn't reach, the appointments you didn't set, and the jobs you didn't close.

With a clear understanding of what to expect from lead generation, you'll prosper.

Lead Quality

We do everything in our power to generate the highest quality leads possible. We want our contractors to have the greatest opportunities for success. Not convinced? You can read more about what our customers are saying about Networx Leads here.
At the end of the day, some leads won't turn into jobs. Others won't even allow you to schedule an appointment or give an estimate. There will even be leads you won’t be able to reach.
A key to success with lead-generation is to realize that the majority of leads are good and to focus on those. Don't let a rare bad one discourage you from pursuing the others.

As mentioned, 10% of the leads we send are confirmed bad. We own up to that. We're not going to pretend all our leads are great. We're going to give every bad lead claim the attention it deserves. We credit around 60% of all credit requests - the most generous credit policy in the industry.

Good Lead or Chicken Feed?

Now it's time to examine the makeup of a quality lead. This will help you make an informed decision about whether it's time to request credit. Legitimate requests are taken more seriously by the Lead Verification Dept.

There are 5 components that make a lead good:

Correct Contact Info. If the number is bad, you're never gonna reach the lead. We'll look into the lead. If we find a working number, we'll send you the lead again. Most contractors prefer a viable lead and a chance to close a job to getting a credit.
Correct Industry. If the job needed isn't something that's related to your industry, that's a creditable lead. That doesn't mean you'll get credit if you're a painter and you decided you don't want to do any exterior painting.
There's a Need. If you call the lead and they tell you they were just fooling around on the internet and they don't need anything, that's a creditable lead.
Within Your Area. If the jobsite is located outside of your service area, that's a creditable lead.
Authorized to Hire. If the person who submitted the lead does not have permission to hire, that's a creditable lead.

As for credit requests submitted due to unsuccessful attempts at reaching the homeowner, those will be reviewed on a case-by-case basis.