In nearly all cases, regardless of where it came from, a lead costs money. Be it a Facebook lead, someone who clicked on your Google Ad, someone who got your letterbox drop or a new enquiry that came from your refer-a-friend program (where you have to give something away to the storer that referred them), money was spent.
Leads are piping hot enquiries – the best kind! Action them ASAP – they cost the business money and should never be taken for granted.
So why do some people tend to treat lead follow-up like a low-priority task? Could it be because the person on-site isn’t comfortable selling? Or are they spending too much time running reports (PS: get Storman Online Reporting) or chasing payments (PS: get Storman Payment Services)?
Either way, as a business owner, it’s important to look at your marketing and advertising costs regularly. Not only to see which channels are performing the best so you can redirect future spend, but also so that you can make sure your business is actually growing at the rate you need (or want) it to, to keep the owner & the bank happy.
Do you know your acquisition breakdown?
Once you know how much you’re spending on your website, ads, flyers and so on – you can compare that to your clicks, enquiries and successful storage rentals in order to build a much clearer picture of your marketing spend and its value, through the:
- CPI (cost per impression): The amount of money it costs for your ad to be ‘seen’. While many ad networks do not charge this way (they charge using CPC; see below) – you can still easily calculate this cost, as ad networks will generally display this information.
- CPC (cost per click): The amount of money it costs to drive a user to your website through a paid advertising channel.
- CPL (cost per lead): The cost attributed to each user who makes an enquiry (eg. phone / email / web form, etc) and thus, becomes a lead that has the potential to be closed as a successful sale (acquisition).
- CPA (cost per acquisition): The cost attributed to each user who becomes a paying customer (ie. a lead that successfully converts).
- CLTV / CLV (customer lifetime value): A prediction of the net profit attributed to the entire future relationship with that storer.
The fantastic thing is that once you have this data (just make a spreadsheet and track it over time), you can compare conversion rates between the various stages and use this data to either KPI your staff to assist in improving these numbers and / or try different experiments to see if they can improve conversion rates between stages.
Let’s say our monthly marketing spend on online assets is $1,000/month. When collecting the data and running the numbers, you may find that…
- Your online ads get 1,000 monthly impressions (thus, it costs the business $1/impression)
- …of these, 100 click the link (thus, it costs the business $10/click)
- …of these, 20 make an enquiry – ie. they call you, fill in a web-form etc (thus, it’s costing the business $50 per lead) …PS: share this number with your staff and now see if they’ll prioritise lead follow-ups!
- …of those, 2 may go ahead and store with you (thus, it’s costing the business $500 per acquisition)
By pulling & incorporating Average Length of Stay data from, say, Storman’s range of self storage management software (yep – that’s the actual name of the report) you might find that the average customer only stays 3 months …in a $100 storage unit. In other words, you’re losing money.
Be tactical about your spend
While there’s much more to it than this, this data will at least allow you to refine marketing campaigns and be more tactical about your spend.
The data will also let you improve close rates by either dropping prices (in order to close more deals and lower the Cost Per Acquisition – though this usually ends up as a race to the bottom and isn’t recommend) or by adding value and appearing more appealing when storers compare you with the competition.
By the way: Do you survey your storers regularly, or upon exit, to see what you can improve? Learn more here…
If you’re interested in reading more about the importance of following up your enquiries, why not check out my earlier blog on the topic. As always, if you need a hand – please get in touch or find out more.