Lead generation is one of the most crucial aspects of growing a financial services firm. It’s also one of the most time-consuming tasks, and it can be hard to see your progress. Lead generation is often a top challenge for advisors, but it can be the difference between an average firm and an industry leader.
Are all the time and resources you’re putting into generating leads through webinars, content marketing, cold calling and referrals actually working? Tracking the success of your lead generation efforts is essential to knowing when to pivot and when to stay the course. Plus, measuring success helps you better track your growth and budget.
Here is more on how to know if your lead generation efforts are working.
Know What to Track
Many factors go into successful lead generation. It’s helpful for advisors and back-office employees to know what to track, so they can focus on the metrics that matter and avoid getting bogged down by other data points.
Here are five common lead generation metrics to track:
- Conversion rate: The percentage of leads that become clients. Calculate this by dividing the number of clients by the number of leads in a set period (such as a quarter or year)
- Lead source: Where the lead came from, such as a referral, community event or cold call. This data can be combined with other metrics to track success by lead source.
- Time to conversion (also called sales cycle length or time to close): The amount of time from first contact to officially becoming a new client. In general, shorter sales cycles lead to more revenue and growth.
- Cost per lead: The cost of securing one lead or new client. Calculate this by dividing the total cost of the campaign by the number of leads it generated.
- Return on investment: The firm’s results, based on cost. Calculate this by subtracting the cost of the campaign from the revenue it generated and dividing it by the cost of the campaign. ROI shows which campaigns and lead generation efforts are most effective.
Tie Data to Strategy
Understanding which metrics to track and which factors contribute to successful lead generation can help you build lead campaigns with results in mind. Although each metric is useful, some will matter more depending on your firm’s situation. Are you focused on bringing in a large number of clients in a short amount of time? Conversion or time-to-conversion rates will be the most important. If you’re trying to find your footing on which channels are most effective, prioritize lead sources. Or, if the marketing budget is tight, focus on cost per lead.
Creating a lead generation strategy is essential for financial advisors. One recent survey found that advisors with a defined marketing plan generate 168% more leads each month. Success comes from setting goals, tracking metrics and building a strategy.
Use Data to Fine-Tune Lead Generation
Lead generation data is important, but it doesn’t do much good if you don’t evaluate it regularly. Set aside time regularly (e.g., weekly or monthly) to review lead generation data and identify what is and isn’t working. Don’t just rely on the number of new clients. The data points work together to tell the full story. You may find that you have a high conversion rate, but it’s costing a lot of money per lead. Or you may have effective lead sources, but it may take a long time to officially secure clients.
These data points show whether your lead generation efforts are working and highlight opportunities for improvement. You may choose to cut spending in a specific area, focus on a few key channels or remove a bottleneck in the lead-nurturing process. Staying close to the data lets you evaluate what is and isn’t working and make changes. Don’t be afraid to experiment and try new things as you fine-tune your lead generation efforts. Success comes when you focus on your goals and strategies and put in the work to continually improve.
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