Why we lost sales.
Losing potential sales always hurts. But, if you know why you lost the sale you can make changes that'll help you win more sales down the line.
The "Why we lost sales" report is one of the tools I use to help my clients make more sales to their Google Ads leads. The report shows how many leads didn't turn into a sale, and why.
Here's the data for a few months from a business that sells new and used cars. The pie chart above represents the same data.
| Reason | Leads | Percentage of Total |
|---|---|---|
| Not contacted | 12703 | 44% |
| Planning to buy later | 7443 | 26% |
| Affordability | 2985 | 10% |
| Declined finance | 3021 | 10% |
| Bought elsewhere | 2030 | 7% |
| No stock available | 620 | 2% |
Not contacted.
These leads never spoke to a sales person after completing an enquiry form. At 45% of all lost sales this represents the biggest opportunity to improve. Fixing this problem is worth several million a year and it's something we're currently working on.
Planning to buy later.
These leads are in the research phase. They're looking at what's available in the market but they're not planning on buying right now.
At 25% of lost sales it is a big enough opportunity to justify some effort. The current plan is to use a combination of email marketing and phone calls to keep in touch. The aim is to get them to bring their decision to buy a car forward, and, to come directly to the business when they're ready.
We'll have the sales person introduce the idea of keeping in contact by saying something like
I know you're not ready to buy right now and that's fine. Occasionally we have very good deals available - where we've overstocked, or where the manufacturer is running a special. That kind of thing. One of those might work for you. Would you like me to let you know when one of those deals comes up?
Affordability.
These leads couldn't afford a new car. We'll do two things:-
-
Introduce them to one of the used car sales people. They might be able to afford a good used car. At the moment there is no incentive for the new car sales team to send leads to the used team so we'll need to come up with something.
-
Add these leads to an audience in Google Ads. We'll exclude that audience. That should improve the quality of the leads we get.
Declined finance.
These leads were not able to secure financing for a new vehicle. Usually because of a poor credit score.
We'll add these leads to an audience in Google Ads as we do for the leads who couldn't afford a car. That should improve the quality of the leads we get.
Bought elsewhere.
These leads bought from the competition. Luckily there were not that many of them. We'll upload these leads as a 'Qualified lead' offline conversion. That'll help improve the quality of the leads we get from Google Ads in future.
No stock available.
These leads wanted a vehicle that was out of stock.
We'll set up a list so we can contact them when stock is available. This is not likely to take a lot of work and might mean a few more sales.
It'd might be worth pausing the advertising when we know there is a stock shortage.
Tips for creating your own "Why we lost sales report".
-
Don't have too many options. When we first tracking lost sales we had 5 different options for affordability and 6 reasons for not being able to make contact. That was too detailed for a big-picture report like this.
-
Make marking leads as lost part of the sales management process. If you don't you will probably end up with loads of "active" leads that are never going to turn into a sale. This creates a false sense of optimism and makes it harder for the sales people to focus on hot leads.
-
Make it easy for the sales team to report on the reason for marking a lead as lost. We've done this with a dropdown list and one button in the CRM system.
Hope you found this as interesting as I did.
I offer 1-to-1 mentoring and consulting. You’ll get help, advice, support and answers without having to commit to a long-term contract. Details here.
Over the last few years I've done deep work with a handful of clients to increase the number of sales they made from their Google and Facebook leads. I've put what I've learned into a 9-lesson email course.
You’ll learn:-
- How to identify opportunities for improvement.
- How to generate more than enough ideas for improvement using the 2-magnets concept.
- How to apply those ideas in your business.
- How to measure the results of your work (so you can do more of what's working and less of what's not).
My experience has been that it will deliver more sales if:-
- Your business receives leads from online advertising like Google or Facebook.
- Your sales process happens offline. A lead arrives and there is a quote, assessment, demonstration etc before the sale happens.
- You have the capacity to handle a few more sales in the short term without having to hire or invest in new equipment.
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