Gone are the days when lead routing was manual and laborious – using spreadsheets, sticky notes, and a lot of guesswork. Sales managers had to sift through leads manually, assign them to available reps, and ensure no lead slipped through the cracks. Regardless of the hard work, it often resulted in missed opportunities and frustrated sales teams.
Fast forward to 2023, and the story couldn’t be more different. Thanks to technological advancements and no-code automation, lead routing has become a breeze for sales teams. But what’s the big deal, you might ask? Well, efficient lead routing enables your reps to focus on selling rather than wasting time on manual tasks or following up on cold leads. And the result?
- Improved productivity
- Faster response rates and
- Higher conversion rates
So, buckle up and join us on a journey through the world of lead routing in 2023, and discover how this critical aspect of the sales process can take your revenue efficiency to new heights.
Lead routing is the process of assigning leads to the most appropriate sales reps. It involves collecting leads through various channels and using predefined criteria to route them. The goal is to ensure each lead is handled promptly by the most qualified salesperson, resulting in improved response times, personalized sales approaches, and increased chances of converting leads to customers.
Lead routing can be done manually or through an automated system, depending on the size and complexity of the sales operations.
The cost of routing leads the old way
Poor sales productivity
Sales reps are the driving force behind generating revenue for any business. Unfortunately, they spend only 28% of their time actually selling, while the rest 72% is spent on avoidable administrative tasks, such as data entry and prospect research. It leaves sales reps with less time to connect with leads and close deals, resulting in lost revenue.
Inefficient lead routing processes exacerbate this issue, making matters worse for sales teams. Here’s an example:
Let’s say your team of 10 reps spends 72% of their time on non-selling tasks due to poor lead routing, resulting in 504 hours of wasted productivity/per week.
Assume average hourly wage/rep = $30
Lost revenue due to productivity loss = 504 hours x 30 = $15,120 lost revenue/week.
And that’s just one team. Multiply that by several teams or departments, and the losses skyrocket.
Error prone
Manual lead routing often relies on human decision-making, spreadsheets, emails, and phone calls to prioritize and assign leads. As the number of leads grows over time, this process becomes more error-prone and cumbersome, leading to missed opportunities and lost revenue.
To illustrate, let’s say your sales team receives 500 leads per month, and it takes an average of 10 minutes to assign each lead manually.
Time taken for lead routing = 500 x 10 = 5,000 minutes or over 83 hours.
If your sales reps spend only 28% of their time selling, they have only 197 hours to close deals, resulting in limited revenue potential.
Furthermore, manual lead routing is prone to errors, such as assigning leads to the wrong reps, duplicate entries, and missed follow-ups. It can lead to lost deals and decreased customer satisfaction, damaging your brand reputation and future sales opportunities.
Limited pipeline visibility
With poor lead routing, sales reps may miss critical data points or activity updates, leading to incomplete or inaccurate pipeline visibility. For example, if leads are not assigned promptly and accurately, reps may not know which accounts to focus on, what actions have been taken, and what actions still need to be taken – resulting in missed opportunities and duplicated efforts, ultimately, lost revenue.
Impact on rep’s productivity and targets
Poor lead routing can take up valuable time that could be spent on selling activities. For instance, if a sales rep spends an hour per day on lead routing, this adds up to five hours per week or 20 hours per month. This time could be better spent making sales calls, engaging with prospects, and closing deals.
As a result, sales reps may struggle to meet their quota targets, leading to decreased morale, burnout, and turnover. Furthermore, missed quota targets can have a cascading effect on the entire sales team, impacting team morale, goals, and revenue targets.
Impacts revenue targets
Allow us to paint a picture of how ineffective lead routing derails your funnel targets with an imaginary case study.
- Sales team size = 5 reps
- Team quota target = $1 million/year
- Individual reps’ quota = $200,000
- Reduced productivity due to poor lead routing process = 20%
It means each rep would achieve only 80% of their target.
- Resulting productivity loss/rep/year = $40,000 ($200,000 x 20%)
- Potential revenue loss/rep/year = $200,000 ($40,000 x 5)
Difficult to track
Tracking lead performance and optimizing marketing spend is critical to any successful business. However, manual or traditional lead routing systems can often pose challenges. Limited visibility into the lead routing process can make it difficult to track which leads are converting and which are not, making it challenging to identify which marketing campaigns or channels are driving the most qualified leads and conversions. The inability to track lead performance at every stage of the sales process further complicates marketing spend optimization and ROI measurement.
Let’s understand this with an example:
Company A sells software solutions to businesses. It invests in various marketing campaigns, including Google Ads, email marketing, and social media advertising. However, due to the lack of visibility into lead routing, the company cannot track which marketing campaigns generate the most qualified leads and conversions.
As a result, it continues to spend marketing dollars on campaigns generating lesser ROI, wasting resources and restricting the company’s revenue potential. With proper lead routing and performance tracking, the company could optimize its marketing spend, directing resources towards the campaigns that generate the most qualified leads and conversions, resulting in increased revenue potential.
Limited scalability
Traditional lead routing systems often rely on manual processes – time-consuming and prone to errors. For instance, you need to manually review and qualify each lead before assigning it to a salesperson, resulting in delays and missed opportunities, as potential customers may lose interest or move on to competitors.
Manual lead routing systems can become unmanageable as the volume of leads increases. For example, if a company generates 100 leads per week, it may be feasible to manually assign leads to sales representatives. However, if the company wants to scale its lead generation efforts and generate 1000 leads per week, a manual system can quickly become overwhelmed, resulting in missed opportunities and decreased revenue potential.
What is dynamic lead routing?
Dynamic lead routing is a process of automatically assigning leads to the most appropriate sales reps based on a set of predefined rules and criteria. It involves using real-time data and analytics to determine the best possible salesperson to handle each lead based on the prospect’s location, industry, size, budget, and behavior.
With dynamic lead routing, sales teams can respond to leads more quickly, increase the chances of converting prospects into customers, and ultimately boost revenue.
Benefits of dynamic lead routing
Focus on speed to lead
Given the speed at which businesses are moving in 2023, you’re last if you’re not fast. Because modern prospects demand fast responses, research shows that 75% of prospects buy from vendors that respond first.
Thankfully, dynamic lead routing tools have arrived on the scene to help businesses keep up with the need for speed. These tools segment, prioritize, and distribute incoming leads in real-time, with features like real-time alerts, SLA reporting, and automatic re-assignments ensuring that speed-to-lead metrics are met consistently.
But why does this matter? Let’s break it down with an example
- Leads generated/week = 100
- Rep quota target = 20 closed deals
- Lead response time = 24 hours.
With a manual lead routing system that takes an average of 24 hours (or more) to respond to a lead, sales reps have only four business days to follow up on leads and close deals. That’s cutting it pretty close!
Enter dynamic lead routing; reps have a whole week to follow up on leads, increasing their chances of hitting their quota targets.
And it’s not just about hitting quota targets. Improved speed to lead also means increased revenue potential. Research shows that companies that respond to leads within an hour are 7x more likely to have meaningful conversations with decision-makers than those that respond after an hour.
In other words, faster lead response times = more closed deals = more revenue!
Speed vs efficiency
Dynamic lead routing improves the speed and efficiency of lead response times by using advanced algorithms to segment, prioritize, and distribute leads based on various criteria, such as lead source, product interest, and location. This ensures that the right lead is sent to the right sales rep at the right time, maximizing the chances of a successful conversion.
Let’s dig into the concept with an example:
- Leads/month = 500
- Average deal size = $1000
With a manual lead routing system that assigns leads to sales reps based on a simple round-robin method.
- Response time = 4 hours
- Conversion rate = 15%
- Conversions = 75
- Revenue = $75,000
Let’s say the company implements a dynamic lead routing tool to segment leads based on various criteria and assigns them to the most suitable sales rep in real time. Result?
- Response time = 15 minutes
- Conversion rate = 70%
- Conversions = 350
- Revenue = $350,000
That’s a significant jump of 366% in revenue generated.
Dynamic lead routing improves response times and maximizes lead response efficiency by ensuring that each lead is assigned to the most suitable sales rep based on product expertise, past performance, and location. This results in a more personalized and compelling sales pitch, increasing the chances of a successful conversion.
No-code solution
In 2023 and beyond, businesses are no longer willing to put up with the pain and frustration of manual lead management. The days of sifting through spreadsheets, trying to keep track of leads, and juggling disparate systems are over.
Dynamic routing eliminates the need for manual lead management, taking care of all aspects of lead distribution, from segmentation and prioritization to sales resource allocation and process management. It’s a streamlined, automated process that allows businesses to respond to leads quickly and efficiently without sacrificing accuracy or quality.
Dynamic routing is a breath of fresh air for businesses struggling with manual lead management. It eliminates the frustration and stress of manual processes, freeing up time and energy for sales reps to focus on what matters – building relationships with customers and closing deals.
And the impact on revenue? It’s significant. You can increase your conversion rates and hit revenue targets by responding to leads faster and more efficiently. Research shows that businesses that automate their lead management processes see a 10% or more increase in revenue within 6-9 months.
Advanced tracking
Having control over your sales process is essential when it comes to selling. And that’s where dynamic lead routing comes in. With its advanced tracking system, sales teams can get a detailed view of each lead’s journey from the moment they enter the funnel to the point of conversion. It’s like having a bird’s eye view of your sales process, but with the added bonus of being able to zoom in on the details.
This level of insight is priceless for sales teams, as it allows them to identify potential roadblocks and take action at the right time. You can see where each lead is in the funnel and adjust your strategy accordingly, whether that means tweaking your messaging or offering a targeted promotion. You can improve your conversion rates and hit your quota targets by making data-driven decisions and taking action based on the insights provided.
And the best part? All this data is available at your fingertips—no more sifting through spreadsheets or guessing which leads are hot or cold. Dynamic lead routing puts all the information sales teams need in one place, making optimizing your sales strategy and driving revenue growth easier than ever.
Adapting to GTM motions with agility and speed
Dynamic lead routing helps you adapt to the ever-changing go-to-market (GTM) motions with agility and speed by quickly adjusting your lead distribution strategy based on real-time data and feedback. With dynamic lead routing, you can segment leads based on various criteria, such as geographic location, industry, company size, and other factors that impact the sales process. This segmentation allows for a more targeted approach to lead distribution, ensuring that leads are routed to the right sales reps with the best chance of closing the deal.
In addition, dynamic lead routing tools allow for easy adjustments to the routing strategy in response to changes in the market, customer behavior, or other factors that impact the sales process. For example, if a new competitor enters the market, you can quickly adjust your lead distribution strategy to focus on leads that are most likely to convert, or if a sales rep leaves the company, their leads can be automatically reassigned to another rep.
By adapting quickly and efficiently, companies can stay ahead of the competition and maximize revenue potential. With real-time data and feedback, you can make informed decisions about your lead distribution strategy, ensuring that you are always optimizing for maximum efficiency and effectiveness.
Improved sales efficiency
Dynamic lead routing can significantly improve sales efficiency by streamlining the lead distribution process and enabling you to focus your time and efforts on the most promising leads. Your reps can spend less time sifting through leads and more time engaging with qualified prospects, ultimately leading to a shorter sales cycle and increased revenue.
Moreover, it helps you identify potential roadblocks in the sales process by providing insights into how leads progress through the pipeline. With this information, you can take targeted actions to address bottlenecks and keep leads moving forward, further reducing the sales cycle and driving revenue growth.
Suppose a company’s average sales cycle is 90 days, with a monthly revenue target of $100,000. Without dynamic lead routing, their sales team takes 3 days to follow up with a new lead, resulting in a slower sales velocity.
The company can respond to new leads within minutes instead of days with dynamic lead routing. This reduces the average sales cycle to 75 days, resulting in a 16.67% increase in sales velocity. As a result, the company can exceed its monthly revenue target and generate $116,667 in monthly revenue, a 16.67% increase.
As we move further into 2023, the state of lead routing is clear – it’s all about speed, efficiency, and agility. The age-old manual routing practices and spreadsheet juggling are becoming obsolete, and businesses must adapt to the changing landscape. By shifting to dynamic lead routing, companies can gain a competitive edge, increase sales efficiency, and drive revenue growth.
The benefits are clear – speed to lead, improved efficiency, and real-time tracking of metrics that matter. Businesses that rely on outdated lead routing methods risk falling behind their competition and missing out on potential revenue opportunities.
So, if you want to take your business to the next level, it’s time to shift to dynamic lead routing. By embracing this technology and making data-driven decisions, you can optimize your sales strategy, hit your quota targets, and drive revenue growth. Don’t get left behind in 2023 – switch to dynamic lead routing today.
If you’re looking to gain a deeper understanding of the current state of sales and lead routing and want to ensure that your strategies are up-to-date with the latest market trends, we’ve covered everything you need in our recent White paper, “State of Lead Routing in 2023.”
Our white paper delves into the intricacies of the sales landscape in 2023, exploring the latest sales methodologies and technologies that are driving success in the current market. We also discuss the latest lead routing and management trends and offer practical strategies for optimizing your lead routing processes to ensure maximum efficiency and effectiveness.
Download our white paper today and explore the latest trends and strategies for sales success in 2023 and beyond.