We‘ve recently heard three different conversations around leads, all of which were a little bit different, and they’re all worth sharing.
The first topic centered around understanding the difference between 1st and 3rd party leads, and why that matters.
A first party lead means the customer was on your website, filled out a form or chatted in. You own that relationship and it’s exclusive between you and the customer.
A 3rd party lead means someone completed a form on a big national brand site like KBB, Cars.com, you get the idea. You don’t own that relationship, you pay for that lead, and typically so do other dealers in your area, meaning it’s not exclusive and you’re competing with other dealers for that business.
Both types of leads are good as long as you closely monitor your lead-to-sold ratio and how much those leads cost you, but the first party leads are much more valuable.
The second lead topic we overheard was about “reading the lead” and focusing on buyers and financing. If your payment calculator or digital retailing tool lets buyers self-select a credit score, steer your team’s attention towards the leads with 660+ credit scores.
The takeaway quote: “I can get you 3,000 leads a month, but if they are all 520 FICOs and you can’t get them financed by the bank, then those leads are worthless to you. We can see though, that the leads that you are receiving with a soft credit pull are high quality, low funnel leads, and that a good % identified with a FICO of 660+. That’s not just a lead. That’s a done DEAL.”
Lastly was a conversation with a customer on why their lead volume was low.
Easy! Their website traffic had been steadily declining.
Yes, you can get trade and payment tools that convert better, but if you’re not investing in marketing to get people there, no tool can help with that.