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Conversion Ratios and Cold-Calling

A member called us this week asking how many cold-calls would she need to make a week to be successful. Not such an easy question as a lot of factors come into play – what is successful? How good of a cold-caller is she? What’s her market doing? Lots of variables come into play here. However we did find some information to help her get a start.

The Direct Marketing Association publishes an annual study Response Rate Report that shows that a phone call has about a 13% conversion rate into a sale (if I’m reading it right a true ‘cold call’ stands at just over 8 percent). Of course a lot of this has do to with your pitch, script, targeting, etc. And an article in REALTOR® Magazine says that “experts say you get one lead for every 25 calls you make,” which is closer to a 4 percent conversion rate.

The book Up and Running in 30 Days by Carla Cross takes a broader approach using ‘contacts’ rather than telephone calls. She says that on the sales side 400 contacts per month will return 8 qualifying appointments that will result in 8 showings that will average over time as 1 sale. On the listing side 400 contacts a month will result in 4 seller-qualifying appointments that will lead to 1 listing.

Regardless of how you connect, be sure you abide by the various rules and regulations when prospecting.

For more ideas and advice, check out our Field Guide to Farming and Prospecting as well as our Prospecting Tool Kit.

Dave

Senior Information Specialist

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Comments
  1. My coaching clients who are at “Performance Level” can usually convert 50 contacts a week into 3-5 qualified appointments. A lot of skill building and coaching has to be accomplished before effective lead generation can take place. When coaching my clients, I focus on personality style coaching, level shifting & future pacing, effective conversational dialoque for agents to use and efficient follow up systems. Sprinkle in a lot of accountability and success follows!

  2. Kate

    Really good information, Angela, thanks for sharing! Speaking from experience, cold calling is very challenging, so it is brlliant that you do a lot of coaching and personality style coaching–I bet your ROI is much higher as a result.

  3. Thank you! This helps re figure my funnel.

  4. Shellyc

    This made me look more closely at my figures. So after making 265 contacts in 18 weeks part time 3 days a week. 165 of those contacts wanted quotes. 28 of those quotes placed orders. so thats a conversion rate of 16%…so is that good?

  5. Carlos

    Those numbers seem a bit inflated to me… I’ve been in sales for over 15 years and the average conversion rate is about 2% not 8%… assuming you pitch a very targeted market that 2% can turn into about 3% and a market with very low relevance is more about 1.4%

    In fact these numbers are pretty much unchanged across most markets, 20% is the conversion rate if you already have a lead. These numbers don’t change enough with testing your colors, language, time of day etc. for a small business to make much impact (the cost of testing far outweighs the profit) but is much worth it at a much higher level if you are a mid sized to large company!

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