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Velocify-Auto-Lead-Distribution-Methods-and-Conversion-Rates-Oct2013What are the best ways to distribute leads to sales teams? A new study [download page] from Velocify tackles this question by examining a pool of 2.7 million leads distributed during a 1-month period by more than 600 of its customers, and followed through the sales cycle for at least 90 days in order to track their outcome. Here’s one headline result: customers that used at least one automated distribution method experienced a conversion rate 87% higher than those who manually or otherwise assigned their leads.

The study identifies 4 key distribution methods:

  • Push-based distribution, where the system automatically “pushes” leads into reps’ queues;
  • Pull-based distribution, where reps actively request leads out of a pool when they’re ready to work them;
  • Shotgun Connect, where multiple reps are notified when a new lead comes in and the first to respond gets the lead; and
  • Manual distribution, where the manager or supervisor manually assigns each lead to a specific rep.

(The study only focused on the initial lead distribution, not on redistribution methods.)

The researchers find that speed is a driver of contact rates, with the organizations in the top quartile in terms of relative percentage of leads called in less than 5 minutes enjoying a 9% higher contact rate than average. Those in the bottom quartile in terms of contact speed had a contact rate 18% lower than average. (The company had also linked speed-to-call with improved conversion rates in a prior study.)

Contact rates – as one might expect – were also positively linked to relative conversion rates. The top quartile in terms of contact rate (with a rate 55% higher than average) boasted a conversion rate 57% higher than average. Conversely, those in the bottom quartile for contact rates (52% lower than average) saw conversion rates 35% below the average.

Given the positive relationships between speed-to-call, contact and conversion rates, Velocify then looked at the different distribution methods to see how they fared in these metrics. The results showed that organizations using auto distributions methods – as opposed to manual distribution – had a 91% higher rate of calling leads in under 5 minutes, and a 13% higher contact rate.

Among the various auto distribution methods, the Shotgun Connect method proved to have the best results, with 415% more leads called in under 5 minutes and a 22% higher contact rate. (The figures for push distribution methods were 16% and 10%, respectively, while for pull distribution methods they were 140% and 15%, respectively.)

Given those results, it’s not surprising that auto distribution methods saw higher conversion rates. But there’s one further wrinkle: the study suggests that using multiple auto distribution methods is better than using one. For example, while companies using just Shotgun Connect had a conversion rate 80% higher than average, those using Shotgun Connect in addition to push-based distribution had a conversion rate 107% higher than those not using any auto distribution.

The requisite disclaimers bear noting here: correlating these metrics does not mean causation. In other words, there may be other variables at play influencing these results. For example, it may be that the organizations using the auto distribution methods have more effective or proficient sales teams than those who are using manual distribution methods. Nevertheless, the results provide an interesting starting point for teams looking to do their own testing.

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