How I track my leads
I’d always heard about the importance of tracking your leads over time, so I started to do it from day one. However, I never really knew what to do with that information or really looked to see if there were any insights. Recently though, I was reviewing my marketing strategy and decided it was a good time to peak under the hood a little and see what my leads were telling me.
I had three assumptions before I started this exercise.
1. I was spending a lot of time on effort on Instagram and was seeing little by way of results
2. I was doing too many jobs for family and friends and they were not profitable
3. Leads from google were harder for me to close
This begs the broader question;
1. Where are my most promising leads coming from?
2. Which source of leads is easiest to turn from a lead to a client?
3. Which source of leads is results in the highest fees?
Like your favorite Hollywood ‘true story’, the general trends here are real, but I’ve changed the values and names of the clients.
I do this for each quarter, then collate them over the life of the practice (see below)
Enquiries
I’ve tracked all of my enquiries since I opened the doors a couple of years ago. I track the obvious information like names, date, suburb, project budget and the value of the fee I’ve offered. A word of warning about budget, this is the budget I ask the client to give me. No disrespect to clients, but they can’t be expected to have a realistic understanding of the project budget, so its not really a good proxy for the project value. I guess I could estimate the true value, but early on in the life of the practice I didn’t have a good feel for it, and now I estimate it later in the engagement so it wouldn’t be reflected in the leads.
More important information is how they found out about us, what was the value of my fee and what was the outcome of the enquiry. I categorise these into four groups:
Outcome of Enquiry
Won – pretty obvious, if I submitted a fee proposal and they accepted it.
Lost – I submitted a proposal and they rejected it
Passed – If after I’ve spoken to them about their project and I don’t think we’re a good fit I’ll pass the enquiry onto a friend or builder
Faded – A lot enquiries go nowhere. They’ll send me an email, I’ll email back and they’ll ghost me. Other times, I’ll tell them my minimum level of engagement and I can tell that its not in their budget. I don’t consider this to be the same as losing a proposal if it happens after the first couple of conversations
Source of Lead
Family / Friend
people that I’d consider to be in my immediate network. Someone who I feel the urge to offer a discount to because they only came to me because they are a close friend or family member (PS, I don’t offer them significant discounts, you can read about how I set fees for them here)
Network
This is generally friends of friends or broader acquaintances.
Professional Referral
Often engineers or builders that I work with will pass on leads. Larger more established architects are also a great source of professional referrals.
Social Media
Leads that have come from social media. I focus a fair bit on Instagram and have a facebook account that I don’t take seriously at all. However, I get quite a few referrals from local renovation facebook groups and the like.
If people are googling ‘architect near me’ and I come up and they give me a call, I consider that from Google.
Type of Project
If you have a certain type of work that you focus on – and you really, really should, this is useful information. You can track over time how close each of these leads are to your bullseye of preferred work. This is a really important metric in terms of how clear your messaging is on the type of work you want to do. Small homes and residential alterations and additions are right in my bullseye, so I’d be wanting to see lots of these enquiries.
Scope of Works
Some leads will be the right type of project, but the wrong scope. For example, you might be clear that you only want to aim for full service projects with a high level of design input, but if you’re consistently getting leads for people that just want you to draw up their pergola to get through council, that’s a problem.
Analysis
It’s kind of hard to make much sense out of this relatively raw list of leads. So the most important thing to do is to dive into it every now and then. While I’ll update my leads every few weeks, I’ll only really dive into this analysis every few months – probably about once a quarter.
First, its really important to know how much work you need to attract to be earning enough money to make this worth your while. I’m working on an article on this now, but essentially, you need to know how much money you need to bring in to the practice. Also, you want your cashflow to be relatively bump free (consistent from month to month).
With this raw information I break it down into a few factors:
Quarters
I feel like monthly is too short a sample size, where as if you’re anaylising this quarterly you’re more likely to see some trends.
New Business Generated
This is essentially the amount of money you brought into the practice. Initially I would put the full expected fee in here when I ‘won’ it. For example, if I signed a contract for full services for $50,000 then I would put all of that fee in that quarter. Over time however, I’ve realised that that job could fall over at any stage and that it is likely to take about 12 months. Therefore, I only track the phase of the project that I’ve just won. So if we start concept in Q1 and then DD in Q2 I will put the relevant fee into the relevant quarter. This helps you to conceptualise two important points:
1. You never win a full project on day one – lots and lots of jobs full off at various stages for various reasons
2. This method is by proxy tracking cashflow. You’re not bringing in that $50,000 in Q1 and so it doesn’t help your cashflow for that quarter
Over Under Target
Knowing exactly how much money you need to bring in quarterly is really important. It helps you budget, manage cashflow and know how you’re going. It’s a combination of your salary, your expenses and your profit margin. We’ll talk more about this another article soon.
Once you know how much you need to bring in each quarter you can track whether you are hitting your target. Obviously you need to do and bill the work, but once you’ve won the work and have seen how it tracks against your expenses you theoretically know if you’re going to be able to keep the lights on this quarter.
Leads and results
As described above I track the number and result of leads. This will help you to understand how many of your leads are genuine and how many of those you’re winning. You can then start to see a pattern of how many leads you get per quarter, and how many you close.
Price per engagement
There is a lot of discussion about working on fewer, more high paying jobs per year. This makes sense to me – but this article isn’t diving into that. However, knowing that value of the projects you close, and seeing that rise over time are important.
Source of leads and Outcomes
Finally, I track in a separate spreadsheet the source of my clients – that is, those that I end up working with. Where did they come from, how many have I engaged, what the average value of that client is, and the percentage make up of each source of leads.
What does all of this mean?
I compile all this info annually. It allows to see the broader trends of the practice. You can see here that, while still bumpy the number and quality of my leads is increasing. Importantly so too is the value and quality of my engagements.
Note all the red up there. That’s because I was slowly starting things off but working part time for someone else. I’d punched in the numbers that I wanted to be hitting when I started working full time. You can read more about this approach here
You can see that I’m being more picky with the projects and passing on a lot more leads.
There is a slow but general trend of my price per engagement increasing.
At the start of this exercise I had a few assumptions. Lets see if this spreadsheet can help me answer some of those assumptions.
I was spending a lot of time on effort on Instagram and was seeing little by way of results
I was feeling this way because a lot of leads where going nowhere, or were unrealistic. Through this analysis you can see that the although there are a lot of unsuitable leads that come through here, once they’re qualified they generally turn into high value projects.
I was doing too many jobs for family and friends and they were not profitable
This turns out to be true. The value of my friends and family jobs account for close to a quarter of my billing so far. However, they are by far the lowest value per engagement. This is a combination of heavily discounted fees for friends and family members in the early months of my practice. However, on a positive note, I’ve learnt a lot from this and I have started to heavily reduce the scope of my services. This means that although I don’t gross as much money on these projects, the scope is small and short and I don’t lose a lot of money by discounted my fees. I’ve written a detailed article on how to set fees for friends and family – you can find that here
Leads from google were harder for me to close
This also turns out to be true. I’ve gotten absolutely no work from leads that have come directly from google. I think there are a couple of things at play here. They may have different buying criteria from other sources – as much as I work on it, building trust over your website can be a challenge, and as architecture is a high value service you need to build a lot of trust.
Another possibility could be that they’re calling around a lot of practices and therefore my competition is higher – they might be shopping on price and I’m ok to lose them if that’s the case. They might also be shopping on service, and if I’m losing on that, then that’s a bigger problem.
Another possibility is that my page isn’t ranking high enough on google to attract many qualified leads – and I think this is actually big one. I’m slowly working on this, but as I’m seeing plenty of other leads come in from elsewhere I’m not too worried about it
Let’s then see if we can answer the other questions I had:
Where are my most promising leads coming from?
This analysis goes a long way to answering this question. A touch over 40% of my work so far has come from professional referrals – other architects, engineers and builders that have vouched for me. Because I’ve been recommended there is already a level of trust there, and they are also generally qualified leads.
Which source of leads is easiest to turn from a lead to a client?
Well I haven’t yet tracked the leads to client ratios, but from a quick scan it looks like friends and family has the highest win rate. That’s probably not a surprise. However, just because they’re easy convert to clients, they’re often not the best clients. Also, unless you have a super huge network of wealthy friends and family, they’re unlikely to be a regular source of high paying projects.
Which source of leads is results in the highest fees?
Even though I’ve only landed two clients from the socials, Instagram and facebook make up close to a quarter of my billing so far, and the value of those leads is highest. This looks like a really promising avenue to continue to explore
Final Thoughts
For me, in my practice is given me really clear insights. Continuing to strengthen my professional network and social media presence looks like a good way forward for higher paying engagements.
Also, it starts to tell me how many leads I need to convert to paying clients to cover my costs. I’ll explore this more in an article soon.