The vast majority of companies make a maximum of 5 contact attempts to close a sale with a potential customer before giving up on the negotiation. However, research indicates that a good active prospecting strategy has 7 to 13 contact attempts. In other words, it takes an average of 10 points of contact to close a sale.
- What is a contact or touchpoint?
- What is the Law of Diminishing Returns?
- How Many Touchpoints Are Needed to Close a Sale?
- How to Schedule Sales Meetings by Email?
- What is the average number of contacts to close a sale?
What is a contact or touchpoint?
How Many Contacts to Close a Sale? A gcash database refers to every interaction with a potential customer, whether it be an email sent, a phone call made, a video conference meeting or even a face-to-face meeting with the potential customer.
It is important to note that interactions through social media or paid advertisements are not considered touchpoints.
When it comes to the number of touchpoints needed to ensure prospecting success, there is plenty of evidence to suggest that response rates increase with each attempt to contact a prospect.
Statistically, through research and data analysis, this average number is around 10. Therefore, when you go beyond 8 points of contact, you considerably increase the chances of receiving a positive response from your potential customer. The name of this theory is the Law of Diminishing Returns.
What is the Law of Diminishing Returns?
The law of diminishing returns states that if one factor of production (e.g., sending emails or meetings) is increased while other factors are held constant, the output (e.g., open and response rates) will eventually decrease.
In other words, a 10th touchpoint isn’t much more effective than an 8th. With that in mind, 10 contacts is a good benchmark number of touchpoints. But there are 2 important caveats to this number.
First, every market segment and buyer persona is different. While 10 touches may be the right number for your company, 12 or 5 might be the right number for someone else. That’s why you should test and monitor your response rates over time.
The second caveat is related to the first. To see accurate touchpoint testing results, you must pick a number and stick to it with every prospect you engage.
Examples of Law of Diminishing Returns:
- Agriculture : Imagine a wheat field asb directory a fixed number of hectares. Initially, adding workers increases production significantly. However, as more workers are placed in the same field, they begin to compete for space and resources, resulting in a smaller increase with each new addition. In the extreme, more workers can even get in the way, decreasing overall productivity.
- Factories : In a production line, the use of more workers or machines initially speeds up production. However, with the uncontrolled increase of these resources, overcrowding, inefficiencies and collapses in the production flow can occur, reducing the marginal benefit.
- Marketing and Sales : Increasing the number of emails or contact points with customers can be effective up to a point. After several attempts, the return on effort diminishes as the audience becomes less receptive. In a business context, balancing between insistence and irritation is essential to optimize results.
This principle is widely applied in economics to optimize the use of resources, helping companies find a productive balance.
In the short run, only some factors of production can be changed, such as labor or inputs, while others (such as technology or capital) remain fixed. Thus, organizations need to adjust their production to avoid diminishing returns and excessive costs.
How Many Touchpoints Are Needed to Close a Sale?
The simple answer is: more than most people think!
According to research, it takes an average of 10 contacts to get an initial meeting (or other conversion) with a new prospect.
How many touchpoints do you need to think about your sales and outreach efforts in 3 parts:
- Interest: Reach out to potential clients and secure an initial meeting to generate awareness and increase interest
- Consideration: Convert that meeting into a qualified opportunity
- Commitment: Bringing the opportunity for a proposal and a victory
As part of the research, 489 salespeople who prospect outbound were interviewed . Their prospecting results, outreach methods and offers were analyzed.
There is a significant difference in results between Top Performers and others at each stage of the sale. What does it take to make a sale?
How to Schedule Sales Meetings by Email?
The best way to schedule sales meetings through emails is by using email cadence flows . Email cadence flows are a pre-programmed sequence of emails that are sent to a prospect.