Need help w/ cold call #s
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Ok guys/ladies, I need some help. I haven't cold called in a few years, so I'm a little rusty with the numbers. I've based these loose projections off of what I've read on here (I don't really remember my own #s well enough). I'm planning on doing a cold calling campaign starting in about 2 months. I'm trying to figure out how I'm going to structure it.
The numbers that I want you guys to help me with are the % breakdowns (% calls that turn into "leads, % of leads that turn into clients, etc). FYI, I’m basing these #s off of cold calling biz owners. Just as an example, I’m going to use a round 100 new calls/day (new as in first time to dial the number). Here goes:
100 calls/day. 20% contact ratio means 20 contacts and 80 no answers/no decision maker)
20 contacts/ day. 10% conversion from contacts to leads. This means 2 “leads”/day. (leads as in people that say they are interested).
2 leads/day. 10% conversion from “lead” to becoming a client. This means 0.2 new clients/day.
5 day work schedule @ 0.2 clients/day= 1 new client/ week.
50 working weeks/year= 50 new clients/year.
If those 50 new accounts avg $75k, that’s +$3.75 mil AUM/year. At 1% revenue, that’s $37,500 gross revenue.
But if those 50 accts avg $100k, that’s $5 mil AUM/year. At 1% revenue, that’s $50k gross revenue added from new clients/ year.
Now, that is a hell of a lot of math (though it’s very simple). If you guys could please give me some feedback on my numbers I would appreciate it VERY MUCH!
Also, I have a few questions that are about time length of calls that incorporate into this discussion that are very interesting. But, I think I’ve put in enough #s to overload people.
Looks very much ballpark.
Regarding the 1%, are you positive you're going to fee everything? Just curious, the payout can be higher if you're not. But I know, many opt this route.
As far as length of calls, you don't really dictate that unless you choose to cut them off, which I advocate in many circumstances. Your opening pitch you can dictate length, if that's what you're asking.
My preference is by far, keep it short and direct. 2-3 short sentences identifying yourself and a product followed by... 'is this what you want?', or 'could I send you some information?', or 'Would you have in interest in this?' etc
Doesn't a fee based business help more in the long run? I tend to build mine to be fee based if there are assets above $250,000. If it's less than that I'm planning on doing a more transactional based business.
[quote=Ulairi]
Doesn't a fee based business help more in the long run? I tend to build mine to be fee based if there are assets above $250,000. If it's less than that I'm planning on doing a more transactional based business.
[/quote]
Yeah, fee-based is cheaper up front but probably generates more revenue over time (unless you're churning). Some people say $250k is the minimum to do fee based, others say $100k.
Given my current situation, I'm thinking of just turning pretty much everyone into fee-based if they're say over $25k. That pays me next to nothing each quarter, but I'm looking to generate my revenue in a year from now (when I'm straight commission), not now (with a discounted pay schedule). If I can't generate revenue in 1 year and after that...I'm out of the industry. So, I'll suck it up right now, to get something small rolling into the future. Also, it's a hell of a deal for clients.
[quote=KingBobby]
Looks very much ballpark.
Regarding the 1%, are you positive you're going to fee everything? Just curious, the payout can be higher if you're not. But I know, many opt this route.
As far as length of calls, you don't really dictate that unless you choose to cut them off, which I advocate in many circumstances. Your opening pitch you can dictate length, if that's what you're asking.
My preference is by far, keep it short and direct. 2-3 short sentences identifying yourself and a product followed by... 'is this what you want?', or 'could I send you some information?', or 'Would you have in interest in this?' etc
[/quote]
I'm not going to fee everything. I'll do a portion (0-20% of portfolios) in some alternative assets that pay much more than 1% revenue. But for stocks/bonds/funds I'd like to stick with fee based. And I'll hopefully add in some insurance products as I begin to cross-sell. But even then, when I have the choice, I'll opt for lower upfront but larger trails.
As far as length of calls, I should've been more clear. I'm just talking averages. Sometimes I'm too nice on the phone...I'll 'chat' with someone hoping to build rapport, when it turns out they aren't interested in me, they just want to gab. The reason I'm asking about average length of calls is to get an estimate in how long it would take to make those 100 calls. For instance, let's say on the 80% of calls that either don't answer or no decision maker, they are 90 seconds. But the ~20 calls I make contact, say they last 7 minutes each...That's kind of the road I was going to take that discussion.
BTW, thank you guys for the feedback. Sometimes it's nice to know I'm not banging my head against the wall!
Don't worry about call time. Just don't get caught up with people that just want to complain about the current adminstration or taxes and have no money.
Ask them early if they are interested or if they "xyz" and if they DON'T and then want to complain about something because they are lonely, say "Well, I agree, but I don't know that there is anything I can do to help you - best of luck with XYZ" and get off the phone. Someone is interested - let them talk as much as they want so you gather info. Make sure you wrangle them into actually giving you important information, but let them talk.
Sometimes I will get enough info from a person on a first call that a follow up is to get statements and start putting together a proposal - saves you a ton of face/travel time.
If they tell you up front they don't have money GET OFF THE PHONE. If they invest and have accounts, let them talk so you can feel for a pain point.
[quote=Bigballin]The reason I'm asking about average length of calls is to get an estimate in how long it would take to make those 100 calls.[/quote]
2 hours.
50 dials/hour.