However, despite all these resources available to generate new leads, many local businesses still let leads get away. These businesses have no process for managing and following up on leads after they are generated.

Local businesses still let too many leads get away

Regardless of the type of marketing and advertising you do, the benefits of a customer relationship management program are very straightforward (the industry term is CRM). Let’s use an example of two florists: Daisy and Lazy.

Daisy has spent $500 per month on search engine marketing consistently for three years. On average she generates about 100 leads per month. It’s a priority for Daisy to answer her phone, return messages and respond to all email inquiries. Her marketing is not limited to the 100 new leads she generates monthly.

Because of her efforts, Daisy has a rich database of over 3600 leads which includes names, addresses, phone numbers, email addresses and specifics about each lead. Daisy uses the database to email a monthly newsletter and direct mail specials. On key occasions such as birthdays and anniversaries, Daisy calls her leads to inform them of upcoming specials or to remind them to renew an order. The total of Daisy’s marketing efforts equal the combination of her search engine marketing and her ongoing customer relationship marketing. Daisy is selling a percentage of her in-house list and new leads generated by SEM each month. If Daisy sells 10% of the 3600 leads she has on file, she is making about 360 sales per month. These efforts are growing as her list grows.

Across town is Lazy. Lazy also spends $500 per month on search engine marketing on his flower shop. However, Lazy doesn’t always answer the phone, return calls or respond to email. Lazy misses about half of the 100 leads he generates. Without a customer relationship marketing program, Lazy’s limited to these 50 or so leads. What a wreck!

How is your program? How you answer these questions may tell you if your customer relationship marketing is a wreck:

• How do customers contact you—mostly by phone or email?
• When customers call, is the call logged in some organized way?
• How do you follow-up on phone messages?
• Do you return all calls and keep trying until you get through?
• After you’ve quoted a job do you have a process to follow-up and keep following up?
• Do you use multiple channels, including phone, email, fax, mail to communicate with your customers?

Six easy steps toward effective CRM

Here are six ways to implement a successful customer relationship marketing program like Daisy’s:

Use customer relationship management software. There are numerous, reasonably-priced services such as Salesforce.com which is offered on a software as a service basis, allowing you pay monthly. You can also use an Excel spreadsheet. Businesses must have some method other than post-it notes to manage their leads. Then you must become a vacuum—ask every contact to join your mailing list. Ask for email addresses, Twitter names, Facebook friends. Don’t just sell to a customer one time. Get your prospects into your marketing program forever.

Actively manage your leads. Have a dedicated resource—or at least dedicated time—to manage this lead list. Carve out an hour a day, a few hours a week, or one day a month to maintain your in-house database. Create newsletters, coupons, specials, discounts for referrals; work Facebook, Twitter, etc. I know you may not have gone into business to be in sales and marketing, but these activities are critical to grow your business.

Keep consistent records. Create a template or form listing the information you need to collect from every caller. If you have a web to lead form on your website (and you should), you can also use this for phone leads. Let your employees use your website to enter leads right into your database. You can add a flag that shows phone leads (vs. web lead). The information you want in your database includes name, phone number, email addresses, project notes, special dates, etc. All this can be added to your website as a form (rather than just a “contact us” email link). The form will send you an email with all the details—or better yet, this data can be added directly to a database.

Follow-up. On everything—all answering machine messages, emails and other inquiries. You paid to generate the lead; don’t let it get away. And make it easy for potential clients to contact you. Offer your email address on your outgoing voice message. It may be more convenient for some callers to email you their questions. When you cannot connect by phone, try email and vice versa. Always make it easy for customers to contact and communicate with you.

Track and analyze the results. How many calls did you receive, where did they hear about you, how many emails, how many return calls did you make, how many sales, what are your best sources for leads? CRM applications offer rich reporting capabilities. Google Analytics can be easily integrated into your website and is free.

The basics of good sales and customer service

In the age of Twitter, Facebook, iPhones and augmented reality it’s easy to forget the basics of good sales and customer service. In a performance-marketing world we pay each time the doorbell or phone rings, and we lose money each time we don’t answer.

Finally, if you have any doubt that your prospective customers expect this type of service from your company, you can read about a survey I recently conducted with Chicago-based Synovate. We asked 1,000 consumers how important availability is in hiring local service providers and 87% of key local consumers said customer relationships was “important or most important.”

We’ve long known that calls are much more valuable than clicks to small businesses in particular, but also to many larger entities with call-center sales operations. However… it’s taken PPCall much longer to get going than I originally anticipated.

Sterling sees pay-per-call growth in traditional media and mobile. He also notes that pay-per-call programs are now increasingly being used in print Yellow Page directories such as AT&T which just announced pay-per-call programs via the YPmobile App for iPhone and iTouch . Merchant Circle also recently announced pay-per-acquisition pricing – including pay-per-call.

And it’s not just AT&T and Merchant Circle. Other traditional yellow page publishes are renewing interest, and venture rounds by MojoPages, Balihoo, RingRevenue, as well as the TechCrunch50 launch of Redbeacon and Yext show that there is a growing supply of pay per call offerings coming into the mobile local search market.

In fact, I just read a blog post lamenting the poor service delivered to a pay-per-call advertiser. The merchant—who was irate that he received wrong number calls and was charged inappropriately—reminded me of what can go wrong with an advertiser’s pay-per-call campaign.

All of this brings home a point: as more and more search engine marketers, publishers and others in the mobile local search ecosystem are discovering, pay-per-call is not as easy as it appears on the surface. If your local business is being pitched by a provider who just provisions a few tracking numbers, begins charging for calls and then expects to roll in the dough, you need to be prepared to ask a few hard questions.

Five rules for every local merchant interested in pay-per-call pricing

Make a good first impression. If the first calls received from your campaign are wrong numbers look out. Despite best intentions, assigned numbers (necessary of course for pay-per-call), are never entirely clean. Before a number is assigned, your provider should be monitoring for wrong number calls.

Be selective. Pay-per-call can succeed for local advertisers focused on phone lead generation, but it may not be right for your business. Your business should not rely on walk-in traffic (retail); the cost of sale cannot be too low, or too high; and sales generally need to be closed every few calls (high sales to call ratio). You are an ideal pay-per-call advertising candidate if you have advertised in the yellow pages, newspapers, FSIs, Valpak or other mailers, radio or local TV. Business-to-business (B2B) advertisers or niche merchants are not typically good candidates for pay-per-call.

Be prepared to serve your callers. I founded my company on the premise that pay-per-call must benefit the consumer, merchant and publisher. Ten dollars per call may be a great deal for you, but your business needs to be properly staffed and trained to answer the phone. Without a connection to your helpful, available staff, the consumer is not served. If your business does not have the infrastructure to serve clients by phone, pay-per-call may not be for you.

Be able to close a sale or make an appointment by phone. I had a client—a direct mail publisher—whose advertiser complained that they did not make any sales as a result of the pay-per-call leads. We were recording the calls (with permission) for the client and discovered that the leads from the publisher were good, but the advertiser’s staff couldn’t sell.

Calls prove return on advertising investment (ROI) even without pay-per-call pricing. If pay-per-call isn’t right for your business, don’t give up on the numerous benefits of tracking and routing calls.

Look for innovators and leaders when comparing pay-per-call offerings. Yext demonstrated an example of this innovative thinking at TechCrunch50. Leakage and dirty calls are a real problem with pay-per-call. Yext is using analytics to examine key words for relevance and filter out junk calls.

The TechCruch50 winner, Redbeacon—while not focused on pay per call, or calls at all—is trying to solve the problem of merchant availability. This is closely related to pay-per-call (see Rule #3). If your staff is not available to respond to a call, the consumer is not served. The merchant who answers the phone is generally more available than the merchant that does not—especially over a series of calls.

Successful implementation of pay-per-call requires bottom up thinking with the same new product development rigor as any major new advertising or lead generation product. The next generation of Pay-per-call 2.0 insures a high level of satisfaction with the quality of your callers (consumers) by including detailed analytics and reporting to identify repeat calls by caller ID and other calling patterns; category management to deliver the best leads to the right merchants; pricing models that optimize value; and finally advanced, real-time call routing applications to deal wrong numbers, vendors and other unwanted calls.

Despite several years of building expectation, pay-per-call is still a relatively new pricing model within mobile local search. Providers entering this market must be prepared for a fairly steep learning curve and merchants need to be prepared to ask the right questions.