BDC 101: Performance Metrics
After a few recent discussion threads about how to measure a dealerships BDC performance, I wanted to offer some insight based on our own experiences.
To be honest, I'm not shocked there is still this confusion. The BDC is rather an anomaly to the auto industry, borne from necessity to handle the large volumes of leads generated by the reach of today's global digital marketing platforms. A single Internet Manager can't handle 500 new leads a month AND follow up on the hundreds that were not reached AND sell the vehicle. Most dealerships struggle to define performance metrics because they lack the experience or personnel with the expertise in operating a call center. Simply stated, Its a completely different functional business model than running a dealership.
I would start by saying I consider the BDC part of the sales department, just a different division. I like to use the analogy similar to how finance calculates 'front-end' & 'back-end' profits on sales - the BDC is the front-end sales team, the the sales reps are the back-end sales team. It's a tag team where both parts are equally important, but have vastly different roles and objectives.
What do you measure?
Start with a defined contact process based on your lead volume. Many of today's CRM systems allow you to view and segment your leads based on defined tasks. So every new lead, every lead that requires a follow up call, scheduled call backs, emails, text messages, etc. are all neatly categorized by date and priority (I recommend VIN Solutions). Every day, these buckets will fill with new leads so its critical to make sure those tasks are completed every day. The number of calls needed to be made daily will be defined by how many attempts or touches each lead receives (average 11 to 18 touches/Calls, email & text). On average, each agent should expect to make between 100 and 150 calls during a normal 4 to 8 hour shift (25 calls per hour).
Call to Appointment Objectives
- Calls = 100 to 150 daily (based on lead volume). Are all call tasks being completed daily?
- Connect rate = 20% A standard that rarely ever changes. This is more of a measurement of lead quality than agent performance. (more on that below)
- Conversion rate = 30% & 40% percent. (Lead quality play's a role here)
- Show Rate = 60% to 75%
Notice I didn't list units sold. While I think its important track sold units back to the BDC for reporting and possibly commission reasons, the BDC should not be judged on the number of sales if they are accomplishing their tasks and meeting their performance objectives - which I will repeat again below, is to convert leads into showroom visitors. It's up to the sales team to then do their job and turn the visitor (no longer a lead, thx to the BDC) into a closed sale.
Lead Quality
Rating lead quality should also be a part of your normal reporting routine. A quality rating would include a 20%+ connect rate and 30% to 40% conversion rate (close rate is also important but should be a key measurement of the sales teams performance).
If your agents are following the appropriate scripts, making the target number of calls, properly rebuttal objections or otherwise follow their training (additional aspects of agent performance that should be monitored and measured by your BDC manager) and you still aren't reaching these numbers, you may want to reconsider your lead sources or better select your market demographics. If only 2 of the 10 daily appointments qualify for financing, you have an issue.
It simply makes no sense to hold the BDC responsible for lead quality or total units sold when their primary objective should always be to get people in the showroom.