Solar Close Rates by Lead Source: the good, the bad & the ugly - a deep dive for solar companies

If you’re reading this, you’re most likely a solar company. If you’re a solar company, you’re most likely like us (Ipsun Solar). And you have tried about every lead source imaginable.

You've had varying results, and a lot of sunk cost along the way too.

We realized that we had tried almost every available source to generate solar leads. So we crunced our numbers to see which ones were converting at the best rates. Both lead to opportunity, and opportunity to closed sale. This seems obvious, but it can be challenging to actually collect that information and today we will take you behind the scenes and show our actual numbers.

First, let’s start with the data:

Ipsun Solar books sales appointments for about 50% of all leads that come through the door.

This is in range for a company our size: $12M/yr, 60 employees.

We close a solid 30% of those appointments, for a total conversion from top to bottom of under 15%.

Having seen these figures from many solar companies over the years, we are above average. Especially for a competitive market like ours (DC Metro area).

Best Performers: Referrals, Yelp, Radio, and Solarize

You would think that referrals would take the top spot. But our Solarize campaigns have proven to be very successful with a net conversion of 33%. These folks are ready to go solar because they get warmed up by local non-profits. Those groups specialize in solar and energy efficiency, which helps you close it!

Of course, you pay for it with fees of up to 5% to the Solarize organizers. Referrals are not far behind though with a net conversion of 29%, and Yelp taking the third spot at 23.5%. You would think that “organic” leads, coming from your website/Google might be in the top 3. But it turns out that when homeowners go to Yelp they already know what they’re looking for. They need to find the right contractor. Whereas leads coming through Google or your website still need educating and convincing.

Referrals are still our bread and butter. We book almost 80% of referral leads, and close on 37.5%. That's a net close rate of 29.2%, which is why they are the most valuable leads. You can only receive so many leads from all other sources, most of which cost money. Referrals on the other hand can generate at compounding levels if you have the right strategy. Giving our customers access to Sunvoy means they have a single place to refer friends and family. That's how we increased our referrals 254% year over year for 2 years in a row.

A sleeping giant is radio ads. We started doing radio ads early in our company, and customers love them. Imagine hearing the same name every day while driving to work. Knowing that your favorite show sponsor is your local solar installer is huge. That translates to sales with 90% booking appointments and 35% closing. That's a bottom line close rate of 30%! Radio ads also build on themselves. Once the project is complete, your customer will still hear your name on the radio. That's going to mean consistent referrals as your company is top of mind for them.

Low Performers: Angie’s List, SolarReviews and EnergySage

Of course the sources of the highest net conversions are also the sources with the lowest volume. And you can’t generate that volume by sheer spend (at least not with ease).

The lead generation engines are pure “pay to play” and generate the most volume at a fixed cost. They also have the lowest net conversion rate. SolarReviews, EnergySage and Angi are where consumers go to window-shop for solar. Many times they go in with little inherent motivation or understanding of solar. They also get bogged down by receiving too many quotes. All with differing equipment, pricing, estimated generation, solar array layouts, and value propositions which makes it hard to compare beside price.

The result is a lot of analysis paralysis and folks falling off. That's because they are missing a direct connection with a solar installer!

Middle of the Road: Google, Phone Calls

We would be remiss if we didn’t mention our results with Google, which show a net conversion rate of 15%. These leads are looking for solar, no doubt about it. But they need a lot of time to simmer. And plenty of education, drip campaigns and follow ups to make sure they’re satisfied.

You would think that folks calling your company would have a high close rate. But if they don't know where they saw your name, that rate drops. We log those leads as "Phone" in our CRM, and not having a discernible source appears to have an impact. Phone leads book appointments 71% of the time and close 25% of the time, for a bottom line rate of 17%.

The Dregs: Facebook

Sorry, Facebook. Your leads suck. At least for us. We always got plenty of trolls on Facebook, with made up names and phone numbers. Those leads are a complete and total waste of time. If you have the chance to get solar leads on Facebook, do yourself a favor. Look elsewhere, like anywhere else. And if you do make this work let us know in the comments what made the difference.

Bottom Line

Here's the bottom line:

First, get a Solar CRM that allows you to crunch these numbers. Take the opportunity to generate these funnels, because they provide invaluable insights. Not only for marketing but also for sales.

Track all the close rates. Both from lead source from lead to booked appointment, and from booked appointment to sale.

Once you have this information, you can make more informed decisions on future spend. Should you invest more in radio ads or Google ads? It will vary by market, region and company.

But one thing is for sure:

Investing in a superior customer experience brings referrals. Referrals compound and before you know it, you can have half your leads from referrals alone. Sunvoy can help you get there, by providing a superior customer experience that minimizes poor communication and maximizes customer and employee satisfaction! And we have actually put together a step by step guide that shows you exactly how we were able to increase referrals 284% for two years in a row:

See you next week,