Lead source
What is a lead source: lead source explained for dealership CRMs
Lead source is the field in a dealership CRM that records where a sales enquiry originated: the dealer's own website, a third-party marketplace, the manufacturer, a walk-in, an inbound call, a campaign, or a referral. Every decision about where the advertising money goes next month is made on the strength of that one field.
You will hear it used loosely alongside lead channel and lead provider. Source is the specific origin recorded on the individual lead. Channel is the wider group it belongs to.
What does lead source mean in the CRM?
Most dealer CRMs carry a source value on every record, populated three ways:
- Automatically, from the feed: a marketplace or manufacturer sends the lead through an ADF or API feed that already names the sender. Reliable, and the only category that mostly takes care of itself.
- Automatically, from the website: form submissions tagged by page, campaign parameter or tracking number. Reliable if the tracking is set up properly, and quietly broken more often than anyone checks.
- By hand: a salesperson picks from a dropdown when logging a walk-in or a call. This is where the data goes to die.
Why lead source data is usually wrong
Ask a general manager which source produces their best business and you will get a confident answer. Ask them to prove it from the CRM and the confidence drops. Four failures account for most of it:
- The default option wins. If the dropdown opens on "Walk-in", a third of the store's leads become walk-ins by 4pm on a busy Saturday.
- The last touch takes the credit. A shopper finds the car on a marketplace, checks your website, then phones the tracking number on your listing. One customer, three plausible sources, and whichever gets recorded takes the whole sale.
- Duplicates split the record. The same buyer submits on two sites and arrives as two leads. Merge them and one source loses a sale it helped create.
- Re-sourcing on the way to the deal. Leads get reassigned, retyped and cleaned up during the month, and by reporting day the field no longer says what it said on the day it arrived.
None of this is fixable with a better report. It is fixable with a shorter dropdown, locked source fields after creation, and someone auditing 20 records a week against the original enquiry.
How is lead source performance calculated?
Two formulas do nearly all the work. Volume and close rate on their own will mislead you every time.
- Cost per lead = spend on the source ÷ leads received from the source
- Cost per sale = spend on the source ÷ vehicles sold from that source
Cost per sale is the one that settles arguments, because it folds close rate into the cost. A source can be twice the price per lead and still be the cheapest way to sell a car.
Lead source explained: a worked example
Two sources, one month, one rooftop.
- Source A: 300 leads, £4,500 spend, 12 sold. Cost per lead £15. Close rate 4%. Cost per sale £375.
- Source B: 80 leads, £4,000 spend, 14 sold. Cost per lead £50. Close rate 17.5%. Cost per sale £286.
Source A looks like the bargain on the cost per lead line and produces almost four times the volume. Source B sells more cars for less money, and it does it while consuming a quarter of the BDC's phone time. If the only number in the meeting is cost per lead, the store cuts the wrong one.
Add one more column before deciding: gross per unit. A source that delivers cheap sales at half the gross is not cheap, and price-led marketplaces frequently do exactly that.
Source, channel and campaign are three different things
- Channel is the category: internet, phone, walk-in, referral.
- Source is the specific origin inside that channel: your website, a named marketplace, the manufacturer's site.
- Campaign is the specific activity that produced it: a used stock push, a plate-change mailer, a finance offer.
Collapsing all three into one dropdown is why so many stores end up with 60 source values, half of which nobody can define. A workable list is short: your website, each third party lead provider named individually, OEM leads, phone, walk-in, referral, service drive, and repeat customer. Anything more granular belongs in the campaign field.
What to review by source, and how often
A monthly source review holds up if it covers five columns per source: leads, cost, close rate, cost per sale, and average gross. Two habits make it useful rather than decorative:
- Follow cohorts, not calendars. Judge March's leads on sales through May, not on sales that happened to close in March. Sources with longer consideration cycles get punished by calendar reporting.
- Track response time by source too. If one source converts badly and is also the one answered last, you have a process problem wearing a marketing problem's clothes.
The point of the field is not attribution for its own sake. It is knowing which enquiries deserve a call in the next ten minutes, and which supplier to renegotiate with in the next quarter.
