Advice No One Asked for - Should You Buy Leads?

[lukifer]

I have had others who are getting into this industry ask me and I've seen it on here, but I thought I'd put my opinion in here for the new people coming into the biz.

"Should I buy internet leads? How do I sell to internet leads?"

Answer: "No, and you don't" (Life is a little different... but still, no)

The fact is that most people banging around online are only mildly interested and some of these leads from internet vendors are aggregated from BS surveys.

Think about it from the customer perspective: If you were cruising Amazon and price checking a book on XYZ, would you want Amazon to call you 30 seconds later to talk about it? How about another call in 2 hours? How about another in 4? How about Barnes and Noble started calling too? Then... Books A Million? What if these 3 groups started calling you every day for 7 days straight at various time? What if you got that "I don't take no for an answer..." kind of sales guy who kept pestering you for weeks on end about buying that book from him?

This is essentially the life of an internet lead.

People shop online to price check and buy things. IF they wanted a pushy, salesman... they would freely ask. With Millenials hitting the workforce and needing insurance, they would much rather just purchase what they need to get the job done and move on... not have constant meetings or conversations over something as boring as Auto.

These "big name" lead guys are simply trashmen trying to sell you trash at a high price. Some of these companies even recycle these leads after 3 months and sell them as "prime". They aren't... they are still trash.

Can you make a sell? Sure... if you play your cards right and find one of the lucky few that hasn't already been beat up by your competitors. You could randomly walk through Walmart and find a sale... doesn't mean it is the best way to go.

The lead selling industry maintains a very low quality of accurate info on these leads. Even if you tell them "I only want good credit people...", they are going to send you crap. Most of them us the "honor system" when collecting info and verify nothing.

Yes, you can return them for credit, but they cap you. If you buy 20 leads and 15 of them are crap...and if you are capped at 10 returns.... those last 5 crappy leads are yours to keep... and you get to pay for them.

Not exactly the best way to do business. Very few if any will stand by the quality they provide you. Usually after you hit your cap too many times, they will just shrug and take your money.

If you are tempted to buy internet leads, I recommend buying call lists or 1 yr old aged leads. For what you would pay for 1 exclusive life lead, you can grab a list of 250+ people who may be interested in being requoted.

 

[Josh]

Say what you will, but there are a TON of agencies and agents that do really well buying leads.

 

[TampaHound]

I have yet to work with any internet leads but that being said, I do see a need for them. Today's world is driven by the internet and the information, right or wrong, that someone can obtain from it.

"I just want a quote." Okay, for what? If your covering your house that's one type of policy. If your looking for final expenses I'm not going to quote you a 10 year term policy.

We are still the experts. You don't hire an electrician to fix your plumbing. Sure your going to get an *** (or three) just clicking about...but your also going to get someone legitimately interested in protecting their family.

 

[Key2Success]

i have had others who are getting into this industry ask me and i've seen it on here, but i thought i'd put my opinion in here for the new people coming into the biz.

"should i buy internet leads? How do i sell to internet leads?"

answer: "no, and you don't" (life is a little different... But still, no)

the fact is that most people banging around online are only mildly interested and some of these leads from internet vendors are aggregated from bs surveys.

Think about it from the customer perspective: If you were cruising amazon and price checking a book on xyz, would you want amazon to call you 30 seconds later to talk about it? How about another call in 2 hours? How about another in 4? How about barnes and noble started calling too? Then... Books a million? What if these 3 groups started calling you every day for 7 days straight at various time? What if you got that "i don't take no for an answer..." kind of sales guy who kept pestering you for weeks on end about buying that book from him?

This is essentially the life of an internet lead.

People shop online to price check and buy things. If they wanted a pushy, salesman... They would freely ask. With millenials hitting the workforce and needing insurance, they would much rather just purchase what they need to get the job done and move on... Not have constant meetings or conversations over something as boring as auto.

These "big name" lead guys are simply trashmen trying to sell you trash at a high price. Some of these companies even recycle these leads after 3 months and sell them as "prime". They aren't... They are still trash.

Can you make a sell? Sure... If you play your cards right and find one of the lucky few that hasn't already been beat up by your competitors. You could randomly walk through walmart and find a sale... Doesn't mean it is the best way to go.

The lead selling industry maintains a very low quality of accurate info on these leads. Even if you tell them "i only want good credit people...", they are going to send you crap. Most of them us the "honor system" when collecting info and verify nothing.

Yes, you can return them for credit, but they cap you. If you buy 20 leads and 15 of them are crap...and if you are capped at 10 returns.... Those last 5 crappy leads are yours to keep... And you get to pay for them.

Not exactly the best way to do business. Very few if any will stand by the quality they provide you. Usually after you hit your cap too many times, they will just shrug and take your money.

If you are tempted to buy internet leads, i recommend buying call lists or 1 yr old aged leads. For what you would pay for 1 exclusive life lead, you can grab a list of 250+ people who may be interested in being requoted.

amen to that!

----------

Say what you will, but there are a TON of agencies and agents that do really well buying leads.

And you would claim otherwise?

 

[DHK]

Leads are different from lists.

Lists are just names.

Leads (supposedly) requested to be contacted by an agent.

Josh sells lists.

 

[Josh]

Leads are different from lists.

Lists are just names.

Leads (supposedly) requested to be contacted by an agent.

Josh sells lists.

Yup.

To add more context to my comment, my father-in-law is the top agent in his region and while he tells me about the sad stories of internet leads we're all familiar with, he has systems in place to grind them and they are working for him. It's a lot more work and organization than most agents are used to, but there is money to be made on internet leads

 

[Key2Success]

Yup.

To add more context to my comment, my father-in-law is the top agent in his region and while he tells me about the sad stories of internet leads we're all familiar with, he has systems in place to grind them and they are working for him. It's a lot more work and organization than most agents are used to, but there is money to be made on internet leads

Then, you admit that without this secret system (or is this for sale?) leads, lists, etc really are a nickel and dime proposition.

 

[Josh]

Then, you admit that without this secret system (or is this for sale?) leads, lists, etc really are a nickel and dime proposition.

There's really nothing secret about his system, they just work the leads to death, let them cool off, then work them again. I think the challenge most agents have is they think it's going to be a one or two call close. The other thing is with State Farm in particular, they're going after a lot of different types of business so the total value of a customer is higher. My experience with internet leads has typically been pretty terrible, but I also haven't sold insurance in about five years. My father-in-law was getting ready to dig in on the SF thing and sign up and asked what I thought, I told him it was a terrible idea. Well, I'm happy to say that I was wrong, at least for him.

Longer version:

Working internet leads requires buying a TON of them, getting a good price (which they're happy to do with volume), and working the hell out of them. To put that point more clearly, call them a few times the day you get them and at least once a day for a week after that. Keep them really organized and make sure you're reworking them (just because they don't buy now, doesn't mean they won't buy later). You already bought the lead, no sense in trashing it.

Another thing he does that really helps is he ALWAYS quotes life insurance with the auto/homeowner/whatever. Guess what, if you quote it to 100 people, some of them will buy. He sells more life insurance than any other agency in his market by a huge margin simply by asking for the business. I was told by an agency consultant how that works before, but this is literally someone I know who's doing it right now. If you're getting more commission money because you're selling extra products, aside from it helping retention, it increases the value of a customer so it makes the ROI formula look better. Not to mention, since almost no one else is quoting them life they do get some life only business.

Aggressively asking for referrals helps too. If you ask 100 people for a referral, whether they bought or not, you'll get some. Are some agents better at it than others? Sure, but it all adds up.

Bottom Line:

If you're trying to be a serious agent you need to be serious about your marketing. Internet leads suck, cold calling doesn't work, seminars are a waste of money, direct mail returns are too low to be cost effective, it's all terrible and you should give up now.. Or, you can realize that's all crap and really focus on learning to use marketing products available. Literally everything I just trashed is the basis for agents and agencies earning massive incomes because they've been dedicated to learning to perfect the science of it.

I can speak a lot more to lists than anything else because that's what I do, but cold calling works. I sell lists because I was cold calling for MA before it became illegal so I had been getting sweet deals and reselling a little on the side. I have a product with ZERO contracts and I have customers that have been with me for years. I'd like to think they stay with me because of my charm and good looks, but my guess is they stay with it because they're actually making money at it. About half the people (or more?) that try cold calling find out for one reason or another it's not good for them. Maybe they don't like the calls, maybe it takes too much time, maybe they haven't found the right pitch for their market, but ultimately it works for some and not for others. Hell, I have a guy that buys lists and door knocks. He spends *MAYBE* $250/year with me and has been doing that for years and from what he says he does $150k+/year in FE premium. Again, I don't know what he's actually doing, maybe he's just spending a few hundred bucks a year to call me a few times for a few minutes, but my guess is he's making good money at it.

 

[Key2Success]

There's really nothing secret about his system, they just work the leads to death, let them cool off, then work them again. I think the challenge most agents have is they think it's going to be a one or two call close. The other thing is with State Farm in particular, they're going after a lot of different types of business so the total value of a customer is higher. My experience with internet leads has typically been pretty terrible, but I also haven't sold insurance in about five years. My father-in-law was getting ready to dig in on the SF thing and sign up and asked what I thought, I told him it was a terrible idea. Well, I'm happy to say that I was wrong, at least for him.

Longer version:

Working internet leads requires buying a TON of them, getting a good price (which they're happy to do with volume), and working the hell out of them. To put that point more clearly, call them a few times the day you get them and at least once a day for a week after that. Keep them really organized and make sure you're reworking them (just because they don't buy now, doesn't mean they won't buy later). You already bought the lead, no sense in trashing it.

Another thing he does that really helps is he ALWAYS quotes life insurance with the auto/homeowner/whatever. Guess what, if you quote it to 100 people, some of them will buy. He sells more life insurance than any other agency in his market by a huge margin simply by asking for the business. I was told by an agency consultant how that works before, but this is literally someone I know who's doing it right now. If you're getting more commission money because you're selling extra products, aside from it helping retention, it increases the value of a customer so it makes the ROI formula look better. Not to mention, since almost no one else is quoting them life they do get some life only business.

Aggressively asking for referrals helps too. If you ask 100 people for a referral, whether they bought or not, you'll get some. Are some agents better at it than others? Sure, but it all adds up.

Bottom Line:

If you're trying to be a serious agent you need to be serious about your marketing. Internet leads suck, cold calling doesn't work, seminars are a waste of money, direct mail returns are too low to be cost effective, it's all terrible and you should give up now.. Or, you can realize that's all crap and really focus on learning to use marketing products available. Literally everything I just trashed is the basis for agents and agencies earning massive incomes because they've been dedicated to learning to perfect the science of it.

I can speak a lot more to lists than anything else because that's what I do, but cold calling works. I sell lists because I was cold calling for MA before it became illegal so I had been getting sweet deals and reselling a little on the side. I have a product with ZERO contracts and I have customers that have been with me for years. I'd like to think they stay with me because of my charm and good looks, but my guess is they stay with it because they're actually making money at it. About half the people (or more?) that try cold calling find out for one reason or another it's not good for them. Maybe they don't like the calls, maybe it takes too much time, maybe they haven't found the right pitch for their market, but ultimately it works for some and not for others. Hell, I have a guy that buys lists and door knocks. He spends *MAYBE* $250/year with me and has been doing that for years and from what he says he does $150k+/year in FE premium. Again, I don't know what he's actually doing, maybe he's just spending a few hundred bucks a year to call me a few times for a few minutes, but my guess is he's making good money at it.

To each his own as they say. I'd guess our definitions of "making good money" are far apart. Good luck to you.

 

[Josh]

To each his own as they say. I'd guess our definitions of "making good money" are far apart. Good luck to you.

The average household income in this country is a little north of $50k/year, so someone doing three times that seems to be good money.

What do you think is good money?