BankRate.com Just Bought InsWeb

[ksigmtsu]

Thank you so much for taking the time to post that reply. You answered my question. How long did it take you to become proficient in generating your own leads?
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Bob...thanks for the pm( I don't have enough posts to pm yet) and thanks for reaching out. I will certainly be in touch.

Idk. I started selling insurance 3 years ago, I wrote my first computer programs at around age 8-9, and I built my first website in 1994. I had a website up in 2001 that got over 100 hits a day about the Nashville TN metal music scene to help promote my friends bands, which is basically the same damn thing as lead generation, so I already understood the core concepts.

I started working on SEO on my own websites like a year and a half ago, so I'm going to go with a year but I think it's an unreasonable expectation to learn to build websites, seo, figure out ppc, etc in 1 year. I had a higher than average working knowledge prior to starting.

You can buy most of the parts to do it yourself or outsource, however it does require active management.

The question is, do you want to buy fish at the store, or learn to fish, or at the very least start frequenting the dock where you can get fresher fish cheaper, before 2 more layers of overhead are added.

 

[PatrickJoseph]

Hey bob, do you guys sell annuity leads?

 

[Bob Klee]

Hey bob, do you guys sell annuity leads?

We don't sell Annuity leads:(

We've never been able to drive much traffic & it is expensive to do so. Wish we could.

I'm open to any ideas of course

 

[Ramond B]

Good post, all great points!! Although there are other factors your not considering from the lead maximization standpoint. Little guys don't have the same ability to monetize there data there for they usually have to charge more up front. At the end of the day though, big or small, try multiple sources, it's never a good idea put your eggs in one basket. Each month cut off the weekest link and add another vendor. If you as an agent are using 2-3 vendors at a time and constantly cutting off the week link, your internal growth should yield higher numbers month in and month out.

Costs of me generating leads out of my house:

Keyword research on fiverr = 5 dollars per sheet if I didn't have software licensed to do it

Domain name = 8.99 with privacy from expertsrs.com

Blog hosting = 5$ a month for a good shared host

Blog posting = free

Landing page on front of blog after traffic starts generating from the weak keywords I targeted = 100$

At this point, I've spent 113.99, I might generate 50-200 leads a year for that 113.99, at a cost of around 1$ per lead plus time spent. On a weak keyword.

Cost for a vendor to generate leads:

Staff for keyword research, 3 man team, $150,000 per year
Cost of sales staff to sell leads 3 person team, $150,000 per year
Cost of page building - 100$ minimum per landing page
Cost of hosting = 5$ a month
Cost of phones to take inbound outbound calls = 300$ per month
Cost of management salary to manage 6 employees - $90,000
Cost of PPC ads to generate leads = $4-6 dollars per click
Cost of server administrator to keep equipment running = $100,000
Cost of office space to run operations and equipment, electric, etc =
$50,000
Cost of advertising = 1000 a month

That puts us to over half a million dollars. Now, if I'm selling these leads for 8$, with a minimum 2 sold to make 2 dollar profit, I need to generate and sell 500000 records in a year to break even. If I sell each lead 4 times, that means I only have to generate or buy 140,000 leads before I can start to see a profit.

Now, remember, the 1 guy can buy the same ppc, point it at a landing page, monitor it, and give himself the same lead that the vendor was selling, minus the half a million dollars in overhead, for the initial 118 dollars plus 4-6 dollars per click.

The bigger the lead vendor is, the more overhead you add to cost and the more records have to be generated and sold to break even. Why do you think larger vendors start generating pure garbage?

The majority of agents are too lazy to verify that the lead was garbage and turn it in for refund.

The true cost of generation of a lead is in a 1 time purchase of a good landing page, time to AB test it, and the cost of the PPC * 3 or time to organically generate search engine position.

Most vendors cut the overhead of the "lead generation" staff out, keep the delivery systems and system manager, pay affiliates to generate leads, and hire more sales staff to boost volume of output to get over the break even point hump.

Very few vendors generate even 20% of their own leads.

 

[PatrickJoseph]

Good post, all great points!! Although there are other factors your not considering from the lead maximization standpoint. Little guys don't have the same ability to monetize there data there for they usually have to charge more up front. At the end of the day though, big or small, try multiple sources, it's never a good idea put your eggs in one basket. Each month cut off the weekest link and add another vendor. If you as an agent are using 2-3 vendors at a time and constantly cutting off the week link, your internal growth should yield higher numbers month in and month out.

I understand where you're coming from .. I've just found in the past that 30 days on any internet program isn't ample time to gain a sound decision on whether or not it is something that will benefit my agency in the long run. But over the years I have absolutely tested the waters and have found AT MOST 5 lead companies that I would continue to do business with.

 

[axel foley]

Which five do you recommend? What type of leads do you buy?

 

[Ramond B]

Right, insurance leads may need to be test longer than other industries. The point is to continuously keep your best couple sources on and mix in some new stuff....always improving your traffic sources over time. The majority of people who fail with internet traffic are those that try one vendor for a week or two and then quit or move onto the next. It does take a good month or so to really test quality on an in depth basis.

I understand where you're coming from .. I've just found in the past that 30 days on any internet program isn't ample time to gain a sound decision on whether or not it is something that will benefit my agency in the long run. But over the years I have absolutely tested the waters and have found AT MOST 5 lead companies that I would continue to do business with.

 

[Bob Klee]

I understand where you're coming from .. I've just found in the past that 30 days on any internet program isn't ample time to gain a sound decision on whether or not it is something that will benefit my agency in the long run. But over the years I have absolutely tested the waters and have found AT MOST 5 lead companies that I would continue to do business with.

The problem is that the industry has consolidated so much...5+ players are now two doing over $400 Million in just Insurance Lead generation sales!

NetQuote + InsureMe + InsWeb = Bankrate [+ they bought smaller companies that you might not have heard of]

All Web Leads bought InsuranceLeads.com

Carriers have entered the business and are now buying Millions of leads themselves! Allstate bought Esurance & Answer Financial: $1 Billion dollar deal for Allstate Insurance Company

Carriers are very efficient at working leads & are throwing lots of resources at them. Why? Because as the article I posted says:"younger consumers shun agents" & “The direct channel over time is going to be the industry’s growth engine.”

So for the Agent, what is the best way to work leads since there is both 1] more competition and 2] more bogus leads? I believe one has to re-think their strategy on how to work leads.

+ when you buy leads, don't just work them for two days & then forget about them. Stay in touch through one of many good CRM tools available. A lead you don't sell today is tomorrows sale if you have a good follow up system. Stay in front of your potential customers. [FYI: This is why those selling "aged" leads Piss me off! Some of the leads they sell are leads that others paid full price for.]

I could write a book & maybe I will when I retire!