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- #11
15 FREE inbound leads a day on a 45% contract - that close at 13% with let’s say a 75% persistency and even a 75% advance… with let’s say average deal of 850 AP -No I don’t think any of these guys are lieing . Yes all these #’s quoted look very incredible and amazing . But all that matters is what your net ( after all expenses ) at the end of the yr . Also what are you looking for long term ? So let’s look at paying for your leads . To really have a chance to “ net “ 6 figs” you must spend $1500 min plus each and every week . Most of these telesales shops even the good ones start agents at 100-110% max ( street is 120%). Few agents will commit that much .That model seems to be dieing as the cash outlay is so great .
Let’s focus on the new rage “ free leads “. It seems to be taking the industry by storm . Why has that exploded ? A few reasons . Massive eye popping profit margins and ease of getting much cheaper leads in quanity than 3-10 yrs ago . Think about were the industry was and is now . Direct mail and face to face was the tried and true model to sell fe for decades . You could physically see the person and hopefully form a connection when selling . Thus retention could be high . Then interesting the last 5 yrs somethings happened . Postage rates have skied and returns fell . That $30 direct mail card is now $50-$70 a card ( if you’re self mailing . $500-$700 a 1000 at 1% return ) . Many areas only get .4-.6% return . The great majority of agents fail with that .
So the last 2 yrs free leads have gone wild . I listed the reason why . Also an endless supply of agents to choice from . Who wouldn’t want free leads ?The real reason for the explosion is massive profit margins x massive vol potential with cheap abundant leads .If I’m giving you something “ free” I control all the cards . Take it or leave it as 1000 guys behind you want to do it . Most fmo’s starting you at 30-50% ( that’s max). The high vol Fmo is making 150% ( some CO’s higher ) . Think about that . You sell $1000 a year policy you make $300-$500 and your fmo makes $1000-$1200 overide . So it seems the avg guys on these leader boards with free leads that stay around doing $20 k a month . Let’s be generous and say there doing 80% persistency . Let’s say $15k staying on books .They make $ $4500-$7500 take home . Good money nothing to sneeze at . But let’s look at your fmo . He’s go big expenses . I fig after all expenses he “ nets “ 60% overrides min . So on your $15 k net premium for the month he’s netting $9 k min . Put 30 agents doing that and your looking at netting over $3 mil a yr . Thats just the front end . He’s making 7-10% override renewal ( remember you get 0) year in year out on all that 10’s of millions of premium his agency has in force . Theoretically his renewal overrides pays all his expenses . me wrong 1000’s of agents who would have failed are now making a living . But let’s not be naive . How are all these agents suddenly doing $30-$50 k a month vol ? I bet min 5 times the # of telesales agents doing $30 k vs face to face . But how ? Fe demographic now massively online . The ease to press a ad is so easy These lower income people press many ads . The intent and effort is much lower than filling out a direct mail card . Thus the persistency is much lower for telesales .But vol makes up for that
So let’s look at the agent earnings . Yes they can make a good living . But they make no residuals or little if any . So you’ll be hustling yr in yr out making a paycheck like a 9-5 worker . Plus if you don’t keep producing at a high level you’re gone . I think a good place to start to learn but it’s a job with no benefits . Good place to start and learn but certainly not a long term career
This calculates to $110K a year NET. (Not including any spousal sales).
You include month 10, 11, 12… your looking at around 150K net.
This I’d say is a very realistic earning for someone who’s going to grind on a free leads program in telesales.
