Lead Value Question - Personal Lines

[Josh]

Hello p&c agents!

I've been working with some Allstate agents trying to work out a telemarketed lead generation program with them, but for the most part we seem to have a difference of opinion. In my experience p&c agents have been more conservative with their marketing budgets and leaned heavily towards "slow and steady" growth rather than aggressively growing their books so I'm looking for some feedback.

It may come as no surprise that I run a small call center and we dial for several products, but the products that respond most consistently are commodity type products, like auto & homeowners. From what I understand most P&C agents are either buying shared internet leads or maybe hiring some work at home mom to dial for a few hours a week. At $15-$20/lead it's not interesting or worthwhile for me to dial, but the question is if I were able to provide a homeowner with one or two cars that was exclusive and fairly motivated to switch, what would that lead be worth? Again, most p&c agents seem to be of the opinion "I can buy a heavily filtered internet lead for <$15, so I won't pay more than that." Is that about right, or would some p&c agents/agencies be willing to pay anywhere near $30 or $40 if that meant they could get a high volume and grow more aggressively, or is that simply not attractive to a p&c agent?

Any feedback here or by PM is appreciated.

 

[GreenSky]

I think Amerilife.

Rick

 

[djs]

The problem is, there is no money in it for the agent if the lead is over $20.

You are thinking that you can set it up for the cross-sell. P&C agents think they get any lead, they have to work the cross-sell, they are one step ahead here.

Some agencies might try a mom working from home, but most have in in-house telemarketer / marketer / contact person, whatever. They have more control over the person since they are sitting right there. By having them in-house, they can use them for additional things, like following up in 30 days to make sure everything is going well.

The problem you have with the $30 lead is its not compelling. Motivated to switch? What does that look like? Can you really get the volume you need to make money if you have individuals that have a true motivation (i.e., buying a house, new teenage driver, just got a DUI, etc)? Probably not.

You need to define what value you are bringing to the table. Every P&C agent has hired telemarketers before. They all promise quality leads. They all promise motivated leads. I can buy these all day long at an average cost of about $12. They are tough to make money on.

A few years ago, choicepoint used to do inhouse telemarketing. They charged $0.75 per number to be called, would call the number up to 10 times, then if they got what they called a 'hot-lead', they would charge an extra $6.00 (I think). A hot lead had parameters associated to it, such as the person had received a renewal notice, was within 60 days of renewal, and had an interest in shopping it. Without all 3, it was a warm lead, which had no additional cost associated to it. I would receive an appointment for a followup phone call. If I recall, they had a guarantee that they would get a certain percentage of warm or hot leads, I think around 4% (may have been different for home vs auto). Since they own the data, they would call more till they hit the guarantee.

Agents weren't happy. It cost to much. Choicepoint didn't make money, they closed down the service.

If you can't sell leads for $15 - $18, you might want to examine your business. You have some costs out of whack. Of course, this is why agents turn around and complain about the quality of the lead, but it is a very fine line where it is a win-win for both parties, especially given the difficulties of telemarketing residential nowadays.

Dan

 

[Josh]

If you can't sell leads for $15 - $18, you might want to examine your business. You have some costs out of whack. Of course, this is why agents turn around and complain about the quality of the lead, but it is a very fine line where it is a win-win for both parties

The thing is that I can do a $15/lead, but I don't like the quality. While it would be on the average a much better quality lead than an internet lead of the same price (or thereabouts), I wouldn't like selling that type of a lead. I guess your answer to my question is about what I expect most p&c agents would have, that under no circumstances is it worth it to pay more than $15/lead, regardless of the quality.

 

[djs]

I have no idea what you mean. You don't like the quality, but why not?

As a P&C agent, I need a certain volume. Okay, I'd like 3-4 leads a day that are easy closes, but if I don't have that, I need 10 that are 'reasonable' opportunities, even if they need some nurturing.

The thing about internet leads (with P&C) is there is usually an immediate need that needs resolution quickly. With telemarketed leads, its usually either a neglected need (i.e., no insurance or premiums could be lower) that are not necessarily an indicator that something will happen quickly. I use telemarketed leads as a pipeline filler, though closing them quickly is nice, and it does happen.

You would have to tell me the difference between a $15 lead and a $30 lead to even begin a decent conversation. The $30 lead would mean something equivalent to the mortgage broker calling me and saying they need insurance to finalize the loan paperwork tomorrow. I doubt you get these via telemarketing.

Dan

 

[Josh]

(double post)

 

[J.R.]

The thing is that I can do a $15/lead, but I don't like the quality. While it would be on the average a much better quality lead than an internet lead of the same price (or thereabouts), I wouldn't like selling that type of a lead. I guess your answer to my question is about what I expect most p&c agents would have, that under no circumstances is it worth it to pay more than $15/lead, regardless of the quality.

What do you determine to be a quality lead? If you listed the requirements you might get better feedback.

 

[Josh]

You would have to tell me the difference between a $15 lead and a $30 lead to even begin a decent conversation. The $30 lead would mean something equivalent to the mortgage broker calling me and saying they need insurance to finalize the loan paperwork tomorrow.

Jane and John Doe Smith
123 Main St
Some City, OH 12345
555-555-5555
Currently paying $1800/year auto with geico and homeowners with travelers, willing to switch within 5 days if can save $X/year.

And yes, I can get leads like that using telemarketers. I can probably do $10/leads all day long, problem is that a bunch of them will be junk. My thought process was that it would make all sorts of sense to let the telemarketer filter through it and then just keep the agent busy with interested prospects, but that's just me.

 

[1manshow]

Problem begins when you will sell that good "lead" to five agents With our own telemarketer/marketing we are assured the lead is exclusive.

 

[Josh]

Problem begins when you will sell that good "lead" to five agents With our own telemarketer/marketing we are assured the lead is exclusive.

That's a false presumption, I would only transfer it or send it to a single agent.

At the moment it appears the problem is the p&c agents not getting paid enough to buy leads.