ROI on AP Vs Lead Cost & Chargebacks!

[theinsuranceman]

There is a lot of ways to look at ROI, but when referring to leads, its usually dollars in from those leads vs dollars out in buying the leads.

If I buy $100 in leads and get $400 in return from those leads, I have a 4:1 ROI which gives me money to pay my overhead and costs of doing business and hopefully enough to pay my own bills.

The number you are looking at is the ROI on your agency. You put in xxx dollars, get xxx dollars back, for your time, you have earned a certain ROI. This is an important number, but not for assessing the value of a lead source.

By tracking the ROI on individual lead sources, you can determine if its worth continuing or not. You want to know if one lead source consistently has a breakeven ROI, another a 2:1 ROI and another 4:1 ROI. If so, you would want to pull some money from the breakeven and reallocate to the 4:1 (sounds easier than it really is).

Keep in mind, its not just $$$$, but its also a more precious commodity, your time. A lot of people love networking because they feel the lead cost is much lower (and it usually is) but frequently their time costs are very, very high with networking over other sources.

Dan

Very well said. Time is usually worth more than most people realize.

 

[Justin Bilyj]

Net ROI and ROI of mailings are two different measurements that both important. Net ROI is a running tab of red and black ink, useful to help calculate overhead into your profit margin. ROI of a mailing or campaign is obviously designed to measure effectiveness of marketing efforts.
When I say 3-1, I am obviously talking about mailings/marketing efforts.

 

[krishnan4]

Hi
I am Sufia by name I love what i saw on your post. I will like us to be a friend. Please contact me on my email so that we can start from there i will also send your my photo for you to know whom i am.

Here is my email [email protected]

I will be waiting for your mail.
Sufia
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Net ROI and ROI of mailings are two different measurements that both important. Net ROI is a running tab of red and black ink, useful to help calculate overhead into

 

[RonRoberts]

Hi
I am Sufia by name I love what i saw on your post. I will like us to be a friend. Please contact me on my email so that we can start from there i will also send your my photo for you to know whom i am.

Here is my email [email protected]

I will be waiting for your mail.
Sufia
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Net ROI and ROI of mailings are two different measurements that both important. Net ROI is a running tab of red and black ink, useful to help calculate overhead into

Where is there a moderator when one is needed?

 

[TDFnCali]

Hi
I am Sufia by name I love what i saw on your post. I will like us to be a friend. Please contact me on my email so that we can start from there i will also send your my photo for you to know whom i am.

Here is my email [email protected]

I will be waiting for your mail.
Sufia
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Net ROI and ROI of mailings are two different measurements that both important. Net ROI is a running tab of red and black ink, useful to help calculate overhead into

^^^ Uhhh, thanks, but no thanks....dont need your photo or to be friends!! WTF?

 

[jdeasy]

I send out a thank you card as soon as its issued & I call at that point too...to congratulate them. I also call after 3mos & send a Bday, Xmas & 1 yr anniv card. When u say 3:1...are u taking into account ALL exp or just lead exp?
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I mustve misunderstood what a "Not taken" was...when U say u dont remember having 1 after the policy has been in place more then 2mos, well if its been in place 2mos & stops, isnt that a chargeback?? A "not taken" I thought was a policy u sold, issued & then the customer never paid 1st payment due to change of mind or whatever.

And as far as the "think about it" close, this was referenced before by me in another post & everybody jumped all over me...inc u JD, I believe, maybe not, dont remember exactly. But when I mentioned it, I was referring to ppl who WANT a policy, u can tell the rapport is good, but they are scared to pull the trigger, or they want to make sure its the best price and/or just want to procrastinate even more then they already have....thats when I use it, to get it in their hands so they wont stall any longer & allows them to make sure they arent getting screwed on price (although I suspect 75% of them never shop the rate). I dont use it on ppl I can tell they dont value it or dont seem more then 1/2 interested or maybe have some & was thinking of getting more (unless they have very lil)...thats a waste of time. Know when to use it & when to just pass...I passed on using it yesterday for a very elderly couple who had some but thought about more. So far none of those Ive used it on have got it & then cancelled before 1st payment.

Semantics. Technically if they have it a couple of months and drop it then it is a chargeback if you were advanced. Not takens are ever paying a premium or accepting the policy. Those are still chargeback for the companies that pay on approval like RNA, Americo, Monumental, etc. Those companies don't pay upon approval if you are as earned with them.

You are a little selective on your memory on the prior discussion on the "think about it close".

That is a close that's popular with trainers and office types. In the real world it's just basically liar's poper. Do I use it? Yep, sometimes. Early in my career I used it a lot because I got the "think about it" objection all the time. Now I rarely get that objection and I know that, if I do get that objection, I have failed somewhere in the presentation, warm up or fact finding.

I will only use it now as a last ditch to write an app. Just taking a shot. I'm surprised now when the people I used it on actaully take the policy now because it was a hail mary anyway.

Nothing really wrong with using that type of close to get applications. I know one pretty successful agent that does it at almost every presentation and he has a pretty good percentage of them that take the policy. I just know that for me if I'm getting that objection often I've messed up somewhere along the line and need to get back to fundamentals.

 

[Rearden]

A/S/L, please.

Here's my picture:

http://www.thecambodiaherald.com/im...5OTg4/760_450/The Fat Man at the Computer.jpg

 

[TDFnCali]

A/S/L, please.

Here's my picture:

http://www.thecambodiaherald.com/im...5OTg4/760_450/The Fat Man at the Computer.jpg

LMFAO!!!!!!!!
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Semantics. Technically if they have it a couple of months and drop it then it is a chargeback if you were advanced. Not takens are ever paying a premium or accepting the policy. Those are still chargeback for the companies that pay on approval like RNA, Americo, Monumental, etc. Those companies don't pay upon approval if you are as earned with them.

You are a little selective on your memory on the prior discussion on the "think about it close".

That is a close that's popular with trainers and office types. In the real world it's just basically liar's poper. Do I use it? Yep, sometimes. Early in my career I used it a lot because I got the "think about it" objection all the time. Now I rarely get that objection and I know that, if I do get that objection, I have failed somewhere in the presentation, warm up or fact finding.

I will only use it now as a last ditch to write an app. Just taking a shot. I'm surprised now when the people I used it on actaully take the policy now because it was a hail mary anyway.

Nothing really wrong with using that type of close to get applications. I know one pretty successful agent that does it at almost every presentation and he has a pretty good percentage of them that take the policy. I just know that for me if I'm getting that objection often I've messed up somewhere along the line and need to get back to fundamentals.

Speaking of being paid as earned...its my goal to reduce my advance to 50% after 1 yr, then to 25% after yr 2 & beyond. Considering Ill have residuals and built up a pretty good book of business by then...is that a reasonable goal (Im assuming I could do this & still keep my income apprx the same)?

 

[tins]

Hi
I am Sufia by name I love what i saw on your post. I will like us to be a friend. Please contact me on my email so that we can start from there i will also send your my photo for you to know whom i am.

Here is my email [email protected]

I will be waiting for your mail.
Sufia

I am to be most friend. Sent to accounting email for review.
Best of Pleasure,
tins

 

[jdeasy]

LMFAO!!!!!!!!
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Speaking of being paid as earned...its my goal to reduce my advance to 50% after 1 yr, then to 25% after yr 2 & beyond. Considering Ill have residuals and built up a pretty good book of business by then...is that a reasonable goal (Im assuming I could do this & still keep my income apprx the same)?

Personal preference. Many agents argue for advances and say they wouldn't do it any other way. I don't like borrowing money from them.

I started everything as earned when I started with EFES. I misread the lead payment agreement and changed from as earned to a 6 month advance with RNA. I've never bothered to change that one. I did try to change to a 3 month advance with them early this year and they don't allow it. If you get advanced with RNA the least you can do is 6 months.

Some companies, like AmAm and Monumental seem to discurage an agent going as earned. If you are as earned with either of those companies they only pay one a month. That's a bit of a headache to deal with. For example, I just wrote a Monumental two week ago that is approved and issued the first draft is not until June 4. That means I will not be paid anything on it until the July as earned payment. Same for AmAm. I wrote an AmAm last week that is approved and issued. The first draft is not until June 10. I will not be paid until July on that one either. If I was advance with either of those companies, {even 3 months}, I would have already been paid on them.

If I were running a company I would reward my as earned agents instead of punishing them. I guess that's why I don't run a company.