We are not the experts on lead optimization. But we know these experts well, are connected to most, and work daily with many on behalf of our lead buyers. Our transparent marketplace and suite of optimization tools allow our buyers to utilize aspects of lead optimization quickly and easily. In our role as an integration platform, we are frequently asked to explain to our buyers the various steps of lead optimization. To help aid in these discussions, we have put together this lead optimization primer, which is meant to briefly cover the basic blocking and tackling of lead optimization.
The LeadCloud Platform is a transparent marketplace allowing lead buyers to diversify, optimize, and manage their purchased lead flow. These three steps are the foundation of a comprehensive lead optimization strategy:
Step 1: Lead Diversification
Increasing the number of lead sources you buy from is a critical component of lead optimization. An increase in lead sources provides two key components: increased potential volume and improved stability in lead quality.
Increased volume is important because it provides the opportunity to be more selective in which leads you purchase—while still reaching a total volume sufficient to fulfill your sales goals. When you are supply constrained, the value of lead optimization is reduced drastically since this almost always involves a reduction of leads consumed per source. For example, verifying that leads are valid and interested, scoring leads, filtering leads, and de-duping leads are all examples of lead optimization services that reduce lead volume. You need excess volume to fully leverage a comprehensive lead optimization campaign.
The second benefit of an increased pool of active lead sources is that you will increase your number of direct lead generators as compared to aggregators, and this helps stabilize lead quality. Aggregators’ lead quality can vary significantly because much, if not all, of their volume comes from many different affiliate lead sources that they don’t control themselves. Any addition or deletion of a major affiliate can affect the aggregator’s overall quality, which can be hard for the aggregator’s to manage at scale. In comparison, the quality of most direct generators, whether good or bad, is usually constant because these usually employ one primary method of lead generation. Even though most direct generators you buy from might also sell to aggregators, once you get their leads directly from them, you will no longer get their leads from the aggregators based on the “leg” management system in place today among the lead sellers.
The LeadCloud Platform allows Insurance lead buyers to receive leads from virtually any lead seller instantly with no integration required. They can contract directly with the sellers or buy from LeadCloud.
Step 2: Lead Optimization
Once you have sufficient lead flow available, you can begin to optimize your lead buying. Lead optimization can be broken down into three functions: verification, scoring, and data appending.
Lead verification processes help verify that a lead is valid, usually meaning it is from a real live consumer who is truly interested in a quote and submitted a request within the previous few minutes. These verification services can be crude or quite complex.
At the most basic level, there are services that simply reject leads with bogus names or incomplete or inappropriate required data, such as address, phone, or e-mail address. More sophisticated services can confirm whether a phone number or address is valid, whether a phone number is from a cell phone, or whether the name and phone match the address provided. Still more sophisticated services can provide consumer session information, including exactly which website and form the consumer filled out, when he or she filled it out, and even how long he or she spent filling it out.
Lead scoring typically refers to the process of applying a numeric score to a lead, based on historical performance. This numeric score indicates the likelihood that the lead will convert into a policy sold. (Or whatever metric the score was built to predict.) Scoring vendors usually require a threshold of historical lead purchases and converted data for results to be statistically significant. We have found the average required volume is usually however many leads it took to create 2,500 conversions or sales. For example, if you close 10 percent, you would need to provide 25,000 or so recent leads.
These vendors use your data to supply a custom scoring algorithm. The algorithm can be applied to new leads in real time, resulting in a score—usually between 1 and 10 or 100. This score indicates the likelihood that that particular lead is going to convert based on how similar it is to previous leads that have converted. Your lead platform can then choose an action for that lead based on the score provided. The most common example of lead scoring decisioning is for the platform to accept leads above a certain threshold and to reject leads below it. Another example would be to send lower-scored leads to an automated e-mail campaign and higher-scoring leads to a live agent.
Another good use of lead scoring is to leverage your lead seller’s ability to optimize his or her sources based on sub-source IDs that many can provide. These IDs identify the various sources the seller is using and provide him or her with an average lead score per sub-source ID, enabling the seller to optimize which sources he or she sends you in the future.
Data appending refers to the process of adding additional data to a lead once it is received from your sellers. Usually this data is from public records provided by data service providers. Examples include adding phone numbers or e-mail address to a lead. Similar data might include type of home or number of bedrooms and bathrooms based on the address or even credit score, driving record, current carrier, and accidents/violations information based on a consumer’s name and address. However, the federal government regulates this type of personal data heavily. Carriers most often use this data to underwrite policies.
A few leading lead service providers on the LeadCloud Platform
The LeadCloud Platform can send leads to an unlimited number of third-party vendors and decide on the lead in real time using the vendor’s response. Most major vendors are already fully integrated, and those that aren’t, can be in a matter of days.
Step 3: Lead Management
The final stage of lead optimization after diversification and optimization is management of the entire process. Since there are lots of moving parts and third party partners involved in most lead optimization efforts, a consolidated platform provides a single point of control and is critical to real time management of the full process.
. One key component of lead management is a lead platform that allows you to easily manage a high volume of leads from many sources, along with an array of service providers who provide verification and scoring services. Some key services this platform should provide are the following:
- De-duping leads, which makes sure you don’t get the same lead from multiple vendors
- Global filtering, which allows you to manage your filters for all sellers from one single location instead of hoping your sellers apply the correct filters
- Decisioning leads in real time, based on the business rules you have provided
Another key component of lead management is the CRM platform, which provides the sales professionals with all of the sales tools they require to optimize their lead conversion. Two key features of this CRM layer are the e-mail and outbound dialing components.
Customer Relationship Management (CRM)
This is a mature industry with lots of best practice documents available, so I’ll only highlight this area a bit.
The CRM options for lead buyers are usually as follows:
- Third-party CRM systems. These can be purchased as on-premises solutions, meaning you buy the software and run it on your own servers, or as hosted solutions. Most hosted solutions are cloud-based solutions from which you simply purchase a seat license, and your sales professionals access the software (which is hosted somewhere else by the provider) via a browser or small client-side application. The biggest of the hosted solutions available today is SalesForce.com.
- Homegrown systems. These are simply custom-built CRM systems that can be written from scratch or on top of other applications such as Microsoft Outlook.
- Vertical-specific solutions. This refers to applications that are written and tailored specifically for a particular industry. These can be hosted or on-premises solutions.
Email should at least be considered for every lead program IMHO. It is a relatively inexpensive service, and highly automatable. Most CRM systems have some level of e-mail capability built in, and there is a robust community of e-mail vendors who will plug into your CRM and manage your e-mail campaigns. Here are some examples of how e-mail can be used to improve your lead performance:
- Auto-Responder – Send an immediate and automatic e-mail to every lead you receive, letting the consumer know that you will be calling him or her. This strengthens your brand to the consumer, increasing your likelihood of him or her answering the phone, and it also provides consumers with other ways to reply to you should they not want to take your inbound call. You can provide links to click and phone numbers to call in the e-mail. Keep in mind that many consumers who fill out a lead form do not really want people to call them but, rather, were hoping to get a quote online to review. This is a big contributor to the low average phone contact rate of about 50 percent that we are seeing these days. Also, there are Click Buyers out there who will pay you handsomely for each consumer click you send to them, and you can embed these into your e-mail to help increase your revenue per lead (RPL).
- Auto Responder with a Quote – For some industries, including the insurance industry, there are third-party services that can create a carrier quote and e-mail it to the consumer. If available, this is a very valuable service for converting consumers to a sale, even if you plan to call them as well.
- No Contact Follow up – You can use e-mail to reach out to the leads you were unable to contact by phone. In most cases, you have paid handsomely for the right to contact these consumers, and if you don’t get them by phone, there is little harm or cost with attempting to reach them by e-mail.
- Drip E-mail Marketing – Finally, there is the basic drip e-mail marketing campaign. This refers to the art of communicating on a regular basis with your prospects (leads) in an individualized way. For example, you may want to send a monthly e-mail to the consumers to whom you have sold a product, cross-selling another product. Or you may want to e-mail your no-contact prospects monthly with a different message in an effort to get a response.
Although it is possible to have a profitable lead program without dialing your purchased data leads, it is the exception and can be very difficult. Virtually all lead buyers call their leads as their first step toward converting that lead into a sale.
Speed to Lead
Speed to lead refers to the time it takes to dial a new lead once it has been received from the source. Many industry-wide surveys have shown a direct correlation between speed to lead and conversion. The more quickly you contact the consumer, the better your chances of converting the sale.
This is likely due to two reasons:
1. The sooner you are able to contact consumers after they hit the “Submit” link, the more likely they are still thinking about the research they just did and are ready to purchase.
2. Because most leads purchases are shared with other lead buyers, the sooner you contact the consumer, the more likely you are to have made contact before your competitors, giving you a better shot at the sale.
Automated vs. Fat Finger Dialing
Automated dialing, as you may have guessed, refers to a system that automatically dials your leads for you, as opposed to manually dialing them, often called Fat Finger Dialing. When choosing how to dial your leads, there are a lot of options available:
- CRM Dialing – Many CRM systems have dialer options from which you can choose. These services either connect to your existing phone system or use their own phone system, and they allow your sales professionals to automatically dial leads around preset parameters. The most common setup is for the system to use logic to assign a priority order for leads to be called based on their age and status. When the agent is ready to take a new call, he or she just hits a “dial” button and the system attempts to contact the next lead in the priority list. This is referred to as preview dialing.
- On-Premises Dialer – Another option for high-volume lead buyers is to set up their own internal dialer. These systems often come with tools to manage lead priorities, scripts, and other key functions required for a dedicated outbound dialing system. These systems usually offer several types of dialing services, such as preview, progressive, power, and predictive dialing.
- Cloud-Based Dialer – There is a growing industry of cloud-based dialing solutions that provide all of the Cloud solutions benefits over on-premises solutions.
- Outsourced Vendor – Finally, there is a large industry of outbound call centers that will take over your outbound dialing services. These services usually receive of copy of your leads (they only need the contact information) and handle all of the outbound dialing functions such as list management, script management, dialing type and settings, etc. They use these systems to attempt to
- make contact with the consumer (this can be harder than you think);
- confirm interest;
- place them on hold and transfer them via a 3-way Hot Transfer to your inbound sales team.
The LeadCloud Platform can be used to manage the entire lead optimization process, including global filtering, de-duping, turning accounts on and off, hourly and daily volume caps, and more.