Lead Generation: How an insurance company reduced acquisition costs in purchased leads
Generating leads organically can ease the qualifying process, throwing “bad” leads out that are simply not worth pursuing. Growing a list organically also allows marketers to know more about a prospect right from the get-go, passing more qualified leads on to Sales.
However, when you start supplementing organic leads with purchased leads from a third party, how can you be sure you are getting the most bang for your buck?
According to the Salesforce 2015 State of Marketing report, lead quality is the No. 2 most pressing business challenge for marketers today.
Plymouth Rock, one of the largest insurance groups offering car and homeowner’s insurance in New Jersey, faced the challenge of ensuring lead quality.
“There are a lot of expenses associated with purchasing hundreds of thousands of leads annually, so we are constantly working to maximize acquisition economics,” explained George Hurley, Director of Marketing Analytics, Plymouth Rock Management Company of New Jersey.
The team at Plymouth Rock needed a way to ensure that the purchased leads were going to be viable with the ultimate goal of lowering acquisition expenses.
Identify “risky” or “bad” leads
With so many leads being purchased by Plymouth Rock, the team determined it would be cost effective to bring on a tool that would help identify bad leads instead of doing it manually.
George and the Plymouth Rock marketing team categorize bad leads, or leads that do not sell, in terms of how that lead was generated.
For example, if that purchased lead was generated in less than five seconds, that would be a lead Plymouth Rock would not want to pursue.
With form fields containing multiple questions and often multiple webpages, George explained that oftentimes, it is impossible for a person to fill one out in less than five seconds.
Concurrently, the fraud detection product can also tell the team if thousands of leads were generated from the same IP address located in a foreign country. If that’s the case, it’s highly unlikely they would be looking into insurance in New Jersey.
Change the way leads are purchased
With the knowledge of how a purchased lead was generated, the Plymouth Rock marketing team now prefers to buy leads from aggregators and generators that are also using the tool to identify bad leads.
Using the tool for lead audit and fraud prevention is now a best practice for the marketing team, which has lowered expenses at Plymouth Rock.
“We hope that others in the industry will follow this practice, driving down expenses,” George explained.
The marketing team couples the data now known on how that lead was generated with another tool that provides insights into a particular lead’s authenticity. An example is a lead for “Mickey Mouse” at “123 Main Street” with a phone number of “867-5309,” which is clearly false information.
“There are very different purposes in the two technologies, but both work to eliminate leads that we believe to be bad leads,” he said.
Communicate successes across the organization
By better understanding how purchased leads were generated, the marketing team has been able to improve the relationships with the sales team because they are providing better-quality leads.
Results are communicated via monthly meetings with stakeholders, including multiple leadership departments, and the marketing analytics group pulls daily reports to demonstrate how leads are performing on any given day.
“We’re very heavily focused on the acquisition costs, so that’s a conversation piece we’re always having, but with the help of the advanced analytics team … we are also looking into lifetime value metrics,” George said.
Since using the lead audit and fraud detection tool, Plymouth Rock saw a 68.8% decrease in cost per acquisition and identified 528% more fraud.
The team also noted that almost zero percent of medium- and high-risk leads converted, confirming the success of carefully analyzing how purchased leads were generated.
You can follow Erin Hogg, Reporter, MECLABS Institute, on Twitter at @HoggErin.
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