Since we quietly opened our doors in 2017, we have identified a stigma within the Alternative Lending Industry regarding Lead Vendors. Regularly, we encounter the cautious prospective lead buyer and hear their versions of being mislead by Lead Vendors who operate within the Alternative Lending Space. This is extremely unfortunate but avoidable and preventable by asking the right questions of your Prospective Lead Vendor(s). Therefore we wanted to provide an Inside-Out perspective to help coach inexperienced Lead Buyers in asking the right questions of a Lead Vendor whom they are considering doing business with.
If you ask the right questions you will be able to identify any potential red flags based on the responses of the Lead Vendor. This way you can avoid spending thousands of dollars with little to no chance of ever seeing a return on your investment of buying Business Loan Leads. Be sure to ask these questions if you do not ask them already. There is not necessarily a right or wrong answer to any of these questions but if you put the Lead Vendor on the “Hot Seat” you may be able to identify some misleading sales tactics on their part.
Below are some questions and our view to these questions when asked.
What is the Conversion Rate of your Business Loan Leads?
This is pretty much a trick question. Our View On This Question: We still can not quite figure out how a Lead Vendor is able to state that their leads have a 10%, 20%, 30% or any specific statistic of a conversion rate. The reason is, even with automation, in order to provide any accurate measure of a conversion rate a lead vendor would have to be able to track the final disposition of all leads distributed over a set period of time. This would require input from all Lead Buyers or a Focused Group of a reasonable amount of Lead Buyers. Imagine that happening! We respect our clients privacy, and while we love getting feedback on funded deals, its actually not any of our business. Our objective is to earn repeat business from our customers and when they re-order, that is usually good enough for us. Therefore, for a Lead Vendor to represent any Statistics of a Conversion rate, we implore you to ask the Lead Vendor: What Formula do you use to determine your Advertised or Stated Conversion Rate? You could even set a mouse trap with this question by asking “What is the Conversion Rate?.” If they have a Statistic that they are using in part to convince you to buy leads, ask them what methodology they have to determine the Ratio that they are representing. Ask them how they are tracking the outcome of all of the leads.
How will I receive the leads after purchasing your Real-Time Business Loan / MCA Leads?
Ask this question to any Lead Vendor you are vetting. You want to try and do some digging here. You want to identify what Lead Distribution System (Assuming Real-Time Leads) is being utilized to distribute the leads to you. Perform a Google Search of the system if they provide you a name of a Lead Distribution System. From there, educate yourself a bit on how that particular system operates. There are many good lead distribution systems out there, some better than others. This is critical in understanding the behind the scenes process that the Lead Vendor has in place to ensure seamless real-time delivery. With real-time leads, establishing contact as quickly as possible is important. Many Lead Vendors have a custom proprietary Lead Distribution System. If that is their response, you want to ask them “What Automations, or Rules does your system have in place to ensure I receive the leads in real-time? By the way – what is your definition of real-time?” If they truly have a custom built system, they should be able to provide you with an educated response. Here you want to see if they fumble on the question or deflect your question in any way. If so, buyer beware. If you don’t find out what system the company uses, you might find yourself with a spreadsheet of leads that are hours or even days old because you didn’t clearly identify how they are going to be distributing you your leads (Yes, this actually happened to someone). If you are purchasing Real-Time Online Inquires, find out if the company has transparency into the Lead Acquisition utilizing LeadiD from Jornaya.
What internal processes do you have in place to ensure I have a consistent daily pace in delivery of these leads?
TRUTH: There are only so many leads that can be generated in a day, and Pay-Per-Click Advertising online needs to be scaled very carefully and sometimes slowly. Therefore, if a Lead Vendor has Sales that Exceed Production and their generation efforts are not in correlation with sales it is almost certain that their distribution consistency will become wildly inconsistent. Leaving you, Mr. & Mrs. Lead Buyer with an inconsistent Lead Distribution Pace with that Lead Vendor. So flat out ask the Lead Vendor “What is your ceiling in terms of your Lead Generation Efforts this Month?” In addition, ask them “How do you control your distribution pace in addition to any new buyers that come in.” Our customers not only consider contact rate and conversions, they also pay close attention to CONSISTENCY. We’ve learned these lessons early on so this has become a critical part of our distribution process that we now always focus on and plan for.
In closing, you don’t want to just rely on your instincts in vetting out Lead Vendors for your organization. Don’t be overly paranoid either. There are many reputable lead providers out there. You just have to do some research and ask some educated questions. Don’t focus solely on Price and make a decision. Ask the above questions along with your common sense approach. These questions may very well save you thousands of dollars in the end and bring a bit of a process to your Lead Vendor hiring task.
If you have any questions, please feel free to reach out to us at 1-877-730-LEAD.