Generating and Selling Leads to Offline Companies...

by WillST
32 replies
Hi chaps,

I'm considering creating an additional revenue stream as opposed to offering traditional SEO, as the recent algorithm changes make me nervous...

So... I've read a lot on lead generation for offline companies recently and have found a particular niche which doesn't seem too saturated. The value of the end service is worth anywhere from £500 - £10k+ so I believe I can sell leads for upwards of £30-£40 per lead.

The one thing thats swimming around my head which I'm uncertain of... is will it be possible to sell the leads to one preferred supplier.

I'm going to be looking to find one nationwide company to purchase these leads from me (as the lead gen will be nationwide, not local), and this 'exclusivity' will be one of my selling points.

But... Will a company be willing to pay £3k to £4k+ per month if I send them 100 leads per month? I know a lot of advice will be 'if it makes them £30k then sure they would' - but does anyone have any real world experience of selling at this level?

Theory and practice sometimes have a bit of a disconnect, and being in the trenches building my own business - it certainly isnt quite as easy as the latest WSO leads you to believe. Not in the real world anyway!

Unless I have a handful of self-limiting beliefs on what is possible?

I suppose I'm just looking for a second opinion, some guidance, to have a little more certainty that I'm about to embark on the correct course of action.

Any advice / help / tips, would be greatly appreciated!

Thanks guys,

JSTEF :-)
#companies #generating #leads #offline #selling
  • Profile picture of the author Rearden
    From my experience as a heavy lead buyer of insurance leads...

    There's a high level of skepticism of lead companies in my industry.

    Yes, knowing what my average life case is worth to me, I would honestly pay $50-$60 per lead that I could close 40% to 50% of the time on average. But actually getting a well-qualifying a lead like that is, in my opinion, impossible.
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  • Profile picture of the author WillST
    Hi Rearden,

    Interesting observations - thanks for sharing! Knowing the industry pretty well, what would you say that your gut instinct is telling you about the idea I have...

    I know insurance leads are the most frequently traded... The leads I will be selling are much less so, as there are currently only 2 or 3 companies generating leads in this niche - none that successfully...
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  • Profile picture of the author Chris Beatty
    Your model will definitely work, just as you described. If there is any skepticism on their part, generate a few leads for "free" just to show them you can walk the walk.
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  • Profile picture of the author WillST
    Thanks for that BestPMarketing. Thats exactly what I was going to do - offer them 5-10 leads for free to see the quality they were getting, and then let nature take its course.

    I think my only hesitation, is investing the time and money into this and not being sure if I'll be able to sell the leads when I'm generating them!

    I suppose there is no way of knowing until I action my plan and jump in at the deep end!
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  • Profile picture of the author Rearden
    My recommendation is to talk to the buyers and get their perspectives before you go full force into your business.

    Do some type of quasi-focus group to gauge their experiences, what they want, etc.

    IE -- selling burial insurance, I can get leads all day long, but if the company selling them to me doesn't qualify enough and the lead ends up NOT having a bank account, that's a worthless lead.

    Plus, having the lead recorded so you can listen to it helps a ton to build credibility.

    This one company I bought from recently ONLY recorded the last 2/3rds of the call -- turns out the leads are garbage -- wonder what they said in the first 1/3rd of the call to convince them to go along with the phone call?

    Lead gen can be an EXCELLENT business if you're honest about it. Just talk to your prospects about what their experiences have been and cater your services around them to meet their needs.

    And the BEST buyers with DEEP pockets WILL PAY more for each lead if it's better quality, because they ALL have experience dealing with GARBAGE leads.
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  • Profile picture of the author WillST
    Excellent, thanks Rearden, a great idea.

    I think I'll start jotting down things to learn from the businesses before I've spent any real time or money setting the lead gen systems up....
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  • Profile picture of the author kenmichaels
    Since i have been killing it for years selling leads , I was going to throw my 2 cents in here,
    but its turning into a book so, before i go any farther, let me ask you.

    Are you serious about getting into the lead brokering bizz, or are you just kinda kicking
    the idea around?

    I am not really a good writer, its kind if hard for me to put my thoughts down easily
    so i really don't want to go through the effort, unless i know your really going to do
    something.

    I hope your not offended by that question.
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  • Profile picture of the author Defacto
    For my business the latest algorithm changes did not affect my video commercials I sell. I can still get them ranked on the first page rather quickly for minimum expense and effort. I don't sell leads but have considered that business model. But videos can be produced inexpensively and once a business sees that they do produce phone calls they will usually want many more.

    I do have a nation wide client and they account for a significant potion of my total income because I continuously make videos for them targeting different keywords and locations.
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    • Profile picture of the author AussieT
      Originally Posted by Defacto View Post

      For my business the latest algorithm changes did not affect my video commercials I sell. I can still get them ranked on the first page rather quickly for minimum expense and effort. I don't sell leads but have considered that business model. But videos can be produced inexpensively and once a business sees that they do produce phone calls they will usually want many more.

      I do have a nation wide client and they account for a significant potion of my total income because I continuously make videos for them targeting different keywords and locations.
      So if you do not sell leads what do you do? Rent the sites? Or just provide the video service for a fixed price for businesses?
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  • Profile picture of the author tryme1
    Ok, well, this is pretty much my area. I run a b2b lead generation business (mainly dealing with accountants, solicitors, health and safety consultants) and I can tell you that the basic model of what you are suggesting will work.

    Here are your potential pitfalls:

    1) In lead generation, getting the clients is fairly easy: generating leads for them is more difficult. You have to get visitors to your sites to trust that a) you are honourable and won't spam them for ever after and b) that your service offers a value greater than them doing it themsleves.

    2) Lead criteria - a lot of big companies have very specific criteria about what types of leads they want. This could be size of the business, amount of debt, number of employees...there are loads of variables.

    If you can't deliver the types of leads that meet these criteria, you won't get the business. You need to make an early decision on whether you are going to offer leads 'as is' or will customize to the clients needs. This might mean you get loads of leads you can't sell as your customers don't want them.

    3) Verification and Validation - Are you just going to pass leads on as soon as you get them or are you or your staff going to call and verify/validate that an enquiry is genuine. You can charge more for the latter.

    If you do the former, expect loads of back and forth with your clients/lead buyers over whether each lead is 'good' or not.

    There's loads of other stuff, but I hope this is food for thought to get you started.
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  • Profile picture of the author WillST
    Thank you so much guys! This is all very very helpful :-)

    Kenmichaels - this is something I'm very serious about, and will be investing a few thousand £ to get it off the ground. This will effectively be the new direction of my business!

    I would be very greatful if you could impart a few pearls of wisdom on me :-)

    Tryme1 - thanks so much, makes me feel a little more positive as you operate within the UK too and making a success of it... I may send you a PM shortly to pick your brain on a few things if thats ok? Very greatful for the advice given so far though!
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    • Profile picture of the author kenmichaels
      Originally Posted by JSTEF View Post

      Kenmichaels - this is something I'm very serious about, and will be investing a few thousand £ to get it off the ground. This will effectively be the new direction of my business!
      Save your money. I will show you how to do it from the ground up.

      It wont cost you anywhere near that amount. It will mostly cost you
      time and due diligence.
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      • Profile picture of the author WillST
        Originally Posted by kenmichaels View Post

        Save your money. I will show you how to do it from the ground up.

        It wont cost you anywhere near that amount. It will mostly cost you
        time and due diligence.
        I would be very, very grateful!
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      • Profile picture of the author AussieT
        Originally Posted by kenmichaels View Post

        Save your money. I will show you how to do it from the ground up.

        It wont cost you anywhere near that amount. It will mostly cost you
        time and due diligence.
        So Ken where can we find out more about your offer above?
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        • Profile picture of the author kenmichaels
          Originally Posted by AussieT View Post

          So Ken where can we find out more about your offer above?
          Its not an offer. I am writing how to do it and posting here, i am just slow.
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          • Profile picture of the author ClayWhite
            I'm able to generate leads but I'm having trouble finding clients to sell them too... can anyone help? How to I go about contacting these companies and what should I and shouldn't I say?

            I generate health, life, dental, senior, and can also offer live transfers (which i prefer to do).
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  • Profile picture of the author tryme1
    Hi Jstef, Yeah, feel free to PM me. I don't know if I have enough posts to be PM'able. But give it a go and if not, let me know here and I'll contact you some other way.
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  • Profile picture of the author JaffeyApple
    I am not sure what field you are working in but there are other ways in which you can do this which are more lucrative, require and equal level of work but offer you a far greater level of control.

    The field in which I work is home improvement. I have determined with X number of providers what services they will provide for which cost. The site I have churns out quotes without any communication with the customer.

    If the customer likes the prices we interact and we secure the job. I then pass the job on to one of the manufacturers and get 15 - 20% of the net invoice value. Instead of selling leads I am giving them jobs, they only pay for what they get and I get paid a good percentage for passing over the job.

    I have various providers across the country in which I am located and I have two providers per region and I spread the work out. If I fall out with a provider tomorrow because they don't pay or perform a poor service I get another provider whilst I already have one other to fall back upon.

    The opening part of your post was in relation to concerns about search engines, your income and future stability etc. Business is the same, do not put all your eggs in one basket, you must spread the work around to secure your own position or before long the tail will start wagging the dog.
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    • Profile picture of the author beldorian
      @kenmichaels - btw - just bought Mobile Renegade - so far it looks really good. I would be very interested in your take on lead gen, as well - I have been thinking about my "irresistible offer" recently - and I think I would like to promise b2b or b2c leads as part of it, but I have a lot of hesitation on this - I have seen vids rank on page 1 position 1 for competitive keywords which do not generate leads & would really dig getting a fellow with your experience to chime in.

      Thanks!
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      Yewp! Let's do it :)

      If you are shopping for Cheap Car Insurance, please feel free to avail yourself of my service at www.QuoteMyAuto.com Thanks!

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    • Profile picture of the author AussieT
      Originally Posted by JaffeyApple View Post

      I am not sure what field you are working in but there are other ways in which you can do this which are more lucrative, require and equal level of work but offer you a far greater level of control.

      The field in which I work is home improvement. I have determined with X number of providers what services they will provide for which cost. The site I have churns out quotes without any communication with the customer.

      If the customer likes the prices we interact and we secure the job. I then pass the job on to one of the manufacturers and get 15 - 20% of the net invoice value. Instead of selling leads I am giving them jobs, they only pay for what they get and I get paid a good percentage for passing over the job.

      I have various providers across the country in which I am located and I have two providers per region and I spread the work out. If I fall out with a provider tomorrow because they don't pay or perform a poor service I get another provider whilst I already have one other to fall back upon.

      The opening part of your post was in relation to concerns about search engines, your income and future stability etc. Business is the same, do not put all your eggs in one basket, you must spread the work around to secure your own position or before long the tail will start wagging the dog.
      Have you developed your own software/script to provide these online quotes? If not where can we find more info on how to implement a similar model?
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      • Profile picture of the author JaffeyApple
        Originally Posted by AussieT View Post

        Have you developed your own software/script to provide these online quotes? If not where can we find more info on how to implement a similar model?
        I have an online quotation tool. It sounds complicated but really the concept is not that difficult. It is simply an upmarket calculator that adds together all of the aspects of a quotation.

        Lets put this into product terms in hope that it will make more sense which will perhaps enable you to get a better handle on how the system works.

        Take a product like garden fence panels. Research the product and see what the variables are as in weatherboard, 1800mm wide panels, 1200mm wide panels, finished, unfinished, concrete posts and wooden posts for example.

        All of these items has a value. An 1800mm unfinished panel might $10, 1200mm panel $8, concrete posts $10, wooden posts $8 and so on. This relates to the purchase of the product, don't forget the installation of the items also has a value too.

        So if a customer wanted the supply only of 10 x 1800 panels & 11 concrete posts the price would be $210, simple maths exercise. There are variables like delivery, installation etc but again these are straightforward.

        The quote engine simply allows the customer to enter the quantities of the chosen items they require in the same way as you would when purchasing from say Amazon for example. An off the shelf shopping cart would be able to do the job required although I personally have had my quote engine built for me as the goods I sell are of a higher value so this warrants the investment.

        Undertake the usual market research you would do for any niche to see what the market demand is for the product. If the product has enough demand then the next stage would be the competition.

        The main providers within this field will all be price conscious of each other. Take the top ten search engine results and do price comparisons for the products in question between them. Then drill down deeper by geographical area, just do three of four areas which have the greatest level of population. Essentially, the greater the population of an area, the more prospective consumers exist for the product. More competitive pricing will exist as multiple suppliers are all competing for the business in high competition areas. Competition drives down prices so this will offer to you the cheapest pricing.

        You will now know who offers the keenest prices in relation to the physical goods and also the installation of them. If need be, talk to the suppliers and weed the information out of them, if you determine the right type of questions in advance you can get a breakdown of the cost variables from them. It might be that Company X has the cheapest materials and Company Y has the cheapest labour, it does not matter, look at the products in isolation and the labour in isolation.

        Once you have determined the products and the prices the next stage will be to obtain a supply line. Again go back to the search engines and get the contact details for companies appearing on pages 2 - 4. Send out an email to these companies telling them you are in their field of work and are getting swamped with work and are they interested in undertaking some of the surplus work on my behalf.

        I already have a web site set up so the prospective suppliers can have a look around at the site and also to use the online pricing tool. The online tool offers the goods out at the same prices as the cheapest product supplier and the cheapest labour supplier. I state to the suppliers I require X margin (usually 15%) from the price generated from the quote engine.

        I now have my site operational, my suppliers and my online quote tool. The remaining jobs is targeted traffic and then servicing the enquiries.

        Take virtually any physical product and you are simply placing yourself between the provider and the customer. The concept is not that different from an Amazon store or any other affiliation concept really. In the case of Amazon etc they determine the percentage (less then 10%) and the consumer can already buy the products direct from a large organisation which has a lot of market clout who know what they are doing with search engines etc. I generally chose products that are poorly conveyed within search engines which have a higher value.

        Yes, this requires work and does take some time to set up so it is not a quick buck type concept but let me put this a different way, the last one I set up I spent 4 months building a 1000+ page site. This entity now makes me between $8 - $18,000 per month which I feel warranted the work.

        Note I work from the spare bedroom in my house and I get salesperson to field the customer enquiries for me so I simply administrate the income and nominal expenditure and look after the site.

        If your wondering, the reason for the variable in figures is that the products are subject to seasonal variations as is the case with numerous physical products.

        I am not suggesting to go for a big site as a starting point, start small, get comfortable with the concept and then roll this out across the Country you are based in. Repeat the process with a bigger one and so on. If you think about this you can repeat it with a zillion different industry types; insurance companies have been doing this for years.

        Hope that helps and that I have not rambled on tooooo much.
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  • Profile picture of the author dinoseo
    Hi,

    Actually generating leads to offline companies may give high profit in their business. Now a day all the companies requires sales and leads to overcome their competitors so they try to generate their leads in different ways. Social media marketing is one of the easiest way to get more traffic within a short period of time. Just make a try with SMO and affiliate marketing to generate more leads and sales.

    Thanks,
    dennis
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  • Profile picture of the author tryme1
    Hi Jstef, Got your PM. I don't have enough posts to reply to it, though, so I've emailed you instead.
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  • Profile picture of the author WillST
    JaffeyApple - Wow!

    That was a lesson in business in and of itself! Thank you for your patience and generosity in providing the breakdown as you just have.

    Definitely gives me food for thought on what to do with the leads when I generate them - I'm in 2 minds what to do now... Sell them as I generate them, or put a little more work in and work on a profit share model with a contractor when the jobs are secured...

    I'm weighing up the pro's and con's of getting paid as quickly as possible, or to wait a little longer to earn more...

    The niche I'm targeting, I don't think I would be able to create an online quote calculator... So will have to pass leads over directly... So Im now struggling with the idea of how I would track the secured jobs to make sure I get paid, and the contractor doesn't decide to conveniently not let me know!

    kenmichaels - thanks for taking your time to put your thoughts and guidance into this thread too, very much looking forward to reading them!
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    • Profile picture of the author JaffeyApple
      JSTEF - No problem, glad you found it of some use.

      With regards to your situation I may have a solution for you. It is not something I have tried as yet but something I feel could work very well.

      Why don't you set up a site. Get prospective customers to enter all of their details onto the site. This would be ALL of the variable factors that determine pricing. Obviously don't charge the consumer to use the site and as they are dealing with all of the administration of the enquiry you have no interaction.

      Place all of the enquiries you receive onto your site removing all of the contact details for the lead.

      Offer lead generation to the organisations that fit the niche. Offer them the usual half a dozen on a free of charge basis so they can test the leads for themselves.

      Let the companies interested in the leads read through the data extracted from the consumer. They can see exactly the data that you have to enable them to attribute a value to the information.

      You will also need to attribute a value to the data. This would probably be on a sliding scale depending on the niche. For example if you were dealing with builders and providing them leads, a lead with a leaky tap would not be worth as much as someone who wanted a house built.

      You charge a monthly fee to the companies for membership (the holy grail of recurring income if done correctly) to access the data on the site. Because they have paid for monthly membership they can have X numbers of leads for no cost as part of the membership fee.

      The companies then pay for the data they decide to purchase regardless of their conversion. Lead generation is exactly what is states, generating leads. What makes people nervous of paying for the lead is not knowing the data quality they are going to get. The online membership access removes this issue as they can see exactly what you have in advance and they are pre-vetting the lead themselves so they cannot complain after the event.

      There are lots of ways you can tweak this. For example if you were selling a physical product each member would state an geographical area of coverage they desire leads from. Membership fees could be a fixed fee per State/County for example which gives you scope for increasing the recurring income regardless of lead volume you sell.

      If the product is not region specific another option would be to sell the data up to three times. A consumer will always get multiple quotes when purchasing most things. If you sold a lead for $10 for example to one company it gives the consumer the need to still look elsewhere for additional quotes. If you sold the data to three different companies @ $8 a pop it would greatly increase your revenue per lead. It would also increase the conversion rate of the consumer going with one of your customers who purchase leads from you as the consumer has now received three different quotations.

      Once operational it should require no real input from you as it is all site based with online payment facilities and data input fields. You would then concentrate on increasing your customer base to sell the leads to and increasing the level of enquiries inputting data onto the site for you to sell.

      You could have a lot of tweaks with this to get it just right but you should get the gist of the structure I am stating from this. A combination of the two rough ideas would also work.

      This sounds like a better model than the one you envisage with chasing up the companies to ensure you get paid. Look at the price comparison and insurance websites that now exist in recent years. Look at their model and this should give you everything you need to see how successful this could be with the right product and lead generation.

      Originally Posted by JSTEF View Post

      JaffeyApple - Wow!

      That was a lesson in business in and of itself! Thank you for your patience and generosity in providing the breakdown as you just have.

      Definitely gives me food for thought on what to do with the leads when I generate them - I'm in 2 minds what to do now... Sell them as I generate them, or put a little more work in and work on a profit share model with a contractor when the jobs are secured...

      I'm weighing up the pro's and con's of getting paid as quickly as possible, or to wait a little longer to earn more...

      The niche I'm targeting, I don't think I would be able to create an online quote calculator... So will have to pass leads over directly... So Im now struggling with the idea of how I would track the secured jobs to make sure I get paid, and the contractor doesn't decide to conveniently not let me know!

      kenmichaels - thanks for taking your time to put your thoughts and guidance into this thread too, very much looking forward to reading them!
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  • Profile picture of the author RD Phoenix
    There are some very insightful lead generation forums around too. Worth finding them and checking out with a Google search.
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  • Profile picture of the author djduckworth
    Hi folks, I've been running this business model for about 4 years now in the web design, graphic design and online marketing niche. You can check out the client side of the site, which is called Design Quotes. It's extremely competitive and generating high quality leads is the most difficult aspect.

    Our initial approach was too automatically make leads available to members for purchase. Using customer data we had a formula that calcuate the price of the lead.

    The problem with this model was that too many of them were fake and we had to refund lots of them.

    Next we started qualifying the leads and adding information to their brief. This was well received by our members but adds to the cost of lead generation.

    The problem remained that lots of clients never went ahead even if they were genuine so members found it hard to justify the expense. In some cases leads could cost as much as $200 X 4 (paid by 4 providers to produce 4 quotes).

    We are now transitioning into a commission model where members pay s very small upfront fee for a lead and then 10% if they win the project. 4 years ago this wasn't really viable because of the administrative overheads, however with tools like Echosign and their APIs this becomes much easier to manage.

    Still the difficult part is generating high quality leads that convert at a low enough price to make a profit.

    If you are a gun at lead generation, then the I recommend going with the commission model.

    Additionally, build affiliate tools so that related websites can embed your quote request form and pay them a commission (a percentage of your own commission) for every successful project.
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  • Profile picture of the author sanlee
    There's a simple way around it. Say you are able to send 100 leads in a month, and let's assume industry average of 50% conversion to paying customers. You are sending 50 paying customers a month. So what's the average revenue from a customer? Let's assume $200, that's $10000. If you are charging $3000, this means they are paying you $3 to make $10 - what a deal right?
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    • Profile picture of the author richie311
      50% conversion? What kind of leads are you selling lol

      Originally Posted by sanlee View Post

      There's a simple way around it. Say you are able to send 100 leads in a month, and let's assume industry average of 50% conversion to paying customers. You are sending 50 paying customers a month. So what's the average revenue from a customer? Let's assume $200, that's $10000. If you are charging $3000, this means they are paying you $3 to make $10 - what a deal right?
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