New Leads360 Study Shows the Importance of Consistent Follow-Up to Convert Insurance Leads

With the economic problems faced in these trying times it’s all important that any insurance agency be sure they’re going to get a high ROI (return on investment) from any expenditure, and this is especially true when dealing with internet leads. The best insurance leads are often generated on the internet and purchasing leads from 3rd party providers has been proven to be an effective way of finding those individuals who are serious about buying insurance. However, for that same reason, insurance leads can be expensive. While it is crucially important that salespeople rapidly respond to these sales leads, it’s also very important that diligent follow-up be done to ensure that no lead is abandoned until it is thoroughly explored.

When reacting to internet leads, speed is the name of the game. Up to 76% of leads contacted in the first three minutes are qualified, and leads can be expected to be converted a staggering 22 times more often when contacted in the first five minutes¹. With these sorts of results tied to the rapid response to insurance leads, it’s easy to assume that initial contact is all that’s important and neglect to diligently follow-up beyond initial contact attempts. A Leads360 study, though, provides ample data proving just the opposite, after sifting through over 15 million leads, to study how leads were converted and why. While being able to get to leads immediately is a major boon to conversion rates, following up a minimum of 5 to 6 times on leads when contact is not made with the initial attempts is still a crucial part of maximizing ROI.

If a lead is not contacted on the first attempt, the study found that that a second call alone increased the chance of contacting that lead by 87%. The more attempts that were made the better the results became. After a second attempt, 72% of contactable-leads were contacted, increasing to 83% with a third call, 88% with a fourth, 91% after five and a whopping 93% of contactable-leads were contacted after the sixth attempt. The study lays bare one simple principle: never give up too early on a sales lead. Particularly with internet leads that come at a high price, putting in one call, even if it’s in the first five minutes, isn’t enough. A diligent sales staff that’s focused on following up on their leads will do a much better job of getting a maximum return on their investment.

The results of proper follow up are clear when you consult the numbers. Another Leads360 study shows that, in the insurance industry, as few as 650 of every 1000 leads are contacted and as few as 550 are qualified. Given that only 30 of those leads are closed quickly, that leaves 520 of every 1000 leads abandoned. While some might be able to convince themselves that this sort of turnover on leads is just an offshoot of modern sales and can be ignored, those who keep an eye on the relevant metrics know that those abandoned leads come at a cost of over $4,000. What’s more, the cost of the potential business lost is over $25,000². Additionally, these leads can easily be nurtured by using software to automatically do email drip marketing around policy renewal dates and other key follow-up periods. The costs of failing to follow up are clear.

Many recent studies have shown that as many as 50% of sales leads can be closed eventually, while even the highest quality of leads can only be closed immediately about 5% of the time³. This clearly shows that, while speed to contact is crucial to successfully converting insurance leads, just because a lead is not immediately converted does not mean it should be abandoned. Diligent and careful follow-up is essential to making sure that those leads that aren’t immediately contacted can still be converted into new policies.

Using lead management systems like Leads360 allows insurance sales teams to start honing in on areas of waste and carefully tracking leads so sales teams to maximize their ROI and follow up on every lead until it’s exhausted. As Eric Mallon of Insurance Quote Exchange puts it: “Leads360 makes it easy to gain full visibility over our valuable sales leads and to ensure that every lead receives prompt and thorough follow-up, resulting in more policies sold. It’s a revelation to have automatic lead tracking and distribution. It has transformed sales and marketing from an unpredictable black hole into an easily scalable profit-center.”⁴ Leads360 can allow a sales staff to not just get to leads early, but to follow up as many times is necessary and ensure that the sales team can and will get as much value from their leads as possible.

¹ Leads360 Whitepaper “First to Call: Why You Can’t Afford to be Second” June 2008

² Leads360 Whitepaper “1+1=3 Integrating lead management & Predictive Dialer Technologies for Exponential Results” June 2009

³ Leads360 Whitepaper “Making Money on the Other 95%: How Lead Nurturing Triples Sales” June 2008

⁴ Insurance Journal “Sales Lead Management” https://www.insurancejournal.com/services/newswire/2009/09/29/104130.htm