The Complex System: Story of an Entrepreneur

Hit LeadGen PayDirt!

Prospecting for leads is much like prospecting for gold. When the gold rush was happening in California in the 1800’s prospectors sometimes got lucky and found a vein of gold running through a mountain. Miners hit Paydirt, spending weeks or months digging out the precious gold. Eventually the vein of gold ran out; it seemed to end rather abruptly. There was seemingly no more to mine. At some point in the future geologists questioned why a vein of gold simply stopped flowing. They thought it was strange that a once molten liquid of gold flowing through a mountain range just ended. As they studied this phenomenon they theorized that the gold vein did not stop there. They found that it was actually movement in the Earth’s plates that caused the mountain range to shift. When they analyzed this shift they realized the gold didn’t end, in fact it continued much further, but was offset about 50 feet to the north. Once they calculated the shift differential, they started digging again and there it was. Paydirt, again!

What does this have to do with leads? Well, I think lead generation works in a similar way. Marketing departments find a great source of leads and work them dry; then all of the sudden those leads dry up. It takes a small shift in the strategy and bam, a new vein of great leads are found.

Prospects are fickle; like fish, they move from spot to spot and the more effort you put into tracking them, the more you catch.

Leads, Leads, Leads, More Leads…. And then, well, more leads

The online lead market is truly amazing. I just heard about another lead generation monster buying up one of our lead partners. The one that was purchased, for an extraordinary number I’m sure, mostly focused on mortgage leads. If companies are still paying big multiples for companies that are heavily focused on the mortgage industry, well I’m pretty excited about that.

For us, it doesn’t matter what leads people are buying on the internet. Leads360’s lead management system is designed to automate lead distribution and monetize the lead tracking process. More and more every day small and large companies alike are buying leads from online aggregators. Mortgage and automotive leads still lead the way, but others industries like home improvement, secondary education, debt consolidation and overseas medical services are growing.

It’s not just that more and more companies are looking for sources of sales leads on the internet; it’s a combination of factors such as:

1)       Customers are going online more frequently, and more importantly, have more trust in online lead providers. The consumer drives the market first and foremost. As customers go online more frequently to search for products and services, they fill out more online forms and request qualified vendors to respond.

2)       More traditional brick and mortar businesses are looking to the web as a source of leads. Big companies like Home Depot see an opportunity to generate leads from customers and contractors online. When big companies, that don’t traditionally use the web as a source for online generated leads, come knocking, well, the lead providers start jumping.

3)       Huge consumer credit and data providers are getting into the game in a direct way. They’re buying the big lead providers like Experian did with LowerMyBills or they’re selling direct to small and large companies like InfoUSA.

So when I say “we’re in a pretty good spot”, well, we’re in a pretty good spot. You see, as one LowerMyBills executive told me, on several occasions, “If you are buying leads online, and you are not using lead management, you are not going to be buying leads from us.” And that’s the truth about our software.

If your company is buying leads online, and you aren’t using a lead manager, you aren’t likely to be in business for long, and you certainly aren’t on your way to becoming a “good to great” company.

The Online Lead Aggregator Model

Companies like LowerMyBills.com are practically printing money these days with the millions of people that go online and fill out lead information forms. LowerMyBills.com (LMB) takes these applications for any number of services including mortgage and insurance. Then they do some minor qualification and sell these leads multiple times over to vendors that provide appropriate products. The model is brilliant in fact because it works well for everyone. The consumer is happy because they have several companies fighting over them and get the best price/service combination. The vendors are happy because they can just buy more leads if they want to grow. It’s like a faucet. Just open the pipe and send more leads. And companies like Leads360 are happy because we provide a way to organize, distribute and manage this massive lead flow.

Because more and more people are going to the web to find services like refinancing and new purchase loans, the mortgage industry has been a great proving ground for companies like Leads360 to prove the lead management service. This trend is growing; and it’s not limited to financial based purchases. Everything from insurance, to time shares, to secondary education, people are looking to the web to get more information and sign up for services online.

We are gearing up for 2006 in a big way. One way we are doing this is by making sure that our software is so much more flexible than our competitors. Additionally, we are moving into CRM territory as to take some of that market share from the big boys like Salesforce.com and Siebel. We believe that not all customers that deal with leads and have sales departments need expensive CRM solutions. If we can provide the necessary customer acquisition management tools and basic CRM functions, we can tap into a massive customer base that has never really been addressed.