We have arrived at the final post in this Leads101 series, as far downstream in the value chain as we will go; the period during which a lead or prospect turns into a revenue generating entity – also know as a customer. What we are really talking about here are the additional pieces of technology that you can use to either close the deal or manage your customer – pricing engines and customer relationship managements systems. Each of which have slightly different flavors in each vertical.
Pricing Engines
Until recently a mortgage broker, insurance agent, personal loan officer or any other individual that offered products with prices that frequently changed would use a physical rate sheet to price loans. In my living memory this was typically a sheet or two of paper with a table of prices on it faxed on a daily or weekly basis by the bank, insurance company etc. The Internet era has changed that. Prices change more frequently and consumers expect more instantaneous gratification necessitating a more automated system of quote delivery.
Many verticals in which there is heavy utilization of Internet leads also rely upon automated pricing solutions in order to help close customers. In most industries these engines come in two different kinds.
1. Auto-pricing
Auto pricing has the ability to take in lead data and return an automated quote or multiple quotes on behalf of the seller, usually by email but sometimes on the a screen subsequent to the one where the consumer has entered their data.
2. Manual pricing
Manual pricing is one that involves a seller making tweaks and adjustments in order to find the best products available for a customer. Typically sellers have access to these pricing engines while they discuss the consumer’s needs over the phone and are able to quote and often lock in a price for a product on the call. This is a very common use in both the mortgage and insurance industries.
Mortgage Pricing Engines
Pricing engines in the mortgage industry compete on a few criteria; the number of lenders that they integrate with, the accuracy of the quotes that they are able to deliver and the user-friendliness of the interface. There are several major players in the market, all of which have great systems for manual pricing, auto-pricing or both. The larger and better ones also integrate with lead management systems to provide a seamless way to receive leads and auto quote on them. The following is a list of the major mortgage pricing solutions, starting with the market leader:
Insurance Pricing Engines Insurance, in some ways is a little more complicated than the mortgage industry. First of all, there is a significant difference between how one prices policies between each insurance sub-categories (auto, home, health and life). This is a far less evolved space than in the mortgage industry, many of the pricing engine solutions primarily relying upon screen-scraping and document scanning to get insurance rates versus direct feeds from the policy writers. The major solutions in this space are as follows:
Auto/Home
Health/Life Administration Systems
Administration systems cover a large clutch of disparate “back-end” pieces of software that are used to get a lead through an application, conversion and ongoing retention cycle. Every industry that uses leads has it’s own flavor of administration system. In the mortgage industry these are called Loan Origination Systems; in Insurance, Agency Management Systems; In Education, Student Management Systems etc. During the later stages of the sales cycle in organizations that follow robust processes, leads will typically be passed from a lead management system to an administrative system for an application or revenue-generating event/conversion to take place.
Summary
And now that we have covered the entire lead cycle from lead submission to conversion we are at the end of the Leads 101 course. Hopefully it is a useful introduction to the lead industry and levels the playing field in a sector that suffers from significant levels of information opacity.
Hopefully, with collaboration from peers, this board may continue to provide useful information and views for and from lead experts and neophytes alike. My next subject will be about my views about the future direction of the lead industry: stay tuned.
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