Don’t Lower Your Commissions for Leads

[theinsuranceman]

Re: Don’t Lower Your Commissions for Leads

Agent #1. Has 100% commissions and no free leads. He makes $600 in commissions.

I see where you are going. But, if the 100% comm. agent's leads are not free.... then he's paying for the leads. How much is he paying for his leads? The cost for his leads were omitted from your excellent example.

 

[Mark]

Re: Don’t Lower Your Commissions for Leads

Agent #1. Has 100% commissions and no free leads. He makes $600 in commissions.

I see where you are going. But, if the 100% comm. agent's leads are not free.... then he's paying for the leads. How much is he paying for his leads? The cost for his leads were omitted from your excellent example.

Yes, it says NO FREE LEADS, meaning that the leads are not free. So that does mean he is paying for his own leads at cost and not taking a cut in pay. He could also be prospecting for free.

Most agents never do the math, when they see free leads and a lower contract, without thinking about how much money they are giving up. They are afraid to prospect or find their own lead sources....Fear is holding them back and costing them money.

I can think of tons of IMO that cut your commissions down to 50% and also charge you for the leads. Like NAA does.

Most of the agents will just end up with leads charges and being placed on vector. THen you will be suck at a low end contract until you get a release or pick another company.

I know of an imo that buy leads from a source that know and pays $22 a lead and then charges the agent $25 a lead, and cut the agents commissions by 50% on top of that. If the lead does not pand out, then he blames the agent and tells you to buy more leads. It is a never ending cycle of the IMO making money from the new agents or the agent that cant find his own lead source or learn to prospect.

 

[moonlightandmargaritas]

Re: Don’t Lower Your Commissions for Leads

Yes, it says NO FREE LEADS, meaning that the leads are not free.

Shades of Yogi Berra?

 

[theinsuranceman]

Re: Don’t Lower Your Commissions for Leads

Yes, it says NO FREE LEADS, meaning that the leads are not free. So that does mean he is paying for his own leads at cost and not taking a cut in pay. He could also be prospecting for free.

Most agents never do the math, when they see free leads and a lower contract, without thinking about how much money they are giving up. They are afraid to prospect or find their own lead sources....Fear is holding them back and costing them money.

I can think of tons of IMO that cut your commissions down to 50% and also charge you for the leads. Like NAA does.

Most of the agents will just end up with leads charges and being placed on vector. THen you will be suck at a low end contract until you get a release or pick another company.

I know of an imo that buy leads from a source that know and pays $22 a lead and then charges the agent $25 a lead, and cut the agents commissions by 50% on top of that. If the lead does not pand out, then he blames the agent and tells you to buy more leads. It is a never ending cycle of the IMO making money from the new agents or the agent that cant find his own lead source or learn to prospect.

You should expose this rip off artist to the forum. Never mind.. I see u r talking about NAA.

 

[retread]

Re: Don’t Lower Your Commissions for Leads

WOW! I can't believe that this thread has not attracted the guys that recruit from this forum. Last year about this time, I posted a similar comment about not taking a commission cut for leads and got assaulted....

 

[theinsuranceman]

Re: Don’t Lower Your Commissions for Leads

To extrapolate a little further on your example:

_An agent writes $2000 ann. prem. for the week.

_Assume agent worked 20 FE leads that week to get that $2k prod.

_Which is best (for the agent):

1. 100% comm., paying $400 to drop 1000 FE pieces, and getting back a 1% response (which means $40 per lead), so we will assume this agent paid $800 to drop 2000 pieces to bring in the 20 FE leads. (2000 x 1%).. (still $40 per lead)...1% response pretty good ave. figure for us to use...usually .5% - 1.5% response rate for FE.

2. 85 % comm. paying $25 per lead for 20 leads (buys these leads from his upline), the upline assumes all the risks in response rates of the mail drops.

3. 50% comm. with 20 free leads

Scenario #1: $2000 prod. x 100% x 75% advance = $1500 in comm. $1500 - $800(for the 2000 pc. drop) = $700 Net Profit.

Scenarion #2: $2000 prod. x 85% x 75% advance = $1275 in comm. $1275 - $500 (20 leads @ $25 each) = $775 Net Profit.

Scenario #3: $2000 prod. x 50% x 75% advance = $750 in comm. $750 - $0 leads costs = $750.

Net profits pretty close to each other considering the wide difference in comm.% for each of the 3 agents.

The leads cost the agent pays influences the Net Profit for the agent as much if not more than comm. %.

Now it's true the agent at 100% comm. could avoid lead costs by cold calling all week knocking on doors. But the EXTRA time it would take cold calling to write the $2k prod. would kinda be offset in that he would make less comm. per hour. (we assumed in the 3 scenarios above that the same amount of time was spent working the 20 leads)

Scenario # 2 is the best right?

If there is an error in my math please point it out.

 

[Mark]

Why not assume the agent is not doing a lead mailing and assuming the risk and not just buying the response back.

Greg, Ive studied your craigslist stuff and your systems. You are selling the tents, supplies, picks, and tools, to the gold mine. There is tons of gold in this mountain, and you will need your stuff to get it..

We can keep this very simple and not play on numbers.

You can have 100% to 110% of whatever x is
or you can have 50% of whatever the premium is.
I would think that with the 50% that you are losing that you can come up with a way to make your own leads, learn to prospect, or do something, besides give up 50% of your money because you don't know any other better way of doing it.

But wait...If you act right now, I will sell you my system that will teach you how to stay at home and sell over the phone in your boxers...I do it all the time, even if I don't have anyone to prove it, but it does work for me...send your money now..there is gold in this mountain..

Now I could go buy some leads for 20 bucks from a lead sourse that I know of, and you would sell 1 out of 4 or 5 of them. I could sell you the lead for $22 each and also cut your commission over 50%... I can make up some fake ass numbers to make you think this is a good deal..I can make you afraid that you really dont want to do this yourself. WHY BECAUSE IM MAKING 50% MORE COMMISSIONS AND KEEPING YOUR LEAD MONEY...

No one talk about doing a lead drop...Just keep it simple.

You can make 50% less or 50% more...

Most of all the Gurus on this forum that are not trying to sell you anything will agree with me on this...WE all know this to be true....We see other IMO doing this all the time.

FOr some agents, this system does work....I can tell you that some agents are very happy with IMO like Naa and the other tons of IMO that do it.

But you are better off, learning to prospect,,finding your own lead sources...and keeping your money...

I just reviewed a system today that charges the agents 89 dollars a month plus cuts their commissions by over 40% that only teaches them how to do a bait and switch on clients and place ads in newspapers.....I bet you can guess who I;m talking about...Mr in the 80's guy that did big stuff..Mr Murray...

 

[theinsuranceman]

Re: Don’t Lower Your Commissions for Leads

Why not assume the agent is not doing a lead mailing and assuming the risk and not just buying the response back.

Greg, Ive studied your craigslist stuff and your systems. You are selling the tents, supplies, picks, and tools, to the gold mine. There is tons of gold in this mountain, and you will need your stuff to get it..

We can keep this very simple and not play on numbers.

You can have 100% to 110% of whatever x is
or you can have 50% of whatever the premium is.
I would think that with the 50% that you are losing that you can come up with a way to make your own leads, learn to prospect, or do something, besides give up 50% of your money because you don't know any other better way of doing it.

But wait...If you act right now, I will sell you my system that will teach you how to stay at home and sell over the phone in your boxers...I do it all the time, even if I don't have anyone to prove it, but it does work for me...send your money now..there is gold in this mountain..

Now I could go buy some leads for 20 bucks from a lead sourse that I know of, and you would sell 1 out of 4 or 5 of them. I could sell you the lead for $22 each and also cut your commission over 50%... I can make up some fake ass numbers to make you think this is a good deal..I can make you afraid that you really dont want to do this yourself. WHY BECAUSE IM MAKING 50% MORE COMMISSIONS AND KEEPING YOUR LEAD MONEY...

No one talk about doing a lead drop...Just keep it simple.

You can make 50% less or 50% more...

Most of all the Gurus on this forum that are not trying to sell you anything will agree with me on this...WE all know this to be true....We see other IMO doing this all the time.

FOr some agents, this system does work....I can tell you that some agents are very happy with IMO like Naa and the other tons of IMO that do it.

But you are better off, learning to prospect,,finding your own lead sources...and keeping your money...

I just reviewed a system today that charges the agents 89 dollars a month plus cuts their commissions by over 40% that only teaches them how to do a bait and switch on clients and place ads in newspapers.....I bet you can guess who I;m talking about...Mr in the 80's guy that did big stuff..Mr Murray...

Mark....I DON'T sell leads, I don't sell a system you have to pay for, I don't even sell picks, shovels, or tents.

All I do is train FE agents to sell FE using tele-sales. I have also trained agents to sell face 2 face. I don't think my numbers have lied. Each reader can be the judge for themself. You sound a tad bit defensive...I was not criticizing you ex. in the 1st post above...I even called it an excellent example.

 

[sshafran]

Re: Don’t Lower Your Commissions for Leads

_Which is best (for the agent):

1. 100% comm., paying $400 to drop 1000 FE pieces, and getting back a 1% response (which means $40 per lead), so we will assume this agent paid $800 to drop 2000 pieces to bring in the 20 FE leads. (2000 x 1%).. (still $40 per lead)...1% response pretty good ave. figure for us to use...usually .5% - 1.5% response rate for FE.

2. 85 % comm. paying $25 per lead for 20 leads (buys these leads from his upline), the upline assumes all the risks in response rates of the mail drops.

3. 50% comm. with 20 free leads

Scenario #1: $2000 prod. x 100% x 75% advance = $1500 in comm. $1500 - $800(for the 2000 pc. drop) = $700 Net Profit.

Scenarion #2: $2000 prod. x 85% x 75% advance = $1275 in comm. $1275 - $500 (20 leads @ $25 each) = $775 Net Profit.

Scenario #3: $2000 prod. x 50% x 75% advance = $750 in comm. $750 - $0 leads costs = $750.

Net profits pretty close to each other considering the wide difference in comm.% for each of the 3 agents.

...

Scenario # 2 is the best right?

If there is an error in my math please point it out.

No. Scenario #2 is NOT the best. Sorry Greg.

Your math is wrong because an agent will (or should) sell more than the leads that he will buy from his "upline." Some sales will come months down the road if he is taking care of his clients.

For instance, today I am going to write up current client's girlfriend. I sold to the client in January. But if, for instance, I paid my "upline" (per your example) the $25 and took a lower commission of 85% in return, I've done the work to get the referral. But, I'm still going to get the 85% on my new sale down the road.

Learning to prospect on your own, like Mark is teaching, will work better in the long run. Perhaps it may even cost more than the $25 that you could pay an upline, but we shouldn't have tunnel vision thinking that it is just about the immediate sales. We need to think long-term.

 

[theinsuranceman]

Re: Don’t Lower Your Commissions for Leads

No. Scenario #2 is NOT the best. Sorry Greg.

Your math is wrong because an agent will (or should) sell more than the leads that he will buy from his "upline." Some sales will come months down the road if he is taking care of his clients.

For instance, today I am going to write up current client's girlfriend. I sold to the client in January. But if, for instance, I paid my "upline" (per your example) the $25 and took a lower commission of 85% in return, I've done the work to get the referral. But, I'm still going to get the 85% on my new sale down the road.

Learning to prospect on your own, like Mark is teaching, will work better in the long run. Perhaps it may even cost more than the $25 that you could pay an upline, but we shouldn't have tunnel vision thinking that it is just about the immediate sales. We need to think long-term.

You are also correct. But anyone who has FE experience knows that to write $2k+ per week EVERY week you need a steady supply of leads all the time. Even Jdeasy would agree with that.