By Sean Fenlon on September 24, 2007
Industry Leaders (Lead Sellers AND Lead Buyers) Gather to Discuss Ways to Increase the Value and Effectiveness of Internet Leads
The leaders in the Internet Leads movement gathered in Vegas last week at
The Palms. I attended the event along with our CTO Syed Zaidi, and our SVP Brian Ocheltree. Ironically, we found ourselves on the same floor as Ultimate Fighting Championship competitors during their warm-up for a bout on stage at The Palms – quite a distraction with this highly-competitive crew.
The two-day conference began on Wednesday 9/19. This was a travel day for most of the participants, thus arrivals were sporadic. The conference began with breakout sessions despite the effects of disparate arrival times. With this smart design, attendees were not forced to miss the special Keynote Sessions scheduled for Thursday as a result of their travel time on Wednesday.
Craig and Angela did an outstanding job of tag-teaming a presentation from both the perspective of the lead seller (DegreeStreet.com) and the lead buyer (Grand Canyon University). One of the concepts they reinforced was to look beyond the Cost-per-Enrollment of a new student and into the retention rates and graduation rates of the students. This concept made a number of the audience members somewhat curious and they felt that the effectiveness of the performance feedback loop would be compromised by the extended timeline of the milestone. In other words, a number of audience members were convinced that things change so quickly that conclusions from longer-cycle performance indicators would lead to moot conclusions. Overall, however, both Craig and Angela demonstrated a deep understanding and desire to measure as many dimension as possible in order to optimize lead flow and the underlying campaigns.
Building the Right Formula for ROI
Laura Lewellyn, Senior Data Analyst, TARGUSinfo
Laura walked through a case study of an anonymous Online Education company by segmenting lead performance into deciles. The analysis provided an interesting philosophical concept to consider. Should a lead-buying organization optimize for pure conversion rate or should a lead-buying organization optimize for a pure profit through-put. In other words, should a lead buyer cut off any lead source below, say, 7%, or should a lead buyer continue to buy leads from any source so long as they were making at least $1 more than what it had cost them (fully-loaded).
Laura also looked at the first-call-close dimension, which was very interesting to me. Clearly, a lead source that can provide a significant percentage of closes on the first contact is a high-octane lead source and will result in significant cost savings with respect to “follow up” resources be applied in order to close the deal on subsequent calls. This concept is the closest I encountered to my concern about labor costs seldom being factored in the cost structures in ROI calculations.
Laura later explained to me that TARGUSinfo provides this type of detailed analysis for free as part of their consultative and value-add sales process. TARGUSinfo customers should take full advantage of this as it could most certainly stand alone as hourly-based consulting contracts in the future.
CEO & Founder, TARGUSinfo
Official Opening Remarks
On Thursday morning, TARGUSinfo founder and CEO George Moore delivered the official opening remarks for the conference. George announced that TARGUSinfo (after being built “brick-by-brick” without external funding) had achieved a $100MM run rate, and was growing 20% per year. This is a fantastic achievement and milestone, and a testament to the TARGUSinfo team. The majority of their revenue continues to come from their Caller-ID, Dealer-locator, and other real-time telephone services, but they are clearly bullish about the interactive leads until of their business as an important growth center. George clearly acknowledged the growth opportunities of real time data services via the Internet.
The Rise of Online Conversion Marketing
Ian Smith (Managing Director, Allen & Co.) & Matt Coffin (former CEO, LowerMyBills.com)
The opening keynote address began with Ian Smith, Managing Director of Allen & Co. Ian is legendary in the Internet leads M&A ecosystem, having managed the process of the sale of Lending Tree, Advertising.com, LowerMyBills.com, and NexTag. Ian provided a historical overview of the evolution of the leads ecosystem with particular emphasis on LowerMyBills.com, including selecting historical examples of LowerMyBills.com innovative display advertisements (stretched animals, the suicidal ginger-bread man, etc.)
In one diagram, Ian posed the question: are publishers (portals, content/destination sites, etc.) moving upstream to compete with the very companies that currently buy their inventory today?
[Personally, I believe the answer is a simple one. It all comes down to eCPM. Publishers almost always prefer to sell their inventory on a non-performance-based (CPM) model. If the CPMs that they are able to command using the efficiency of the various exchanges (Right Media, CPX Exchange, DoubleClick Exchange, etc.) is significantly lower than the EFFECTIVE CPM (eCPM) of selling using a performance-based delivery model such as CPA/CPL, they will indeed move upstream in an attempt to capture additional value.]
Since 50% or more of advertising sales are reportedly from non-performance-based brand advertisements, I, like Ian, do not see the publishers moving upstream anytime soon. Quite simply, “the juice just aint worth the squeezin’” for them at this time.
Ian then invited Matt Coffin up for a fireside chat (without the actual fire).
One of the things Matt Coffin clarified early in his discussion was that “Lead Generation is NOT a Value Proposition.” I could not agree more. Matt went on to predict massive innovation in the Lead Generation space based upon competitive pressures as well as the economic reality as a result of a drastically affected mortgage leads ecosystem. But Matt was definitely betting on the innovators and entrepreneurs in the audience, which warmed my heart. He did also warn entrepreneurs that whatever it is they are doing better bring significant value to the consumer or else the model will ultimately fail.
During the Q&A session with Ian Smith and Matt, former CEO of Experian Interactive, Ed Ojdana, was handed the microphone and asked Matt “What was the biggest/best lesson learned now that you’ve stepped away from LowerMyBills.com and have a fresh perspective” (or something of that effect).
Matt took his time to gather his thoughts before responding emphatically – “I need to break the answer up into pieces. First, TEAM MATTERS.” Matt went on to recount that all the great success of LowerMyBills.com have be attributed back to the addition on new rock star team members, and that the technology and the vision alone could not have produced the same results as the people. Secondly, Matt described a culture that passionately-analytical and poured over key metrics, and would quickly “double-down” on what was working at the time in order to continue to accelerate growth.
[Matt’s advice was quite apropos as I witnessed him later in the evening doubling-down at the blackjack table with almost eerie sense of what the next card will be – to the cheers of the folks around the table.
IAB Marketer & Agency Guide to Lead Quality
Prior to this session, attendees were provided a multi-page IAB Marketer & Agency Guide to Lead Quality, a great handout but did not include anything DoublePositive was not already incorporating.
Terrence Thomas, CMO, eLearners.com
After the break, excellent presentation by Terrence on how to attract potential students to your educational institution.
Striking a Balance Between Branding and Lead Generation
Josh Perlstein, President, Response Media
Many described Josh’s presentation as the most insightful, as there were very few brand marketers in the audience. All I can say is that even toothpaste manufacturers buy leads.
Just before lunch, two awards were presented for Online Marketing Excellence. The Awards were presented to David Behn, Cole & Weber, and Matt Wells, LowerMyBills.com. Based upon Dave Wengel’s intro, it sound as though both are way beyond well-deserving of such awards.
Dave Wengel was the most-present presenter during the second half of Thursday (delivering a similar presentation to both lead sellers and lead buyers). Dave also provided excellent closing remarks at the end of the conference.