Best Metric(s) to Evaluate Lead Generation Performance?

This is a community question. What is or are the best metric(s) to evaluate the performance and success of your lead generation channels?

Thoughts?

Is it contact rate, application rate, closing rate, cost per funded loan, other?

Is there such a thing as the life-time value of a lead?

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3 responses to “Best Metric(s) to Evaluate Lead Generation Performance?

  1. Wow, I think the true answer to those questions could take up quite a large response, but I will give you my two cents.
    Your first question, “What is or are the best metric(s) to evaluate the performance and success of your lead generation channels?”
    Initially, when I am creating a new lead generation channel or picking up a new provider, I look at contact rate and application rate. These are two indicators that I can see right out from the gates, neither takes long to create. After a specific time has elapsed I look deeper into the numbers and analyze the closing rate and CPF.
    I think the #1 most important numbers to look at is your ROI on each lead source. How much are you making on each lead. I almost don’t even look at conversion numbers, because if a lead source has a low conversion number, but are giving me high dollar loans at a lower CPL, then I will be profiting more that source than possibly a higher converting lead source.
    It all comes down to ROI.

  2. I agree with “Morinsight” — there are many ways to skin that cat. But at the end of the day, Cost-per-funded-loan and/or an overall ROI measurement give you the best metrics to determine the success of a lead gen channel.

    But to get to the true cost of a lead generation channel, I find that most mortgage shops fail to factor in the opportunity cost of a loan officer’s time having to call on the data leads they would otherwise purchase. That time isn’t cheap, and would be much better invested in time spent closing loans rather than performing telemarketing services.

    Check out our post over at http://blogs.doublepositive.com/2007/03/22/three-pillars-of-lead-generation/ about how to truly measure lead quality, quantity and cost.

  3. Selling (by extension, ROI) is the bottom line, of course, but I think that Chris B. is also on the mark with figuring in the total time investment involved. Time is the most valuable factor there is, for insurance or just about any other enterprise!

    Jerry
    http://www.leads4insurance.com

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