Q & A – Why Are “No Contact” Leads Billable

Here’s a Q & A with a Los Angeles personal injury attorney about car accident lead generation, calculating the ROI of auto accident leads, the challenges of lead generation in a competitive market like Southern California, and why “no contact” leads are billable with just about every personal injury lead generation company.

PPLM Rep: What area of law do you practice?

Attorney: Personal injury.

PPLM Rep: Okay. Do you have any specific questions or did you have a specific area

Attorney: Well we do all of California mainly ideally, I’d prefer SoCal and then we are expanding more into the San Francisco area. But initially, with anything I mean I would want to know like what your process is, how much you charge your lead, what constitutes a lead, everything like that and see if it’s something that we could after a little bit of testing we could expand on exponentially.

PPLM Rep: Yeah. So, unfortunately you’re in about as saturated a market as you’re going to find in the US…you’re looking specifically at auto accident leads, correct?

Attorney: Preferably yes, auto, truck, motorcycle, bike pedestrian leads.

PPLM Rep: Sounds good… I wouldn’t recommend general personal injury leads specifically for a test. You can get some cases out of them but there’s going to be a good deal more sorting through than their role with the MVA. So, with regard to kind of how we get the lead, what constitutes a lead etc; everything is digital, everything is search based. So, we don’t do Facebook ads or anything that’s not somebody that’s not sort of proactively going and either looking for a lawyer or looking for information, which looks tends to result in a higher quality of leads than somebody who let’s say is doing Facebook advertising and getting cheaper traffic but they’re not necessarily people who are proactively looking for anything. So, that’s one piece of it. The other piece is– so, with regards to the criteria, so within the agreed-upon geography again, SoCal is going to be a bit tricky and kind of high price and low volume but I’ll get to that a minute.

 

Criteria wise has to be injured, not found at fault for the accident, injury has to stem from a car truck or motorcycle accident, accident date must line up with statute of limitations, and must indicate that they do not have an attorney for the issue. So, checks all those boxes, we deem it a valid lead. Obviously we make sure that they put into name that’s not John Doe or Mickey Mouse or anything like that, number if it’s five five five five five five five five our systems kicks it out, never gets to you in the first place. But assuming all of that looks valid, they check all the right boxes and their zip code matches with an area where you’re taking leads that would then get sent down to our firm via email and we have the ability to add text messaging alerts if you’d like as well. We don’t do contracts of any sort so it’s just you prepay for a block of leads. We deliver against that once we sort of get down towards the bottom of the initial batch of leads that you bought. Obviously, you have a chance to evaluate and decide whether or not you want to continue. If you don’t, you’re under no obligation to. Pricing wise, like I said Southern California is tricky and very, very saturated and very competitive.

Attorney: So, you only sell to one law firm per lead, right?

PPLM Rep: Correct.

Attorney: You don’t or do you do like three or five people? Okay.

PPLM Rep: No, we’re not. We don’t do the non-exclusive lead gen model. It’s one lead one firm, and if ever we have two firms that are in the same state it’ll just go like a round robin, one for one type situation.

Attorney: How many do you have in the SoCal area?

PPLM Rep: Obviously, that’s going to fluctuate a little bit but probably right now given the firms that we already have and the volume that we’re getting out would be probably my best estimation would be 40-50 per month assuming SoCal is…everything, LA and South.

Attorney: Okay, got it, got it. So okay so you don’t have too many people in this one specific area though. Okay. Good.

PPLM Rep: No, we’re a smallish company. As a private company, we’re not trying to hit quarterly earnings statement. So, for me it’s as long as we have a good home for the leads where people are going to follow up with them and do a good job of converting and most of my clients are on auto overdue at this point. And every time their account balance hits five leads we just auto charge them. Once I have somebody who’s sort of happy with the service and I’m at that point with them, I don’t have a lot of need to go out and find more clients at that point. So, we don’t really work with a ton of firms or it’s just logistically a bit of a nightmare. We try to focus on quality over quantity both in terms of our leads, and in terms of our clients.

Attorney: Okay. Awesome. Well, I mean this is– I’m trying to expand so I’m looking for multiple ways to generate leads and then we’re also looking to expand into another couple states. So, if it works out great. I mean we could do some other states maybe and see how that goes. So, the price for the lead, I mean it’s not bad too depending on a few things. Like I’ve work with a couple lead gens, some are great and honestly, I buy everything they have and if they had more I would buy with them. But like everyone has their cap some way. Others are a joke unfortunately. So, you don’t know until you try it. But like this one company when we started with them the leaves are coming in, the number no one answers the number, the email no one answers the email, text. We email, call and text them from our office, personal lines. No, response. And then the guy initially, when we talk about it goes oh yeah no. I mean they’re all good leads, you’ll get a hold of them. I explained it to him out of the first 10 leads that we got, we didn’t even get one person to answer which was really fishy. And then he was trying to claim no, no, those are legit leads. I’m like no. So, we had to part ways he fortunately gave us money back. I was surprise we didn’t have to go into like a pissing battle to do it. But I mean obviously, I mean no one wants to get taken advantage of so that wouldn’t have worked. So, like I wanted to see what your thing is.

Obviously, we’re not sitting here trying to lie or nickel and dime. I’m hoping to get at least 20-30 leads from you a month. And then if it works even more and more. But let’s say they do what’s – a few examples are one, you get no response and we tell you and then you can try yourself, if you get a response great then we’ll get in touch with them. But I mean there’s no response, that’s a problem. And then also look if they didn’t have a case. But yours clears it out, like you’re saying are they at fault or not. But if they end up being at fault or it’s not even like a case that we can do because there’s nothing to be done.

PPLM Rep: Well, so that’s– yes and no, right. I mean I on the one hand right, they’re leads they’re not cases. I would say 80% of them are not going to turn into cases for any variety of reasons, right.

Attorney: …80% you feel?

PPLM Rep: Oh, yeah. But if you’re converting, run the numbers, right. Let’s say you’re paying 250 per and you’re converting 1 out of every 5, that’s a 20% conversion rate. So, your cost per signed case is 1,250 bucks. I’m pretty sure the average car accident settlement nationwide is somewhere in the $15,000-$20,000 range, so if you’re making a 33% contingency fee, that means you’re investing $1250 to make about $6,000 back in case fees, which works out to about 5 to 1 ROI. Most people consider that pretty good. Even if you cut that in half and only converted 1 of 10, you’re still making better than 2 to 1 in terms of ROI, which obviously isn’t nearly as good, but at least you’re still profitable.

Attorney: No, I mean I’m trying to average out. My cost of acquisition is generally around 6-700 honestly. So, like for me doesn’t matter whether the lead costs a 100 or 400 depending on if it’s like the value is if you can get it if it’s signed then it works for me. So, look if I could do one out of three, it would be good. But if it comes out to one out of five it’s really tough unless like something comes out to be a million dollar case every once in a while to cover.

PPLM Rep: Which might. But candidly speaking you’re probably looking at closer to one out of five than one out of three. And we don’t credit for no contact. I would say probably 20 to 30% of all the leads that that we send end up being no contacts for whatever reason, and that’s a billable lead as well.

Attorney: So, basically any lead that comes in that follow– like they check off the right boxes and comes to you is a lead. And if there’s no response or no contact or they end up being a fault or any of that kind of stuff, they’ll count as a lead?

 

PPLM Rep: No, if they were a fault it’s returnable. So, basically what we return for is this; verifiable things that either, and we have this present to my knowledge probably the most flexible return policy in the industry. But if you call them they’re at fault, we’ll credit that lead back. I don’t many other lead gen companies that do that. Obviously, wrong number, disconnected number, fax number if you call and they have an attorney or they’re just like looking for a second opinion or something like that, that’s a creditable lead.

Attorney: Honestly, I’m even okay with that not being as much of a credible lead as a no response. If they have an attorney, there they’re not happy, they’re looking a change; that’s still a person looking for an attorney. But no response to calls, emails and texts; it’s hard to swallow.

PPLM Rep: But put yourself in our shoes. We’re paying for the ads no matter how you slice it. Also, think about it from this perspective; somebody who fills out a non-branded, generic online form, who didn’t take the time to ask a friend for a referral, didn’t take the time to call the bar, didn’t take the time to read yelp review… chances are pretty good that these guys are not necessarily that bought into whoever the end firm is, until that firm does a good job of follow-up and intake… And even then they’re still going to be a lot more likely to fill out multiple forms online than someone who was a referral, or even someone who found your website and took the time to read your bio, see where your office is, etc.