Anthony Bux:
There are a lot of marketing agencies that probably oversell what they can deliver on, and the same with law firms. There's a lot of law firms that oversell what their intake and processes can deliver on it.
Chris Dreyer:
Third party lead generation can feel like an absolute minefield. You've got agencies promising the moon and law firms burning capital to try to figure out what actually works.
Anthony Bux:
One of the issues, they've had a really poor experience with lead generation five years ago or six years ago. Those are groups that are fossils in the space, who don't do lead gen the way it's done today.
Chris Dreyer:
The landscape is confusing and the rules are constantly changing. If you're relying on outdated strategies or buying from aggregators who sell the same lead to five different firms, you're going to lose. But if you navigate it right, it could become an engine for new case acquisition.
Anthony Bux:
The firms that have recognized that, they're the firms that are grabbing a lot of the cases out there.
Chris Dreyer:
Today, we're talking about the Wild West of third party lead generation. We're cutting through the noise, talking real numbers, and showing you how to vet providers so you don't get burned.
This is Personal Injury Mastermind. I'm Chris Dreyer, founder and CEO of rankings.io, the elite performance marketing agency for personal injury law firms. Rankings get you cases. Today, I'm speaking with Anthony Bux from Sanguine about how third party lead generation might fit into your business model.
Sanguine isn't a lead vendor. They act as a strategic advisor that tests and vets providers, so you don't get burned by the bad actors in the space. We talk about the confusing landscape of buying leads, the current cost per acquisition benchmarks you need to know, and why a cold lead requires a completely different intake strategy than a warm referral. Let's get into it.
Before we get into specifics, talk to me more about Sanguine. Sanguine isn't a lead generation company, guys. Sanguine is a strategic curator, so to speak, but talk to me about what Sanguine is.
Anthony Bux:
Yeah. My wife often gets asked what her husband does, and I see her sometimes struggle with the messaging. So the best way to put it, I've been in the legal space for 20 years. I'm not an attorney. My partner is an attorney. We started the first legal lead gen marketing agency in the early 2000s. So, we were literally pioneers in the space.
As a young 20 something year old, I started reaching out to law firms to talk to them about form fills that my website was generating. So I got very intimately involved with lawyers, their dynamic, their infrastructure, and it is a two-way street. There are a lot of marketing agencies that probably oversell what they can deliver on, and the same with law firms. There's a lot of law firms that oversell at times what their intake and processes can deliver on.
And when Sanguine comes into play is to really help matchmake, really understand a law firm's infrastructure and what they will have success with. Sometimes they're not ready for lead gen, and I'm very open about that. Hey, let's build a foundation first before we start burning money on leads. You guys are very good at taking inbound calls from your LSA ad, but handling an outbound call from a third party lead provider is a completely different sort of dynamic for your group, and one we should look at before spending cash.
Chris Dreyer:
Let me ask you a question on that. A lot of times the wanted case conversion percentage on an inbound, a branded inbound is 92% to 95% and you got some of those unicorns hitting the 96%. What do you see from Legion? It's cold, right? They're using a variety of tactics. What's a benchmark that you should for cold?
Anthony Bux:
70% to 80%.
Chris Dreyer:
70% to 80%.
Anthony Bux:
Converted off a wanted, yeah, that's where I like to be. That's where the firms typically like to be. I will say this, it's not apples to apples. When you look at your branded marketing versus your non-branded, you need to get comfortable with a little bit of a higher cost of acquisition. It's okay.
The idea of jumping into a third part of your campaign is to get another piece of the pie, right? It's to tap into some of these national campaigns, these groups with massive buying power, spending millions of dollars, things you cannot do as a law firm by yourself. The firms that have recognized that, they're the firms that are grabbing a lot of the cases out there.
Chris Dreyer:
I'd like to touch on that more. I'm a search marketing guy, of course. The SEO, AI search, that takes time, especially if you're entering a big metro. And I just heard, or we just had Richard Harris on a podcast and he was talking about a go to market strategy, how he went into a new market and he used lead gen. And how I've talked to other firms, their go to-market strategy, you go in with broadcast television like, "It's going to work eventually. I hope you got the dry powder." So talk to me about a go to-market strategy either for a new market, or maybe you're a young firm that doesn't have a brand.
Anthony Bux:
Totally, I look at third party lead generation as something that could help out on both ends. If you're a new firm without a lot of capital to support, a branded SEO or PPC campaign, you and I both know those SEO campaigns can take some time. Tapping into third party lead gen is an immediate turn on to start getting cases in the door. With some of these larger firms, they're smart enough to know they need to diversify their portfolio.
Obviously, Richard Harris, he's got a great brand. He has billboards. He's got plenty of capital, but he's also smart enough to probably recognize, I'm not just going to put all of my eggs into the billboard and traditional basket. I'm going to spread out my capital and see what gets me the best return when I get into market. And as a business owner, he just starts to pull levers.
So, I would look at third party lead gen as another bucket that law firms really need to consider. I don't think it's talked about enough. Me and you have, we've been to dozens of conferences. You don't really hear a lot of conversation about the third party lead gen category. It's kind of talked about, but-
Chris Dreyer:
It's taboo.
Anthony Bux:
Yeah, it's taboo. People hold it close to their chest. I totally understand why, but the reality is it's a growing market and with more and more money coming into the space these guys are gaining traction quickly by tapping into these groups. And let me tell you, from experience, this is what I do every day, there are some groups who have gotten really, really good at it.
One of the issues, and I'll talk to law firms that get introduced to me all the time, they've had a really poor experience with lead generation five years ago, six years ago. I won't talk about the specific sources, but when you really dive in those are groups that are fossils in the space, who don't do lead gen the way it's done today. They're not using video. They're not selling their leads to multiple people at once. So it's really trying to get through that barrier to a law firm to say, "Hey, I understand what happened in the past. Let's talk about what's happening today in some of these groups that can really deliver a quality lead."
And that's again, what we're saying when it comes into play. When I test a lead provider, I'm looking at all the KPIs that a law firm would look at, your conversion rate, your cost of acquisition, your drop rate after 90 days. How many of the leads that you signed up are still cases that are going to be viable at 90 days?
And then the metric that I find most interesting and important, does the campaign have the ability to generate a higher tier case? Fractures, broken bones, catastrophic commercial, at the end of the day, those are the types of cases, that 10% to 15%, that are really going to make the campaign worthwhile over the course of the year. The smaller stuff keeps the lights on, keeps the flow in. You start to get referral business from that. It's those larger cases that make those campaigns worthwhile.
Chris Dreyer:
I know this is on the spot, but you probably top of the dome have some of these. What are just some general benchmarks? What's a cost per lead in lead gen? What's a cost per case? What's a fall off rate percentage that's acceptable? And I know it depends because if you get that big commercial case and then you hold it, even though the fall off rate might be higher, you're going to still do it.
Anthony Bux:
Yeah. It's interesting to see the market shift. I probably am in front of this more than your average law firm because I live and breathe it. So, I see the shifts in the market happen. When we talk about third party lead generation, there's three buckets a lead could get delivered today, a web form lead, very straightforward, API'd into your CRM, a law firm reaches out, nurtures it and calls, a live call transfer lead. So that's where the marketer generates the lead, and also has an intake group that's going to do a pre-qual with some basic questions over the phone and then live transfer into the office. And then the third tier and something that started to gain a lot of traction over the last six to 12 months is a signed retainer model, where your marketer is now delivering soup to nut, intake, marketing, intake, and signing retainers, passing them over to the law firm.
So, each of those come with a price tag. Every tier is going to be more expensive. I'd say a web form lead on average, you're going to be around $300 to $400 depending on your market. California, Texas, Georgia, your big boys, Florida, those can be more expensive. Live call transfers, depending on the group, anywhere from $450 to $650, again, more expensive for those states. And then a signed retainer, it used to be acceptable at $2,400, $2,500. That number's jumped to $3,000. You talk about California, $3,500 plus. So the numbers are moving and law firms need to understand the cost to generate these leads has gone up, right? The margins for the marketer have shrunk, right? To invest in an intake and the services and all the technology to nurture and control the process, it's more expensive.
Chris Dreyer:
Let's just stop for a second and take a look at the math, a web form lead for $400, a signed retainer pushing $3,500. With costs like that, you cannot dabble in third party lead gen without the intake infrastructure to back it up. A third party lead is completely cold. If your team treats them the same way they treat a warm, organic referral, you aren't just losing cases, you're throwing away thousands of dollars. But I want to talk about the stinkers, some of the bad stuff. Do you think the attrition and the fall off rate is so high because the affiliates that these lead gens are paying are selling the lead multiple times? Why is it so much higher?
Anthony Bux:
Yeah, it's a question I get asked often. I work with some groups, some law firms give me a lot of detail into their analytics, so I'm able to see that drop off rate. It is really interesting when you start to look source by source. Some of these groups have a much higher attrition rate than others.
I think one thing to be conscious of when you're talking to a third party lead generation group, and the question you should always be asking, how are you generating your leads? Are you an aggregator? So are you somebody that is going out and buying other people's traffic, polishing it up, and then reselling it to a law firm? That's where you run into some issues on the attrition side. Or, are you a lead provider who's got homegrown traffic and generating your own business? I tend to see a higher stick rate with the latter, and those are things that I keep an eye on.
One of the benefits of having Sanguine kind of, I guess Sanguine in your catalog, I'm able to look at trends with lead providers on a more macro level. My team usually has anywhere from 30 to 100 law firms with a lead source. So I can get ahead of these trends, and really help guide my law firms if I see some trends going sideways.
Chris Dreyer:
The other one I see, and you touched on it, right, is the cherry-picking. Do they sell them for a higher price, and that's pre-negotiated? Is that happening under the table? It's like, "Oh, I pre-qualified the commercial. That's not going to Bob. That's going to John, or we're keeping it."
Anthony Bux:
Yeah, it's tough. It's tough.I hear the same stories. There are implications around the space of groups that do that, and there's law firms that negotiate that. Again, those are things I try to really caution against when I work with a lead provider. I tend to leverage the fact that, "Hey, if I find out that this is happening, you're going to cannibalize the entire book of business that you have with Sanguine," and that's quite a bit of revenue.
So they do run that risk, but you have to stay on them. Chris, you know as well as I do, lead providers get hot for a year, a year and a half, and then you see the traffic go down. And a lot of times what happens is you have these lead providers that deliver a premium product, the law firms recognize it's a premium product. They go back to the lead provider and say, "Hey, I love what you're doing. I want more traffic. How can I get more traffic?" And all of a sudden you have this marketer with a law firm saying, "I want to give you an extra $300,000, $400." They struggle to figure out how to do that, and that's where they kind of sign a deal with the devil and they go out and buy traffic. Or, they start to do all the things that we tell them not to do because they want to go to the bottom line with the revenue and at the end of the day, they see their attrition numbers go way up.
One of the things that I've found is, yes, I advise and my team advises on lead gen to the law firms. We also are an advisor to the lead gen group. I am constantly talking to the lead gen groups about the mistakes that I made as a marketer. The mistakes, after we did our marketing agencies, we sold our interest in that business after a decade. We ran a national law firm ourselves. I was purchasing 50,000 leads a month for a 70 person intake department, crazy. But. I've used those experiences right and wrong to really help guide some of these markets to say, "Don't make that mistake. Stay the course." Stay the course and keep your attrition low. Figure out how to maximize the quality. Don't figure out how to double your revenue month over month immediately because it'll bite you.
Chris Dreyer:
That's super interesting. I guess they have one good source that's probably getting a good CAC and then they're like, "Oh, let me talk to my friend who has the affiliate program and I can get some volume."
Anthony Bux:
Right, I need more leads. I have firms that want to pay me for more leads. If they don't give me the money, they're going to go give it to somebody else. So I'm going to do what I need to do to get that money in and the quality, you just see the quality dip.
Chris Dreyer:
Talk to me, let's just say hypothetically a firm listening comes to you, comes to Sanguine and you're like, "Here's three good providers." They spin out, do a $20, $30,000 test on each. Can they do it with their third party intake? Have you seen any success there, or is it you got to have to control the really robust intake with the good chase sequence? Obviously, there's the different levels. You said, "Hey, one of them signed a retainer," so I guess if you don't have a good intake, I guess that's a method.
Anthony Bux:
It's a method. I definitely have some third party personal injury specific intake groups in my catalog, and I've recommended a ton of business to them and they do right by clients. I like the idea of always having some people in house with your team. I like the idea of having overflow, after hours and weekends with a group you trust, who can talk competently and sign people on a retainer. When I talk to a personal injury firm and they are aligned with an answering service versus an intake department for their after hour, that's not helping, right? You and I both know you can't take a message for someone who's got into a car accident, or sometimes even make a transfer. You've got to be able to talk to them right then and there, and get them signed and over to the firm. So-
Chris Dreyer:
Can I jump in there?
Anthony Bux:
Yeah.
Chris Dreyer:
On that point, one thing that I've seen with our clients is when they sign on say a Friday evening or a weekend and they don't get it connected to the attorney immediately, they don't get connected until Monday, well then that, I've seen the fall offs increase there.
Anthony Bux:
The person's gone.
Chris Dreyer:
Yeah.
Anthony Bux:
The person's gone and probably hired somebody else, and you just wasted the marketing. There has to be immediate connection in one way, shape, or form. So, there are groups that do a really good job out there of helping carry through the message of the law firm. They understand the law firm. They can talk competently on behalf of the firm, and talk about the next steps in the process. They're not giving legal advice or anything like that, but they are presenting the law firm correctly.
And the same even with those signed retainer models, the thought that, "Oh, well, the case is signed, they're already a client," I tell my firms, "You treat that signed case just like a lead. They still need to talk to you guys. You guys still need to discuss the next steps." The consumer doesn't care if they signed a case or walk through a retainer. They will move on and you will have to drop that case, and send out a drop letter in two weeks because you can't get them on the phone. Or again, you didn't carry over that message and they feel like it's a bait and switch, so they drop the law firm and move to somebody else.
Chris Dreyer:
This is very important, so I want to stop for a moment and underline it. When you drop three grand on a signed retainer, it's easy to assume the hard work is done once you get that signature. But, that third party lead has zero brand affinity with your firm. If your intake team treats it like a warm referral and waits until Monday to establish a real connection, that client will ghost you.
With bot leads, the deal isn't closed when the ink dries. You have to make sure you resell the firm to your new client constantly. How much capital, or how much time do you give a provider? Do you say, "Hey, you got to spend X amount and then I've got enough data." How do you make a decision? When is it time to pull the rug? When is it time to scale? What's some general tips there?
Anthony Bux:
Yeah. When I make a recommendation of a law firm to a lead provider, I've already got the data and the intel on thousands of thousands of leads. So I'm able to tell the law firm, this is a lead provider with quality, with product, and the numbers back that up. So, I really try to focus on the law firm to make sure that they're set up to do what it takes to get the numbers to achieve, and that goes to what you said earlier, the lead nurturing sequencing, the immediate follow-up. When a web form lead comes in, you have to get a call out within two to three minutes, preferably sooner, but immediate. There needs to be three to four phone calls a day for the first 72 hours, preferably longer if you've got the bandwidth to do it.
So when I quote to a law firm, this lead provider's converting 18% to 22% on average with my firms, what that law firm needs to understand it's because those law firms are doing longer lead nurturing sequences. They're calling leads for 14, 21, 30, 60 days. Now, how are they doing that?
Chris Dreyer:
I'm just trying to guide the audience. What's a minimum when you come in to test lead gen? Is it a five? Is it a 10? Is it a-
Anthony Bux:
I'd say the lowest amount I would do with a law firm on a lead buy would be $10,000, and that's even pretty minimal.
Chris Dreyer:
A three month, four month trial?
Anthony Bux:
$10,000 a month would be a minimum, and obviously if they can give it three months they'll see the campaign improve. So mentally, $30,000 on the low end.
Chris Dreyer:
Perfect.
Anthony Bux:
And if they flinch at that, it's okay. What I say is it's okay to react. Lead gen is not for everybody and if that's making you feel uncomfortable, then let's hold off on lead gen because you're going to have those reactions when the conversions aren't where you want them to be. So, let's talk about some other solutions to get some things in the door and help build that out.
Chris Dreyer:
Anthony, this is the softball question. What did I miss? What did we not hammer?
Anthony Bux:
The other point I'll make, Chris, and I know I sound like a broken record because this is talked about, invest in your intake department. Invest in people. An intake person, when I look at some of my best firms, their top intake people are not the person with the most personal injury competency. It is the person with charisma who can talk, who can make someone feel love on a phone call, when someone says they broke their arm, they empathize with that situation, they tie it back to a scenario.
That's how you're going to get a stick rate. It's those people on the front lines talking to your clients, so invest in your intake department and understand the difference between traffic from a third party group and then an incoming phone call from somebody who saw your billboard up. They are completely different journeys for the consumer, and they need to be handled differently. So, intake can be fun.
I ran a large intake department for several years. I gamified the intake process. I ran monthly contests. I shot a spotlight on people that I thought were doing really good work, making other people around them want to aspire to do that. You have to recognize that it is a grind and you are on the phone all day trying to do right by this law firm and representing your business the way you want to be represented, so treat them kindly and praise them with their successes.
Chris Dreyer:
Anthony, this has been amazing. You covered the gamut on lead gen, what Sanguine does. I'm sure this is going to be really helpful so people can avoid those pitfalls. And for those that want to reach out to you to get assistance here or have questions about the podcast, what's the best way to get in touch?
Anthony Bux:
The best way to get in touch with me is through email. It's anthony@sanguinesa.com or my direct line, 708-289-1111. I like to tell my wife I stop working around 6:00 or 7:00, but I tend to be 24/7 these days. And frankly, I just really like helping lawyers and talking to them.
So, it's fun for me. I think you'll find with me and anybody on my team, we try to do right by everyone and I think that's why our business has grown. We're not a sales group trying to make a quick sale. We are in this to help you guys build, and that helps us build when we do right by you. So yes, please, anybody who wants to reach out, even if just educational, I could help hopefully guide you guys in the right space.
Chris Dreyer:
Fantastic. Anthony, thanks for coming on the show.
Anthony Bux:
Chris, thank you for having me. I will see you soon.
Chris Dreyer:
A huge thanks to Anthony Bux for peeling back the curtain. Third party lead gen can be a fantastic way to turn the faucet on and get immediate traction, and it's clearly an essential piece of the puzzle for a lot of growing firms. As you're looking at your whole marketing mix, it's always interesting to see how fast action channels pair with long-term brand building. That's the side of the house we focus on at Rankings. We're the elite performance marketing agency for personal injury law firms. If you're ready to build an asset you own, brand equity, crush search, and dominate your market, head to rankings.io. I'm Chris Dreyer, and this has been Personal Injury Mastermind. I'll catch you next time.
