Lead Sellers' Path to 1:1 Consent: Practical Solutions and Early Results

Introduction

In the last session, we reviewed the current state of FCC compliance and upcoming requirements. Michelle Schuster from Ms. Law provided a detailed analysis of key aspects of 1:1 consent, including when it is required for regulated dialers.

Bas and Ryan presented why PX’s and VMS’ solutions work so well together and the adoption and early results they see across the board. They also highlighted how PX’s Brand Explicit Consent will help businesses capture and integrate 1:1 consent into their lead workflows, and TCPA Guardian by VMS will help validate the consent.

You can watch recordings of all our previous webinars on this link.

This follow-up series aims to provide actionable and practical solutions to meet the FCC deadline on time and share what we are seeing in the market today. These were the key topics we covered:

Impact of 1:1 consent on end-consumers

The key question is whether 1:1 consent truly benefits consumers. To answer this, we must adopt the consumer’s perspective. Consumers value competition, choice, and the ability to compare options for the best price.

However, competition narrows to the highest bidders in the 1:1 consent model, where someone in the ecosystem decides which option to present to the end consumer. This model benefits only large brands, leaving smaller players disadvantaged compared to well-funded companies with bigger marketing budgets. This is not ideal for consumers seeking diverse, competitive options.

From an execution standpoint, two lead flows are most common today to ensure that every lead must have 1:1 consent:

1. Automated Matching: The consumer is matched with the single highest bidding brand.
2. Consumer Choice: The consumer is matched with multiple highest bidders. They can select these brands individually, giving explicit consent.
   

Let’s see how much these flows are effective for better customer choice.

Do these flows benefit consumers?

In the first flow, where auto-selection matches the consumer exclusively to one brand, the consumer has no choice. This also disadvantages smaller companies that may have lower budgets or limited coverage. This may also lead to drop-offs in the selection step, resulting in the lead falling to the floor and losing monetization for the lead seller.

In the second flow, where consumers choose from a list of brands, they may not recognize the names or have the information needed to make an informed decision.

Additionally, if we take the example of Medicare industry, large brands always tend to prioritize their own plans, whereas smaller agencies can offer solutions across multiple providers, potentially delivering better outcomes for consumers. This lack of competition leaves consumers at a disadvantage.

This issue extends itself typically to industries with high-ticket, complex, and infrequent purchases, where consumers often need expert guidance. In such cases, some specific lead flows can limit their ability to work with multiple providers to find tailored solutions.

Consumers gaining control

1:1 consent is designed to give consumers greater control over their data and choices. Previously, when a consumer filled out a lead form, their information was often treated like a commodity, passed around without regard for their preferences, leaving them with little control.

Does consumer selection help?

Even in the second flow, where consumers choose brands, algorithms often predetermine their choice. For instance, a system might match a consumer to the top 4-5 brands based on criteria like zip code or age, reducing the choice for the consumer. Similar practices occur in other industries, like mortgages, where options are pre-positioned in disclaimers at the end of the form.

Exceptions under existing matching algorithms

As we examine how to match consumers with the best buyers, it's essential to examine the algorithms used in this process. And do these approaches differ across industries?

The challenges during the implementation for lead generators in existing matching algorithms arise when comparing multi-carrier solutions with point solutions. Multi-carrier offerings require fewer questions, enhancing service flexibility. However, when a multi-carrier solution is matched only to a point solution, it limits consumer choice, excluding other options that may offer better value.

The question is deciding when you have enough information to comfortably match a point solution versus a multi-carrier solution. Or do we need to ask for additional data during the lead capture process to match the consumer accurately?  

What’s next?

As Matthew from Wisdom Companies suggests, the goal is to provide consumers with the best solution while ensuring a seamless experience. New rules are being implemented for service providers to prevent duplicate leads, rejections, and other inefficiencies. However, providers are now responsible for optimizing their systems for better consumer outcomes.

What is the impact of 1:1 consent on revenue, match rate, rejection rate, and conversion rate?

This was the elephant in the room: if you're a lead generator, what impact will 1:1 consent have on your revenue?

Just to note here, the deadline to implement 1:1 consent for Medicare services was October 1, 2024. So, 1:1 consent has been a significant topic of discussion lately.

The following insights came out from the discussion:

• One definite outcome is that lead volume will drop. This doesn't mean fewer consumers actively seek services, but the leads won't be sold as often as before.
  
  
• Lead quality has significantly improved, with brands reporting 1.8x to 2.5x higher yields than leads under standard TCPA. Increased conversion rates indicate a better consumer experience, and lead sellers could earn up to twice as much for the same lead when performance is substantially higher.
  
  
• With the introduction of the new choice checkbox user experience, approximately 30% of consumers drop off, contributing to a higher unmatched rate. Additionally, aged leads and certain lead flows may no longer occur.
  
  
• The unmatch rates have increased from low single digits to around 25%. This situation has created inefficiencies in the marketplace that we need to resolve. We must find various ways to connect consumers to options outside the existing lead formats.

Another interesting question to consider is: When a consumer selects a specific brand, such as Brand X, does that indicate a higher likelihood of conversion since the choice reflects their preference? When presented with a checkbox option allowing consumers to select one or multiple brands, how does this impact conversion rates and lead quality?

Here are some insights to answer this question:

• While we don’t yet have definitive data on lead quality or conversion rates, preliminary insights from a partner suggest that leads associated with a brand selected by the consumer show a higher conversion potential. These leads tend to have a higher value, as the consumer actively chose that brand, signaling intent.
  
  
• In some cases, this uplift in value has exceeded 50%, demonstrating the potential significance of consumer choice. The equation becomes compelling when balanced against a 30% drop-off rate for consumers who don’t select any brand. The math favors improved revenues if a 50% uplift offsets a 30% drop-off.

While it’s too early for concrete conclusions, ongoing experiments are starting to provide valuable insights, and the early signs point to a promising impact on revenue when consumer choices are correctly captured and utilized.

What if the consumer does not make any choice?

1:1 consent will continue to evolve the user experience for sure. But if the consumer makes no selections, does that mark the end of the funnel? Well, this situation opens up many opportunities for experimentation. For instance, should we ask for secondary consent or delay the match until we gather more information?

What is the future of aggregators and indirect buyers? 

One prediction is that the pure brokering model will face significant challenges but still holds value in industries like insurance, where building networks and distribution takes time, trust, and robust platforms. So, to stay relevant, brokers must focus on core competencies, whether excelling at lead generation or strengthening back-end sales and account management.

Brands are expected to move towards buying leads directly from generators or platforms as lead volumes decline under new FCC guidelines. This scarcity will make leads more valuable but harder to secure, impacting call center operations and creating a potential Q1 shockwave. The industry must prepare for a transformative rollout in early 2024, requiring strategic adaptation and readiness to address these challenges.

How do we handle lead rejects in the new system?

The new 1:1 consent model presents challenges when a consumer is matched with a brand, but the lead is rejected. Without 1:1 consent, rejected leads cannot be resold or redirected, resulting in inefficiencies. Current estimates indicate that around 25% of leads are rejected.

Let's understand the reasons behind these lead rejections:

• The biggest challenge behind low acceptance rates in the industry, especially on the lead seller side, is that many brands today reject a lead either because it's a duplicate, on the DNC list, or because it's a current customer. Lead sellers can use PX solutions to collect as much info as possible and ensure 100% or close to 100% matching capability to brands. Lead sellers can also launch an API request and pull all the brands that would be eligible for a particular consumer.
  
  
• Lead rejections also occur for various other reasons like mismatched geographies, unavailable call center hours, or unaligned direct relationships. Till now, many partner systems are designed for post-rejection, a practice prevalent since the advent of ping post models. To adapt to new 1:1 consent processes, partners must recognize the benefits of retaining leads and updating their systems accordingly.

A collaborative solution

To resolve these inefficiencies, a collaborative approach is needed between lead sellers and buyers. Sharing comprehensive data upfront can significantly minimize rejections.

Best practices include sending detailed pings containing sufficient information to enable buyers to make informed decisions upfront. This reduces rejections caused by duplicate leads, existing customers, or other mismatches. By improving data sharing during the ping process, match rates can increase, and inefficiencies can be minimized.

Going forward, it's not just the lead sellers and generators who need to adapt; lead buyers must also improve their systems. For example, after receiving 1:1 consent, lead buyers must manage the consent efficiently, as they are the only ones with that permission. Their processes will have to change accordingly.

Embracing smarter matching strategies

The industry must adopt smarter matching strategies by leveraging insights into user history, preferences, and product affinities. Precise and efficient matches are critical in this landscape, where every lead matters. Delays in matching must be avoided, and processes must evolve to eliminate post-rejection inefficiencies.

Innovating for seamless lead generation

PX has introduced Brand Explicit Consent solutions and advanced matching capabilities to address these challenges. PX centralizes and optimizes the matching process by allowing partners to share relevant data. This prevents scenarios where consumers select a brand but fail to get matched, resulting in a poor experience.

What are predictions for other industries?

The adoption of 1:1 consent is reshaping industries like Medicare, education, insurance, mortgage, and home services, with Medicare leading the way due to CMS regulations. Other industries governed by FCC and FTC guidelines under TCPA are at varying stages of implementation.

Key developments include Medicare's real-time compliance, education's established 1:1 matching systems, and insurance's rapid evolution, particularly in the auto and P&C sectors. Mortgage companies are shifting towards branded experiences, while home services and solar companies are gaining momentum.

Summary:

Here’s a summary of the discussion points:

1. 1:1 Consent: Ensuring 1:1 consent enhances revenue generation and consumer experience. More importantly, it ensures compliance with FCC regulations and safeguards against serial litigators.
   
   
2. Lead Value: Leads hold greater value when consumers actively select brands under 1:1 consent, emphasizing the importance of consumer-driven interactions. Lead quality has significantly improved, with brands reporting 1.8x to 2.5x higher yields than leads under standard TCPA.
   
   
3. Advanced Matching: Transitioning from basic ping post models to sharing comprehensive data is critical for accurate matching, benefiting both brands and consumers.
   
   
4. Industry Collaboration: Continuous industry dialogue and innovation are necessary to optimize matching processes and create a seamless experience for all stakeholders.

Way forward:

The key is understanding the spirit of 1:1 consent and the consumer behaviors that made it necessary. Regardless of how it's enforced, it should focus on delivering the value consumers expect.

For lead buyers, the goal should be clear: help the consumer complete their transaction or meet their needs efficiently. Doing this effectively drives value and justifies the existence of the process. Buyers should focus on "bidding to value," which can take many forms, such as enrollment, CPA, LTV, or a long-term revenue stream. Improving efficiency benefits both the consumer and the end fulfillment partner, creating a win-win situation.

As marketers, our role is to help consumers find real solutions. This means stepping up the quality of creatives and setting realistic expectations throughout the funnel. Consumers don’t seek “free money” or stimulus packages—they want genuine solutions. This shift represents an evolution in the industry, requiring everyone to adapt and mature, from lead sellers to buyers.

Engage with us

Need help navigating the FCC changes?

Reach out to us at brandconsent@px.com - we’re here to help!

You can watch the full recording of the webinar here.