A ping tree is a piece of software that is widely used in the online lead generation industry. It allows companies to distribute and sell leads to other companies.

Ping trees are especially popular in the finance space amongst loan, mortgage and credit card providers.

A ping tree is a simple concept that allows a group of lenders to bid on leas in real-time as and when they are generated.

How are the leads generated?

The affiliates within a ping tree will implement an almost identical enquiry form on their websites – simply editing the branding to fit the aesthetics of their site.

A customer will visit one of the affiliates websites and complete the enquiry form. Upon completion of the form, the customer details will be sent to the central hub, along with all other affiliate generated leads.

Based on the data captured, a lender can then decide whether they’d like to bid on the lead and if so, how much they’d like to bid. These parameters are all set up in-advance so the process is automated in real-time.

The highest bidder gets first preference on the lead. If they decline, it is passed down to the next highest bidder until a lender has accepted the lead.

Once a lender has accepted the lead, the customer will be sent their website to proceed further with the application.

If the lender accepts the application and pays out the lead, the affiliate that generated the lead is paid a commission.

The controversy surrounding ping trees

Ping trees have come under criticism in the past. Their ethicality has been questioned with many deeming them as immoral.

This stems from the fact that the customer is often unaware that their details are getting passed around lenders.

Initially this does sound suspect, however it’s important to remember that the customer will be presented with the lender that they are most eligible for. Subsequently, they have a higher chance of being approved.

This not only saves the customer the time of searching around lenders, but it may save their credit score too.

When a customer completes an application, the lender will usually perform a credit check on them to assess their eligibility. When the credit check is completed, a footprint will be left on the applicant’s credit file, regardless of whether their application is successful.

Having multiple credit searches on your file in a short space of time may lower your score. This may subsequently reduce your chances of getting approved for credit in the future.

By using a ping tree to pair the customer with the most well-matched lender, you are essentially bypassing this process.

Nowadays, affiliates and lenders must gain consent from the customer to pass their details to third parties. This will usually be a tick-box at the bottom of the application process that applicants and opt-in or out of.

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