You can benefit from Pay per Lead and these ideas can help increase your return on investment (ROI).
The pay per lead model is maturing and changing rapidly as electronic and mobile media rush headlong into the now predictable future of the proliferation of portable media channels. If you are looking for leads for sale, there are numerous options available to you.
The challenge these days, isn’t so much finding media opportunities that will sell you leads on a pay per lead basis (although the options for local advertisers vs. national advertisers are more limited). Rather, the challenge is in getting quality leads at a decent price. And for local advertisers, the difficulty is often in managing the leads.
There are companies that sell mailing lists, or lists of names, and call them ‘leads’. But if you have to cold-call your leads, are they really ‘leads’? Pay per call marketers would say no. The beauty of pay per call advertising is that your leads are proactive, reaching out and calling you. They are momentarily engaged in the purchase process and if you can connect at that moment, you will have fulfilled the direct marketer’s mantra of reaching prospects at the ‘right time’.
However, there is some grey area. If you are buying web leads, which are generated from forms on the internet, you would technically be getting electronic data. However, these ‘leads’ are typically delivered in real-time. If you can follow-up immediately, you will often have an engaged buyer on the line. However, if you wait, those leads are as about as much use as a direct mail list. Not worthless! But lacking the freshness and eagerness of someone currently involved in the purchase process.
Either way, you’d like to pay on a CPA (cost per action) basis, and not by the thousand impressions (CPM).
How Much do Sales Leads Cost on the Pay Per Lead Model?
The price varies based on a multitude of criteria. Vertical and Quality are the two main considerations.
1. Vertical. What industry are you in? Leads for high ticket sales typically cost a lot more. If you are a roofer and are looking to quote on the installation of new roofs, you can expect to pay $50.00+- for a decent lead. On the other hand, if you are looking for leads for carpet cleaning, your cost may be closer to $20.00.
2. Quality. If you are buying pay per call leads, one of the criteria might be duration of the call. When calls don’t pass certain minimum durations, they cost you nothing. So in the case of pay per call, cost per lead (CPL) is relative to time duration of each call. If a 30 second call costs you $30, a 60 second call could cost you $45 and a 90 second call could cost you $60. But as the duration goes up, presumably your odds of closing them do as well, so it’s sometimes worth the extra money to negotiate for longer calls. If you are paying for leads off the internet (or any other source), qualification questions might be asked as part of the screening process, and the more questions you want asked, the higher the price. For example, if you are selling residential solar panels, you would want to know that the prospect is a homeowner. Having no quality criteria is known as buying a ‘raw lead’. Sometimes the numbers are in favor of buying raw leads.
The Need for Testing
When buying leads on a pay per lead basis, testing is a big part of the success formula. You’ll need to test leads from each supplier. And you’ll need to test your lead-handling workflow. If you’d like to pay per lead, you’ll need an excellent lead-management system to make it work. And that type of system is more likely to mature over time rather than just appear. If you are a national advertiser, then it’s likely you already have much of the infrastructure in place. However, not many local businesses have sophisticated marketing staff in place and the lead-handling systems are more likely to be missing or in their infancy. Pay per click (PPC), while not pay-per-lead, is an intermediary channel that can deliver responses at a fixed cost. If you are good at converting those responses into leads, the CPL might be profitable for you. Again, testing is necessary.
No Risk/Low Risk
The pay per lead model is certainly far less risky than traditional advertising. Buy an ad in your local paper or radio station and you’ll quickly find that those media channels might great for national brands a handful of local verticals, such as grocery stores and super-store pharmacies. But for most businesses, using local traditional media channels to drive leads is far too costly.
For the average business, whether national, regional or local, the pay per lead model offers a reduced risk model that is objective, measurable and improvable. As long as you have a testing budget and a bit of time, you should have no trouble finding a healthy lead workflow that will produce for you, making pay per lead a wise choice for virtually any business where there is a sales process before purchase.