Lead generation is undoubtedly one of the most cost effective and measurable forms of marketing. Unlike most forms of marketing when you buy leads you are actually paying for a physical piece of information. This is what makes it so measurable and appealing to marketers but it also brings into play certain psychological aspects that other forms of marketing don’t suffer from.
The measure of success for any marketing campaign is return on investment. Spend £x, generate £y and work out what your ROI is and if the number meets or exceeds your objectives then you have done well. The problem with lead generation is that although you can work out ROI on the back of an envelope, lead buyers often get distracted by the leads themselves and are inclined to focus on the leads that didn’t convert.
The following scenario is one we often encounter. Company A runs a lead generation campaign. They plan to spend £10,000 for a month’s worth of leads and they expect a return on investment of 25%. Let’s assume the price of a lead is £10 so for their campaign they will receive 1,000 leads. Now after the campaign they begin to work out the performance of the leads and it turns out that they achieve an ROI of closer to 30%. So everybody is happy right?
Well you would think so but what often happens is that companies tend to get hung up on the leads that didn’t convert. This is totally the wrong way to look at things. If you achieve your ROI targets then it is irrelevant to a certain extent whether you converted 5% or 50% of the leads. Of course, the more you convert the better but what really matters is the revenue that you generated and did the campaign meet your objectives.
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