Lead Generation: A website monetized through selling leads is a site set up to make visitors click on a call to action advertisements that will direct the visitor to a landing page with a form for collecting visitor information.
The publisher can gather the data and sell to the advertiser as a collection of information containing names, emails and other useful data. The client will use this information for the possibility of converting leads to future customers buying goods and services.
Key factors to a profitable leads generation business:
Choosing your niche: It’s important to research your market and know what clients are willing to pay for leads, the type of information required and any filtered information.
For example, if you decide to provide information to your local landscaping companies, for this campaign, you might need to target the suburban middle class, say household incomes above $80,000, they can afford to hire a landscaper. Middle-Aged homeowners as they are more likely to rely on lawn service and specifics can be targeting larger-sized lawns, from 8,000-12,000 square feet for better profit margins.
You might filter the data for families with no children between the age of 14 to 18, so they don’t have helpers for the garden.
It’s important to note that the leads database you end up having for the landscape company example can be useful to other businesses like insurance companies, home renovation, realtors and others. Allowing the publisher to offer versions of the same database information to multiple clients and the total income generated from a set of the database can be much higher. Making the process a very profitable business once you collect your set of data.
Data Collection: Seek legal advice to ensure you understand federal and provincial laws or any specific laws related to the EU union or other jurisdictions.
You have to consider all associated costs related to creating content, advertising, freebies, hiring a graphic designer and marketers, physical booth, phone bills, hosting and other expenses.
You are in the business of providing leads to clients at prices much lower than what your clients can achieve. One of the main advantages allowing your website to sell information cheaper are the following:
1- The ability to sell a list of leads to multiple businesses and spread the costs.
2-You may also have the technical expertise a professional team of online marketers and graphic designers not available to your client; this can reduce your costs of advertising and therefore, generating leads at relatively lower prices.
It’s important to understand fully your advertising costs, digital design concepts and how to make successful leads generation campaigns.
Finally, you can take your business to the next level by creating database stored in the cloud, and the information can be available to your clients as needed. You will set for your client a payment method to access specific portions of your database.
How much clients are willing to pay for leads?
There is no one answer fit all. A difficult question to answer because of the many factors involved such as:
1- Each Industry has different profit margins, a business that makes $1200 from the sales of service can afford to pay more than a client who makes a small profit margin selling $6 mug as a product.
2- Cost of advertising is different for each country based on supply and demand. Advertising Costs are more expensive in North America than say nations in Africa. Hence the cost of generating leads in the latter example is much cheaper.
3- How reliable is the agency selling the leads? Is it a large company with years of experience or you’re paying for information from someone you found on auction sites?
4- Data Customization: Requesting data with many filters can increase the costs per leads. A client may request specific geographic location, age groups, income, usage, and other filters but the more they restrict the data, the more likely you have a smaller market size and hence the cost of such data will be much higher.
5- Size of database: If a client requesting 1000 leads at $2.40 and another client wanting 10,000 leads from the same database, the latter most likely would get a discount.
6- How useful the information to other clients: Is the leads information requested too specific for one business, or it’s more general and can be helpful to many?
7- Global Economic cycle: Are we at a time when employment rates at all-time low and many businesses are expanding or are we in a recession, and few are buying? A time when small businesses may spend less on marketing campaigns and your database priced lower.
How do you charge clients?
1- Accurately calculate all your costs, add your profit, and overhead, this should be your minimum selling price. You will also need to consider the above factors we discussed when setting your selling price.
2- Use industry averages cost per lead businesses are paying to set your selling price:
For example, the average Cost per lead per Industry according to a blog site listed below:
- Finance $47.0
- Computer/Technology $45.0
- Health $37.0
- Manufacturing $36.0
- Travel and Tourism $29.0
- Retail $29.0
- Education $27.0
- Telecom $26.0
- Media/Marketing $24.0
Once you know your costs per leads and the average leads by the industry, you have an upper and lower limit to charge your clients. Note any pricing information you may come across online related to leads can be misleading as data may represent different sample sizes. A lead cost estimate using a large sample size 1000 clients is more accurate than information published on a blog with only 50 clients surveyed. Where is the surveyed client base located? Are they close to your market? Are they relevant to your business? Questions you need to ask.
To do a more detailed analysis of predicting leads costs, its best to use Adsense and research costs associated with each keyword related to your campaign. Use optimization techniques to come with optimum costs. Its outside the scope of this article to discuss such methods.
Cost per lead can vary significantly across industries.
Lead filters will increase your lead cost.
A lead database can be useful to many clients from different industries.