Yes, Quality Leads can be Expensive

aidan-bartos-313782.jpgAs a direct response industry expert, Justin Steinle often finds himself confused when company owners are shocked or surprised by what they consider an excessive cost for a targeted quality lead.  Let’s dive in…

First, what is cost-per-lead (CPL)? This is a media calculation when taking the media spend divided by a specific action, such as a call or form submission. Example: Media Spend / Calls = CPL ($1000/10 = $100)

A campaign’s CPL will vary based on the specific industry and media type, which an expert in both areas will usually have a rough estimate on average CPL’s typically achieved.  It’s more than understandable that a business owner will want to achieve the lowest cost-per-call, as this represents performance and potential revenue for the company.

Though a lower CPL is desired by the company, it may be better for the company to have a higher CPL with targeted media and leads.  The CPL may increase as you target a more specific lead with various selects, an example is location; if your organization is focused in one state, you’ll potentially pay more for targeting that state versus less for a national campaign.  $100 State vs $50 National – The targeted leads may develop a higher conversion rate, with less operational expenses to process, and in turn develop higher profits for your organization.

As you review your media plans and strategy, make sure you don’t just focus on lower cost is better.  Through modeling processes, you can develop a strategy that will allow you to reach your companies goals.

Author: Justin Steinle