Lead Generation Quality Matters

Lead Generation Quality Matters
BRL Admin


19 Apr

Lead Generation Quality Matters

On the surface, lead generation is almost a startlingly simple concept. “Generating a lead” is most commonly defined as the process of taking one person and getting them interested in the product or service that your business is putting out there into the world. The precise moment that this hypothetical person showed interest in what you’re selling, either by signing up for your e-mail newsletter, making a direct call or taking some other form of action, is the moment of initiation and acquisition.

 However, there is an entire industry built around the activities that occur in the days, weeks or even months prior to that person initiating interest and becoming a lead. A wide range of different factors are carefully considered, from someone’s credit score, to their income, to their age, and beyond. They’ve probably been contacted at least a few times by now, helping them slowly, but surely, move along the sales funnel and to build and strengthen that interest over time. When people talk about “cost per lead,” this is what they mean – the money associated with all of the effort put into CREATING those leads in the first place.

 The idea isn’t that you just want to generate leads, period. You want to generate QUALITY leads above all else. Those are two incredibly different ideas and should always be treated as such. Only by taking a closer look at the benefits of generating high value leads (and the type of problems you create for yourself if you don’t) will you begin to see just how important quality is in terms of lead generation.

Low Quality vs. High Quality Leads

Something that far too many marketers fail to understand (or outright ignore) until it’s far too late is the idea that no two leads are created equally. In an effort to reduce costs and “juice their numbers,” many marketers attempt to save a little money by buying “general” leads. These leads may represent a person who has shown a certain willingness to eventually spend money in the past, but they’re not targeted. They’re not branded. They’re not generated from a custom program that is looking at all of the various criteria that is important to a marketer like income level, demographics, psychographics and more. They’re exactly that – “general.” These are the plain white toast of leads in just about every conceivable way and because they’re not branded, they will have no affinity with your company, thereby reducing a likeliness of becoming a strong customer with any reasonable expectation for a lifetime value.

 The reason so many people fall into this particular trap is because, at first, it seems like a great idea. One of these general leads may cost anywhere from $0.10 to $0.90, which seems like an incredible savings over traditional methods. The issue, of course, is that you get what you pay for. Poor quality leads like these also come hand-in-hand with a poor contact rate. When an advertiser attempts to reach out to a customer and close a sale, their success, on the best of days,  is going to be limited. This problem not only causes frustrations, but it also leads to a waste of money (albeit only $0.10 to $0.90 per lead x thousands of leads) and generates a noticeable lack of revenue on behalf of the advertiser.


In many cases, this also causes people to lose faith in the lead generation industry in the first place. This feeling is such a counterintuitive idea, but it’s something that happens again and again. The logic of “these leads that I barely spent any money on were incredibly poor quality, which means that lead generation does not work” is obviously faulty, but an unfortunately large number of marketers would rather accept this as fact than admit that maybe their quest to cut costs guides them directly into a type of mistake that probably could have been avoided.

So when you’re beginning to experiment with lead generation and you find yourself thinking “that package of $0.30 leads will probably give me what I need if I just buy enough of them, right?”, just think about this one little phrase over and over again:

“You get what you pay for. You get what you pay for. You get what you pay for.”

What Quality Leads Can Do for You

If a “general” lead (which we’ve already established doesn’t really help advertisers accomplish much of anything at all) costs between $0.10 and $0.90, it should come as no surprise that a qualified, targeted lead can range anywhere from $1 to $25. This price is dictated by the fact that the effort required to generate the lead is much higher, combined with the general market demand of leads that advertisers know they can use to get what they need.  Think about the costs associated with keywords in high demand on Google, Bing and other search engines. 

The same principal for cost factors apply and so does optimization with time, volume and relevancy with your offer.

However, in addition to that larger sticker price, you’re also getting a huge number of benefits that you aren’t going to find anywhere else.

In order to be a quality lead, a person would need to not only show interest in a particular product or service, but a deep, vested interest. They likely need to be a specific gender, fall within a certain age range, make above a certain amount of money each year and even have a certain credit score or education level. With general leads, you’re hoping that as many of these things are right where you need them to be, which is why this, more often than not, ends in disaster. With qualified, targeted leads, however, you’re all but guaranteeing that you’ve checked off as many of these boxes as possible and can expect to pay more as a result.

If a client seeks a highly targeted lead like a person with diabetes for a healthcare product or an “accredited investor” in the real estate industry, the effort required to generate that lead is going to be much higher as those criteria get more and more specific and unique. However, if you’re trying to sell a healthcare product aimed at people with diabetes, it’s probably worth the bit of extra money (and effort) required to make sure that as many of the names on your list as possible actually have diabetes (and are eligible to have their insurance company pay for the product or service). The same basic idea is true for almost anything that you happen to be selling or providing.

Additionally, just because you’re willing to spend more money on qualified, targeted leads doesn’t necessarily mean you’ll be forced to pay $25 for each name. Proper lead generation programs can actually scale the total price per lead downward automatically as a client increases the volume of their orders. It’s essentially like buying leads at a wholesale club. If you buy in bulk, you save a little extra money on the unit price that you wouldn’t if you were playing it conservatively.

The Warning Signs

Another important idea to understand is that just because a lead happened to cost a lot of money doesn’t necessarily make it high in quality. There are still a number of important warning signs that you need to watch out for to help make sure you’re not getting “taken for a ride,” so to speak.

Remember that no matter what the quality of a lead is, there is still a chance that a particular name on a contact sheet still could not quite manifest itself in the way you wanted it to. Things happen. This is why nobody’s close rate is a true 100 percent. Because of this, you’ll want to watch out for “quality leads” that are being sold at an advertiser to a really low price that are actually being RESOLD at that discount.

If a lead initially appeared to be qualified and then turned out to be anything but, the original parties may try to recoup some of that investment by reselling what is still on paper a high value target. It’s definitely true that this person has the POTENTIAL to give marketers what they want, but they’ve already proven that it will be a needlessly difficult road to travel – hence the reason why someone is trying to get rid of that lead in the first place. Likewise, a quality lead being sold to an advertiser at a really low price is likely not going to be qualified, which represents a whole new world of proverbial bear traps that are just waiting to be stepped in.

 Just as you can still spend $40,000 on a car and have it turn out to be a hunk of junk, you can still spend $25 on a “high quality” lead and come up short. Knowing what to watch out for is one of the keys to making sure you don’t wind up in this type of situation at all.

 In the End

So remember: when it comes to lead generation, quality doesn’t just matter – it matters a great deal. Anyone who ever tells you differently is probably trying to sell you something, and that “something” is likely a huge number of low quality leads that do little more than waste your money, ruin your closing rate and cause you a significant amount of frustration that easily could have been avoided at the same time.