Buying cheap leads is a false economy

Mortgage Strategy

Like any marketing activity, the measure of success of a lead generation campaign is return on investment.

Buyers can try to boost the revenue generated from the campaign by improving conversion rates or cross-selling into different products, or lower input costs.

It makes sense for buyers to get the best price for leads, but trying to get cheaper ones can be a false economy.

Buyers will speak to a few providers with the conversation revolving around price. Most buyers have a limited budget so the inclination is to go with the firm offering the cheapest leads.

But this makes the assumption that all leads are created equal and this is definitely not the case.

Often the marketing method used determines the cost per lead and quality. For example, leads sourced through consumers searching on Google are often the most expensive to generate. But buyer feedback is that the contact and conversion rates from them are higher than from other sources.

So you might be saving money going for the cheaper option but looking at return on investment, cheaper leads might have lower conversion rates.

It is also important to consider the ancillary costs of processing leads. For example, if you make five calls to speak to a consumer from a £10 lead compared with 20 calls for a £5 lead it might turn out the £10 campaign delivers better returns because you spend less time trying to contact each consumer.

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