Cost per Lead: The Next Generation


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This article on the Vision Edge marketing blog advocates turning away from lead based metrics such as ‘cost per lead’ because they are misleading. The author bases her claim in part on a Forrester Research study that found that “the metrics that most B2B marketers say they use — like number of leads generated and cost per lead” — rank in the lower half of the effectiveness list.” Her larger point is that putting undue emphasis on cost per lead ignores much more important information, such as: Which marketing efforts are resulting in leads that move on in the sales process?

In other words, cheap leads that bring down the cost per lead but don’t close are a waste of time. But placing undue importance on cost-per-lead when measuring ROI incentivizes marketers to waste their time on this type cheap lead generation. This is a keen insight on the part of the author. Her solution to this problem, however, is to focus on marketing metrics that seem much more difficult to quantify.

But another solution is to use a lead management system that enables you to measure the effectiveness of marketing and lead generation efforts from every angle. A lead management solution that has robust campaign management and reporting tools will enable to marketers to slice and dice metrics as needed. Undue attention on cost-per-lead will in fact set off a race to the bottom, but what about being able to measure ‘cost per qualified lead by campaign’, or ‘cost per converted lead by campaign?’ With the right tools it’s possible to measure exactly how well leads from every source are performing; to get feedback in real time about what’s working, and what’s not worth the time and money.

Lead management software puts a whole host of tools in your hand to track the effectiveness of all your marketing efforts.


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