(888) 893-2165Lead generation. It is crucial for businesses that want a successful marketing campaign.
About half of all businesses consider the ability to generate leads their top priority.
If you are a business owner that wants to focus on generating leads, you may consider going the pay-per-lead (PPL) route. However, this is not always the best idea.
What is pay-per-lead? Why could this not be the best idea to generate sales?
Here are some of the biggest reasons.
The Leads Are Too Generic
One of the biggest reasons the PPL model may be wrong for you is that the leads could be too generic.
Let’s say that your company has a particular niche. It could be something as extreme as acquiring rare animals for zoos. Well, your leads would have to be very specific to get them to be remotely interested in what you are trying to sell.
That becomes the problem when you try to use a PPL system. The people you pay for leads may send you a generic list of phone numbers and emails for you to try to contact.
However, there is far from a guarantee that they will be interested in your product. In some cases, you may see leads that barely work in the same industry as you.
If your company has a very specific audience, it may be worth thinking about going another route for leads.
There’s Too Much Competition in Your Niche
Another reason the PPL system may not work for your company is the amount of competition you have for those leads.
Think about it. If a company sold you PPL leads, you are likely not their only buyer. That means companies that sell similar products or services to you are also likely looking at this lead list.
In that situation, you could be in a race against the clock. Even worse, you could enter a situation where the market is simply too saturated because of how many similar companies have that PPL list.
When buying leads, you want the biggest leg up on your competition. That is why if you go with this system, you likely do not have the edge that you think you do because of the competition that may have also bought access to these leads.
How It Makes Your Business Look
When it comes to PPL leads, you must consider how it makes your business look. This mainly comes into play with the vendor you are dealing with to acquire those leads.
Companies typically spend nearly 14% of their revenue on marketing. Assuming the vendor you are dealing with is aware of this, they may judge how much your company is worth by the amount you are willing to put towards generating leads.
While lead generation is not an entire marketing budget, it is typically recognized as essential. This is especially the case for small businesses.
So, what does a PPL system for leads look like? It looks like your company either lacks a proper marketing budget, does not have the confidence to invest more in lead generation, or you are just cheap.
None of those things is a good look for your company, and as a result, you may end up working with the wrong vendors because they may not believe you have high expectations. Get out of this system while you can and be willing to commit a little more to your business.
You Deal With Complex Sales
Another time PPL leads can be an issue is if you are a company with more complex sales. With this, you need to consider when you typically see the PPL system come into play.
One of the most frequent times you see this happen is in social media ads or in the middle of videos. These companies typically leave a link to sign up or buy a product.
Let’s say that you are an insurance company that is trying to sell insurance to your clients. With the system described above, there is likely going to have to be a phone call that takes place along with paperwork.
In other words, it is not as simple as clicking on a link and immediately buying the product. You need to know how long a typical sale in your company takes here.
Speed Issues
Finally, regarding PPL, we discussed above how the leads you are paying for could be shared with your competition. In these situations, time is of the essence.
That means if your competition beats you to the leads, you will not have access to those leads yourself. This can be bad if you do not have the marketing budget to compete with your competition. It is also bad if you are not first to market.
If speed is vital for your company’s sales, you may want to think twice about this option.
Why You Should Think Twice About Pay-Per-Lead
These are some reasons why you need to think twice about using a pay-per-lead system to generate leads.
You have to realize that these are likely going to be generic leads that you are going to share with your competition. As a result, speed may become too important for going after leads you may not be sure you want.
Do you need help thinking of a different system to use? We help C-suite leaders and directors of B2B companies build revenue the intelligent way. Book a meeting with us today.
