There’s no such thing as lead qualitySeptember 24th, 2010 by LeadPoint
The following article was written for iMedia connection to view the original article click here
Can it be true that there is no such thing as lead quality? Justin Rees from lead generation company LeadPoint surprisingly argues that there isn’t.
Companies involved in the supplying and buying of leads will often talk about lead quality as if it is the equivalent to a field on a data capture form, like a telephone number or an email address. But really there is no such thing as lead quality – leads either work or don’t. If they do then they could be described as “high quality” and if not they could be described as “low quality”. There are quality components to be aware of along the way that increase the likelihood of success for a lead generation campaign but the only real way to definitively assess lead quality is to ask the most important question: will this campaign make any money?
The outcome of a lead generation campaign is more often than not determined by what the advertiser does with the leads and frequently has nothing to do with the leads themselves. If you give two different advertisers the same leads, they will usually have very different experiences. So if advertiser A does very well from the leads and advertiser B doesn’t, could you really draw any conclusions about lead quality? Probably not. The point is that leads don’t turn themselves into business so “lead quality” is as much a function of how the leads are processed as the lead data itself.
The process, as well as the competence of the processor, is also a big factor in determining the outcome of a lead generation campaign. If an advertiser is buying leads to be fulfilled by post (for example, free mobile phone sim cards or similar), then it is important that postal addresses are as accurate as possible. If the lead supplier doesn’t validate post code fields on the data captured then the campaign will probably not work well as it’s effectively paying for leads that are never going to generate any income. But, if the same data capture form also collects telephone numbers and leads are sent into a call centre to be fulfilled where the value of a conversion is high then the exact same leads might generate a very healthy ROI. It is not hard to imagine something like the above scenario where from the same data set one advertiser would say the leads are low quality and the others would say they are high quality. In this case, you can’t even categorically say that accuracy of the data in each field has anything to do with lead quality.
What the above illustrates is lead quality is only something to be aware of in the lifecycle of a campaign rather than it being some kind of end goal as a lead buyer. There are certain quality components that will impact upon the ultimate campaign ROI to a greater or lesser extent. Some are universal and others are specific to a particular campaign. For example, “contactability” of a lead (ie. the propensity for a lead to be contacted) is fairly universal but the exact form that this takes (for example, post code vs. telephone number) is much more subjective.
So if you are an advertiser considering using lead generation, what can you do to maximise your chances of success? In addition to what has already been discussed there are a few other things to be aware of.
Ask more questions, not less
As a general rule, the more fields on a data capture form that you put in front of the consumer, the more “qualified” or engaged the consumer is and the more likely on a lead-for-lead basis that the lead will convert into business. What this means is that every extra field added to the form, causes more consumers to not submit their details. The theory is that these are the less “interested” consumers and those that go all the way through are signalling a greater purchasing intent. In addition, the more data captured, the more filters you can put in place to get closer to your ideal customer. As it is important to remember that it costs more to generate leads the more consumers “drop off” the form. This is especially the case if the leads are generated from Google where each click can be very expensive. There is always a fine line between collecting enough information to qualify the lead and collecting too much to make the lead cost prohibitively expensive.
What’s in it for me?
The incentive for the consumer to submit their details online will also play a big part into likelihood that leads will convert into business. For example, leads generated from competition sites are much less likely to generate business than leads generated from Google with no extra incentive apart from the fact that a consumer can speak to somebody about the product or service they are researching. However, this is a generalisation. There are plenty of examples of very good competitions sites where appropriately priced leads can work very well and as many examples of bad search campaigns producing expensive poorly performing leads.
Show me the money
This brings us to possibly the most important piece in the lead quality jigsaw and that’s lead price. If you work back from ROI, lead price is really the only determinant of lead quality. If every lead has value (or a value) depending on how the lead performs then if you knew the outcome in advance of every batch of 100 leads then you could work backwards to determine a price that would work irrespective of how the lead was generated. The hard part is that it can often be quite expensive to find out what works and what doesn’t work so if you have a good grasp of what effects lead performance then you should save yourself a lot of time and money.
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