How to Lower Your Overall Cost Per Lead
If you look at a typical sales force, leads are generated the old fashion way: cold calls. A few drawbacks of generating leads by cold calling: time consuming, low hit rate, lowers morale, and rejection. However, the grand daddy of them all is the overall high cost and low numbers produced from cold calling. As an example, if a sales rep's annual compensation is $100,000 a year, that means each work day, productive or not, equates to a $400 a day pay rate. Let's say a rep does 30 cold calls per day and generates just 5 solid leads from cold calling for the week. That means each call, or really each dial, cost $13.34 while the average cost per lead is a whopping $400! What happens in situations if the sales reps does not feel like cold calling, is working off a poor call list, or does not have time to cold call because of time spent servicing exisiting accounts? Sound familiar? What do you think will happen to the lead flow? Will there be enough active opportunities in the pipeline to generate closed business? Think the sales team will hit their numbers? Probably won't even come close.
Sales is a numbers game. If you disagree, ask yourself one simple question, "Would you want more leads or less leads?" You probably have a good idea of what your win ratio is and what your average deal size is. Put the numbers in the equation: (number of leads x win ratio x average deal size = revenue brought in) If you increase the number of leads, you increase the amount of revenue brought in. Simple numbers game.
One of the most cost effective ways to generate high quality leads is through online webinars. You can quickly broaden your reach, penetrate emerging markets, and capture the attention of an executive who happens to watch your event during his lunch break, never having to leave his office to hear you speak in person at a hotel conference room hundreds of miles away. Get in front of more decision makers, you'll close more business.
So here is how online webinars work...
Let's say you are a consulting firm that specializes in Sarbanes-Oxley and other Compliance-related issues. You plan to do an online webinar on "SOX and Risk Mitigation." You put together a PowerPoint presentation and include a few short video clips of customer testimonials and success stories. Then you begin actively promoting the event for about 4 weeks via your website, newsletter, partners/sponsors, banner ads, Google ads, email, direct mail, etc.
An executive sees your event and is intrigued with the topic and decides to enroll for the event. You capture pertinent contact information like name, email, phone number, company name, title and even ask some customized qualified questions. He presses submit. Boom, your first lead. You then track where the lead actually came from: Google Ads, corporate website, newsletter, referral, banner ad, email campaign, a mailer, and prioritize the lead based on his answers to your qualifying questions. If he is a C-level executive that runs a $1B company, he scores more points than a non-decision maker from a company that generates less than $1M in revenue. If you have this information, your sales team can follow up accordingly based on the "hottest" leads. You also can identify which marketing campaigns generated the greatest ROI. If more leads came from the newsletter than from the direct mail piece, perhaps more focus should be put on the newsletter since it produced better results. About now, you should get yourself in the mindset of thinking "cost effective, repeatable, measurable results." Replicate this process over and over with each event and you will always have leads.
As you can imagine, online webinars can quickly generate more prospects in a shorter time period than cold calling. The leads are pre-qualified, scored for follow up, and were generated at a lower average cost per lead compared to cold calling. For example, you target 10,000 potential prospects with a 2-3% enrollment rate which equals 200-300 registrants. There will be "no shows" but you now have 200-300 potential leads of people who filled out your enrollment form and provided their contact information for follow up. By spending around $10,000 annually for an online webinar solution with a trained Event Producer, your average cost per lead is only $20-$30!!!
You can improve those numbers by sending follow up "Thank You" letters or inviting the prospects to view a URL of the recorded online webinar. You could also post the online event on your corporate website for playback, while capturing contact information from a short registration page before the prospect views the recording. More leads and no added time or resources were needed.
Would you rather spend $400 per lead from 5 cold calls or $20-$30 per lead from 200-300 online webinar registrants?
Thanks,
David ChaoThe Web Conferencing Expert
