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For any business, a crucial part of its continued success is how well it can bring new customers into the business. Upselling to existing customers is certainly useful, as a loyal returning customer is often a business’ best asset. That said, every loyal customer was once a lead persuaded to use your products or services in some way.

This shows why effective lead generation is so important for businesses, as any potential lead could go on to become a loyal, returning customer in their own right. However, it’s also important that businesses know what they’re investing in these efforts.

So what does lead generation cost?

Time and scope

The cost of lead generation is something that can vary based on a number of factors. Think about things like:

  • The staffing costs, such as hours and wages, for time spent on lead generation
  • The channels you’re using, such as PPC, email marketing, or TV/radio adverts
  • How hot and ready-to-buy are the leads that you’re looking to target?

Are you looking for a broad campaign that targets a lot of people who might not be hot leads, or would you prefer a shorter, more intensive and focused lead generation campaign that targets qualified customers from the start? Think about how the costs could vary by channel too. A PPC campaign may be more useful in some cases than a larger and more expensive TV advertising campaign, for example.

You could pay less for colder leads that you nurture yourself over time, or more for prospects that are closer to converting into a sale, and so require less time and effort from staff.

It should also be noted that you can continue to work on and improve the efficiency of your marketing over time. For example, a business’s first marketing campaign may be less focused on the right audiences and potential customers, and it won’t be as apparent what works and what doesn’t until the conclusion of the campaign.

By investigating and analysing the results of your previous marketing and lead generation efforts, you can continually tweak and improve the process. You can target potential customers more specifically, use budgets more efficiently, and create more useful content for the areas you target.


Note how much profit you make on each sale or service provided. If your lead generation costs tend to overshoot this profit mark, you’re losing money.

Profitable lead generation

Because increasing cash flow and generating revenue is always an important goal for businesses looking to become more successful, it’s important to know that your lead generation cost is working effectively and, more importantly, profitably.

Note how much profit you make on each sale or service provided. If your lead generation cost tends to overshoot this profit mark, you’re losing money.

However, to earn a first-time customer, you should be more willing to spend up to this profit mark. Once they’ve converted into a customer, it’s easier to encourage repeat business going forward. While you may have spent the upper limit to convert them, they’ll become more profitable from that point onwards.

It’s also important to note that this cost can vary depending on the industry you’re in. For example, some industries might bring in more money and a lot more profit than others on an individual sale, meaning they can afford a higher cost per lead. This is why analysing the data you have to hand is so important, as it lets you figure out what will work and what will be profitable in your industry and for your business specifically.

By comparing the amount you can afford to pay for a guaranteed sale with your conversion rate, you can figure out a maximum cost per lead. Similarly, you can compare the cost of your campaigns with the amount of leads they bring in to figure out what you’re actually paying per enquiry.

How FLG can help ensure your lead generation is a success

Bringing more and more customers into a business over time is a fantastic way to make a business more profitable, and help it grow and expand.

In order to bring in new customers efficiently, you need to make sure that your lead generation and lead management strategies are robust and thorough. For example, it might be that you put systems in place that automate parts of the sales process to help your staff handle a higher volume of new leads, allowing them to work as effectively as they can and giving them more free time to focus on converting hot leads into sales.

This is where FLG can help. We provide a tool set that can:

  • Process your leads efficiently to help you and your staff follow them up, successfully close more sales and increase customer conversion
  • Effectively integrate with other software platforms, such as MailChimp and Campaign Monitor
  • Utilise powerful workflows to keep your customers updated and informed

To find out more about FLG’s products and how we can help your business with effective lead management, see how our CRM software can help.

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