Buying leads vs. generating leads

The man and the fish There is an old saying that goes something like this: “

*Give a man a fish and you feed him for a day. **Teach a man to fish and you feed him for a lifetime.*”

You have probably heard it before and already have an idea of what it means. A lot of businesses spend a lot of money on buying leads. Then they try to sell their product or service to the leads they buy. Whether they succeed or not they will be left with no new leads after the sales process and they will have to buy some more. Wouldn’t it be beneficial for the company if it were able to supply its own leads? Being able to control the amount of leads you get and when you get them, without buying them as a 3rd-party, will not only save you money. It will also make you more effective sales-wise.

Here is why: The leads you buy are people with interest in your type of product, but not only that which your company delivers. For instance if the person is interested in a new carport it really does not matter what carpenter offers the service as long as someone does. This is the type of leads you pay for. If you generate the leads yourself you can make sure that the leads not only wants your type of product but also 

your company. The leads you generate yourself are therefore stronger than they leads you buy from traders. Plus you save money since you don’t have to spend money on getting your leads. If you have not already figured it out this can be compared with the man and the fish. Each day the man gets hungry and each day someone gives him a fish. That is in many ways ineffective and it is a simple but short term solution just like buying leads. If you learn to generate leads yourself you will be “fed for a lifetime”. You will be able to get the leads you want, when you want and thus you do not have to depend on others.

How to increase your success with Google adwords super easy

Adwords is easy. Super easy. Easy to loose money with, and easy to make money with. Here’s how you can stop losing money with Google Adwords and start making money with it instead. All you have to remember is one rule:

§1) You pay for the clicks! Most Google adwords campaigns are CPC campaigns. This means that you pay per click. Never forget that.

§2) Optimize your conversion rate Since you pay per click means that you pay per visitor on your website optimizing your conversion rate for these visitors is the only way you can make sure to start making money on Google adwords instead of losing money. Here’s the mathematics behind it: If you pay $1 for 100 clicks it means that you’ve paid $100 for 100 visitors on your website. If 1% of these visitors convert and gives you a sale with a profit of $75 it means you’ve spent $100 to make $75. This is not good business and the campaign should be improved or stopped.

How to improve things Now you can spent your time and money in two different ways: You can optimize your Google Adwords setup to ensure your search terms are better chosen, the price per click is set right etc. This work will usually give (please correct me if I’m wrong here) an optimization of about 5-20%. Meaning that you can get your clicks a bit cheaper. After optimization of Google Adwords the person in our example above will have got 100 visitors 5-20% cheaper meaning that the expenses would be 5-20% less for each 100 visitors, but this doesn’t change the fact that they are losing money since the total expenses is still higher than the expected return. If the person would instead optimize the website to get a better conversion rate the money is made much faster. Before optimization the conversion rate in our example is 1%. If this can be improved to 1.50% instead the whole case improves massively. Now our client only needs 67 visitors for each sale instead of 100. Using his existing Google Adwords setup getting 67 visitors costs the client $67, so our client will make $75 – $67 = $8 for each sale made.

§3) Tell the user what they get before they click There’s two ways to improve conversion rates: You can create a better website and make it much easier for the user to get what they need fast. This requires a lot of work and massive investments. Unless you’re using LeadDoubler.com that is 😉 The other way is to make sure that the people visiting your website know what to expect before visiting. Here are two examples of adwords ads. Guess which one gives the best conversion rate:

Teddy’s bears At Teddy’s bears we give
The best service ever!
www.teddysbears.com
Buy your teddybears today
1 Teddy Bear is $99 ex. VAT
Free shipping in the US
www.teddysbears.com

In the last example it’s clearly explained for the user what they can expect. This means that almost no users from the adwords ad will arrive at the website not knowing that a teddy bear will be $99, so only people interested in buying a teddy bear will click the ad. It really is super easy. Start making money today by: – making sure you’re very clear in your ad text on what a visitor should expect from your website – making sure your website is optimized to help your visitor achieve what you promised in your ad

How to improve your conversion rate

Definition: Conversion rate is the number of leads you get from your website divided by the total number of visitors.

Conversion rate = Number of leads / Number of visitors on your website

Calculate your own conversion rate in the bottom of this article

Why working with conversion rate is important Conversion rate relates to the cost of acquiring a new customer. If acquiring a new customer is expensive for your company then the value of your company is lower if you can show that acquiring new customers is not so expensive.

Acquisition cost = The money it takes to get a new customer

For a company that primarily gets customers using online marketing this basically means:

Acquisition cost = The total cost of getting traffic to your website / the number of new customers

This really means:

Acquisition cost will decrease if you get more customers without increasing your total budget.

5 easy steps towards a better conversion rate

1) Start by calculating your conversion rate Get the total number of visitors for the last month and the number of customers or leads you got in the same period. Input it into the conversion rate calculator in the

bottom of this article to find your conversion rate. It might be much worse than you think.

2) Review your site from a customer perspective Your site consists of pixels. Every pixel means something – either it increases the chance that the visitor leaves their contact information, it is neutral or it decreases the chance that the visitor leaves their contact information. Try taking a print screen of your front page or just look at it and ask yourself:

  • Is it very clear for the visitor what they can get out of leaving their contact information with you? (The clearer message – the more leads)
  • Does the site look messy or does it give the visitor a positive feeling (The more messy – the fewer leads)
  • How many clicks will it require for the visitor to leave their contact information. (The more clicks – the fewer leads)

3) Consider how you can create value for visitors fast Value for visitors can be different things. When they are visiting your site they probably visit you to get fast information. If you can provide that information in a way that makes it an obvious choice for them to leave their contact information in exchange then you’re pretty close to getting a lead. Here are some ways to give your visitors what they came for in exchange for their contact information:

  • Setup a calculator. This is the most efficient tool we know of since it engages the visitors before asking them for their contact information
  • Add a newsletter signup form. This promises the user a set of emails. Really interested visitors might want just that
  • Add an ebook download form. An ebook is a 5-20 page .pdf file (usually) that the users can get by submitting a form with their contact information

4) Experiment Try making experiments with your website and the content of it. Experiments can be done by doing one of the following things:

  • If you think your website is pretty good at converting – then consider using a testing platform like optimizely to optimize it
  • If you think your website might need a total redesign to convert better than we believe it’s better to do experiments by setting up completely new landing pages using software like LeadDoubler before changing your corporate website itself. It allows you to experiment more freely and achieve faster results. (Actually we recommend total redesign of your website, but that might not be possible in your company, so you might need to create some comparable results first)

5) Repeat step 1-4 It never ends. In 4 months your website is old and dusty again. You’ve got to stay moving to stay ahead. Basically this means:

  • Keep your investments at a level allowing you to invest again in 6 months. Consider prototyping your next bright idea instead of having it developed 110% automated.
  • Kill your babies is essential: Even if you paid $$$ for your old corporate website it might be time to throw it away if it doesn’t work. Don’t throw new money after old money

Conversion rate calculator

Survival of the fittest marketing animal

One of the more surprising lessons from the theory of the “Survival of the fittest” is the fact that it is more important to be good at adapting than it is to the biggest, fastest or strongest. If you’re a fast adapter you’re able to adapt quickly to changing environment – surviving new threads and taking the advantage of new possibilities. In marketing the theory applies as it does in biology…

Let’s play a game… In a given market (a world) a group of different companies (species) co-exists. If one company launches a campaign or a new service it will have an advantage for a period until the effect wears off or the other companies have adapted (copied?) to the new situation. The success of company is in such a market determined by how effectively it provides it’s services and how well and fast it adapts to changes in the market.

The problem The problem when moving the market to the internet is that the number of services and campaigns launched in a given market have grown explosively. In the good old days a company could live for decades doing the exact same thing. Now it has to re-invent every service every 5 year!

The loosers The species that dies out in a changing environment like this are the dinosaurs. The biggest animals with the slowest adaption ability.

The winner The winner in an environment that changes like this is the company that is best at adapting it’s services and launching the most revolutionary campaigns – over and over.

How your company can become adaptive If you seek to become adaptive we suggest that you seek to explore the way you develop and launch new services and react to others doing just that in your market. Imagine a situation where a new player enters the market by launching a campaign eating customers right out of your cash-cow market… What do you do?

  • A: Calls your board of directors, discusses what to do for a while. Determines to do someting, ask some outside consultants or agency to come up with some brilliant idea and perhaps decide to launch a campaign after a few months.
  • B: Designs a new service or campaign by prototyping and launching it fast to minimize the head start of your new opponent. Knowing that not all services can be launched equally fast give the above a thought.

  • How fast are you?

  • Did you prepare yourself by purchasing adaptive marketing components that at least makes that part easy

  • Did you consider taking the first move – removing any incentives a newcomer would have for entering the market?

How LeadDoubler makes you adaptive With LeadDoubler prototyping marketing automation machines right into production is easy breezy. It is done extremely fast and takes away the reason for considering new campaigns for a long time before just doing something. Take our marketing automation test if you want to know more about your ability to thrive in todays rapidly changing market.  

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