Should you Buy Leads for Your Small Business?
In this free marketing lesson you will learn:
- Who are the companies that sell leads?
- What is the company’s offering that is compelling to you?
- What’s the service that you think is worth spending money on?
- Why should you create your own lead generation website?
- Why should you, as a small business owner, be in control of the marketing of your business?
This video will answer your questions and more!
What You Need To Know About Buying Leads
With Your Personal Marketing Trainer, Jesse Stoddard
Listen to or download the audio Podcast via Soundcloud:
Jesse Stoddard: 00:00
Hey, Jesse, back again, with Stoddard Consulting, I’m here to be your Personal Marketing Trainer. Today I want to talk to you just a little bit about buying leads. Now, if you’re a service-based business or you are a mid-size large company, it’s actually doesn’t matter. Everybody’s been approached with the opportunity to buy leads. For example, you could be an attorney. I was just meeting with my attorney clients this morning. Great guys, Russell and Hill. If you happen to live in the Pacific Northwest and you’re looking for good personal injury attorneys or social security disability attorneys, these guys are amazing. They also specialize in a few other things as well. But anyway, that’s beside the point. But when I’m talking to them, they often have companies that approached them seldom leads. So there are companies that will sell them “law leads” you know, people that were just in auto accidents that are looking for an attorney.
Jesse Stoddard: 00:55
And I often get asked by clients, should we buy these leads? Which one of these is a good idea? Which one’s a good a deal, what’s a good offer? I’m getting inundated with them. You’ll also see that in a moving industry, automotive industry, I mean anywhere nowadays and even the network marketing, multilevel marketing, there are companies that will sell you leads. So here’s something I want to talk to you about before I give you the, “should we buy it or should, should we not buy it?” I actually think that’s a bad question. I think the real question is, “why do you want to buy them?”, Why?, Because you need leads now, and you want to close sales and you want to grow your business. OK, yeah, Duh. But really think about it. Why do you need to buy a lead?
Jesse Stoddard: 01:44
What is it that, that company is offering that is so compelling to you? What’s the service that you think is worth spending money on? Well, they will give you a person, a name, and a number of a phone number, email, whatever, and then you call them, and a certain number of them close. And then depending on how much a client is worth to you, that lead may or may not be worth it to you, right? If they charge you $7 a lead and every lead ends up being $5,000 to you, that’s a great deal, theoretically, unless the closing ratio of those leads is very low or your average ticket prices low where you don’t have a back end of your business to follow up to make more money out of that initial lead. There’s a lot of reasons why that lead might not be worth it, other than just what you see on the surface.
Jesse Stoddard: 02:32
And oftentimes a surface is easy to tell. Still, should you buy them or not? Well, maybe yes and no. And here’s what I’m getting at. What do they really do? Well, these companies have figured out how to put up a website. Typically nine times, nine times out of 10, it’s a website and they are doing lead generation. In other words, they are creating a website that’s compelling people to want to submit information requests, you know, help from a lawyer, from a moving company or from a network marketer or from anybody personal trainer, a gym, and then they have cracked that little code, that company. They then take that and sell it to you. What a great business to be in remembering one, Groupon first came out and Living Social, still valid, and they still work in certain industries. But remember when it came out of those guys were cleaning up, I’d love to be in that business.
Jesse Stoddard: 03:25
In fact, a lot of my digital marketing friends are often doing those businesses on the side, more power to them, nothing against it. But I want to challenge you as a small business owner. What if you could create the lead generation website? What if your, offline and online marketing was so well integrated that you created your own leads. What would that be worth to you? Instead of giving HomeAdvisor, Angie’s list, Yelp, thousands of dollars every month for, one out of 50 of them turning into a customer. What if you spent the same amount of money and instead of getting one out of 50, you got highly qualified, you’ve got one out of five. We’re talking a huge impact on your business. It’s just something to think about there. Now the next question obviously is, well, how do you do that? Well, you need to potentially get into another business and that may scare you, may say, “well, no, that’s not my business.”
Jesse Stoddard: 04:20
What is Your Business? Well, I’m a personal trainer. I’m a gym owner. I’m a doctor, I’m an attorney. You know I’m a moving company. I’m a tree service. Well, are you or are you actually in the marketing of that service business? I would argue that you’re in the marketing of that business because the easiest thing to outsource, delegate or hire for is the doing of the thing. The hardest thing to hire for is the selling of the thing, and the idea and the creation and the big idea. Well, that’s you. If you’re the entrepreneur that you’re the owner, that’s you. That’s what you need to be doing all the time and in order to get more business to grow the business, you don’t need to hire more bean counters. No offense to my bean counter friends, but they don’t have a job unless sales happen.
Jesse Stoddard: 05:06
How do sales happen? Usually you, if you delegate it all, then you’re not really in control anymore of your own business, and the more money you give the Yelps, and the Home Advisors, and the Angie’s List and the lead, the guy on the, you know the company in India that’s emailing you every day telling you they will sell you leads. The more money you give them, the more it’s like a drug pusher. It’s your pusher man. The more money you give them, the more they can grow their business of providing leads, the more they grow and the more money you give them in, the less effort you make toward that and the more dependent on them you get, pretty soon. What business are you in? You’re the fulfilling of your business and you’re going to limit your growth, or at least you’re going to limit your profit and you’re gonna.
Jesse Stoddard: 05:49
Make those guys fat. Living high on the hog. Now is it wrong? No, they do provide a valuable service perhaps? If they’re amazing at it, if they’re Google, if they’re, you know, Reviews and Yelp and Angie’s list, they got a pretty big business. Angie’s list, sorry, part of Home Advisor. Now they’ve got a pretty big business. It may be hard to compete with their business, but how can you be unique in your marketplace and have your own lead generation and build your own marketing machine so that you don’t need to rely on them. You may still use them. You may still buy them. So my advice is, yeah, go ahead and use them and test it and compare it to all your other lead sources continually, but at the same time, watch what they do, copy the best of what they do, dig into it.
Jesse Stoddard: 06:35
Find out what websites they’re using to produce leads and mimic it and test it on your own and do your own ads to that. How hard would that really be? I don’t think it is going to be that hard for you. You know your business better than anybody else. You can find somebody to write a good ad copy for you. To create great images for you and to set up a website for you. You can find somebody to help you advertise that website on Google. You can place directly every door, direct mail ads with postcards to drive traffic to that website. What’s keeping you from doing that and doing your own lead generation, so before you go out and buy another lead, think about where that lead comes from and think, could I create that lead on my own? All right, take care and see you next time.