December 20, 2019Marketing
Why buying leads is not your best investment.
Purchased Lead generation is an option, but is it the best approach?
I recently consulted for a client that had an overwhelming amount of leads coming to his practice. His business model required details and facts collected on the initial call that was relevant to their ability to not only close the deal but create an accurate assessment of the fee presented. Over and over again the individual assigned to answer the phone, email and voicemails spent very little time vetting the calls, he relied on a face to face interaction to secure the business.
This young man works 12 plus hours per day, every day and is at the point of breaking. So much so random notes left in the CRM showed his desperation and lack of self-felt worthiness.
Let's take a moment and break this apart.
Here is an environment the headless chicken would love. Having to react constantly without garnishing details taking a break results in chaos. So much so there were over One Hundred Thousand Dollars left on the table with a massive question mark attached. These were the leads that did not seem smoothly close and were never followed up.
Why or better yet, how is this ok? Why is it justified and what is the cause?
From my perspective leads should be garnished based on your brand's reputation and focus. Meaning, the best potential clients are the ones you receive because the prospective client has heard of you via the most powerful channel in existence. Word of mouth.
The hard truth of this statement is pure.
It takes time, and precision effort to build a brand that speaks for itself and yes, some opportunities should be garnished to help create your brand, ie, ad words when used correctly. The sad part is many business today use mediums that are labeled as advertising to feed the business and more often than not neglect the daily activities that result in business become the absolute term when the need arises among the targeted demographic.
An actual brand has is developed not bought, and advertising is to defend it not grow it.
Imagine a swap in a daily exchange where the phone steadily rings with high potential key demographically solvent clients on the other end vs. filtering a massive amount of calls due to a slight categorical recognition that triggered their efforts?
- Imagine a healthy engaged and personal conversation with each target and the resulting exchange of personal attachment leading to a future relationship on a professional level?
- Imagine fewer leads creating more revenue and closing faster.
- Imagine spending a healthy 3-5% on your marketing budget vs. 30-40.
- Imagine your lead management and customer relationship system giving you powerful insight as to the content, strategies, and systematics of how the process pays off.
Oh how the results would not only be more profitable, time would also be a valued and structured asset vs. a race to complete daily.
So when should we buy leads?
First things first, start with a healthy budget. Make sure that your business hones its focus on growing the right way by not delving into a dependence on bought leads. The risk involved is a never ending threat, the minute you cannot afford to advertise your business will shut down.
According to a 2014 Gartner Research study, “companies spent on average 10.2% of their annual 2014 revenue on overall marketing, with 50% of companies planning to increase [in 2015] to an average of 10.4%.
Take that number and break it down into categories that will help you own your class and retain your best clients and yes, advertising can be a part of that. While growing spending money on advertisements, you should keep it at the nominal percentage at best, keep it simple.
To make matters more precise, there are many other ways to seek leads that are healthy, i.e., referrals, speaking directly to them and offering solutions. This can all be accomplished with a sole focus of building vs. sustaining.
Share your thoughts below.