Attribution is the Heart of Lead Generation
I am constantly approached by customers looking to generate leads and reach customers but not knowing where to start. In large part the challenge for most customers is a failure to understand the importance and role attribution plays in allocating a marketing budget with a expected return on investment.
Marketing, like any other business, is one which competes in a market. Irrespective of the form of marketing (social, search, PPC) typically there is heavy competition to find unnatural return on investments. Customers may have a service and product that is generates a large amount of profit or revenue per client but are looking to spend an amount with little to no correlation to this cost per acquisition. That is to say, I often encounter customers looking to spend a fixed and one-time amount to and build a lead generating machine that will deliver qualified customers in perpetuity at no cost or investment. This kind of customer typically ends up with a web development company which focuses on the product to be consumed by prospective customers but with no avenue to reach them. Put otherwise they have someone build them a website and then wonder why it is not generating leads. The reason is because this is based on a rather simplistic notion of the internet as a democracy rather than a competitive market place.
Of course if you are the only one creating a particular product and there is existing search traffic for that product, location or service simply creating a website will ensure you reach a portion of your audience. Likewise if you have an audience and simply need a presence to send them to a website is a great start. That said – if you are hoping to generate leads from your website the starting point is actually finding and driving traffic from qualified customers to your site. This means first and foremost means paying attention to how customers are finding your competitors (what channels, what cost, what kind of content) and subsequently identifying opportunities or gaps in the market for your voice or offering.
What should be remembered however is that the channel you hope delivers you leads it is open for competition and likely ripe with it. That is to say no matter how hard you try to dominate a marketing stream, and be the only kid on the block, you will never succeed at stifling competition. The only way to get and retain market share on any lead generation channel is to strategically invest and develop with clear attribution and an understanding of your ROI.
So what is attribution? Simply put it is being able to attribute or know where your traffic is coming from, how that traffic typically act and the value of particular online events (such as filling out a form) to your businesses bottom line. In order to do this you need to set out clear and definable goals for visitors and be able to put a dollar amount on them taking a particular action.
How Well Does your Funnel Perform
While e-commerce providers have a much more direct accounting of the gross sales associated with the average customer service and product providers that do not sell directly online need to do a little more work. This involves a couple steps. The first step is to identify the channels through which customers actually connect with your company. For most this typically is email, phone and form and in some cases social. Each of these channels need to be monitored so that the cost to acquire a lead can be assessed.
For most email proves to challenging and accordingly most web marketers have shut down this form of inquiry in order to push customers through phone calls and forms. Call tracking software has made tracking phone call allot easier and increasingly call tracking software allows for catergorization of calls at their conclusion.
Putting your phone and form data together you should be able to get a rough estimate on a week by week basis how your site is performing at getting leads. That is to say you should be able to resolve how many leads you are able to acquire on a week by week basis.
The next step is to understand your close rate on those leads. This should be rather simple if you aggregate your inquiries in a spread sheet and then cross compare them with your invoicing software. The resulting close rate combined with an average cost per transaction should give you a solid basis to asses the number of visitors it currently takes for you to acquire a customer.
Once you know how many visitors it takes for you to acquire a customer it should be relatively easy to sort out what you are willing to pay per visitor. Look at your average profit on a transaction and divide that by the number of customer typically required to convert a sale and voila you have your upper limit. When I say upper limit I really mean upper limit. I would typically divide that in half and treat that as my actually upper spending limit.
Now that you know:
- How many visitors you need for a conversion
- Your spending limit to get that number of visitors
you are now in a position to put together a strategy for acquiring customers through paid, organic and social channels.
Talk to our team today about how we can put together a robust lead generation strategy. We are a Prince Edward County based Inbound Marketing and Lead Generation agency that services Eastern Ontario and Western Quebec including Toronto, Montreal, Ottawa, Kingston and Belleville.