$47 Per Lead… No Problem - NOT!
Posted on August 18, 2008
Filed Under SEO fraud, PPC fraud, Unethical SEO, SEO scams |
Today I got a business associate who said he was solicited by an Internet Marketing firm with an offer that seemed a bit out of sorts. As much as I’d love to expose it all, I will just say that the generous offer to generate about 200 leads per month at the cost of nearly $10,000 per month ($47 per lead) was a bit more - actually exponentially more - than this site needed to spend. Especially when you consider this person runs a successful business already without doing hardly any online marketing.
I discussed things like organic search and effective web design with him and how that could help his business, for a fraction of that cost and produce far more leads. There is the up front cost for site re-design and the ongoing search engine marketing activities, but again, the cost for a small business should not be anywhere close to $10,000 per month as most cannot afford this. So you may be asking “is this one of those clients where the top position in Google costs like $30-$40 per month?”. The answer is no and in fact, I have done lead generation for this company on a contingency basis in the past, so I already have the numbers. For paid search, this client would do very well for well under $8.00 per click. So even if we used $8.00 per lead figure AND marked it up by 25%, he would still see 800 leads for his $9,600 MONTHLY spend, not the proposed 203.
As in all things - BUYER BEWARE. If something seems a bit out of range, get a second opinion. Sadly, I am sure this company exists because they are able to find people who are willing to over pay for search marketing for the promise of a few leads and then sold on the fact that they will close “x” percent of them, even without addressing usability - and that could be no further than the truth. Or they sell them on the fact that they are going to offer a deep discount (if their manager approves it).
If you are looking at a search marketing proposal and you are unsure of it’s legitimacy or cost, contact us and we will gladly review it for you at no charge.
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2 Responses to “$47 Per Lead… No Problem - NOT!”
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Anthony,
I understand that you don’t want to share a lot of details, but this is a bit inflammatory. When you say leads do you mean visits?
I think there are plenty of businesses that $47 per LEAD is well within margin. Under the scenario above you are saying PPC $8 per click so $47 lead is about 13% conversion — thats pretty good in some verticals.
@ Carlos - You make a very good point. I don’t have all of the figures they used for their PPC and yes there is a clear difference between a site visit and a true lead. I just know what I could produce lead for. The even bigger problem is that the site would NEVER convert near 13% and the proposal also quoted ROI based on closing 80% of their “leads” which I thought was very overstated.
My primary point was to make sure people are aware of what they are paying for, especially when “investing” nearly $10,000 per month in an online marketing campaign with little knowledge of the process. I am a huge advocate of consumers being educated in SEM so they know how to make the right decisions. That thought scares some SEM providers because it makes them accountable, but I believe it builds better client relationships.
Thanks for your input.