Should You Buy Leads or Lists?
Periodically, business owners will ask me what I think of buying leads or lists from “lead generation companies.” This question is not really as straightforward as the business owners think it is. It really depends on a variety of factors specific to your business that can impact the number and quality of leads that are provided. These factors are rarely taken into consideration by the companies offering to “generate leads” or sell you a “list.”
If I am pressed for an answer, I usually just tell the person that I have rarely – if ever – heard anyone who is happy about the amount of new business they got from a list or lead generation company, and frequently the most positive thing I hear is that “the company was willing to give me more leads” or “they gave me a refund.” Nevertheless, business owners continue to seek out leads and lists that will help them build their businesses. If you’re thinking of buying leads (or lists), here are a few things to consider so you can (maybe) get something for your money:
1. How fresh is the data?
Some leads are fed to you as they are generated; others are compiled and sent daily, weekly, or even monthly. If the delivery of the data doesn’t match the sales cycle for your business, the leads may already be stale before you get them. You, at least, need to find out when the leads will be generated relative to when they will be delivered.
2. Does the lead generation company do anything to qualify the leads or introduce your company?
Just because someone tells you they are generating “warm leads” doesn’t mean they are truly warm. We know that buying decisions are based on “know, like, and trust” and will occur only at the moment of need. If the leads are generated close to the moment of need and you’re an unknown to the buyer, you’re already too late to the party
3. Does the method used do anything to reduce sales cycle time?
Let’s face it, the reason most companies think about buying lists or leads is to rapidly improve their revenue stream. That means the lead generation company has to be doing more than just generating a list, or the sales cycle will still be just as long as it is. And if the latter happens, are the “leads” you’re paying for really any better off than cold-calling?
Business owners I have spoken with that have used “lead generation” companies and “lists”, typically report disappointing results. That’s not all that surprising given that lead generation as a goal is a dying – if not already dead – growth strategy. Instead of buying leads or lists, I recommend developing a comprehensive marketing program that includes strategies for attracting prospects, creating value for them, and actively leading those prospects through the stages of customer development (see Cultivating Brand Advocates for more information) – and no one does that as well as your own team.
If you would like more information on developing a strategy to cultivate customers and brand advocates, contact us today.