Buying B2B Outbound Leads: Why Your Leads Cost 125% More Than You Think

- 2 minutes read

Cost of LeadsSourcing new outbound leads is a never-ending endeavor for sales and marketing. Prophesies of cold calling being dead have not come true if only for the simple reason that prospecting through all channels must be on the table to fuel the engine of sales growth.

Companies typically get leads from four main types of leads:

  • Internally-generated leads: Referrals, word of mouth, events, etc.
  • Intelligence-based leads: Newsfeeds, industry alerts, personnel changes, etc. InsideView is one good example of this, but we believe LinkedIn also fits this mold (the evolution of this is exciting)
  • Special or vertical lists: Trade associations, commerce groups, organizations operating with a geographic charter
  • Compiled lists: The likes of D&B and InfoGroup, including credit files

But as any sales or marketing manager knows, simply dumping more records on a sales rep is a thing of the past. Lead nurturing and scoring are the norm, wherein prospects are nurtured until they raise their hands as hot leads, and are then forwarded to sales. In addition, predictive modeling that identifies the most likely prospects based on the “ideal customer” profile must be part of the mix.

It’s clear that the prospects at the top of the funnel – the ones you might pay for – are not sales ready. Further criteria and filters must be added which reduce the number of truly viable sales-worthy leads. Let’s take a look at how the leads get whittled down in the pipeline – we call this the “prospect waterfall”:

Sales Funnel FOI

The net result is, if you are paying for leads and then “throwing away” 55% of the records (typical from our experience), your true list cost goes up by almost 125%. Add the additional processing cost, sales rep fatigue and opportunity costs, and you can see why your prospecting results and ROI are not what you had hoped for!

For best ROI, pay only for what you use.

If your current processes throw away prospect records that you paid for before the sales reps see them, it is time to reassess your lead generation program. Or as one of our clients put it, “stop buying leads until you figure it out.”