Have Your Considered Pay Per Lead Telemarketing?Pay per lead telemarketing is becoming a popular request from companies rather than traditional lead generation.
A quick search on Google will show that there are hundreds of agencies in the UK to choose from.
As the recession causes more companies to rethink their sales and marketing strategy, so to are companies looking for more guarantees with their marketing efforts.
More businesses are asking about payment on results (or commission based work) or another route that may be less risky than paying for it on a day by day basis with the risk of nothing to show.
Pay per lead telemarketing is something that has grown as the recession as deepened, a kind of response to the call by businesses for results based telemarketing. This is popular with appointment setting, a flat cost per appointment booked.
Traditionally telemarketing is or was carried out on a monthly fee being paid to the telemarketing company for an agreed number of days (or hours) being spent calling up prospective customers.
The problem however is the risk, the risk to the client in paying out money but not receiving the sales leads needed to cover the monthly costs.
More and more UK companies are asking for pay per lead telemarketing over the monthly fee.
Traditionally this is based on either a monthly contract (which is now quite unusual) or a day rate for telemarketing.
Pay per lead is based on the charge per lead provided. No additional fees except on qualified sales leads that they pass over to their clients.
This is a low risk form of lead generation, however, there is still the risk of the leads not converting into business. We have put together some lead generation tips, that may be helpful.
Two of the key benefits from telemarketing are; market intelligence gained through human interaction with prospects and data enrichment.
Data enrichment includes capturing decision maker contact details, account profiling insight such as competitor information, spend on or usage of your services, and pain points or strategic objectives of the business.
The value of this information is that it can drive greater return from other marketing activity.
Additionally, it can help shape Director-level decision making on areas such as pricing, product development and market positioning.
But here lies the problem for the lead generation agency.
If when initially engaging with the prospect, the telemarketer qualifies that there is not an opportunity in the short-medium term, where is the incentive to continue with the conversation?
The pay-per-lead model prioritises moving quickly on to the next call, yet the risk is that by doing so, many of your best prospects are qualified out at an early stage, rather than nurtured and developed over time.
Preparation and planning are essential to telemarketing success. Good business data and lead nurturing are essential to telemarketing.
If a telemarketing agency generates 10 leads for their client (and charge £250 per lead) this means that the client spends £2500 on 10 qualified leads.
However if none of the leads convert into business, then that is £2500 that has been spend without a return.
The main problem is the issue it causes to the telemarketing company. They are taking the risk in employing staff and investing man hours into a clients campaign.
If the product or service of the client is unpopular or super competitive (such as solar panel leads or double glazing) then there is all the risk on the telemarketing company.
As long as prospects are qualified and meet the right criteria, then this is a good option.
Not all sales leads are going to turn into business, sales always has and always will be a numbers game, pay per lead telemarketing is not going to change this.
Sales leads that a telemarketing agency can pass over should (hopefully) be well qualified and have a good conversion ratio, so returns should be good.
There is less risk for the client, as they are paying for qualified leads, which is even less risk than PPC advertising.
Where the client pays the telemarketing agency on a per-lead basis, naturally the focus of the telemarketing agency is the volume of lead generated.
There will be times when the prospect is open to having an exploratory meeting, yet in truth, the lead is not sufficiently qualified to warrant a salesperson visiting.
From the agency’s perspective, it is a genuine lead. The prospect has agreed to a sales appointment, the meeting invite is sent, and the appointment progresses.
But were they just curious or genuinely interested?
The financial incentive of pay-per-lead, doesn’t and can’t foster the genuine two-way relationship between agency and client where long-term ROI is the shared objective.
Some leads enquire and then use a relative to do the work. Some leads enquire and then change their mind.
Telemarketing can be part of the overall lead generation strategies for startups.
Telemarketing prices do vary from agency to agency, and this is no different with pay per lead telemarketing.
Normally agencies would look at average order value to determine how much a lead is worth, and then set the price accordingly. It could be £25 a lead, or £500 a lead depending on the product or service the lead is generated for.
The cost per lead could be agreed between the telemarketing company and the client, so that it is affordable for the client and less risky for the client. This could be based on the sale value of the lead.
If (for example) the client was an accountant and the sales lead is £500, paying £200 could be a good fee. Bearing in mind that when an accountant takes on a new client, that client could be with them for 5-10 years.
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