Lead Sources: How Are Leads Generated - 6 New Client Sources
How do I get leads for my business? As a marketing agency in Houston, It’s a question we hear all the time. Every business, whether a large corporation or a small service business needs leads to help grow their business. After all, it’s the lifeblood of business. Why?
No leads = no chances to sell = no revenue
Identifying and understanding lead sources will help develop a long-term - and profitable - marketing strategy that can help your business see greener pastures (pun intended!)
Table Of Contents
What Is A Lead Source?
A lead source is how a prospect hears about your company and decides that they want to make contact. Depending on what stage of the marketing funnel this prospect is in, they could make contact with you to read an article, ask for more information, or because they’re ready to buy.
Regardless of the reason they reach out, this is worth its weight in gold for your business. Why? Because you’ve discovered someone who is interested in your company and has given you their contact information…a salesman's dream!
Even if your new “lead” isn’t ready to buy, that’s ok. It has given us the ability to market to them over time. This means that when they get in the market to buy, they know, like, and trust you and you’re infinitely more likely to make the sell.
So since leads are so important to growing the business, the question still stands….
How do we get more leads for my business?
6 Ways To Get New Clients
When it comes to marketing, getting more leads can be broken down into 6 separate buckets. These can and do vary in level of difficulty, the cost of time/manpower, and monetary cost. These can further be broken down between platform and people.
We’ll begin by breaking down the platform from most expensive to least expensive.
Paid Media (Platform)
Paid media is the quickest way to generate attention for your business, but it’s also the most costly. Paid media is defined as a way to promote content through social media, paid search results, video ads, traditional media, and other forms of multimedia.
When measuring the cost of paid media, typically the best way is in cost per thousand (know as CPM), or the amount it costs to reach 1,000 people. The reason this is the base measurement is due to the fact that digital is more trackable, but traditional media still struggles in this regard. So if you want to compare the cost of a billboard to the cost of a social media ad, the best way to get an apples-to-apples comparison is first by calculating how many people you reach.
There is no shortage of vehicles you can use when deciding to do paid media. Let’s go over some of the most popular and more traditional methods of using paid media.
Social Media Channels
Youtube, Facebook, Instagram, LinkedIn, Pinterest, Tiktok, Twitter. Unless you’ve been living under a rock for the last 15 years, social media has become a mainstay in the lives of people across the planet. These applications focus on community-based input, interaction, content-sharing, and collaboration.
So what are the business applications of social media?
ALL of your target market is on social media. That means it’s an AMAZING place to reach those who are most likely to want to use your product or service. Social media can be used for all stages of the marketing funnel, from cold content to get someone aware you exist, to video content that will teach that person HOW to buy from you.
The best part about social media is that feedback on effectiveness is in near real-time and every penny that is spent can be accounted for. This means it’s far easier to tweak your campaigns in a shorter time in order to see more effectiveness. Scale is much easier to achieve than vs. traditional media methods.
As for cost, it varies wildly based on how you have campaigns set up. However, it’s very possible to achieve a CPM as low as $1 for a targeted audience when you have your campaigns rocking and rolling. It makes it a very cost-effective medium for small businesses to get started or for big businesses to further build their brand.
Old faithful. Television has been a choice for advertisers for over 80 years. The first television ad was actually run in 1941 before a baseball game between the Brooklyn Dodgers and Philadelphia Phillies. It was direct. It was short. And it revolutionized the world. The cost was $9, or approximately $181 dollars by today’s standards.
Today, television is still a favorite option of Fortune 500 companies that target everybody. Think Coca-Cola, Pepsi, Doritos, and every other company that runs commercials during the super bowl. These are the advertisers that run on Broadcast TV, however, you don’t have to be a fortune 500 company to make TV work for you.
Television can get very granular in WHERE you can run your commercials, especially when you start to think about cable television. Most cable providers who offer advertising have it broken down into TV zones.
As an example, our office is located in Northwest Houston, Texas. If we were looking to only advertise our services to the 5 miles around us, it’s something we could easily achieve through Comcast Advertising. This still makes television a very viable option for smaller businesses to compete for attention.
The cost of television varies more than ever. Typically, if you talk to a sales executive, they’ll give you a myriad of options that include cable, OTT, and digital…it can get kind of confusing (this is why it’s awesome to have an agency with experience). The CPM for a tv ad also varies wildly by which market you’re in. The average CPM in Los Angeles comes in around $35 for broadcast TV. By comparison, the average CPM in Kansas City comes in at around $15
There are a lot more intricacies to television advertising. We can’t cover them all here so we’ll move to the next vehicle.
Radio is another form of traditional advertising that has a long history of being very successful. It got its start in 1922 and has hit the ground running ever since. Even though fewer people listen to the radio as more and more technology is created, it can still be an effective medium to spread awareness, get attention, and make product sales.
Similar to television, the cost of radio varies wildly between which market you’re in, if you choose to advertise on syndicated programming, or if you want to supplement your media flight with digital elements.
That being said, the average CPM in the USA for local radio stations comes out in the range of $14-20. The drawback is that the audience isn’t overly targeted and it’s hard to track effectiveness…although there are definitely ways such as vanity phone numbers and specific URLs.
Billboards are another traditional way to get attention to your service or product. This is a very passive way of advertising and there’s practically no targeting involved. The concept is simple. Put your message up on a board, make it simple so that they can read it in 3 seconds while driving by, and hope the message resonates with those driving by.
A billboard is typically measured in showings, which then translates into the cost per thousand views. Again, the price varies wildly depending on location and market, but a cost rule of thumb is about $2-$10 CPM.
Another interesting way you can use paid media is by out-of-home advertising. This consists of the non-traditional ways of advertising while out of the home. Examples include ads on the side of buses or bus stops, digital signage in a mall, an ad placed on the side of a building, or signs put up on a golf course.
Search engine ads, sometimes known as Google Ads, Bing Ads, or search engine marketing is an AWESOME way to get people to your website. It’s where you bid to pay money on specific keywords to have them show at the top of the search engine results page.
The beautiful part of doing this kind of advertising is that you can focus on intent-based keywords.
This means that if you have done the research or discovered your customer’s path to journey, you can avoid spending money on top of the funnel keywords and spend all of your budget on the middle or bottom of the funnel terms.
An illustration of this would be “Best Pool Builder In Houston” vs. “Pool Ideas”. The longer-tail keyword that is more specific is much likelier to capture customer intent.
How else are “Google Ads” different? They only charge you when someone actually clicks on your ad. This can cut down on mistakes due to poor copywriting and help you be aware of any shortcomings quicker. You can also discover in real time what’s working and what’s not.
So the million dollar question…how much does it cost? Adstage.io placed the average CPM for Google ads at $41.10 based on their data.
Influence marketing is a relatively new way for advertisers to make their mark with their prospects. The idea is that you find a social media influencer…someone with a big following on Instagram or YouTube, etc…and pay them to promote your product or service FOR you to THEIR audience. This can be in the form of sponsored posts or product placement in videos.
The cost for this varies depending on how new the influencer is, the size of their audience, brand name, etc. The general range for this is going to be between $100-$10,000 for a post.
Magazine advertising is another oldie, but a goodie. You can take an ad out at various placements and sizes. Do you want front cover, back cover, or next to an important article? Do you want a 2-page ad, a full-page ad, or even a quarter-page ad? They’re all options. The price is fully dependent on the readership that the publication has.
Newspapers, similarly to magazines, offer a boatload of placements and inserts in order to get your company seen. Sadly, newspaper readership has been on a consistent decline over the last 20 years as the internet has become more prominent in people’s lives. However, most newspapers supplement the physical newspaper with digital copies now.
Direct mail is a great way to get your message into the homes of those prospects you desire to reach. These can be segmented down into zip codes, neighborhoods, or layered with demographics. It’s predicted that open rates reach up to 90% for letters sent through the mail and that most people check their mail at least weekly. If you can craft an amazing offer, you’ll have a captive audience when they read it. You can get direct mail campaigns as low as $.30 cents per person.
Product placement is used in media all the time as branding. Does your favorite movie star drive a certain kind of car? Eat a certain brand of cereal? Or drink a certain beer? Most of these products were carefully thought out and paid for by the brand. After all, who wouldn’t want to use the same hair product as Jennifer Aniston or eat the same food as Chris Hemsworth? This type of advertising is best used by big brands.
Tradeshows are similar to billboards in that you’re renting space at a high-traffic event. However, trade shows have the added benefit of being highly targeted and you have the ability to actually speak with the people who see your booth. Tradeshows can be used to launch a new product, reveal exciting news, or just show an industry that you exist. The tradeshow setup can range from a banner on a table to a full-blown electronic booth with a video screen. I personally know many companies that develop the majority of their leads from a tradeshow.
The last vehicle we’ll discuss in paid media is podcast sponsorships. These are the new-age talk shows that are sweeping the internet. Some podcasts have raving fans that will listen every day. These podcast hosts become trusted influencers for their knowledge of the niche their show is about. A podcast sponsorship can be an excellent way to get your message in front of a very targeted audience. As an example, if you’re launching a new comic book, advertising on a comic book-themed podcast would be an excellent way to hit your target audience. As an added benefit, have the podcast host be your influencer with a paid ad.
Earned Media (Platform)
Earned media is any material written about you or your business that you haven’t paid for. This is the most coveted and most desirable category and is generally the end goal of all PR work. This is when news outlets, digital publishers, or any other media entities publish stories on you without any paid incentivization. Hello, awareness!
Let’s discuss some earned media options, although for full disclosure, some of these have the potential to blend with paid.
The mack-daddy of all earned media. PR is the practice of leveraging news and media channels to help syndicate content and promote your organization to the broader public. PR also includes the management of stakeholder, investor, and governmental relationships with the aim of supporting business goals and objectives. Public relations, when leveraged properly, will end up getting you TV interviews or segments, radio interviews, or articles.
Magazines and reporters are always looking for content. One of the best stories are human interest stories and achievement stories. If the value that you’ve provided to the world is valuable enough, these publications will naturally reach out to you to feature you in one of those stories. What does this mean for you…free exposure!
Podcasts are a very popular alternative to radio. As a matter of fact, it’s estimated that people who listen to podcasts listen for about 44 minutes per day. This means that being invited as a guest on a podcast can potentially hold a lot of weight.
Search Engine Optimization
SEO is one of the most coveted aspects of digital marketing. SEO is the art and science of building websites, webpages, blogs, and otherwise, that rank on organic searches. There are two major facets to SEO that will help you earn attention…on-page optimization and off-page optimization.
On-page optimizations consist of all actions that you take on your own site and your own pages that influence your ability to rank on various keywords and search terms.
Off-page optimizations consist of everything that happens outside of your own site that influences rank, with off-page SEO predominantly pertaining to backlinks and mentions.
Social media is an incredibly powerful tool to gain eyeballs and interaction. Specifically, social media groups are one of the top ways to have an earned, captive audience, based on the niched-down information that’s presented.
Have you ever been reading an article that you got a TON of value out of when a pop-up comes up on your screen asking for your email? Of course, you fill it in, because why not get more valuable information? All of a sudden, you’ve opted-in and now you have become owned media! However, that piece of content was so valuable that other websites start linking back to it to reference it. That content has now become earned attention…you could even be an influencer.
Without paying to promote it, you now have distribution via sharing.
Owned Media (Platform)
Owned media is a more long-term strategy for lead generation. Owned media refers to all the properties that you own and have complete control over. This includes websites, blogs, email marketing lists, social media channels, and podcast subscribers.
The idea is that once you pay to acquire the contact information of the person, they transition to being part of your “owned” list. It is suggested that 1-3% of the market is ready to buy at any given time which means that you consistently have to “farm” these other prospects until their buying cycle matures and they become “in the market”.
Let’s put it another way. You need to build a lake to fish in so you don’t have to be constantly leasing the space to fish in from a different paid lake, like Facebook, Youtube, or Google. This gets to be expensive, so why wouldn’t you pay to acquire the contact information so you can keep reaching them for pennies on the dollar of what it cost to acquire them in the first place?
Let’s discuss some of the ways in which you can develop your owned media.
A website is an integral part of a digital marketing strategy. You can use your website to sell your products or services and use it as a gateway to developing leads of people who would be interested in your company.
Some of the most popular ways to do this are by providing gated content in exchange for contact information. This includes case studies, ebooks, white papers, how-to guides, or any type of information that someone would find valuable and educational.
These types of content are hosted on the website but aren’t available until someone fills in a form with real contact information in which an automation is triggered to then send them the information, usually through email or text. This way, you can verify it’s real and legit contact.
Blogs are another way of delivering valuable information to people which can get them invested in your content. If you can teach someone that they can use to make more money or just impress their friends, they’ll be fans of yours. So how do you transition this to owned media? Ask for their email address to get updated every time you publish a new blog.
Email marketing is an amazing vehicle to reach your owned media. After all, now that you’ve already put all of that work into acquiring their contact information, shouldn’t you stay in contact with them?
Email marketing is an extremely powerful way to reach your customers. You have the ability to segment your audience to truly tailor messages to their experience. What else can you do? You can make a lot of money…
Let’s introduce you to the email-to-income ratio.
Your list size X conversion rate X product price = income
1,000 X 2% X $99 = $1,980
That would mean if you had a list of 1,000 people, every email that you sent with a hypothetical $99 product would make you $1,980 in revenue. Cha-Ching!
That’s the power of email marketing.
Social media is another version of owned media. This is by way of the audience, subscribers, or followers that you have on the channel. These people have begun following you because your content is entertaining, engaging, or educational. You can monetize this audience in the same way that you can for the email channel.
A podcast is another version of owned media, in that you “own” your loyal listeners. They tune in for your insights, your comedy, or various other reasons. There are several ways to monetize your podcast audience. You can sell sponsorships, product placement, commercials, or even just urge the listeners to buy a product that you own or through your affiliate links.
Outbound Media (People)
Outbound media is a people-intensive exercise where you send cold messages to prospects whom you haven’t yet developed a relationship with. This type of communication is an interruption at its finest and it’s likely to result in A LOT of rejection. However, that’s ok when you realize it’s all a numbers game.
As an example, if you know that you have to reach out to 100 people to get 5 of those people to agree to a meeting, then you can predict that if you need 10 meetings to get 1 sale, you’ll need to reach out to 200 people.
This is one of the most predictable forms of lead sourcing, but it’s labor intensive and you need a thick skin to be able to do it. But let’s dive into a few examples of outbound media.
Cold emailing is one way that you can reach a lot of people quickly, but sometimes it’s very hard to break through unless your message is compelling enough. The idea behind cold email is that you will buy a list of your targeted prospects, warm up an email account so it doesn’t go to SPAM, and then send solicitations to these prospects who have never heard of you.
So…does it work?
It depends on what your definition of “working” is. If you’re looking to get 1-2% of everyone who receives a cold email to reply, then yes…it spot on worked. If you’re looking for a 5-20% response rate…not a chance.
Check out this great article from a journalist who did an experiment for great tips here.
Social Media Outreach
Social media can be another tremendous way to reach your ideal audience and communicate with them directly. LinkedIn is very popular for this, although Facebook, Instagram, and even TikTok can be used very successfully to do so as well. If you have a compelling message, you can cut through the noise and really get people to respond.
There are several automation tools that, although against the terms of service of social platforms, can still be utilized very successfully to have the computer working for you instead of you sitting at a computer or by a phone all day sliding into those DMs.
Direct calling, or telemarketing, is a time-honored method of developing leads. Pick up a phone book, turn to your page of prospects, the smile-and-dial! Or the new age way of doing this is by buying a list of prospects through a person, a service, or even getting their contact information off of a search engine like Google.
The million dollar question…does it work?
Surprisingly well. When done right, you can expect about a 10% success rate in securing appointments. In a world of increasingly digitized communication, the classic phone call is a break from the ordinary.
SMS, also known as text message marketing, is a quick messaging way to get people to read your sales message. It’s so effective at getting opened that ManyChat suggests open rates are as high as 98%. That means when you’re using text marketing, people are seeing it!
But does it work?
In the same article referenced above by ManyChat, it suggests that click-through rates are as high as 19% on the links sent via text.
SMS can be an incredible way to get quick messages to a load of prospects and generate awareness.
Direct Messaging Apps
The last outbound media channel we’re going to discuss is Direct Messaging apps like WhatsApp. WhatsApp is a free-to-download messenger app for smartphones. WhatsApp uses the internet to send messages, images, audio, or video. The service is very similar to text messaging services, however, because WhatsApp uses the internet to send messages, the cost of using WhatsApp is significantly less than texting.
From a business perspective, you can use this to message anyone who has a WhatsApp account. You must have a list of numbers before you can start messaging (just like text messaging).
Is it effective?
The jury is still out on this one.
The partner's space of lead generation can be a very fruitful one. What this means is not necessarily taking on a partner for the business, but using like-minded people who are in similar fields or positions to leverage your company's expertise to grow together.
A business coalition is a group of businesses that have interconnected services but don’t necessarily do the same thing.
Let’s look at the restaurant industry as an example. You might have one company that sells tequila and you might have another company that sells Point Of Sales (POS) systems. Although these vendors are working in the same vertical, they are wildly different services. When they form a business coalition, they can then utilize the same lead generation efforts between them. If the tequila vendor gets into a Mexican restaurant, they can refer that restaurant over to the POS vendor and vice-versa.
Business coalitions can be set up in almost any industry. In marketing, it can be an SEO vendor and a PPC vendor. In real estate, it can be a realtor and a mortgage loan officer. In home repair, it could be a painter and a general contractor.
Really…any two companies that compliment each other.
Networking groups are the tried and true way to leverage the power of others. This is a relatively low-cost means of marketing by developing strategic business relationships in the form of sales contacts and business referrals. The people you can meet at these events can be worth their weight in gold.
In one network group we joined, we got a 68x ROI on our membership fee from just one client. In another, we’ve got a 47x ROI on our membership fees through earning various clients. These can pay off really well, but they’re time-intensive.
What are some types of networking groups?
Chamber of Commerce
Another fantastic way to leverage people is through various events and workshops. These are designed to teach someone an aspect of business while developing contact information. These can be public speaking events where YOU are presenting or public events where you just go to network and learn. Remember, at these, it’s all about meeting new people with which you can provide a value exchange…because your network is your net worth. Some examples of these networking events include:
Lunch and Learns
Affiliate marketing is a way of sourcing others by incentivizing their performance. This type of marketing is one in which a business rewards one or more affiliates for each visitor or customer brought in by the affiliate’s own marketing efforts. What this means, in a nutshell, is that it harnesses the power of others.
As an example, you might know someone who has an amazing YouTube channel with lots of followers and views for every video they put out. If you have a complimentary product…like an SEO software that could compliment a YouTuber who speaks about marketing…you can incentivize that person by providing them a link that is tracked which can then track sales. You would then provide them a portion of all sales that came in using that affiliate link.
Charity sponsorships are another fantastic way to get out in front of a community of people who are like-minded where you can develop relationships. There are several ways you can do this. The first is to participate in charity events like Golf Tournaments, Bowling Tournaments, or Casino Nights. By showing up to these events, you get to shake hands with people who support that charity and most likely donated to it.
The 2nd way to have charitable sponsorships work in your favor is by actually sponsoring the charity's events and asking for referrals from the charity. Charitable organizations are more than happy to try to provide value to their sponsors. Sometimes it’s as easy as asking the point of contact at the charity if they know of anyone looking for your service. You’ll be surprised how many leads you can develop just by asking.
This brings us to our 6th way to generate leads for your business…and that’s getting referrals from people. This is the most cost-effective way and, oftentimes, the most profitable way of generating leads, but it’s unpredictable and unscalable. These leads are the easiest to close because they don’t require a long-term warming-up process. That’s because these people are already warm since they know and trust the referrer.
So what is the best way to go about getting referrals? The answer is simple…ask for them!
Lead Source Best Practices
There are a crazy amount of places from which you can source leads. The magic to it is discovering which lead source works best for you, most efficiently, for the least investment to close the most deals. Which source will work best depends on the company, the salesperson, and the market. The absolute key to success is to use these sources to create a predictable and repeatable system in which you can scale your company.
Here are a few best practices to get you on the path to building the system.
Track Your Lead Sources
THIS IS IMPORTANT! If you can’t track it, it shouldn’t be done. After all, if you’re not tracking it, how do you know if it’s working? This is especially important if you’re spending money. As an example, don’t you want to know how much it costs you to get a lead? Business is math.
It’s crazy important that you know how many leads you get from where. This will help you hire the right people, invest the appropriate amount into marketing, and put a dollar amount to the work required to scale.
Use a CRM
A CRM, or Customer Relationship Management system, is a tracking system that keeps track of your customers' and prospects' contact information, identifies sales opportunities, records service issues, and tracks marketing initiatives. The best part of a CRM system is that you can record form fills, calls, emails, text messages, meetings, quotes, and contracts.
It goes without saying, if you’re trying to stay organized and track your leads, a CRM system should be the first piece of software you invest in.