Buying leads is something many business owners have contemplated at some point. Those that actually did buy split into two camps: while some quite enjoyed the experience, others wouldn't wish it upon their worst enemy.
Pros and Cons of Buying Leads for Your Company
Both sides have their reasons.
Let’s try and take an impartial look at the pros and cons of buying leads for your company.
Why should you buy leads?
It can save you time and money. Compared with setting up multiple inbound marketing campaigns, gathering data, sorting out prospects and reaching out to them, buying leads is almost instant. And cheap. When it’s baby steps for your business, generating your own leads will cost you much more (especially when you haven’t yet fine tuned your sales funnel). But here, you just specify desired criteria (like industry, seniority or job role) to your lead provider and get a list. It’s that easy.
You can get some high quality leads (just make sure they’re exclusive). This is very important – you don’t want to choose a provider that will share your leads with another company. Non-exclusive leads are useless (especially when you’re not the first one who bought them). Double- or triple-check that point before you engage with a lead provider. If they do provide exclusive leads, chances are you’ll get a list of qualified prospects tailored to your criteria.
It’s easy to calculate ROI. When you purchase leads, it makes ROI-related number crunching simple. You buy a lead list and see how many of those leads convert. This could make perfect sense for marketers who otherwise struggle to calculate ROI.
Verdict: if you have a tight marketing budget and need leads to a) boost your budding business or b) stay afloat, then buying a leads list might be a way out.
But what are the reasons against buying leads? And why would it be better to gather and qualify your own leads?
Information might be outdated. Some lead providers compile lists and then let them go stale for years before you buy them. You know what that means: contact details could have changed, and if we’re talking about B2B, some companies might have gone out of business. So the chances that the lead provider will bring you the companies you were targeting are pretty slim.
You risk getting blacklisted (or even persecuted). Another issue here is that the information you get might be unvetted. You must be aware of where your leads come from and the processes used to qualify them – that means the lead provider should have transparent policies. If you buy untrustworthy or unqualified leads and start sending them unwanted emails, they can let their email provider know these messages are spam. It can get worse than just being blacklisted: sending cold email while not following the rules of the CAN-SPAM Act might cost you $42,530 per email.
You undermine your relationship with the lead. Buying leads can’t buy you authority. Barraging your lead list with cold emails out of the blue means you’re cutting corners and skipping the entire lead nurturing phase (here I mean all the inbound marketing efforts like SEO, landing pages or online advertising) that would naturally make leads want to contact you. By choosing such straightforward outbound tactics you can damage your relationship with prospective customers even before you start building it.
Verdict: Alternatively, you may consider outsourcing lead generation, and this means that you don’t need to hire a lead generation team, which may entail filling multiple roles.
Tips for Hiring a Lead Generation Company
You have some money to spare and want to see for yourself if outsourcing to a lead gen company works. I say go ahead! But take a look at these tips before you set off.
Do your research. Make sure the company you want to outsource to isn’t one of those here-today-gone-tomorrow ones. Look for businesses that have been in business for at least 5 years and have predominantly positive reviews.
Choose a company that will charge you on a monthly basis. Of course you can pay a few hundred dollars and get a one-time list of 10,000 contacts (only to find out that 50% are no longer good). Or, you could get a month at a lead provider and pay about the same. (That plan usually guarantees you a month of unlimited leads.) A trustworthy company will update their lists regularly to ensure that their contacts stay relevant and accurate. And you can constantly tailor your criteria to target the best leads.
Ask for a trial. Make sure the company offers a trial period of providing a certain number of verified leads within an agreed period of time. They should also have a lead return policy. Read it carefully.
After the trial period is over, ask yourself the following questions:
How many leads did you get?
How many of the leads converted into customers?
How much in total did you pay?
Did you profit off of the leads, if at all? How much?
Assessing the leads will help you understand if buying lists is worth the investment or you should try something else.
If you’re interested in leadgen you may find this report on AI in lead generation interesting.