What are leads? All about leads and lead generation

Briefly: Leads are potential customers who have shown interest in a product or service and left their contact information. Lead generation is a system of attracting such contacts through advertising, content, promotions, and other marketing channels. Without a stable flow of leads, a business cannot grow, even if the quality of services is high.

Let’s discuss the topic of leads, because without them, neither profit nor development is possible for a business.

Leads and their generation – what is it? What leads exist, how to work with different categories? What are the methods of lead generation? How to calculate the cost of each lead? Today on the APPOINTER blog we will talk about all this and more.

Content:

• In simple words about what ice is
• What is lead in advertising, marketing, sales?
• What are the types of leads: 2 basic classifications
• How to deal with different leads in business
• Lead generation is: concept, types, factors
• Stages: How lead generation works
• Basic and additional methods of lead generation
• The cost of leads: how to calculate it, what it depends on, how to reduce it
• Conclusion

In simple words about what ice is

Business does not work without an audience. Companies can attract it in various ways – commercials on TV, promotion on social networks, word of mouth, and many others. etc. But in order for a person to buy a service/goods, they need to be “warmed up”, turning them into a potential client, that is, a lead.

A lead (from the English “hint”, “initiative”, “trail”) is a user interested in a brand’s products. Confirmation of interest is targeted actions on his part – a request for a consultation with a manager, a completed questionnaire, etc. With the right approach, leads should transform into buyers (this is the first level of the sales funnel). We will talk about how to achieve this later in the article.

What is lead in advertising, marketing, sales?

The concept of lead contains 2 meanings.

Marketing leads are people who, under the influence of advertising, left a request for feedback or contact information for the company: email, phone number, call request, online chat message, newsletter subscription. If such users acquire the status of “interested customers”, they are transferred to sales managers.

A sales lead is about direct communication between a person and a business: correspondence on a social network or messenger, an application on the company’s official website, a letter to an e-mail – that is, the user communicates with a manager to place an order. But leads do not always come to sales from marketing. Sometimes sales managers themselves generate potential customers – most often by calling the contact base.

What are the types of leads: 2 basic classifications

Potential customers are divided into targeted and non-targeted ones based on their level of interest in the product/service. Targeted leads are those that fit the company’s criteria for purchase > can move through the sales funnel until the deal is made. Non-targeted leads are not interested in buying, have left their details by accident, or are looking for a product that this brand does not have. But the potential still exists, because they may be interested in the company’s offer.

Leads are also divided by “temperature” (readiness to buy) into:

• “cold” leads. These are leads who have just learned about the brand and its offering. They are not planning to make a purchase, but want to know more;
• “warm”. The client has interest, as well as reasons to refrain from buying for now. Many warm leads are among subscribers on social networks, and they are also likely to already receive the brand’s promotional mailing;
• “Hot” leads: Leads who are about to buy/have already started the buying process by making a prepayment.

Examples of leads by temperature. A brand sells vacuum cleaners. A “cold” customer saw an ad and went to the website, a “warm” customer studied the models and thinks which one suits him best, a “hot” customer found his vacuum cleaner and makes a deal.

How to deal with different leads in business

Regardless of the type, save all leads: sort by category, assign to different employees, keep track of completed work. Track the movement of potential customers along the sales funnel – overall dynamics and each lead separately. This is important for increasing conversion, for creating + improving the technique of working with leads of different temperatures. A CRM system helps a lot in all this: it stores and structures data, automates operations and saves the time of company employees, protecting them from errors.

Assign cold and warm leads to internet marketers and sales managers. The main task is to “warm up”, that is, provide information, answer questions, resolve doubts, and get them as interested as possible. Newsletter, information about promotions and advantageous offers to help. The main thing is not to scare away these types of leads. Avoid being intrusive, but periodically appear on the horizon of potential customers, watch how they interact with the product/service.

Hot ice is sent directly to the sales department. You can’t let their interest fade even a little. It’s important to maintain correspondence with such customers, stay in touch, don’t keep them waiting, help them place an order, and remind them of its status.

Lead generation is: concept, types, factors

Collecting leads is called lead generation. The process includes determining a person’s interest in the product + encouraging them to make a purchase. Globally, lead generation forms a loyal brand audience, which regularly increases it. This includes working with communication channels, creating plans, analyzing the effectiveness of each step. It all starts with studying the potential audience and creating a customer portrait. From this data, a direct or indirect lead generation scheme is derived.

Direct lead generation is when a person has an active interest and request for a product. Example: a user searches the Internet for a refrigerator with the query “where to buy a refrigerator in Kyiv” > Google displays a list of sites. A person leaves his/her data on the pages he/she liked for feedback with the manager to discuss availability, model characteristics, and delivery. Example of indirect lead generation: to attract the audience to buy a new smartphone model, the brand presents the product with the participation of famous bloggers: they actively talk about the new smartphone on their social networks. If the blogger and his/her audience are chosen correctly, potential customers will be interested in the new product. That is, with indirect lead generation, the seller’s task is to create demand for the product/service.

Both types of lead generation are influenced by factors that are important to consider when choosing a strategy. These include the composition and actions of competitors, the specifics of the product/service, the level of online demand for the company’s offer, the number of stages during the deal, and different purchase channels.

Generating quality leads is necessary:

• 1. Internet business. It is difficult to stimulate a cold audience to buy, while it is easier to communicate with leads and guide them through the sales funnel.
• 2. Offline companies. In particular, the restaurant business, where it is useful to address SMS newsletters about promotional offers to potential customers.
• 3. To company employees whose earnings directly depend on the volume of contact data collected.

Stages: How lead generation works

Audience engagement is achieved in 5 main stages.

Stage 1: Tell the user about the product. It is important to give the person as much information as possible so that they form an opinion > become interested.

Stage 2: Stimulate interest. Various types of advertising are used to increase interest. If the stage is successful, the lead should visit the company’s website/offline store.

Stage 3: Compare competitive analogues of the product. Any product has competitors. A potential customer of the brand will compare them. Successful lead generation at the third stage is to emphasize the advantages of a specific offer (for example, price or free/convenient delivery).

Stage 4: Show interest. The customer must make a choice in favor of the brand’s product.

Stage 5: Take a targeted action. The lead leaves a request for the product on the company’s website.

Basic and additional methods of lead generation

Among the main ways to generate leads online are chatbots, lead forms, and lead magnets.

Using a chatbot, company employees provide online advice to visitors to the official website, messengers, and social networks. There is a special window where managers answer users’ questions. The chatbot helps the employee collect important data about a potential client and lead them to a purchase.

Lead forms are found on websites and some social networks (like FB). They offer, for example, a calculation of the cost of a product provided that the user leaves their full name and contact information. Such forms are called widgets, which are installed on the company’s website as applications. In addition to calculating the price, feedback forms are used: a person writes a phone number and sends a request to be called back later.

A lead magnet is an option for exchanging contact details/completed questionnaire for a bonus: a trial subscription, free manager consultation, a discount on a product, a gift, etc.

Additionally, email newsletters, contextual and targeted advertising, and SEO promotion help in lead generation. Using email newsletters, you can collect various data about the user, personalize new newsletters for him, encourage people to visit the company’s social networks and become a subscriber (special transition buttons are added to the letters). In order for contextual advertising to contribute to the generation of high-quality leads, ads are created in Google Ads (text, graphics, video and audio advertising, banners) and adjusted to different segments of the target audience so that people receive a solution to their problem. As for the target, in the FB account there is an opportunity to create advertising for lead generation: the client completes a short questionnaire, leaves information about himself. The advantage of well-established SEO is that it brings warm leads. However, the tool does not give results immediately, but in the future.

The cost of leads: how to calculate it, what it depends on, how to reduce it

It is important that each lead pays for the money spent and brings in revenue. For this purpose, calculations are made. Cost Per Lead/CPL is the price a business pays to attract a potential client. The indicator provides an understanding of how effective marketing activities are, which ones are worth continuing, and which ones are not.

Factors that influence Cost Per Lead are: service/product prices, competition in the niche, geodata. The indicator is calculated using the following formula: CPL = cost per lead acquisition*/number of leads acquired.

*costs are charged for a certain period.

Example of CPL calculation:

• monthly expenses for the brand’s advertising campaign – UAH 55,000;
• the number of applications from users during this period is 60 applications;
• The cost of one lead is 55,000/60 = 917 UAH.

To ecologically reduce the cost of leads, the company should work on the content of advertising, look for more effective channels for attracting customers, optimize the sales funnel, review the settings of the advertising cabinet, edit the sales offer, and try to increase conversion by optimizing the site.

Conclusion

Leads and lead generation work to increase a loyal audience and business profitability. Collecting key information about potential customers in all available ways allows you to understand what marketing strategies to apply in promoting the company’s product. By competently processing leads, avoiding intrusiveness, but remaining in the field of view of customers, the brand gets the opportunity to move forward, develop and compete at the proper level.

FAQ

What is ice in simple words?

A lead is a potential customer who has shown interest in your product or service: left a contact, filled out a form, wrote a direct message, called. A lead has not yet bought, but has already taken a step towards it.

What are the types of leads?

Leads are divided by temperature: cold (don’t know you, first contact), warm (have already shown interest – came on a recommendation or subscribed), hot (ready to subscribe/buy right now). Each type requires different communication.

How to generate leads for a beauty salon?

The most effective channels: targeted advertising on Instagram/Facebook, Google advertising for the query “manicure [city]”, SEO (organic search), recommendations from existing clients, partnerships with related businesses, contests on social networks.

How not to lose leads that have already arrived?

Respond to inquiries within 15–30 minutes — after an hour, the chance of conversion drops by half. Keep contacts of everyone who contacted you. Warm up leads who didn’t sign up right away with regular content and promotions.

How does Appointer help you avoid losing leads?

Online registration in Appointer allows leads to register independently at any time — without waiting for an administrator’s response. All applications are recorded in the system, and none will be lost, even at night or on weekends.