The Quantity & Quality Dilemma and the ROI of Lead Generation

ROI of Lead Generation


This is not the first time we are discussing online lead generation here. In a previous post, we talked about some of the major challenges of online lead generation. However, we only touched the issues on the surface and more in-depth analysis of these challenges is required. In order to find a feasible solution, we must identify the reasons and factors behind these challenges. And one of such challenges is the quantity and quality dilemma.


Describing the dilemma in the simplest manner, let us take an example of an online business that gets 100 leads per day i.e. a pretty impressive number. However, only 20 percent of the leads convert into sales. This means all the resources and efforts invested on those 80 leads returned nothing but waste of time and money. Similarly, take an example of a website that has an astounding 100 percent conversion rate, which means all the leads convert into sales. Yet, the average number of leads per day is not more than 30. Comparing both the websites, your sales are equal in both cases.


Here some might argue that the latter fares better in comparison as it offers a higher ROI due to comparatively lower waste of money and resources. But let’s not forget that we are speaking of a hypothetical situation that is kind of ideal, but there may be a website that has 100 percent conversion rate but less around 5 to 10 leads only. This is how we explain the dilemma of quantity versus quality of online leads.


The key is to strike the right balance of quality as well as quantity. But before we share tips about maintaining the balance and optimizing your focus, we need to understand a few important concepts here.


What Qualifies as ‘Quality’?


Any lead that has the potential of turning your prospects into your customers is a quality lead. For better understanding, let us explain it in the form of a process. Disregarding the quantity for the moment, every marketing campaign or activity is likely to bring leads. However, the quality depends on a few factors that mainly include response rate and qualification.


The life cycle of a lead


Response rate is the rate at which your prospects respond to a certain marketing activity such as a PPC or social media campaign. This response is usually in the form of an inquiry about the product/service. When a certain prospect contacts you for inquiry purposes, it becomes a Marketing Qualified Lead MQL. This is where most of the prospect’s queries and concerns are answered and they make the decision about making a purchase. If they decide to entrust you, the Marketing Qualified Lead becomes a Sales Qualified Leads.SQL the transaction is handled by the sales person/department, the purchase is made and the lead converts into a qualified lead.


A lead that has smaller response time and turns into sales in the least possible time is considered a very high quality lead.


Quantity Counts As Well


One of the most useless online lead generating advices you can get is to focus only on the quality of leads. This unfortunately, is a very short term solution to this dilemma. In the long run, quantity is almost as important. If you wish to grow and evolve as a business, you will have to focus on increasing the number of leads. This is basically the whole purpose of business expansion. Businesses expand their outreach to escalate the size of the market they cater to and therefore increase the number of their leads. For this purpose, they may increase the number of marketing channels they employ. In any way, the increasing quantity may not hinder the quality of leads. That is exactly from where the major problem arises.


The Right Balance


As mentioned above, the right balance is extremely important for the growth of the company. For startups, it is best to focus your efforts to improve the quality of the leads. With a small budget, you may not be able to invest in too many online lead generating channels. So, streamline your choices to those that deliver highest quality leads. This will save the amount of money, time and other resources required to mange marketing and sales channel. At the same time, try to optimize your campaign so that you can get the maximum yield from these channels. Yet, every channel has a limit and there will come a time where each and every channel will reach its threshold. This is when you might have to divide your focus between quantity and quality.


By this time, your business is likely to be in a position where you can expand your marketing budget to hire more resources and utilize more channels. Remember, hiring more resources i.e. a small scale sales team, is important at this stage because losing your focus on quality for the sake of quantity is critical even at this level.


The Basic Balance Guide


Now that you know when you must go for quantity and instead of quality and vice versa, let’s take a look at what you can actually do to improve online lead generation through quality and the quantity.


Social Media or PPC, keep your strategies strongly targeted

Don’t underestimate the power of strong SEM and SEO

Create SEO optimized targeted landing/squeeze pages

Create unique content that helps you stand-out

Promise value through special bonuses and offers

Investigate and explore multiple channels

Increase interaction to impress your social media prospects

Track your leads and abandon the sources that do not work

Promote but don’t force participation through lengthy forms

Ask for minimum personal information and high-light a no spam policy

Use a strong call-to-action that reflects your credibility and quality


Finally, if you want the best of both worlds, you must align your marketing and sales activities; make sure both the departments share integral information regarding the leads, especially those that convert from MQL to SQL. With a systematic approach, you will be able to improve the quality, quantity and ultimately the ROI of your online leads generation without stretching your budget.

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2 Responses to The Quantity & Quality Dilemma and the ROI of Lead Generation

  1. Reginald says:

    Hey Annetta,

    I think this is a wonderful write up. Thanks for sharing this!

    Personally, I don’t really care about ROI until recently. I felt that I need to consider the ROI before proceeding with any actions. And obviously, your write up helps me quite a bit as well.

    As usual, thank you Annetta.

  2. @ Reginald:

    As an Internet marketer, you will definitely invest your hard-earned money to your business. Knowing how much hard work you put to earn that investment means calculating the ROI both idealistically and realistically. Of course, we all want a serious ROI, right? 🙂 It’s cool that you have realized being cautious before investing into something. 😀 Thanks for the comment Reginald.

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