Let me ask you a question - what does it cost your business to generate one new business lead?
The answer to this question is critical to the success of your small business.
Your cost per lead generated enables you to assess the value of your marketing efforts and when you compare your cost per lead generated with your average profit margin per sale, you have an immediate ready reckoner as to whether your marketing effort is making or costing you money. In our experience, so many small businesses are distracted by the day-to-day operations they are often throwing money down the drain when it comes to their digital marketing tactics.
Cost Per Lead Generated Calculation
Calculating your cost per lead is relatively simple. Calculate your total costs of your marketing campaign which could include costs for advertisement spend, content creation costs, software costs, labour costs or any other promotional cost such as direct mail costs. Then, total the number of new business leads that are generated by the campaign which could include registering for your newsletter, liking your social media post or requesting a product brochure. Then simply divide the total costs by the total number of leads generated to obtain your cost per lead.
Figure 1: Cost Per Lead Generated Calculation - in this example, the total campaign costs were $5,000, which generated 50 new business leads. Therefore, the cost per lead generated was $5,000 divided by 50 = $100.00.
As cost per lead generated can vary dramatically by industry, there is no universal benchmark for this important metric. Typically, a strong cost per lead generated for your small business would be less than your average profit margin per sale and a poor cost per lead generated would be higher than your average profit margin per sale.
Reducing Your Cost Per Lead Generated
The Digital Marketing Crew offers cost-effective content marketing strategies to help your small business reduce its cost per lead generated. Our proven methods include:
Digital Content Development: We specialise in creating tailored digital content—whether it's blog posts, how-to guides, infographics, or videos— we resonate with your target audience to optimise lead generation. With our expertise, your content will drive organic traffic and convert visitors into valuable leads.
SEO-Optimized Content: Our strategic SEO ensures your content ranks high on Google, boosting visibility without costly ads. We have many clients that have experienced significant increases in traffic with our SEO expertise.
Amplify Social Media Reach: We expand your content's reach across platforms, engaging your audience and repurposing it into videos and infographics. Small businesses we've worked with have seen enhanced social media engagement and growth on very small budgets.
Build & Nurture Email Lists: We help you build strong email lists with irresistible offers including blogs and templates, coupled with value-packed newsletters that convert leads into loyal customers. Our small business clients report improved customer retention through our email strategies.
The Digital Marketing Crew can show you how content marketing can transform your cost per lead generated outcomes. Contact us today to start your journey toward affordable, effective digital marketing success!
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Adam Williams
S10580273
(Disclaimer: This content is for the sole purpose of teaching and learning at Edith Cowan University).
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