How Much Does a GOOD Marketing Lead Really Cost?

Spoiler (but read on to see some other great info)


One question on the mind of many business owners and marketing professionals today is figuring out what a marketing lead really costs. There are some major differences in how marketing leads work in B2B (business-to-business) and B2C (business-to-consumer) worlds. But one thing that all businesses can have in common is that inbound marketing is much more cost-effective than out-bound marketing.

HubSpot did a study which revealed that those companies that predominantly used inbound marketing had a cost of 60% less per lead than those that predominantly used outbound marketing. Inbound marketing is using social media, blogs, and your website. Outbound marketing involves advertisements placed in magazines, newspapers, and even billboards, and direct mail. Essentially, inbound means attracting customers to you whereas outbound is about pushing your message out. More and more, inbound marketing is becoming increasingly effective.

To be fair, measuring marketing success using cost-per-lead as a metric isn’t necessarily any good on its own. You have to figure which of those leads are actually ready to buy, of course. The truth is, no matter what method of marketing that you use, your time has to be a factor. Inbound marketing tends to take a lot more time and direct involvement than outbound marketing, but its rewards are greater for several reasons.

Obviously, getting a ton of leads is good. But inbound marketing is about nurturing relationships and while on paper, yes, the cost is lower, it’s more of a time investment. The problem with outbound marketing is that you oftentimes won’t exactly know what may have brought a lead to you. Sometimes, they’ll tell you, of course, but more often than not, it’s harder to gauge effectiveness with outbound. Within inbound, you have a better idea of what’s working and what’s not simply through the amount of engagement or lack thereof.

That doesn’t mean outbound marketing doesn’t have its places, of course. The idea is to use the outbound marketing techniques to drive people to your website, blog, and social media pages. It’s what HubSpot calls “closed-loop marketing.” The idea in all marketing is to capture leads, and your outbound and inbound marketing must work together. That way, they aren’t working separately, which so often happens, and outbound marketing effectiveness is relatively unknown. That you most certainly don’t want.

The actual dollar value of a marketing lead is going to wildly differ not only based on your industry, but what sort of customers you are specifically seeking. What is true, however, is that besides the dollars put into building a website and maintaining advertising channels, it’s time and effort in nurturing those that are your target audience. If you’re focusing on those that you know will be your best possible leads, your cost-per-lead, of course, will rise. So it’s not about how much a lead costs, so much, as much as how much they inevitably become valuable to you.

There are ways to determine if a specific marketing campaign is effective, but if you are curious on an overall level try this very simple calculation to determine how much you spend per lead:


This of course, does not allow for the cost of time, including your time for hiring and training staff, overseeing various marketing activities, etc.

What qualifies as “Marketing / Advertising” can be a subject of debate. I would consider:

  1. ANY paid advertising costs offline and online
  2. Direct and indirect Marketing staff costs.
  3. Job signs, business cards
  4. Vehicle Printing
  5. Website costs
  6. etc…

Some costs you may wish to exclude are:

– Printing Costs (except if used for a trade-show or Marketing event)
– Memberships on Marketing-focused groups (may also be an exclusion – only you can decide)

In any case, the true cost of a marketing lead is how much time and effort you put into obtaining and nurturing each one that you get. The less expensive it is money-wise to obtain them, the better, but no matter how you get your leads, a lot of your time and energy must go into developing them into sales-ready leads and hopefully into loyal customers. 118group focuses on getting you as many inbound leads as possible so that you can spend less of your time looking for leads and putting it all towards nurturing them.

No matter how you boil it down. Leads are probably more than we want to pay. We recommend the use of a tracking tool – or CRM. 118Group has developed its own custom lightweight CRM tool that will allow you to keep in touch with that contact – for as long as they wish to be contacted. Given that a single contact may hire you to perform multiple projects throughout their lifetime, your costs per lead will drastically be reduced.

Interested in our CRM tool? Contact 118Group today to find out more.