How To Make Your Number With Less Leads


It’s time to evaluate your lead sources. We suspect that you are wrestling with a dilemma that gives most CMOs fits.


“How can I get more sales qualified leads from my current lead sources?”


In a recent podcast with Greg Head, CMO at Infusionsoft, we discussed how modern marketing is killing lead sources.  It takes a few short months for a good lead source like email marketing to attract thousands of businesses that either abuse or wear out the channel.


Which means that you are constantly trying to squeeze more leads from tired channels.


There’s a better way.


We started with the questions – Is there a way to make the number with less leads? 


We believe you can.  In this post we’ll walk you through a process for optimizing your pricing and merchandising tactics to get more revenue from your current lead channels.


Let’s get started.


Cost Per Lead Vs. Cost as a Percentage of Revenue: Shifting the Mindset

The old way of evaluating a lead was looking at the straight lead cost. Instead, let’s shift to lead cost as a percentage of revenue to evaluate the lead.  While cost per lead is an easy measure, it can lead to using cheap but ineffective lead sources.


A percent of revenue approach allows you to fund a budget that invests in the best lead performance.

A percent of revenue approach allows you to fund a budget that invests in the best lead performance.


Let’s look at examples of both scenarios: 


Instead of setting a goal of finding those leads sources that cost less than $100 per lead, set a target to spend one percent of revenue:


Planned deal size: 


Planned lead gen budget 1% of revenue:

$100 per lead


Revenue generated less lead cost:



Now let’s increase the average deal size to $20,000:

Deal size:



Planned lead gen budget 1% of revenue:

$200 per lead


Revenue generated less lead cost:



We shifted cost per lead to percentage of revenue, resulting in increasing the price of a deal. And that directly increases the allowable spend for lead generation. And it also increases revenue.


We created our Price Conversion Optimization spreadsheet to help model different pricing and revenue scenarios.  Use this tool to also get a clear understanding of the cost of marketing and lead flow.  


Click here to download the spreadsheet.


Raising Prices Isn’t Your Only Option

One way to get more revenue from each lead is to increase the price of the sale.


In that scenario, we must understand the price the market will bear at specific price points. How much can we raise our prices and still maintain enough customers to increase our revenue? We have to understand what percentage of our customers will gladly pay more for the value they obtain. And we have to be clear on how many will walk away. 


Option two is more creative and involves bundling products into packages. This option provides higher value at a marginally higher price point.


For example, a software company sells three products at the same price:    


1.      word processing software                         $100 per unit

2.      presentation software                               $100 per unit

3.      database software                                     $100 per unit


This company’s hot product is word processing software. Their average sale is $100 for customers purchasing the word processing software only.


But what if you bundle the word processing software with the other two products. 


You’ll increase the price to $200 to get three times the value. Now you’ve doubled your average sale to $200 and increased your lead generation budget calculated as a percentage of revenue.


What’s the bottom line?

Chasing the latest lead source is a risky strategy.  Even if you are first to the next best thing, competition will erode your gains in weeks rather than years.


The smarter approach is to engineer high value product pricing that contributes more marketing budget each sale. This strategy creates a lead generation war chest for uncovering new lead sources or investing in organic growth.


As we approach the mid-year point, consider how smart pricing can insure you hit the number this year.


Aaron Bartels

Helps clients solve the most difficult challenges standing in the way of making their number.

He founded Sales Benchmark Index (SBI) with Greg Alexander and Mike Drapeau to help business to business (B2B) leaders make the number. The world’s most respected companies have put their trust in and hired SBI. SBI uses the benchmarking method to accelerate their rate of revenue growth. As an execution based firm, SBI drives field adoption and business results.

His clients describe him as a consultant who:


“Makes transformational impacts on me, my people and my business”


“Solves my most difficult problems that to date we have been unable to solve ourselves”


“Brings clarity to an environment of chaos”


“Has real world sales operations experience making him qualified to advise us on a variety of sales and marketing challenges”


“Is able to spot proven best practices that once implemented will make a material impact on my business”


“Constantly challenges status quo and compels us to act”


“Focuses on execution and driving change to stick in our environment”


“Makes good on his promises while enabling our business to realize his projected results”

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