One of the biggest challenges for B2B marketers is getting the right kind of leads that actually want to make a purchase. You have the option to pay for either clicks or impressions, and although both choices are valuable, neither choice ensures a large number of genuinely interested leads that are ready to make a purchase.
Thankfully, pay per lead, also known as PPL, is specifically intended for acquiring such leads.
What Is Pay Per Lead Advertising?
Pay per lead advertising is a type of cost-per-acquisition advertising, which is different from pay per click (PPC) or pay per impression models. In pay per lead advertising, instead of paying for clicks or impressions on a web or landing page, you are paying for the presence of a real person who has shown genuine interest in your product or service.
You are being charged for the obtained qualified lead through a form submission, sale, subscription, or any other conversion as determined by you.
How Does Pay Per Lead Work?
The structure of a pay per lead campaign is similar to that of a pay per click campaign, except you, as the client, collaborate with a referral partner who is the advertiser of the campaign. In this arrangement, the referral partner receives payment for generating a specific number of leads for you every month.
Before starting your campaign, you have the opportunity to not only receive a specific amount of leads but also define the criteria for what constitutes a “qualified” lead. To accomplish this, it is essential to examine your CRM or sales data and recognize any prevailing patterns among your most prosperous clients.
It may be of interest to you to know, for instance:
- Minimum annual revenue (of your successful clients)
- Total number of employees or locations
- Industries you’re successful in
- Number of users (which may be important if you’re in a SaaS-model business)
- How much you’re willing to pay for a lead (which means you’ll need to know what percentage of your leads turn into opportunities, and what percentage of your opportunities turn into new clients).
When Should I Think About Pay Per Lead?
If you are finding it difficult to generate sales-ready leads with your paid search campaigns, you should consider trying pay per lead advertising. Pay per lead works well for industries that are challenging to target, especially in the B2B market. Certain verticals are especially suitable for pay per lead advertising.
- CRM, IT or SaaS companies
- Marketing Agencies
- Professional Services and Consulting
- Business Banking, Credit Union, and Financial Services
- Industrial and Manufacturing
- Wholesale
- Legal Services
- Insurance
- Real Estate
- Publishing
- Education
- Medical and Health Services
Pay per lead is a viable option for B2B or B2C marketers as long as they have a clear understanding of the specific types of leads they desire.
How does PPC work?
PPC advertising functions through enabling advertisers to place bids on particular keywords or phrases for which they desire their ads to be displayed in search engine results. If a user searches for any of those keywords or phrases, the ad of the advertiser will be shown within the top results. The advertiser is subsequently invoiced for a fee every time a user clicks on their ad.
Advertisers generate campaigns aimed at particular demographics, interests, locations, and more. They establish a highest bid for the keywords they want to focus on.
The complex algorithm used by the search engine considers factors including the order and selection of ads to be shown.
- Advertiser’s bid amount
- Relevance of the ad to the keyword
- Quality of the ad
- PPC strategy and campaign planning
- Top PPC platforms
- How to learn PPC
Social media platforms, such as Facebook and Instagram, can also be utilized for advertising purposes.
What’s the difference between PPC, SEM and SEO?
While these three terms are often used interchangeably, it is important to note that there is a distinction between PPC, SEM (search engine marketing), and SEO (search engine optimization).
SEM is a comprehensive term that includes PPC but is not exclusive to it. It pertains to efforts aimed at enhancing website discoverability via search engines. SEM comprises both paid (PPC) and unpaid (SEO) methods to drive organic traffic.
PPC is an internet advertising strategy that collaborates with search engines alongside other platforms like YouTube for video ads and Instagram/Facebook for image ads.
The process of search engine optimization (SEO) involves optimizing a website’s content and structure to enhance its visibility to search engines. This involves researching and utilizing appropriate keywords, optimizing meta data, producing high-quality content, and acquiring backlinks from other websites. The objective of SEO is to enhance a website’s non-paid search engine rankings and attract organic search traffic.
Why is PPC important?
PPC should be perceived as a valuable asset rather than a cost for marketing purposes.
In 2022, for every $1 spent, PPC generated an average of $2, with a CPC of $1.16. Despite the continued popularity of advertising on social media, search garnered 40% of the total ad spend in 2020, with Google receiving 73% of that portion.
PPC provides various advantages that are not available in SEO or social media, which include:
- Quick results: PPC advertising can drive traffic to a website almost immediately, whereas SEO can take time to show results. Platforms usually approve ads the same day, providing maximum exposure almost immediately. This could be a text ad via Google search, an image ad through Instagram, or even a video featured on YouTube. Using multiple platforms in different formats can increase your brand’s visibility.
- Reach your targeted audience: PPC advertising allows marketers to target specific demographics, interests, and location, which helps to reach the right audience. You can even target individuals based on their behaviors and interests; social media sites like Facebook can help you get your ad to the group that’s likely to convert into a sale.
- Measurable: PPC advertising provides measurable results. It allows marketers to track conversions, return on investment (ROI), and other key performance indicators (KPIs).
- Cost-effective: PPC advertising can be more cost-effective than traditional advertising methods, such as television or print ads, since marketers only pay when a user clicks on their ad, and they can set a budget for their campaign.
- Branding: PPC advertising can help to increase brand awareness. Even if users don’t click on the ad, they may still see it and remember the brand.
- Complementing SEO: PPC can be used to supplement SEO efforts. While SEO focuses on increasing organic traffic, PPC can be used to drive immediate traffic to a website while SEO efforts are still ongoing.
- Track your goals: Tools such as Google Analytics can help you track your goals. See how your ads are performing in real-time, and decide what needs to get done to reach your goals more efficiently.
- Reputation management: PPC can be used to bid on keywords matching a reputation event and directed to a landing page directly addressing the matter so you can control the narrative, instantly and professionally.
PPC advertising is a cost-effective and measurable method that enables reaching a specific audience, generating leads and sales, and ultimately enhancing brand awareness.
What is important for PPC strategy and campaign planning?
When strategizing a PPC campaign, there are a few crucial steps that need to be followed:
- Define your target audience: Identify the demographics of the people you want to reach with your ads, including their age, gender, location, interests, and more.
- Set clear goals: Determine what you want to achieve with your PPC campaign, such as increasing website traffic, driving online sales, or generating leads.
- Research keywords: Use keyword research tools to identify the terms and phrases your target audience is searching for, and include them in your ad copy and website content.
- Create compelling ad copy: Write attention-grabbing headlines and descriptions for your ads that will entice people to click through to your website.
- Choose the right ad platforms: Decide which platforms you want to advertise on, such as Google Ads, Microsoft Advertising, Meta Ads (for Facebook and Instagram), and so on.
- Monitor and optimize your campaign: Track the performance of your ads and make adjustments as needed to optimize your campaign and achieve your goals.
- Test different ad formats and targeting options: Try different ad formats (like text, image and video) and experiment with different targeting options to see what works best for your campaign.
- Set a budget: Decide how much you want to spend on your campaign and make sure you stick to your budget.
