Lead generation comes of age

Lead generation is set to continue on an upwards growth trajectory over the coming months and years. In a recent e-consultancy report, 65% of all respondents said their use of online lead generation had increased in the last year and 88% said it will become more important to their organisation over the next 12 months. These stats are pretty impressive and it’s not just down to the fact that this growth is starting from a small base. 10% of all respondents stated that they already spend more than £1m per year on lead generation.

All of this is great news for the industry but as more and more advertisers look to find ways to harness the power of lead generation, there are still a lot of misconceptions about the industry. Significantly, the majority of marketers still don’t know the difference between lead generation and data capture and this fundamental misunderstanding is causing many would-be lead buyers to either get their lead generation campaigns wrong or steer clear of lead generation all together.

Although a lead is usually delivered to the advertiser as a piece of data, it is so much more than just a name and contact number. It is a piece of information about a consumer who has stated they are interested in a product or service and given their express consent to be contacted about that product or service – i.e. a lead is a very engaged consumer. Furthermore, a lead should contain a consumer’s full contact details as well as a suite of information about the product or service they are interested in enabling the advertiser to filter down to their target market.

Paradoxically, one of lead generations biggest strengths – the ease in which performance can be measured – also seems to be adding to the confusion. According to the same e-consultancy report 39% of respondents cite “lead quality” as the major factor that determines the success of an online lead generation campaign compared to 35% that singled out campaign ROI.

Lead buyers often talk about “lead quality” but the truth is that lead quality is just a means to an end and not the end itself. Just as an advertiser would run a PPC campaign to generate clicks in order to generate a sign up, a brochure request, a transaction etc. a lead generation campaign should be viewed in the same light. Leads are only of “high quality” if they convert into some other action and generate a desired return on investment. The same lead may be deemed of different quality depending on how the lead is actioned after it is received by the advertiser. In this sense lead quality is important only in terms of how it impacts upon ROI which is the ultimate determinant of a lead generation campaign’s success.

As lead generation grows in prominence in the UK and establishes itself as a separate discipline in digital marketing best practice will emerge and marketers will inevitably become more clued up on the industry and how to manage a lead buying campaign. The involvement of the IAB has already begun to expedite the process and September saw the launch of another three white papers on lead generation covering Premium Lead Generation, Co-registration and Lead Quality. As these papers help to lay the foundations for best practice, lead generation will really make it onto the marketing map.

Justin Rees is UK Head of Marketing for LeadPoint, the world’s first online lead exchange marketplace. LeadPoint provides over 3,000 real-time leads a day to over 2,500 customers across a range of verticals. Justin is a regular commentator in the marketing and trade press as well as being part of the IAB’s Online Lead Generation Taskforce.