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  1. #1
    Affiliate Manager
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    How much to pay per lead?
    Hi!

    I'm trying to make an affiliate program that is more than fair. Right now we're offering $1 per lead, but I'd like to up that, hopefully substantially. But I need to show my CEO that other people are offering more per lead. Can anyone help me with suggestions for cost per lead?

    We're essentially B2B, selling web marketing solutions to real estate professionals, and our leads come by way of our free test drives of our products.

    Thanks, everyone!

    //Jason Lewis
    iHOUSE Marketing Manager

  2. #2
    affiliate emeritus missdonna's Avatar
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    It has to depend on how much a lead is worth to you. If you pay more than they are worth you'll go broke.

    When you can define how much it is really worth, you can figure out the optimum payout. The more you pay the more leads you'll get but the less you'll earn on each.

    Of course some leads will be worth more than others. And things will continue to change.

    Nothing is simple.
    Affiliate Marketing - The hardest easy money I ever made.

  3. #3
    Affiliate Manager
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    I'm just trying to get a feel for the market- what do people usually offer? Should we pay as much as or more than we are paying for PPC?

  4. #4
    Moderator MichaelColey's Avatar
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    Some places pay up to $300 per lead. But that's not comparing apples to apples. Every program is different.

    Is Pay Per Lead the only option you have? PPL is very prone to fraud and/or low-quality leads. If you run it on just about any CPA Network and try to convert those leads, you'll see what I mean.
    Michael Coley
    Amazing-Bargains.com
     Affiliate Tips | Merchant Best Practices | Affiliate Friendly? | Couponing | CPA Networks? | ABW Tips | Activating Affiliates
    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela

  5. #5
    Affiliate Manager
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    Woah- who? I'll sign up immediately!!!

    Right now we offer $1 per lead and up to $50 for a sale. We have a pretty high conversion rate, provided the traffic is targeted. We work with real estate agents, and oh, they need web marketing. I had some problems with Napalese affiliates, but since I limited the countries that can join, I've had a much higher conversion rate.

    Besides, right now I'm trying to get affiliates excited and using our program. I'm willing to pay good money for that .

  6. #6
    ABW Ambassador Greg Rice's Avatar
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    Try researching your competition and see what they offer. Asking what to pay for a "lead' is like asking what to pay for a "sale". There's too many variables to give you a good answer.

    Look at your current stats for some clues. For every 100 test drives, see how many of those convert to a sale. From this, you can figure out, on average, how much you make per lead.

    For example, if 100 leads = 5 sales times $100 per sale = $500. Divide $500 by 100 leads and you earn about $5 per lead, on average. How much of this can you share with your affiliates?

    MichaelColey is right, you need to watch your program and pay close attention to who is doing what. PPL programs tend to attract all kinds of affiliates, some of which you may not want. Make sure you spell out exactly what a qualified lead is to protect yourself and let potential affiliates know what you consider a lead.
    Greg Rice Affiliate Program Management
    www.gocmc.com info(AT)gocmc.com | 330-259-1223

    Join us! - MiNeeds.com | DiscountCandleShop/CheeseSupply | Feng Shui Plaza

  7. #7
    Affiliate Manager
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    We're pretty specific- a lead is a completed test drive of our products. While it's not time-intensive, it's verifiable.

    The problem with the competitive research angle is that we're a niche of a niche- we don't have any competitors who are doing affiliate marketing... yet.

  8. #8
    ABW Ambassador Greg Rice's Avatar
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    Quote Originally Posted by jlewis
    We're pretty specific- a lead is a completed test drive of our products. While it's not time-intensive, it's verifiable.
    So if an affiliate drops an email to 1,000 people telling them to sign up for a test drive and they will be paid $1 each time they sign up, you would pay for that (yes, that kind of affiliate is out there)? What if the same person signs up 10 times? What if the lead is from someone who doesn't have anything to do with real estate?

    I don't know your system or service so all I'm saying is be careful to define what a qualified lead is. The keyword is "qualified". Qualified should mean a lead to you that could result in a sale or is the type of lead you're looking for. Spell it out and don't expect affiliates to know what you mean. I run 2 lead programs and see what people try to get away with. Also, make sure you have good Terms and Conditons defined and accessible. If you need to reverse leads, you should have good T&Cs to reference.
    Greg Rice Affiliate Program Management
    www.gocmc.com info(AT)gocmc.com | 330-259-1223

    Join us! - MiNeeds.com | DiscountCandleShop/CheeseSupply | Feng Shui Plaza

  9. #9
    Affiliate Manager
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    Wow. That's a scary thought.

    Could you give me an example of T&C regarding qualified leads? I'm working through the CJ system. Is that a problem?

    How much do you pay per lead in you rprograms? What's your ratio of leads to sales commission?

    Thanks so much for your help so far.

  10. #10
    ABW Ambassador Greg Rice's Avatar
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    Quote Originally Posted by jlewis
    Wow. That's a scary thought.

    Could you give me an example of T&C regarding qualified leads? I'm working through the CJ system. Is that a problem?

    How much do you pay per lead in you rprograms? What's your ratio of leads to sales commission?

    Thanks so much for your help so far.
    To create your own T&Cs, you need to first define what a qualified lead is for you and your purposes. If you only work with realtors, then a qualified lead can include:
    1) Name, address, phone number, company name (and what you consider to be the minimum amount of information required)
    2) The contact information must be submitted by the registrant (if John Doe's name was entered, it must have been entered by John Doe. You can be as relaxed with this as you want but it can show affiliates what you think is a qualified lead. If the owner of the company fills out the form but wants you to contact someone else to handle the details, this can still be a great lead. You want affiliates to know that they can't go through the phone book and start signing up companies.).
    3) Valid email address (or other necessary info). If the contact info is bad, the lead may be useless and can be reversed according to your T&Cs.
    4) A qualified lead must be from a licensed realtor

    Take a good look at your form and make sure you capture everything you need. If you have 10 fields and need all 10 filled in, then you can make that part of your T&Cs "All form fields must be completed".

    CJ is not a "problem", you just need to manually approve the applications IMO. My lead programs are on CJ (one is on CJ and SAS) so with proper management you can make it work.

    My lead programs are very different than your program but we pay $0.75-$1.25 per lead for one and $10+ for the other. I won't say how we verify leads but we have some checks built in for validation. Granted, any affiliate can have bogus leads but if their percentage of bad leads is high, we put that affiliate under a microscope, analyze what they're doing to promote us, reverse the bad leads and, if necessary, send them a warning. And, yes, we removed some from the programs.
    Greg Rice Affiliate Program Management
    www.gocmc.com info(AT)gocmc.com | 330-259-1223

    Join us! - MiNeeds.com | DiscountCandleShop/CheeseSupply | Feng Shui Plaza

  11. #11
    Kung Fu Master Eathan's Avatar
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    Are you offering $1 for a completed test drive or a test drive sign up? In either case, with such a tight niche, and what I would expect to be a decent payout, $1 seems a bit weak.

    I agree with those posting before me. You need to define what leads actually make you money, and define what you want in a qualified lead based on that. I can't believe that a really good lead is only worth a buck. Perhaps you're casting too wide a net...

    I also agree that fraud is rampant in lead programs. There's a whole class of affiliates whose only business is to try to rip off lead programs. Keep a close eye on lead quality.
    Eathan Mertz

    Black Cat Mining - Gold Prospecting & Rockhounding Equipment

  12. #12
    Moderator MichaelColey's Avatar
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    One key to success with any affiliate program is to align your affiliates' goals to your goals. Make sure you're paying for the action(s) that make you money, not for an action that should lead to an action that makes you money.
    Michael Coley
    Amazing-Bargains.com
     Affiliate Tips | Merchant Best Practices | Affiliate Friendly? | Couponing | CPA Networks? | ABW Tips | Activating Affiliates
    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela

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