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As companies continue to automate marketing processes both online and off, the lead-purchase industry, which sells hot leads to help brands find new customers, is growing. And just as we’ve seen in the advertising industry, so is fraud and cheating.
But just as advertisers combat clickfraud with forensic tools to find and remove clickfarms, lead buyers now have a new tool to fight fake leads.
Fake leads are a problem for both businesses and demand generators, LeadiD CEO Ross Shanken told me via email.
“The current lead market is highly inefficient,” he says. “Lead buyers are frustrated with the wasted energy, expense, and opportunity cost of processing bad leads, as well as managing complaints. Lead suppliers are frustrated with the bad apples who make them look bad.”
Leads can easily be sold for $35 or more for potentially high-value customers, such as post-secondary students. But that’s a fraction of their true worth … if they can be better authenticated.
The problem is the preponderance of fake leads, which drive up costs and return nothing. High-risk leads, which have a greater likelihood of being fraudulent, are five times less likely to convert into customers, Shanken says.
LeadID has incorporated fraud detection capability powered by Forensiq, one of the top online ad fraud finders, to check the IP address, proxy server(s), VPN, operating system, browser ID, and device ID of all generated leads. Then LeadID checks that against a constantly updated list of known offenders. The result is a risk score and classification that a lead buyer can use to assess how likely it is that the leads he or she just bought from Eastern Europe or Nigeria are fake.
Check out analyst David Raab’s look at the 5 worst mistakes in marketing automation … and how to avoid them.
According to LeadID, which has already processed over a billion leads for its 350 enterprise clients, the additional data changes lead buyers’ behavior, allowing them to make better decisions about which leads they buy, how much they pay, and how they treat the leads once in their systems.
“The rise of advanced technology is driving efficient practices like programmatic ad buying, but at the same time, fraudsters are also getting more advanced, making high-risk leads even more difficult to detect,” Shanken said. “LeadID’s goal is to bring a new level of customer intelligence and integrity to the customer acquisition process, and the Fraud Detection app makes our platform even more powerful.”
There appears to be a demand for this type of service — LeadID’s platform usage and revenue tripled last year, according to Shanken.
It’s likely just a matter of time until this type of technology is also built into marketing automation systems’ lead scoring capabilities.
VentureBeat’s VB Insight team is studying marketing analytics...
Chime in here, and we’ll share the results