LendingTree landed a spot at the top of Fortune’s annual list of 100 Fastest-Growing Companies by helping their clients go beyond cost per lead and target the opportunities that drive bottom line results. Find out how they do it, and why it’s time to break out of the old metrics, in this VB Live event.
In the lead gen arena, the argument is that spray and pray is out, and quality is the new black. Sam Yount, CMO of LendingTree, says that’s not necessarily true.
“We think of lead gen like chicken salad,” Yount explains. “If you went and bought chicken salad, and all it had in it was celery and mayonnaise, you’d be pretty disappointed in that chicken salad.”
He calls it the portfolio approach to lead gen. “[Get] enough chicken, the high-quality leads which are more expensive,” he says, “and then enough of the celery, which are lower-quality lead sources, so that there’s a good mix in that pool that’s available, and then partners are able carve them out.”
Of course, what’s chicken to one customer may be celery to another — it all depends where you’re sitting at the table. “There are some partners that have good mechanisms for churning through a lot of leads,” says Yount. “They’d rather buy a hundred leads for ten dollars because they know they have good methodology to churn through those leads.”
The companies with a system to churn through hundreds of leads an hour are actually interested in efficiency, because their incremental cost to filter leads is not very high.
But companies without those resources buy only the customers they’re confident will convert, and are willing to pay a substantial premium for that.
According to Yount, cost per lead is essentially a budgeting and efficiency metric, rather than a marketing metric.
What should marketers be tracking instead? “You want to go as far down the funnel as you possibly can,” Yount says. “As a marketer, if you’re selling SaaS, what is your return on ad spend?”
In other words, how does the cost of all of those leads stack up to the revenue you earn directly in exchange? Once you know that, he says, you can track that back to your EBITA and your profitability.
The real challenge as a marketer is to have that tracking that goes from lead source all the way through to revenue, says Yount.
“The best marketers have good tracking all the way through the process,” he explains. “They’re thinking about their marketing channels as a funnel, and tracking each step of the way, from what they’ve spent to get this lead to where did it come from and where did it fall off in the process? And is that something you can fix, or are there major differences by channels?”
But then there is this nuance of price.
“At the point where your funnel becomes very efficient, if you’re paying a quarter of the price for one lead type versus another — and even though it only converts half as well — as long as the cost of doing business and the cost of moving customers through that funnel aren’t prohibitive,” he explains, “the lower-quality, lower-intent feed sources can be the key to really growing your business.”
Yount is joined by Jason John, CMO of Publisher’s Clearing House and VB’s own Stewart Rogers. To learn more about what quality means, when quantity needs to step in, and what needs to happens after the lead is generated, join this free VB Live event.
Don’t miss out.
In this VB Live event, you will:
- Understand how to balance quantity versus quality leads
- Build the right marketing KPIs for defining lead quality and lead conversion
- Define a conversion strategy that builds retention
- Sam Yount, CMO, LendingTree
- Jason John, CMO, Publisher’s Clearing House
- Stewart Rogers, Director of Marketing Technology, VentureBeat
- Wendy Schuchart, Analyst, VentureBeat