Why do most marketing agencies not provide cost per lead?

It's a question that is asked a lot, and it's a fair question to ask! Why do most marketing agencies not provide cost per lead?

Thinking about it from a clients’ point of view, you want to minimise your risk – that’s fair! The normal thought process is “well if you think you’re so great, why aren’t you willing to put your money where your mouth is?”. 

The challenge for marketing agencies is then that they need to pay for the resource to generate the leads upfront and if you then don’t feel the opportunity is exactly as needed, it’s not a sustainable business model. This is where a pre-agreed, no grey-area criteria is vital to protect all parties. To save you time when reaching out to agencies, make it very clear what you’re looking for in an objective way and this will allow them to know whether or not they can, and are willing to help you. 

An example of pre-agreed criteria:

1. The sales meeting will need to be with a Director-level member of the business

2. They should be willing to meet within 2 weeks and they must have accepted the calendar invite

3. The meeting will be a F2F/Web Call 

4. The business will need to have 10+ staff

5. They must have an explicit need for XXX and we have confirmed X, Y and Z. 

6. The business will need to be UK Based with no parent company

Naturally, you’d update the above as needed, but the criteria must to be objective and quantifiable. 

Why do most agencies work on upfront payments?

Well, marketing is an investment and it can’t necessarily be guaranteed – you can’t buy stocks and then ask for your money back if the price falls. 

It’s key to ensure the agency has a robust process in place for finding solutions when things aren’t working. Ways to identify this could be to ask to speak to current or former clients, as well as asking to speak to the operations team who will be involved in delivering the project. 

Why ask to speak to current or former clients?

These clients have experienced things first hand and you can ask them what happens when things haven’t worked perfectly. You’re able to ask 1on1 questions from an objective perspective and help you make good a decision on the right partner for you. 

It can be really useful to speak to former clients to see how the marketing agency wrapped up the partnership as this will give you a real feel for how professional they will be if you don’t become a long-term client. 

A lot of people ask to speak to similar clients to themselves and whilst perfectly logical, they may not wish to share competitor details, and so it can be just as useful to speak to someone in a completely new space to understand how the processes work and how you’ll be looked after throughout the full process. 

Many agencies will have NDA’s in place and so you can share your questions with the marketing agency and ask them to have clients complete it for you. This requires an element of trust, but can be just as useful. 

Why ask to speak to the Operations Team who will deliver your project?

Marketing is absolutely vital to every business and the partnership between the client and agency needs to be positive. By meeting them prior to committing, you’ll be able to assess how well you’ll get on, as well as key aspects (such as the specialist knowledge they’ll be able to provide) and how they accept feedback. As the client, you need to feel comfortable that what you need will be onboarded, and that you’ll gain value from the partnership. 

Conclusion:

It’s worth noting that some marketing agencies do provide a cost per lead model that work positively, though some will focus on high-volume, low-quality leads – so it’s key that you have the internal team in place to ensure these are converted as needed for ROI. 

If this is a model you’re fixed on, ensure the agency is well-established and able to put the resources in required to generate results – if they aren’t, all that’s like to happen is that you’ll waste a lot of time (and time is money in another way) waiting for good leads to come in, or trying to work low quality leads which won’t support your business growth. 

Here at Bee Connected Marketing, we provide a “mixed-model” – you pay a retainer, and then pay per lead based on a pre-agreed criteria. We feel this benefits all parties involved and results in the best outcomes for our clients. Get in touch today if you’d like to discuss your options.