What is a bad lead? What is a bad traffic source?
Personally, I don’t think there’s such a thing as a bad traffic source. The closest you can get is bot traffic, which is completely ineffective, but I even know some people using that very successfully in specific situations.
Internet marketing is a numbers game, and it works like this.
* How much does your traffic cost?
* How many leads do you get from the traffic (Cost Per Lead)?
* How many leads are opening/clicking your emails (Cost Per Active Lead)?
* How many leads are buying products (Cost Per Sale)?
The more leads and sales you get from a traffic source, the more you can pay for it. The less leads and sales you get from a traffic source, the less you want to pay for it, but that doesn’t mean it’s bad. It just means the numbers work differently.
Let’s take a quick look at how these numbers work…
You spend $1000 on 1000 clicks. 40% of these convert to leads, and your sales page converts at 1%. Which means:
Those sales may not come immediately, but you can expect four of those leads to purchase, and I personally expect around 20% of the leads to be actively reading and clicking links in emails.
That means it’s cost you $1000 to get 400 leads ($2.50 Cost Per Lead), of which about 80 are active ($12.50 per active lead), and you get four sales ($250 Cost Per Sale).
Unless you have a superb copywriter, I doubt you’ll be converting a $250, or higher priced, product at 1% to cold traffic.
Add to that, these are averages.
Just because you get 1000 clicks, doesn’t mean those people will convert to leads at 40% and sales at 1%. Sometimes they may convert to leads at 20% and sales at 0.1%, and other times they may convert to leads at 50% and sales at 3%.
However, over tens of thousands of clicks, this will average to the numbers we first mentioned.
That’s just the way it works.
Personally, I like to work in scale. Large scale.
I’d rather use a slightly cheaper traffic source, that gets me leads for a fraction of the price, in vast quantities, for just a small drop in quality.
That’s how I added 2130 leads to my mailing list last weekend.
Next month, I’m going to share my lead generation source to Business Ignition members.
And it rocks!
P.S. I’ve had people ask me whether I sell traffic before, and we’ve chatted about it in our FB group. I’m still considering the possibility of doing this, and even combining it with an Autoresponder service that’s a fraction of the cost of most.
Let me know your thoughts in our FB group.