Why Them Solar Leads You Bought Sucks – NO INTENT
Let me tell you a story.
I have a friend who went to work for a big finance company in Wall Street right out of college.
As a 25 year old, he was making $150k base with up to $2 million dollars in bonus before he hit 30.
He was rolling in the rough.
But alas.. he wasn’t very happy in the long run.
He wanted to make a difference in the world once he had enough financial resources.
Being that he was into changing the world and in saving the environment, he started a solar panel installation business in San Diego.
So he took his savings and took a leap of faith… bought a building, office equipment, trucks, installation “stuff”… and of course, started hiring.
… except he had no customers.
He was waiting for his phone to ring off the hook.. but instead he looked more like this:
After twiddling his thumb for a year and burning through almost $750k of his life savings, he decided to take my advice I gave him MONTHS ago how I think he should look into buying leads (instead of generating his own because believe it or not, it’s more expensive) since his company’s forte was not in marketing.
So he did.
Without asking me for my advice, he bought 300 leads.
At $6 bucks a pop from some random website off the web.
What did this website promise him?
That his “phone will ring off the hook!”
Total investment? $1,800.
And guess what.. NO ONE BOUGHT ANYTHING.
In another words, the leads SUCKED.
In fact, not only did he not even make 1 sale… but he ended up getting 35 CAN-SPAM violation fines (each one being thousands of dollars), got his company’s IP address blacklisted by pretty much email service provider, AND got a visit from the friendly people at DO-NOT-CALL registry.
(Luckily, he settled most of that for a relatively small amount.)
Yes, as a first timer, he made mistakes buying the wrong kind of leads…
So, why did buying these leads not work?
- I totally forgot to tell him that I do lead generation for solar industry (whoopsie)
- That these crap leads have no intent to purchase.
Your Leads Have Zero Intent to Purchase
This is how sales process works:
What lead generation (either doing it yourself or buying leads) does is accelerate through the awarenes, the interest, and most of the desire part of the sales funnel.
In another words, if the leads are “good”, they are aware, interested, AND have the desire to buy your stuff.
BUT… imagine, if the leads were somehow brought in who aren’t quite in the cycle.
Some are incentivized… some just did it by mistake… some they were co-registered.
(You can read about all the lead generation tactics.)
In another words, not aware… not interested.. and of course, NO DESIRE.
This is why those solar leads cost only $6 BUCKS.
If you aren’t aware, search engine marketing is probably the BEST damn form of marketing out there because people are literally typing in what they’re thinking.
Do you know how much solar related clicks go for on Google?
Let’s do the math.
If on the average 1 in 20 people sign up for your service (i.e. 5% conversion rate, which is pretty darn awesome by any means)… and 20 clicks cost you (20 x $10) $200 bucks, how in the world do you think those lead generation companies are making money selling you at $6 something that cost them $200 dollars.
Simple, they either OVERSOLD that leads a couple dozens of times to your competitors .. or those people who signed up didn’t know what they were signing up for.
It’s All About Intent to Purchase.
Ever wonder Google is making $40 billion a year?
Facebook has way more traffic than Google, yet Facebook can’t even come close.
It’s not Facebook’s fault… it’s just the way the brain works.
Your brain, when it decides that it wants something, goes through several phases.
And depending on which phase your brain is in, your likelihood to take out your wallet and say “yes” varies:
So, in another words, people are telling search engines what they want.
Search engine marketing is about as close as you’re going to get as mind reading.
And this is the reason WHY search engine traffic costs the most.. because you can TARGET people who are ready to buy.
In fact, compared to search engines, popular websites (or any website for that matter) do a good job giving awareness to your company, product, or service.. but does not good job convincing them they they should necessarily buy from you.
(When was the last time, you put “solar panel system” into Facebook’s search box?)
See… if you’re buying cheap online leads, they are coming from LOW intent and LOW quality site..
In fact, I wouldn’t be surprised if they had ZERO intent..
Yes, if you are in expensive vertical like solar, higher education, finance, etc… your leads will NOT cost you $6 bucks… I wouldn’t be surprised if they cost $100-$200 per lead.
But remember, it’s not how much they cost.. it’s how much they will make you.
My friend spent $1,800 and made zero sales… for ROI of -100%.
Now, if he’s spent, say $100 per lead on 10 leads… then made 1 sale on a 20k solar panel system at 15% margin, that’s $1k spend for $3k profit.
That’s 200% ROI.
Yeap, it’s ALL perspectiv.