Chapter 68
Pay Per Lead

Marketers obtaining customer leads online need a payment method for each lead acquired.

Pay per lead simply describes an online payment method in which payment is based on actual, qualifying leads generated by a website or an advertisement on a website.

Assume, for example, that your company attracts 10,000 visitors per day to its website, 1,000 of which click on a banner ad promoting the advertiser’s website and, of those, 100 register on the destination website. Then your company, as the publisher of the website on which the banner ad was placed, will be paid for the 100 leads that were generated.

An advantage of website advertising is the measurement precision that allows marketers to know the details of their customers’ website behavior (their page selection, length of time on each page, links clicked, repeat visits, etc.). Qualified leads are any marketer’s desire, as long as the overall revenue generated from qualified leads that turn into sales is not exceeded by the cost. A sizable and growing challenge with online advertising is getting website visitors to pay attention to ads since, over the past several years, online advertising effectiveness has declined (although it can still be very cost effective compared to traditional advertising forms). As with any marketing communication, the key to success is identifying the right need, the right audience, the right message, and the right website. Even then, success is not guaranteed.

For the website publisher, pay per lead is similar to cost per action, since customers of your site will have greater confidence if you charge them only for actual qualifying leads, based on actual registrations. These registrations are important to the advertiser since customers who register are giving their approval to be contacted in the future, qualifying them as viable prospects.

Pay per lead can be unreliable due to the potential for fraud. Website publishers may generate false leads on the destination website through the use of programs called robots. Activity-based filtration (ABF) is a tool marketers can use that analyzes website log files to identify activity suspected to be robot-generated. ABF should be conducted periodically to check questionable activity.

iThe Digital Marketing Reference, Pay Per Lead Definition. Retrieved May 4, 2017 from https://www.marketingterms.com/dictionary/pay_per_lead/; Emily Wubsauer, Why 2017 Is the Year of Pay Per Lead (PPL), Videodesign, January 24, 2017. Retrieved May 3, 2017 from https://www.vieodesign.com/blog/why-2017-is-the-year-of-pay-per-lead-ppl