How do you calculate the cost per lead?

1 What is cost per lead?

Cost per lead is the average amount of money you spend to generate one lead from your marketing efforts. A lead is a potential customer who has shown interest in your product or service, usually by providing their contact information or taking some action on your website. To calculate the cost per lead, you need to divide the total cost of your lead generation campaign by the number of leads it generated. For example, if you spent $1,000 on a Facebook ad campaign and got 200 leads, your CPL is $5.

4 How to calculate the cost per lead for different channels?

Depending on the type and source of your leads, you may need to use different formulas to calculate the cost per lead. For example, if you use paid advertising, such as Google Ads or Facebook Ads, you can use the formula we mentioned earlier: CPL = total cost / number of leads. However, if you use organic methods, such as SEO or content marketing, you may need to factor in the time and resources you invest in creating and distributing your content. In this case, you can use this formula: CPL = (total cost + labor cost) / number of leads.

5 How to benchmark your cost per lead?

To know if your cost per lead is good or bad, you need to compare it with the industry average and your competitors. This will help you identify your strengths and weaknesses and adjust your goals and strategies accordingly. However, keep in mind that the cost per lead can vary widely depending on factors such as the type of product or service, the target market, the quality of leads, and the stage of the sales funnel. Therefore, you should always use relevant and reliable data sources and benchmarks for your analysis.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?