Are you looking for information on how much lead generation services cost?
First of all, you must know that it will depend on your specific industry, as research shows that a lead can cost between 91 USD (or less) up to 982 USD (or more!).
The price for lead generation as a service may vary depending on the company, what they offer, and the industry they focus on.
It can also depend on your business needs and what you want to achieve by using this service.
In this blog, we will review how much lead generation services cost, how you should calculate the cost per lead, and the average lead price by industry and other factors.
With this knowledge, you’ll know when a campaign was successful and genuinely contributed to your company’s growth.
BONUS: See the type of results you can expect when you invest in organic lead generation.
Contents
Is Lead Generation Expensive?
Lead generation is a crucial part of growing a business, but the cost can vary widely.
The expense of lead generation services hinges on numerous factors including the strategies employed, the tools used, and the complexity of the campaigns.
While some companies might find it costly, others may consider it a worthwhile investment due to the potential high returns.
Let’s delve into the factors that affect lead generation costs and how businesses can budget for these services.
Factors Influencing Lead Generation Costs
- Service Type: Are you opting for pay-per-click (PPC) advertising, content marketing, email campaigns, or a mix? Each method has its own pricing model.
- Tool and Platform Fees: Different lead generation tools and platforms come with varying price tags. Premium services often charge more for advanced features.
- Target Market Complexity: Targeting a niche or highly competitive market often requires more resources, which can increase costs.
- Scale and Scope of Campaigns: Larger campaigns targeting broader audiences can drive up costs.
Price Ranges of Lead Generation Services
Lead generation services cost can range from a few hundred to several thousand dollars per month, depending on the scale and complexity of the campaign.
For small businesses, basic services might start at $500 to $1,500 per month.
Mid-sized to large companies could be looking at $5,000 to $20,000 monthly, reflecting more extensive, multi-channel strategies.
How Much Does Lead Generation Services Cost?
As we said at the beginning, lead generation services costs vary depending on the company, their offer, and the industry they focus on.
However, you should always know how much a lead is costing your business to know if the investment you made is paying off.
The way in which you can do that is by learning what your cost per lead (CPL) is. That is:
For example, if you invested $2,000 in a social media campaign and you got 20 leads, your CPL was $100.
If you need help calculating, here’s a CPL Calculator to do the math for you, and also, help you learn how many leads you need to make a profit.
What’s a Good Cost per Lead?
There are two factors to consider in what a reasonable cost per lead is:
- The cost of the actual lead
- Your customer lifetime value
To understand how it works, here’s an example from Monika Kisielewska, a lead generation content writer:
If your customers spend on average $3,000 on your products or services from the time they first become your paying customers to the time they churn, and your gross profit is, say, 50% it leaves you with $1,500.
Next, consider the rate at which your sales team closes deals […] let’s assume they convert one in 10 leads, so their conversion rate is 10%.
In this example, one lead generates $150 of gross profit for your company.
With this type of calculation, you can establish how much would you invest in a generation lead service to achieve your revenue goals.
The Average Cost per Lead by…
Overall, according to the 2017 Demand Generation Benchmarks Report, the average cost per lead was $198.
However, the cost per lead varies considerably over time, as well as from one industry to another due to factors like target audience, competition, and others.
Average Cost per Lead by Industry
| Industry | Average Cost per Lead |
| B2B SaaS | $237 |
| Business Insurance | $424 |
| Cybersecurity | $406 |
| eCommerce | $91 |
| Entertainment | $114 |
| Financial Services | $653 |
| Healthcare | $361 |
| Higher Education | $982 |
| Hotels & Resorts | $266 |
| Legal Services | $649 |
| Real Estate | $448 |
| Software Development | $591 |
| Staffing & Recruiting | $497 |
Average Cost per Lead by Lead Generation Channel
| Lead Generation Channel | Average Cost per Lead |
| Referral | $25 |
| Search Engine Optimisation (SEO) | $35 |
| Email Marketing | $50 |
| Social Media Advertising | $65 |
| Content Marketing | $95 |
| Display Advertising | $100 |
| Webinars | $125 |
| Paid Search Advertising (PPC) | $175 |
| Direct Mail | $250 |
| Cold Calling | $300 |
| Events and Trade Shows | $1,000 |
Average Cost per Lead by Company Size
| Company Size | Average Cost per Lead |
| 1001+ Employees | $349 |
| 201 – 1000 Employees | $212 |
| 51 – 200 Employees | $180 |
| 2 – 50 Employees | $147 |
Average Cost per Lead by Company Revenue
| Company Revenue | Average Cost per Lead |
| $500M+ | $429 |
| $10M – $500M | $179 |
| $1M – $10M | $185 |
| < $1M | $166 |
BONUS: See what type of investment you’d need to make to create content that helps you attract leads.
Top 5 Lead Generation Services
If you’re ready to start investing in lead generation as a service, we have a blog to help you choose between the Top 5 Lead Generation Services.
Nonetheless, if you would like to keep learning about how to get clients and generate more leads, we have a selection of articles that may interest you:
