5 Reasons Pay-per-Lead Produces Poor Performance

It’s easy to fall into the trap: you think that pay-per-lead lead generation companies will give you exactly what you’re paying for, thinking that their incentive structure will encourage the best performance possible. Unfortunately, that couldn’t be farther from the truth.

Pay-per-lead companies use bad work environments and inferior methods, damaging your brand, generating fewer quality leads, and creating conflicts between you and their sales team. If you’re thinking about working with a pay-per-lead lead generation company, give a thought to these five potential issues first.

1. No Research Incentive
Pay-per-lead companies don’t have any incentive to put time into researching your product and ideal customers. Remember: their only incentive is to book meetings with your team while spending as little of their own money as possible.
That means these companies have no incentive to do research beyond the most basic level they need to make a pitch on a cold call.

2. Short-term Profit Interest
It’s important to remember that you won’t be your pay-per-lead service’s only client. These businesses try and collect as many clients as possible, prioritizing the ones they can make money from the fastest.
That means that if your product isn’t easy for them to collect a short-term profit from, they’ll deprioritize you. Instead, they’ll focus on other clients that require less time.

But the problem goes deeper: there’s no short-term profit in providing good customer service, consulting on sales strategy, or A/B testing different options for outreach. While other lead generation services may take a more consultative approach, pay-per-lead companies only look to extract profit as quickly as possible.

3. Lower Talent Level
If you’re a talented lead generation professional, you’ll probably work for anyone but a pay-per-lead company. That’s because the pay-per-lead structure creates questionable working conditions with economics that don’t allow them to pay a living wage. It also creates little incentive for a proper training and onboarding process.

Obviously, the impact of this is enormous. Not only will they generate leads slowly, but the inexperienced people that work for pay-per-lead services will also have a harder time identifying ideal prospects. You’ll get your leads, but they’ll be
low-quality and coming in at a trickle.

4.Client-Provider Conflicts
With the structure of a pay-per-lead agreement, the provider is incentivized to define “leads” as broadly as possible. That means that the provider may try and charge for low-quality leads, individual contributors with no buying power, or even leads whose attribution is questionable.

When providers engage in these practices, they’re simply responding to the incentives they’ve set up for themselves. But that means they’re shifting the conversation away from what actually matters–providing you with quality leads–and towards issues of secondary importance like attribution.

5.Brand Damage
Consider the sum of all of these issues: poorly-informed, untrained cold callers looking to generate leads as quickly as possible regardless of quality. Now, imagine that team coming into contact with key decision-makers at high-value companies.

The long-term damage to your brand could be serious. The next time you try to reach out to those high-value prospects, they’ll associate your company’s name with the unprofessional and often aggressive cold calls they received from the pay-per-lead service.

The long-term impacts of using a pay-per-lead service can be severe. With poorly-trained callers incentivized to work as quickly as possible and stretch the meaning of terms like “lead,” you may find that the service does more harm to your brand than good. If you’re thinking about working with a pay-per-lead service, try reaching out to Salaria Sales to discuss better models for fast, quality lead generation.

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