Maximizing ROI: Lead Quality VS Lead Quantity


When it comes to improving bottom line results, achieving the highest Return On Investment (ROI) is key to making any major business decision. One of the most important functions whereby a company needs to address ROI is when planning and executing their lead generation strategy.

There are two areas that marketers can focus on when going about their lead generation efforts: Lead Quality and Lead Quantity. Depending on the nature of your product offering and its associated value, it might be more efficient to focus on one rather than the other. At this point you should be asking yourself “Is it more important for my business to increase the volume of our leads or to improve our conversion rates?”.

In most cases, there is a disconnect between marketing and sales departments. Sales teams require the best quality leads possible to improve their closing rates whereas  the success of marketing teams is measured by lead quantity. Though both criteria are essential, each team strives to achieve results through what is effectively an entirely different metric. This disconnect usually leads to confusion and inefficiencies in the sales funnel and buyer’s journey.

Maximizing ROI: When to Focus on Lead Quantity

Lead quantity is basically the number of contacts you acquire during your marketing campaign. This is obviously critical to the success of any lead generation strategy because if you aren’t getting the numbers, there’s no point in worrying about their likelihood of converting.

It not hard to get caught up with lead volume, it’s pretty exciting to know that your content is getting viewed by a large audience. If you’re playing it like a numbers game, it can definitely seem like the more you get, the better you’re doing. Keep in mind though, focusing mainly quantity only works in certain circumstances where the ROI for your targeting strategy doesn’t quite cover the costs involved.

There are a few situations in which focusing on lead volume might be a better decision:

  • It is difficult to gather data and target your audience effectively.
  • It is not worth predicting your audience due to the cost of the analysis versus the value of the sale.
  • Your target market is broad enough that imperfect marketing spend still yields decent ROI.
  • Your strategy involves low-cost selling methods that scale well.

If this sounds like B2C companies to you, you’re not wrong. B2C products tend to involve cheaper selling methods, shorter decision-making processes and less lengthy relationship.

Maximizing ROI: When to Focus on Lead Quality

Focusing on lead quality is all about making your operations more efficient and getting the most bang for your buck. It relates directly to how likely your lead is to convert into a paying customer. Lately, and for good reason, marketers have expressed the need for quality over quantity. According to BrightTalk’s 2015 B2B Lead Generation Report, improving lead quality over quantity is a top priority for over 600 marketing professionals surveyed.

A high quality lead means that they have the budget, the authority and have expressed the need for a solution that your company offers. Though these leads are great because they don’t require as much effort to close, finding them can be a pretty complex and potentially expensive task. However, the right targeting strategy not only improves the quality of your leads, it also enhances your brand’s ability leverage data and deliver value to your audience.

Most B2B and some B2C businesses need to focus on lead quality for the following reasons:

  • The buying relationship is longer, making each customer more valuable.
  • Lead pools are smaller, making them inherently more defined and targeted.
  • The product offering is more complex, only appealing to specific markets.
  • It is more effective when it comes to increasing awareness, engagement and advocacy.

Achieving a Balance 

Unfortunately, there will always be a trade-off when it comes to choosing what area to focus your efforts. If you’re pushing to maximize lead quantity, the quality of those leads is likely to suffer. On the other hand, if you’re working hard to only source qualified prospects, chances are you’re not going to find very many of them.

No matter what type of business you are or what industry you operate in, you need to address both areas to achieve any sort of success from your sales and marketing efforts. Acquiring more leads is always required for more sales. However, upon operations reaching a certain level of maturity, focusing more on lead quality is generally a more effective way to reduce costs and improve ROI.

In the end, to get the best results, you have to find a balance that works for your circumstances. The only way to find out the best strategy is to continually test, implement, evaluate and evolve your methods so you can base your decisions on concrete facts. Discover the best combination of tactics for your business in order to maximize ROI from your lead generation campaign.

Author Bio

Pierre is a content strategist at spiralytics, who enjoys reading writing and learning about pretty much anything sales and marketing related. In his free time, he enjoys playing golf, tennis and watching the occasional cat video on YouTube.
Twitter: @PierredeBraux