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Lead Gen: Do you charge percentage of profit, or sell per lead?

Discussion in 'Local SEO' started by Daddykins, Aug 22, 2019.

  1. Daddykins

    Daddykins Senior Member

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    I've been working on a lead gen site. Have a google voice there to see when leads start coming in. I've gotten some calls now and plan on replacing it with a call forwarding number.

    Will also be calling up a few in the niche to work with them. It's a homeadvisor type niche. Should I ask for a percentage or just sell leads as market avg?

    I feel like the percentage may sell better. And if that is the case, how much is reasonable? I'm planning on calling up a business, tell them I have an old site for <niche> and I'm still getting calls for it. Looking to refer these out to a good business. And ask them questions to choose the best business to work with.


    Anyone with experience can share some advice? Thanks!
     
  2. blackwalker

    blackwalker Jr. VIP Jr. VIP

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    Tbh the best way for that are call funnels using GMB listings as they are live calls, those work well too if you can gather enough leads.

    I kinda set up churn and burn sites that rank some on first and some on 2-4 to get leads.

    I call then up and here is my basic script

    Hey, mr ___
    Im blackwalker. I just moved from [nearby state] and I run lead generation so I have tons of client calls coming in that are unmonetized.
    How much could you give me per live call? I am making no money currently with these and I felt you would be the best person to reach out to because of your good reputation
    // make them feel good. better them up

    The last [niche] guy I worked with can give you a reference. And either call up a reference or give them your google voice num
     
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  3. Daddykins

    Daddykins Senior Member

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    Anymore advice on this? I guess it depends on niche. If I'm selling leads to a pool construction company as example.
     
  4. jon_xx_x

    jon_xx_x Elite Member

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    Asked the same in VIP. It's a reminder that very few here know what they are doing and you just hope they find your thread and help.
    Keywords Everywhere addon helps a bit as it shows what they are paying per click.
    I have a site that I can't use some of the leads. I emailed a few companies, but they told me they aren't allowed to buy leads. It's for debt.
    I'm debating right now starting a legit company and seeing if I can make it work.
    I did this years ago, but I fucked up as I had zero experience in the niches. I started getting leads and didn't know what to do with them.
    I have a friend that is a tradesman and is doing side jobs right now. I'm debating starting a whole new company, telling him I want 20-30% of the company and going to work. It would be a shit load of work but if it can actually work it will be big recurring income.
     
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  5. Daddykins

    Daddykins Senior Member

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    Why wouldn't they be allowed to buy leads? Have you tried telling them you want a kickback % instead? In my area, a lot of trademen throw leads to each other and just give them a percentage.

    I feel like there are a lot who do lead gen, but don't answer threads. I've seen tons of info on BHW for lead gen
     
  6. MaestroDelWeb

    MaestroDelWeb Senior Member

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    Percentage is more money but per lead is safer for getting paid. The problem with percentage deals is that you have to trust the person/company and some people will claim they didn't convert a lead into a sale.
     
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  7. gentzalli

    gentzalli Regular Member

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    This is probably one of the best routes you can go down, but like you said it'll be a lot more work on your end and obviously you still have to trust the person you're working with a lot.

    That's the biggest problem i faced.. Some asshole kept telling me "well you know, actually that particular caller decided to not use our service after giving a quote" and something seemed fishy so I stopped working with him. Like 20 - 30% of the leads he made excuses on why they didn't convert.

    How can you work around this issue though? Can you ask for receipts or can they easily fake those? I guess the easiest way to find out if you're getting ripped is to call the clients themselves and ask them if they worked with "X" company and how much they were charged, but it seems a little weird to do all that.
     
  8. homeriscool

    homeriscool Power Member

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    Here's my experience.....its MUCH EASIER to sell the leads. You would probably make more money on percentage of completed job but that whole scenario is based on trust. I've been ripped off more than once by so called "mates" by catching them out.

    Greed is the human condition i'm afraid. Do yourself a favor and just sell the leads. That you can prove 100%. Completed jobs you cannot.

    Tying to get percentage of job causes trust issues and if your leads arn't converting you start to get paranoid of whats REALLY going on.
     
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  9. ContentExpert

    ContentExpert Jr. VIP Jr. VIP

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    Any time I've sold leads I charged per lead. Tracking the profits from those leads and charging a percentage I found to be too cumbersome.
     
  10. InWire.Agency

    InWire.Agency Newbie

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    I just went to Lead Gen (and replacing lower-paying clients with lead gen sites) and I will always go for leads payments and not percentages. But it could depend on a niche. If you know a niche is a low volume but high-value jobs (300$+ lead value) I would personally take a call (or my assistant) and try to get as much info as needed and then sell it.

    I have a feeling percentage base is a problem if you are not a niche expert and you are not involved in the closing process. Businesses have problems closing so you would leave money on the table.
     
  11. jon_xx_x

    jon_xx_x Elite Member

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    I cant remember his exact explanation but I think its some law in canada. This is debt leads specifically.
    I even asked how they can advertise but not buy leads and he explained it.
     
  12. Rj268

    Rj268 Jr. VIP Jr. VIP

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    I charge per lead. Keep it as passive as possible. With the percentage model it will require far more time on your end and you will need to trust the person buying your leads to be honest on conversions and sales prices.
     
  13. gentzalli

    gentzalli Regular Member

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    What are we considering a lead though? Just the phone call/email that can lead to nothing? Or does it actually have to convert into a sale and then we consider it an eligible lead?

    The reason I ask is because most of the time, business owners are not going to be very happy to pay per phone call and if they are OK with it, they are going to not be open to paying a lot.

    If I charge per phone call for a roofing company for example, how much can I realistically charge? $40? $60? $80? Nobody's gonna pay that much especially when they can buy Google ads cheaper. If I send 20 phone calls and charge $40 in a month, I only made $800 meanwhile the business owner probably made $15,000+ with those phone calls. The system seems very flawed.
     
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  14. Tipitip

    Tipitip Jr. VIP Jr. VIP

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    I think charging per lead is a safer option
     
  15. jon_xx_x

    jon_xx_x Elite Member

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    Probably depends how good your leads are. Collecting leads of window shoppers aren't going to convert well. Collect leads of people giving their info because they want a roof now, will convert well.
    I haven't done it but you can use phone tracking to see how many times your number was called. So if you're forwarding it to another business you'll know how many calls they've received. Using the roofing example if someone is phoning your business, it's probably a pretty strong lead. As mentioned in another thread you can also send them leads for free and after a week or two and bunch of leads see if he wants to make a deal. Of course he can BS and say they didn't do too well.
     
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  16. Tipitip

    Tipitip Jr. VIP Jr. VIP

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    Do you mind giving the link to that thread?
     
  17. gentzalli

    gentzalli Regular Member

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    I'm mainly talking about buyer intent leads where people google "roofing chicago" and call my phone number (I record their conversations too). The problem is that a lot of times they have to get a quote so that means the phone conversation ends, and the roofer sees the guy in person to give them an estimate. At that point I'm completely at the mercy of the business and he can just tell me that the caller didn't convert, or that they converted on a very small service fee. Basically the guy will just lie to me in order to not pay.

    I've tried to go the route of just charging them on a per-phone call basis but almost every time they don't want to do it that way because they keep bringing up the adwords example and how "they can just buy adwords clicks for $20" or whatever. I'm thinking that the best technique would be to charge per customer/charge a percentage of the profit, and make it very clear to the owner that you'll be personally calling his clients back to ask for "feedback" (in reality we're just asking them how much they paid and if they used our company)

    This way the guy would be too scared to lie since he knows you're going to double-check with the callers. However it would be very time-consuming and not very efficient - maybe you could just bluff the owner and say you'll occasionally call the clients to make sure he's not cheating you without really calling?
     
  18. jon_xx_x

    jon_xx_x Elite Member

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    Can't even remember where I saw it sorry.
     
  19. jon_xx_x

    jon_xx_x Elite Member

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    Yeah it's tough. I guess you'd need to try and find someone that is trustworthy.
     
  20. mudbutt

    mudbutt Executive VIP Jr. VIP Premium Member

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    Pay per lead is the cleanest model. I run both models, but pay per sale is a lot more work and only really worth it for big ticket sales. You have to quality check and call the leads you generate after the fact to stealthily see if the deal was closed. Disguise it as a quality customer happiness check and it won’t appear unnatural.
     
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