How to Start A Lead Generation Business?

What is a lead?

Any person who shows interest in the product or service that a company sells is a lead for that company. Leads typically hear from a business or organisation after a conversation has taken place, and after they have submitted their personal information. This is in contrast to a cold call from someone who has purchased your contact information.

When it comes to marketing and sales, time = money; so, you should use it wisely. If you are given a choice between 500 ordinary leads, and only 50 qualified ones, which one will you pick? Surely, the qualified ones, since those will have a high conversion rate and thereby save you time.

What is a lead generation business?

A lead generation business is where you work to generate new customers for other business owners, to whom they can sell their products or services. For every lead that you generate, the business owner will pay you. A lead generation business idea is somewhat similar to affiliate marketing and helps to sell products or services for a fee.

For example, let us suppose that your client sells ladies’ ethnic wear. Then your job will be to get him customers who are looking to purchase ethnic wear.

Why start a lead generation business?

Small businesses in India outnumber medium and large-sized businesses and have a staggering combined revenue. So for small business lead generation companies, there is a huge opportunity out there.

Doing lead generation digital marketing for brands is one of the best online business models. In this, you create a host of tools to generate interest among potential customers that can result in phone calls or emails. In the case of B2B lead generation, clients pay for every lead generated, if they meet a specific criterion.

How to start a lead generation business?

By now you know what lead generation is. But how do you start a lead generation company? Just read on, as we provide you with a step-by-step guide:

1. Register Your Company

Decide on a name for your business. Register the name and also your business. Also, apply for your GST number.

2. Decide on your geography and niche

You have to first decide what type of business or niche you are going to target, and the type of leads that your business will generate. Choosing the right niche to sell is very important in the business of lead generation. You can either opt for retail-based businesses or service-based ones. A clothing store or a gift shop are examples of retail businesses. Examples of service-based companies are interior decoration, carpet cleaning, housekeeping, etc. Getting leads for retail businesses is comparatively easy.

Here are some things that you should consider while deciding on a niche:

• Work out the economics- Find out how much the client can earn from your lead, and the margin that he will have.
• Learn about the market-Know how competitive or saturated the market is.

3. Decide how much to charge

You have to calculate how much to charge your client per lead. For a service-based business, the usual practice is to charge 10 per cent of the value. But, if the service is a recurring one, like for example, say, a haircut, the commission can go up to as high as 50 per cent of the first bill. This is because, if your client does a good job, the customer is going to come back over and over again.

4. Figure out the ‘hook’ for the customer

Once you have decided on the business, you have to decide what you can do to entice people towards that business. For example, in the case of a salon, it can be the offer of a discounted haircut. Find out what are tactics are working for other similar businesses. If the ‘hook’ is compelling enough, the prospect can fill up the form and visit your client’s website.

5. Method

You need to decide what method you are going to use to generate leads for business owners. We are giving a few examples below:

• Facebook Ads

One method to generate leads is to use Facebook ads. You can offer a deal for a particular service or a product, for a limited time, and give the visitor the option to “Learn More” by clicking on a button. This method will enable you to broadly target a certain part of a city.

The ads must have some crucial things like price with the discount. The focus on the ‘limited time, and that the deal will not be available forever, will create a sense of urgency in the minds of the consumer. The algorithm of Facebook favours accounts that use paid advertising.

• Twitter Lead Generation

Twitter provides Lead Gen Cards which let marketers generate leads directly within a tweet, without them having to leave the site. You can pull a user’s name, email address, and Twitter user name automatically into the card, and after clicking the “Submit” button, he/she can become a lead.

• Search Engine Optimisation (SEO)

In this method, your task will be to ensure that your clients rank high on the search engine results when a customer puts in the relevant query. It is a passive form of lead generation, but the initial work is more.

• Content Marketing

Most B2B companies agree that content marketing generates more leads than any other marketing strategy. You should create content that relates to your client’s products or services, and that will provide valuable information and resources to the target market. The content should be diverse and should drive people to your landing page or website, and become your leads in the process.

Make sure to create content for all stages of the lead’s journey. The content should provide visitors with free and useful information.

6. Create a Website or a Landing Page

Where will the traffic go after they click on your ads or the listing in Google? For that, you should create a landing page or a website. The landing page informs the visitor what are the things they will get, and it will have a form for them to fill up. If it is a service-based industry like a salon or a spa, people can provide details like what day and time of the week they would like to book an appointment.

7. Get the client!

The final step is to get the client. You can reach out to potential clients who might be interested in buying your leads by sending an email, or by calling them. One trick to close the lead with the client is to let them try out one lead for free. If they can successfully sell to that lead, they will come back to you for more. You can then charge them on a per lead basis.

Though lead generation may be one of the best business ideas, it has some drawbacks.

Whenever people feel that they are being sold to, they tend to put up walls. It also depends too much on the seller and lacks sustainability from a sales and marketing perspective.

Marketing and sales require the proper mix of education and outreach to be truly effective. A lead generation business provides just that. Though the competition can be fierce, it is one of the most lucrative among the new business ideas, and definitely worth giving a try.

Also read:

1) Best Tips for Customer Retention for a Small Business
2) Tips to Understand Your Market while Starting a Small Business
3) Tips for Businesses to Overcome the Covid Blues - Revival Tips for Businesses
4) What are the keys to success when operating a small scale business?
5) OkCredit: All you need to know about OkCredit & how it works.

FAQs

Q. What are the types of leads?

Ans. Leads can be generic i.e., for the general public, or proprietary, which are customised for a particular segment.

Q. Is it necessary to have your website for a lead generation company?

Ans. Owing to the increased focus on digital marketing, building a website should be a priority.

Q. How do I pick a market?

Ans. Pick the least competitive market. Then, you will earn much more in commissions.