Stop Judging Your Ads on Cost Per Lead
Cheap leads look great in a report. They look a lot worse in your bank account. Here's the number you should be watching instead.
Most agencies report on cost per lead because it's easy to make look good. Want cheaper leads? Loosen the targeting, make the form shorter and offer something free. The cost per lead drops, the report goes green and everyone feels great.
Then your team spends the week calling people who don't remember filling in a form, and nothing gets sold.
Cheap leads are cheap for a reason
Ad platforms are very good at finding exactly what you tell them to find. Tell them to find leads as cheaply as possible and they will, from the people least likely to buy. A $20 lead that never answers the phone costs more than a $50 lead who books in.
The number that actually matters is cost per customer: what you spent on ads, divided by the number of people who paid you.
How to start tracking cost per customer
No fancy software required. Just connect the dots between the ad and the sale.
- Tag every lead with where it came from. Campaign, ad and keyword, recorded in your CRM.
- Mark what happened to each lead. No answer, booked, quoted, won or lost.
- Add up the spend for each campaign and divide it by the customers it produced.
- Feed it back to the ad platform. Tell Meta and Google which leads became customers, so they go and find more people like them.
Then make decisions on the right number
Once you can see cost per customer, the decisions get obvious. Some "expensive" campaigns turn out to be your best ones, and some "cheap" ones turn out to be burning money.
We build this tracking into every campaign we run, and report on it weekly. If you can't currently tell which of your ads made you money, that's worth fixing before you spend another dollar. Apply for a strategy call and we'll show you where to start.
