How to Optimize Pay Per Lead Advertising CPA in 2024

pay per lead advertising

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The numbers are in…And it’s official.

Most marketers concentrate on making more sales.

(No big shock there)

Source: HubSpot

However, what you may find interesting is this approach might not be optimal – nor effective.

Where as lowering your CPAs and making higher margins will help you put more money in the bank WITHOUT the need to sell more products, heavily increase your customer base, and manage more leads.

You just improve the conversion rate of your pay-per-lead ads.

In this post, you’ll discover some of the best ways to optimize your CPA and make higher margins.

What Is Pay Per Lead Advertising?

Pay per lead advertising is an advertising model where a marketer generates leads using different advertising channels.

Once leads are generated, the client (lead buyer) pays a fixed price for a lead.

Of course, it’s not as simple as generating random leads.

The lead buyer is looking for a specific lead type with relevant information. For instance, if you sell leads to a real estate agent, you’d consider leads such as:

  • Name
  • Verified Phone Number
  • Email Address
  • Budget
  • Kind of house they’re looking for

If a lead does not have this type of information, or it’s just a name and email, it’s useless in most cases.

The more relevant information a lead has, the higher the quality and the more money you can make per lead sold.

PPL Advertising vs. Impression Advertising vs. PPC Advertising

There are many different models of advertising.

In essence, they are the same; you just pay for a different thing. You can calculate it like this:

With impressions, if you pay 1c per impression, your Cost Per Thousand (CPM) = $10.

Assume a searcher makes 1 click per 10 impressions = $0.10 PPC.

And 10 clicks will get you 1 lead = $1 per lead.

It doesn’t matter whether you pay $1 per 100 impressions, $1 per 10 clicks, or $1 per lead.

(you are still getting the same results.)

Let’s observe these advertising models further so you can better understand how they work.

Impression Advertising

An impression means a user has seen (or potentially seen) your content or ad.

In general, an impression is counted whenever an item appears on the current page of results, whether or not the item is scrolled into view.

Source: Brafton

Meaning searchers don’t have to scroll to your ad nor see it, yet it counts as an impression. This model is nothing to confuse with pay per lead.

In PPL advertising, you pay per leads, while with impressions, you only pay per impressions.

(not knowing whether users actually saw your content.)

PPC Advertising

PPC stands for pay-per-click, a model of digital advertising where the advertiser pays a fee each time one of their ads is clicked.

PPC ads are usually displayed on top of Google, above organic search results.

Source: Ahrefs

Unlike impression advertising, you know for sure that a user interacted with your ad.

But you have to realize that you pay for every click a searcher makes. It can be a misclick, a bot, or they might not like your offer.

Yet, you still have to pay for the click they made.

No guarantees about generating leads like with the pay per lead advertising model.

Interested in organic search? Check our simple (but complete) PPL SEO guide.

The Most Common Channels of Pay Per Lead Advertising

There are many ways to go about pay per lead advertising.

You can choose social media, Google ads, or even radio advertising. There is no best channel to choose, though.

Some are just more suitable than others…

Whether it’s because of the skills and experience you have or the type of leads, you generate.

Social Media Pay Per Lead Ads

Social media pay per lead ads is about running ads on social media to attract and generate leads. This is highly effective because of how popular social media is.

Source: Data Reportal

On top of that, it’s also considered one of the best channels to generate leads. No wonder, so many marketers use social media for lead generation.

Source: Hootsuite

There are a lot of different types of ads you can choose from too.

It can be just videos on Facebook, shorts on TikTok, professional ads on LinkedIn, and more.

There are multiple platforms to choose from, and it’s important to pick the ones that suit the type of leads you generate the most.

Facebook

Facebook is a great platform for running PPL advertising for “non-time-sensitive offers” leads.

These are things leads might have an interest in based on demographic data, such as cosmetic surgery or teeth whitening.

(But none of these offers are time sensitive, so they don’t need them ASAP.)

Facebook is the perfect traffic source to introduce the demographics you need for attracting this type of leads.

It also provides information based on where they are in the buying cycle.

LinkedIn

LinkedIn PPC ads are extremely powerful for generating pay per appointment leads for B2B niches.

This is mostly because this is the social media platform with most businesses and business professionals on it.

Also, Linkedin shows specific demographic data that most other traffic sources can’t provide.

Source: LinkedIn

But there is a big downside to this.

The prices of running LinkedIn ads are through the roof and deter most people from doing it.

But this can come in pretty handy…

If you sell high-valuable leads, you can justify the cost of ads and have lower competition,

YouTube

Youtube is the second largest search engine in the world, making it an excellent platform for lead generation.

You might think that there is no way you generate a lead while it is enjoying a YouTube video. But believe it or not, people look up all sorts of things on YouTube.

And you can get HIGHLY targeted video views for pennies depending on your targeting.

(making it a super-effective platform for lead generation.)

Also, video advertising tends to be incredible at increasing conversions and sales.

Now, this may seem like a lot of work, but a video can be easily created with tools such as Camtasia, Screenflow, etc.

Or you can hire a freelancer to do it for you on sites like Fiverr or UpWork.

TikTok

TikTok is booming right now, becoming the 6th world’s most popular social media network.

What’s even better, it has launched a new kind of ad objective: TikTok Lead Generation. This new feature allows marketers to have a seamless interaction with their potential customers directly on the TikTok platform.

Source: Net Imperative

And it has great targeting options too, including psychographics and detailed information.

TikTok is especially great if you are generating leads that are young – Generation Z.

These people are addicted to social media, they can’t stop scrolling, and they trust influencers and advertisements more than ever before.

Source: The Social Shepherd

This is a golden opportunity to turn a large number of young people into high-quality leads.

Google Pay Per Lead Ads

PPC (pay per click) ads on top of Google are highly effective for generating leads. These are displayed on top of Google, above organic search results.

After a potential lead clicks on your ad, you just need to retrieve the necessary information.

This approach is super-effective because your ads are on top of Google.

And searchers see them right in front of them, so there is a high chance they will click on them. But of course, in some niches, it can be quite expensive.

This is especially true when you don’t optimize your CPA and have low conversion rates.

You’ll pay thousands of dollars while converting almost no leads.

(unless you know what you are doing.)

With that said, let’s now look at a real-time example of Google Ads pay per lead, so you can understand it better.

Real-Time Example

You run an ad campaign for people looking for a repayment program.

You create a compelling ad on Google, and a potential lead clicks on the ad to learn more.

There, they will fill in the necessary information to determine the repayment program best suits their needs.

And you get the information you need.

This can also be done by having a lead magnet where you can download a cheat sheet, PDF, checklist, and so much more.

Blog banners

Blog banners are small advertisements sitting on blogs.

This approach works great mostly because you directly target your ideal audience and leads that are in need.

For instance, if you want to generate real estate leads, you’ll find blogs about real estate.

And create an advertising campaign there.

This approach is much simpler and usually a lot more affordable than running PPC or social media ads.

Radio Advertising Pay Per Lead

Radio advertising can be very cost-effective for direct marketers and pay per call lead generation.

But there is a price you need to pay when it comes to effectiveness.

(obviously, there are much better channels to generate leads.)

However, even though it may seem old-fashioned, it has its uses and benefits, such as:

  1. Providing unparalleled exposure at a fraction of the cost
  2. Producing higher quality leads than other mass media sources
  3. Providing incremental lead flow complementary to other advertising efforts

Pay per lead radio advertising is like “the icing on the cake.”

It should not be the only or main channel for lead generation. Instead, it should act as a support or supplement for other channels you use.

This is mostly because radio advertising generally generates 5-15% of marketers’ leads.

And the whole lead flow tends to be unstable too.

TV Advertising Pay Per Lead

TV advertising can be an excellent way to attract the masses and get the right leads generated.

That’s because almost everybody watches TV.

Source: Statista

And the TV pay per lead ads model works like a charm.

The effectiveness of lead generation with this channel depends mostly on the quality of your ad and the platform or network you advertise on.

Here are a few reasons why you should consider pay per lead TV advertising.

  1. Massive reach
  2. Less competition than in an online environment
  3. Done right, you can subconsciously program people

It can be a golden opportunity that can help you generate thousands of high-quality leads you can sell to businesses.

But you have to realize that it has its limitations too.

For instance, it’s much more difficult and expensive to test new campaigns, and consumers may fast-forward or skip your ad.

(which can waste a lot of your budget.)

But, all in all, it’s a solid channel, especially for attracting the masses.

Yellow Pages

Yellow pages are telephone directories of businesses organized by category. They are a great source of reference for consumers who are ready to make a purchase.

Source: Independent

And they are very cost-effective when it comes to generating leads.

This is because eligible direct marketers pay only for leads, and NOT for ad placements. But it is not very easy to generate leads that way, and it’s more of a hit-or-miss opportunity.

You have to jump through a lot of hoops to get your ads to show up.

(especially if you are a lead generation company.)

But the number of leads coming to YP is pretty high – According to SimilarWeb millions of people visit the YP.com site (or use their app) each month.

It’s definitely worth a shot.

Direct Mail

Direct mail is a very popular way of generating leads. The key here is to choose the offer that is a good fit for direct mail.

Ideally, you’re looking for something with a high payout that can be targeted using a direct mailing list, such as:

  • Legal
  • Insurance
  • Home security

Then you need to find suitable leads – their name and address or other relevant information.

If you don’t already have a mailing list, you can rent one.

You can also leverage lead distribution platforms like LeadByte and select only a specific type of lead you are interested in.

For instance, let’s say you are considering a home security offer.

If you’re considering a home security offer, you might want to purchase or rent a list of male homeowners, ages 35-50, that have children and earn $40,000 or more a year.

You could also consider targeting neighborhoods that have had recent break-ins.

Then, you just have to come up with an offer and design and send the mail to the list.

You can also scale it, optimize it for higher ROI, and experiment with it.

This approach is great since there is less competition than in an online world and leads are more likely to read the physical letter than an Internet ad.

Pay Per Lead Ads Best Practices

All of the pay per lead channels mentioned above are an excellent way to generate leads. But what if you could make it more effective and push it even further?

That’s exactly what you’ll learn in this section.

You’ll find out how to minimize pay per lead ads CPA as much as possible.

(and make them super-effective too.)

#1: Combine Channels

Many marketers pick only one channel and put all of their efforts into it.

And while this approach can be successful, you should definitely consider combining multiple channels together.

That way, if something happens to one of your pay per lead channels…

(you get beaten by competitors, it won’t work, etc.)

You will just rely on other channels and generate leads over there. Basically, it’s about not putting all your eggs in one basket.

You could combine social media ads and Yellow Pages ads.

Or use radio ads as a supplement to PPC ads.

Either way, it’s much better to use multiple channels for lead generation. Just make sure you have at least a basic understanding of the channel you use.

And don’t overcomplicate it too much.

#2: Set up Retargeting Campaigns

97% of people who visit your site for the first time leave without buying anything. Just imagine how many potential leads are out there.

And you are never able to capture them because they leave without doing anything.

Fortunately, there is a way to fix that – and it’s called ad retargeting.

Retargeting campaigns remind your website visitors of your products and services after they leave your website without taking action.

Source: Maropost

They help you retain leads that have been interested but for some reason, decided to leave.

And it works like a charm…

In fact, retargeting can lift ad engagement rates up to 400%.

You can use ad retargeting with banner ads, PPC ads on top of Google, or social media ads on all of your favorite platforms.

#3: Optimize Post-Click Experience

You perfect your ad and attract the right lead, you get the click, and…

Your landing page is horrible, so a lead will leave, and you generate nothing. That’s why it’s vital to optimize the post-click experience.

Source: Omnisend

You have to meet the lead’s needs and deliver a seamless experience.

You can do that by:

  1. Tailoring user experience
  2. Having a lighting-fast load time
  3. Writing irresistible copy

And so much more…

If you have a decent ad CTR but fail to generate any leads, this is most likely the problem.

(and fixing it can incredibly decrease your CPA.)

#4: Always Experiment

You can never know whether something will work or not – you can only guess. And that’s why you need to constantly experiment and try new things.

It can be as simple as decreasing the number of choices on the landing page.

Source:Unbounce

That can lead to an increase in conversion.

The way to go about this tip is to use A/B split testing. Basically, you divide your audience into two groups, and you show them different variations of your ads.

Source: Cin7

You then find out which one resonates with your audience the most and go with it.

It’s as simple as that.

#5: Stop Low-Performing Campaigns

Chances are you are running multiple ad campaigns, maybe even on different platforms.

And some are probably not performing well, right?

If they aren’t, there is no reason to keep holding on to them. Let them go; they only waste your resources.

It’s much better to reinvest the money into stuff that works and lowers your CPA.

And generate more leads too.

How to Lower Pay Per Lead Ads CPA on Facebook

The strategies above will help you optimize your CPA in general. But what if you could push this even further and minimize your CPA even more?

And that’s what we will look at in this section.

You will discover the secret steps to lower your CPA for Facebook pay per lead ads.

#1: Leverage Facebook Ad Pixel

The Facebook pixel is a piece of code for your website that lets you measure, optimize, and build audiences for your ad campaigns.

You can leverage Facebook pixel to:

  1. Create website custom audiences
  2. Reach people most likely to take action
  3. Measure the results of your ads

It’s easy to add to your site, and you can use it with all of your ad campaigns.

You get a lot of data from pixels, which means that you can fine-tune your marketing to maximize ROI.

You can analyze the behaviors, create audiences, and assess events.

That’s a sure way to lower your CPA.

#2: Use Facebook’s Campaign Budget Optimization

Campaign budget optimization is a way of optimizing the distribution of a campaign budget across your campaign’s ad sets.

Facebook continuously finds the best available opportunities for results across your ads.

Source: Ad Espresso

(and distributes your campaign budget in real time to get those results.)

It can help you with finding the ad campaigns that work and those which do not. And make your CPA as low as possible.

#3: Fill out All of the Details on Your Facebook Page

Facebook ads, similar to Google, run on algorithms.

And a big algorithm factor that most people overlook is their actual Facebook account/page.

Take the time to fill everything out properly – your about us section/business info, your address, and your contact info.

Also, add your story and mission, your products and services, and get some reviews.

The best way to think of it is if Facebook offers a section to be filled out, fill it out.

If you do these things well, you will maximize your page’s engagement – which the algorithm “notices,” and you get the green light that your ads are ads that people will want to see and engage with.

Which will definitely lower your Facebook pay per lead ads CPA.

#4: Don’t Sell to a Cold Audience

Going straight in for the acquisition can work.

But it will generally cost a lot more than first engaging that audience before going for the install/sale/signup.

Source: Lusha

Sure, it takes a little more time, but a $0.10 engagement followed by a $1.00 app install is a lot better in the long run than a $3 app install, for example.

Especially when you get into the millions of users.

If you are looking to generate high-quality leads, you must engage them first.

Get in touch with them, teach them something…

And only then close them and get their valuable info – which is very effective for lowering CPA.

#5:Take Advantage of Video

Video ads allow you to show off your product, service, or brand using a video.

And they work like magic…

Source: Piktochart

Yes, that’s right, videos can completely supercharge your Facebook pay per lead ads.

(and get them on another level.)

While drastically minimizing the cost per acquisition.

How to Lower Pay Per Lead Ads CPA on Google

Google ads can be a great way to generate a lot of new leads for your pay per lead business. But as with Facebook ads, there is always room to improve.

Here are some of the best ways to go about lowering Google ads CPA.

#1: Rebalance Your Campaign Budget

Properly rebalancing your resources into ad campaigns with the lowest CPAs is one of the easiest ways to make lead generation effective.

There are a couple of ways you can go about this and find the winning campaigns.

For instance, you can look at metrics, such as:

  • Lost Is (budget)
  • Impression share and abs
  • Top of page IS

If these metrics indicate growth, evaluate whether there are higher CPA campaigns from which you could pull the funds.

And transfer them to the more effective, lower CPA campaigns.

#2: Revisit Campaign Structure

A well-thought-out campaign structure is essential to driving down CPAs.

The way you structure your Google Ads account allows you to control how you want your ads to be triggered and when and where you want them to appear.

Source: PPC Expo

Not having a well-structured account is like attempting to drive a car that’s not properly built.

(accidents are bound to happen.)

And…

Budgets are set at the campaign level, making budget distribution dependent on campaign structure.

That means if your structure sucks, your budget will be distributed ineffectively.

And you will have no control over your CPA.

That’s why you have to ensure your campaign structure is on-point and organized for maximal efficiency.

#3: Campaign/Bid alignment

Aligning bids to your campaign budget is vital to maximizing efficiency.

If you run an ad campaign, you should analyze whether it makes sense to drop your ad group and keyword bids. Often, even for ad groups/keywords that are converting, it makes sense to drop your bids to capture more clicks and conversions for that same budget.

This can help you fund campaigns better and increase your chances of winning the #1 spot.

Source: Ten Thousand Foot Views

If you want to ensure you keep bids high enough to stay on the first page of the SERPs, you can pull in a column for “first-page bid estimate” to find where that bid floor is.

Even if this costs a bit more, it can be exponentially more effective since your ad will be #1.

And paradoxically, by paying more, you decrease your CPA.

#4: Keyword Expansion

Proper keyword research may uncover most terms relevant to your business now.

But consumer search behavior changes over time, and it’s important to expand or change the keywords of your ad campaigns.

To discover new opportunities, you should regularly conduct keyword research.

That way, you can see all of the relevant search terms and their metrics like volume or competition.

Another thing you can do is take advantage of Dynamic Search Ads.

Source: PPC Expo

With DSA campaigns, Google scrubs page content and serves up your search ads to individuals searching for content relevant to your site.

These campaigns are excellent, always-on way to mine for new, low CPA keywords.

#5: Boost your Quality Score

A lower bid can lower your cost per click, which lowers your overall cost per lead.

But it also lowers your exposure and chances of capturing leads. So how can you win the Google Ads auction with a lower bid?

The answer is a high-quality score.

Google rewards quality ads with lower costs per click.

Source: WordStream

This is to prevent low-quality, crappy ads with high budgets to always appear on top. Google cares about its searchers.

(and that’s why the ad quality is a critical part of ranking your ads high.)

To improve your Quality Score, you need to understand its main components:

  • Expected click-through rate: use ad extensions, ad customizers and improve your ad copy
  • Landing page experience: make sure your landing pages are trustworthy and useful to the people who click on your ad.
  • Ad relevance: ensure there is tight alignment between your keywords and their associated ads and landing pages.

If you can manage that, you can rank higher in paid search while paying less.

Which can drastically lower your pay per lead ads CPA.

The ULTIMATE Solution to Minimize Pay Per Lead Ads CPA

All of these tips are great, but they are not as powerful as this one…

The only way to truly know what resonates with your audience and make them convert is through hard data.

(there is no other way around it.)

Most marketers conduct market research in two ways:

  1. They do mountains of research, discover every man, woman, and dog who might be interested, and try to serve every one of them.
  2. They go all ‘Dunning-Kruger Effect’ and pick what they think their perfect audience is, with little or no research at all.

Either way, both can lead to long working hours lost and Ad spend flushed down the toilet.

And the way we do that in LeadsHook is by reverse market research.

In a nutshell, it goes like this:

  1. Create a Decision Tree with your relevant segmentation questions (Age, location, etc.)
  2. Send traffic
  3. Use a Pivot Table to see who’s sticking. (Opting in for your offer or service.)

Then Reverse.

Use the hard data to find out who your audience REALLY is.

Focus on them…

And stop wasting time, money, and marketing resources on those who aren’t.

Reverse market research works on any vertical and is probably one of the most powerful but least used features in LeadsHook.

And when put into action…

There’s a good chance you’ll discover audiences none of your competitors even know about, which means you’ll be the only one fishing in this big blue pond.

Read on to learn more about how you can leverage reverse market research to the fullest.

Conclusion

Pay per lead marketing can be a powerful way to make a lot of money and advertising is one way to do it. But focusing only on making sales might not be optimal – nor effective.

Lowering your CPA and making higher margins will help you put more money in the bank too.

And that’s what most marketers forget about.

Fortunately for you, now you are equipped with some of the best strategies to lower the cost per acquisition on your ads and make the highest margins possible.

What’s even better, you’ve learned the ultimate way to achieve this – reverse market research.

And that’s only the tip of the iceberg of what LeadsHook can help you accomplish.

LeadsHook is, in our opinion, the most advanced and valuable tool for lead generation and customer engagement throughout the funnel.

It features decision trees and interactive quizzes to make capturing the lead’s first-party data a piece of cake. The best thing about it is that you can choose from plenty of pre-made lead capture forms, and you can hit the ground running with minimal setup.

No need to create anything new or start from scratch. You can do all of that lead generation without lifting a finger…

You can then segment these leads, nurture them, and get the highest possible offers from companies that pay for leads.

Sign up for our 14-day free trial and give it a shot right now.

Want Higher Quality Leads?

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Leadshook Team

From one of the various talented members of the LeadsHook Team who would rather stay anonymous, won’t admit to writing the article in question, or have moved on to different pastures

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