What is Pay-per-Lead?Pay-per-Lead is a billing method that is mainly used in affiliate marketing. It is an online advertising payment model in which payment is based solely on qualifying leads. The affiliate is remunerated for the fact that a visitor performs a certain action on his site (download of a file, registration newsletter etc.)
- Worthwhile for consulting-intensive goods
- Better remuneration for the Affiliate
- Simple clicking generates no revenue
How Pay-per-Lead works
In a pay-per-lead agreement the advertiser therefore only pays for leads that are generated. Consequently, no payment is made for visitors who do not sign up. A lead is generally a registration with contact information and possibly some demographic information, so it is usually a non-cash event. For example, a lead may consist of an email address. A risk to the advertiser is the potential for fraudulent activity by third parties or marketing partners. Some false leads are easy to spot. Nevertheless, it is advisable to check the results regularly. So what are the advantages of the Pay per Lead method? For affiliates, this form of billing has the advantage that such higher-value contacts are correspondingly better remunerated than other (lower-value) marketing measures. However, pay-per-lead measures are often supplemented by a few more in affiliate marketing. The contact with users is thus considerably more intensive, because such a method requires them to interact with each other. In most cases, a contact is only remunerated if a previously defined qualification level of the contact has been reached in the process. In addition to a fixed number of leads, it is therefore possible to define what a “qualified lead” means.
Pay per Lead in Practice
A popular combination that you often see is a combination with Pay-per-Sale (PPS). If the user has carried out the desired registration on his first visit and thus generated the pay per lead, then in a further step the order of products or services can be assigned to the affiliate and remunerated separately with PPS. However, there are a few disadvantages for the Affiliate with Pay per Lead. For example, it is often not possible for the affiliate to check directly whether a pay-per-lead has actually taken place. Therefore, such a marketing method should only be chosen if the respective affiliate manager has a corresponding reputation. Since a simple click does not lead to any income, another disadvantage is that the placement of banners for forwarding is basically free of charge. The advertising space used does not therefore yield any direct profit. In addition, the conversion rate is also much lower than with the low-threshold methods such as the Pay per Click method. The Pay-per-Lead model is particularly suitable as a commission model when it comes to the sale of goods requiring intensive consultation. In contrast to alternative methods, only really high-quality traffic originating from the affiliate is paid. In affiliate marketing, there is a cooperation between the site operator and the company. The webmaster has the choice whether to use banners or affiliate links. Winning the right leads, the users who actually want to buy something, is one of the biggest challenges of the B2B marketer. You can pay for clicks or for impressions, and although both options have value, neither guarantees you a large amount of really interested, ready-to-sell leads. Fortunately, thats exactly what the reward at PPL is designed to be. It is in the affiliates own best interest to make sure that the associated advertising is better presented, as this is more likely to generate interest in the product among website visitors. The Affiliate must also be aware of the basic interest of the visitors to his site and whether he can generate enough traffic at all. If such basic things are sufficiently taken into account, it is very well possible to earn a decent profit with the PPL procedure