Lead Buying Best Practices For Marketers

Understanding and researching the differences in purchased leads is critical. Due diligence when buying leads can save you considerable time and money.

How to Implement Best Practices for Buying Leads

Buying leads is an important consideration in any lead generation strategy. Whether your sales process is fed entirely by purchased leads, or they supplement internal lead gen programs, it's critical to understand how to get the most value from lead buying.

ClickPoint has a lot of experience helping customers buy leads from lead providers. We work with many small, medium, and enterprise customers that buy internet leads, and we have the experience to understand which ones have value and how to spot the winners and losers.

Clients often ask if we can recommend lead providers for specific industries, and generally, we love to. Receiving a recommended lead provider is always better than selecting one at random, but there are also steps you can take now to prevent making a wrong choice and ending up with dead-end leads that frustrate your sales team.

Due diligence when researching and vetting lead sales organizations will save you a lot of headaches.

Managing Expectations

Manage your expectations before purchasing leads from a provider. Understand the differences in leads that providers supply. Additionally, like hiring an employee or making any significant decision for your business, do the work upfront, so you don't pay for it later. Researching lead providers needs to be scientific, so you don't fall for the allure of promises made and results never realized.

Take stock of the sales team's capabilities and skills before purchasing leads. Are they better suited for exclusive or live call transfers vs. semi-exclusive or aged leads requiring more tenacity and consistency to get a good result?

Main Types of Internet-Generated Leads

High Value (Exclusive) – This lead type is sold only to your company. This lead type has a premium and should result in higher close and win rates. Your sales team has no competition for exclusive leads and has a better shot at winning the business. These leads should come from campaigns that focus on your target audience.

High Value (Live Call Transfers) – This lead type is also generally exclusive as the customer transfers directly to your sales team via a phone call. These leads carry a premium as the potential customer is on the phone and presumably ready to talk to a salesperson about a product or service.

(Semi-Exclusive) – Semi-exclusive leads sell to multiple buyers that will compete to win the business. The problem with this type of lead is that it's difficult to ensure how many people will compete for the sale. Make sure you have something in writing stating how often each internet lead sells to competing businesses.

(Lead Lists or Aged Leads) – These leads are aged and not real-time, meaning they may have talked to multiple salespeople about a competing product or service, chose not to purchase at that time, and your sales team can find good leads at a meager cost. If your team is suitable for these types of leads and has a highly efficient dialing and multi-touch solution to reach these potential customers, it can work well.

A Scientific Approach to Selecting a Lead Provider

  1. Research the lead provider's website. Does the provider guarantee safeguards to ensure the leads you purchase are TCPA compliant and have opted-in to an offer for your services?
  2. Ask the lead provider to show you the lead generation landing pages and verify that TCPA and Opt-In safeguards are in place.
  3. Search for reviews – If you cannot find reviews via Google, TrustPilot, or something comparable, look at their BBB rating. Also, ask the company you are thinking about working with for a customer referral, someone you can talk to about the quality of their leads.

    LeadExec improves your lead quality with TCPA certification

Questions to Ask the Referral

    • How long have you been working with the lead provider?
    • What is your average contact rate on the leads provided?
    • How many leads are receptive to your offer out of every ten leads you contact?
    • Would you recommend the lead seller to other companies like yours?
    • Does the provider have a good return policy for bad leads? Which leads can be returned to the seller? Is it difficult to return bad leads to the lead provider?
    • Can they send leads directly into your CRM, lead management, or sales solution?
    • Ask about the lead's price and if they are exclusive or semi-exclusive. If they are semi-exclusive, how many buyers do they sell them to? Be sure that they write it into your agreement. What is the cancellation policy if you cannot convert the leads?
    • Once you have asked these questions, you can build a prospective lead provider scoring matrix; here is an example:

    Semi-Exclusive Sold Rate Key

    2 Buyers = 10
    3 Buyers = 7
    4 Buyers = 5
    5 Buyers = 3

1-10 Points


Return Policy


Semi-Sold Rate

Total Score

Lead Provider A






Lead Provider B






Lead Provider C







Once you start receiving leads, three KPIs matter most to determine if the lead provider is working out as expected.

1. Contact Rate – you should create a scoring matrix for your contact rate that looks like this:

    • Excellent Provider – 70% or better contact rate
    • Good Provider – 60% or better contact rate
    • Poor Provider – Less than 60% contact rate

2. CPA (Cost Per Acquisition) – This is one of the most important KPIs, as you could have a lower contact rate, but the CPA is still within acceptable thresholds. The equation is the total dollar amount spent on leads divided by converted leads.

If you purchase $5,000 worth of leads and close five deals, your CPA would be $1,000.

ROI% – 50% to 100% target
ROI% = (Profit From Sales Leads – Cost of Leads)/(Cost of Leads)

  1. If you spend $5,000 on leads and convert 20 leads at an average profit of $500 = $10,000 Profit-$5,000 Expense / $5,000 Expense = 100% ROI
  2. If you spend $5,000 on leads and convert 15 leads at an average profit of $500 = $7,500 - $5,000 / $5,000 = 50%

See how ClickPoint Software can increase your contact rate

Understanding the right questions to ensure you pick a great lead provider is just the first step; you must follow through with KPIs that will determine if your lead source is ROI positive. If the ROI is within your range, you can forgo an excellent return policy or a less desirable lead contact rate.

These KPI metrics help determine which lead sources you should keep an eye on; if there is a low contact rate and high rate of return, that should be a red flag, but ultimately the success of any campaign will come down to ROI. Remember, this is not something to take lightly; the more you are dialed into the metrics, the better you can plan, pivot, and divert resources to lead sources that are ROI-positive, and your sales team will thank you.

Learn more about lead sellers, lead sources, and how to manage them as part of your lead management process.

See also: lead distribution software

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