double POSITIVE Marketing Group, Inc.

Market-driven (i.e. “auction”) pricing for leads is growing in popularity. The best and most prominent example of this is found in the proliferation of lead exchanges like LeadPoint and Root Exchange, where lead buyers set their own bid prices and purchase leads based on their performance. LeadPoint’s Michael Rosenberg breaks it down nicely in his recent blog post “Auction Model Moves Into Lead Generation.”

But lead exchanges aren’t the only place where you can “name your own price” for leads.

Earlier this year, DoublePositive launched a Name-Your-Price For LIVE Hot Transfer Mortgage Leads application, which lets lead buyers determine the price they are willing to pay for a mortgage lead with very specific filter criteria. Much like buying keywords on Google or Yahoo, the price for a specific LIVE Hot Transfer is based on the supply of and demand for that lead. Lead buyers actually compete with each other by bidding on LIVE Hot Transfers. In fact, our pricing for mortgage leads was actually market-driven before we launched the online pricing wizard, but now we’ve handed over the pricing engine to lead buyers directly so they can see what the going price is for a lead at any point in time.

So why is this important to lead buyers? Well, it means that DoublePositive doesn’t set an arbitrary price-point for the LIVE Hot Transfer Leads we sell, so you can rest assured that you are always getting the true, fair market-driven price. With this model, we’ve basically said to lead buyers, “Hey, you may not think that a lead is worth x-dollars, but your competitor does.”

If you’ve been following this blog, visited DoublePositive’s website, or talked to us at a trade show, you’re probably familiar with our “Evolution of Online Marketing” story. In short, the story explains how online advertising has moved from a pricing model based on ad impressions (CPM), then to clicks (CPC), and then to a performance-based model that is based on cost per lead/acquisition (CPL/CPA). Finally, we introduce the idea of CPT (cost per transfer), which is the most evolved model, delivering a double-verified live call transfer of a consumer directly to a sales professional. You don’t get any more “evolved” than that.

Sure, we sell “leads” — and so do lots of companies. But not all leads are created equal. List services, for example, sell cold lists and say they are “leads.” Online lead generators sell leads, but those leads are sold (multiple times) before any verification or qualification of the contact’s information or intent has been done. So doesn’t the industry need to recognize the difference between leads and qualified leads?

If you had to give it a label, Cost Per Qualified Lead makes sense. Yet, a Google or Yahoo search for cost per qualified lead, CPQ or CPQL brings up just a handful of results, most of which are articled and blog posts from the last several months. So the momentum is building, and that’s good news. The online advertising industry is always evolving, and a measurement like CPQ/CPQL is one measure that lead buyers need to be able to compare apples to oranges — or leads to qualified leads.

If you are a lead buyer, try asking your lead generation company what their “Cost Per Qualified Lead” is. I would love to know how they try to answer that one.