double POSITIVE Marketing Group, Inc.

Post By
Sean Fenlon

After attending the TARGUSinfo Lead Quality Summit, the thing that surprised me the most was that even professionals in the lead generation ecosystem continue to speak different languages to one another.

Not just industry-specific language, but also language core to lead generation as a concept.

What I realize is that those involved with leads and lead generation need a CONSISTENT lexicon and vernacular.

Below may ultimately become the DoublePositive entry into Wikipedia for the respective terms…

What is Lead Generation?

I agree with Matt Coffin.  Lead Generation is NOT a Value Proposition, and Lead Generation is NOT an Industry.  Rather, Lead Generation is a subset of the ADVERTISING industry.

Lead Generation has a different definition depending on whether the perspective is from the lead supply side or the lead demand side…

On the lead demand side, Lead Generation is a specific INTENT of advertising dollars.  In other words, I am spending $X in advertising in order to generate at least Y leads, so that my cost-per-lead is $X divided by Y. 

On the lead supply side, Lead Generation is a performance-based delivery model of advertising sales.  In other words, companies that sell advertising in any form prefer to take no risk if possible.  However, if they cannot sell their advertising in a no-risk model (such as a raw sponsorship or CPM), the will offer to absorb some of the risk by offering advertising on a performance-basis.  The first form of performance-based advertising occurred in 1998 by selling the “click” of an Internet user (CPC) instead of simply selling the impressions of a banner ad.  Some advertisers demanded even greater performance than merely a user’s click as only a small percentage of clicks will result in a form-fill (or phone call in some instances), thus CPA (Cost-per-Action/Acquisition) or CPL (Cost-per-Lead) is an even high performance-based delivery model.

Many companies make the supply side and demand side reconciliation simple by managing all the advertising-buying risk themselves and selling to advertisers only on a per-lead basis.

What is a lead?

For years, DoublePositive has been struggling to draw the enormous distinctions between a “lead” and a LIVE Hot Transfer.

I see now more than ever why there continues to be so much confusion.

A conversation I had with the CEO of a major shopping engine was referring to an Internet user “clicking” on a link to visit a the site of an e-commerce retailer as a “lead.”  I found that rather strange use of a the lexicon – we have always referred to such a phenomenon as a “click” and pricing models are this type of user action are typically Cost-per-Click (CPC).

Later in the day, ValueClick and Scholastic, Inc. gave a case study of how offers made for Dr. Seuss books in a co-registration environment resulted in completed “sales.”  However, in the PowerPoint presentation, they referred to the completed sales as “leads.”  We have always referred to transactions that are fully-completed online as “sales” and this type of user action are typically priced as Cost-per-Sale (CPS).  Another way to support this position is to think of yourself as an advertiser that ONLY pays the advertising cost when a sale is completed – I don’t think you’re too concerned with “lead quality” since the quality is essentially perfect every time you are asked to pay.

A lead is NOT a click.  A lead is NOT a completed transaction.

A lead IS a consumer’s “Expression of Interest” in a product or service offer.  Using this definition, an “Expression of Interest” is typically represented by a form-fill process (anywhere to 1 field of contact information such as an email address to dozen of fields of information). 

Many of these “leads” are what we refer to as “marketing leads,” meaning the consumer’s contact information goes into a marketing database for additional marketing communications.  A good example of a “marketing lead” would be a consumer requesting more information from Crest on “Teeth Whitening Strips.”  The consumer may receive a coupon for the product by email or perhaps a free sample by mail.  But there is never a Crest salesperson attempting to make contact with the consumer that expressed interest in “Teeth Whitening Strips” as the value of the transaction is too low and the transaction is sufficiently simple where additional sales support would be superfluous.

In this universe of marketing leads, the concept of “lead quality” is essentially limited to accuracy of data, since there is seldom any individual transaction that is track-able in order to determine consumer “interest” (or consumer “motivation” in the words of the IAB Lead Generation Committee).

Marketing Leads makes up a significant part of the Lead Generation universe.  Brands such as Nike, Pfizer, Proctor & Gamble, and others often spend millions of dollars per month for “Marketing Leads,” however, due to the value of the product or service being offered, the price seldom exceeds $10 per lead.  Offers placed in co-registration environments and also incentive-ized offers are good options for marketing leads, since there is seldom any human cost associated with sorting through the leads to find genuinely-interested consumers.

“Sales Leads,” however, demonstrate significant differences from “Marketing Leads.”  Sales leads are expressions of interest in a particular product or service.

So, my next post may be titled “What is a…”?
1. “Lead” Supplier

2. “Lead” Aggregator

3. “Lead” Generator

4. “Lead” Seller/Buyer

5. “Lead” Etc.

Post By
Sean Fenlon

Industry Leaders (Lead Sellers AND Lead Buyers) Gather to Discuss Ways to Increase the Value and Effectiveness of Internet Leads

The leaders in the Internet Leads movement gathered in Vegas last week at
The Palms.  I attended the event along with our CTO Syed Zaidi, and our SVP Brian Ocheltree.  Ironically, we found ourselves on the same floor as Ultimate Fighting Championship competitors during their warm-up for a bout on stage at The Palms – quite a distraction with this highly-competitive crew.

:-)

Wednesday Sessions

The two-day conference began on Wednesday 9/19.  This was a travel day for most of the participants, thus arrivals were sporadic.  The conference began with breakout sessions despite the effects of disparate arrival times.  With this smart design, attendees were not forced to miss the special Keynote Sessions scheduled for Thursday as a result of their travel time on Wednesday.

Techniques and Strategies for Increasing Enrollments
Craig McGuinn, COO of DegreeStreet.com (Ward Media)
Angela Siegel, Marketing Manager, Grand Canyon University

Craig and Angela did an outstanding job of tag-teaming a presentation from both the perspective of the lead seller (DegreeStreet.com) and the lead buyer (Grand Canyon University).  One of the concepts they reinforced was to look beyond the Cost-per-Enrollment of a new student and into the retention rates and graduation rates of the students.  This concept made a number of the audience members somewhat curious and they felt that the effectiveness of the performance feedback loop would be compromised by the extended timeline of the milestone.  In other words, a number of audience members were convinced that things change so quickly that conclusions from longer-cycle performance indicators would lead to moot conclusions.  Overall, however, both Craig and Angela demonstrated a deep understanding and desire to measure as many dimension as possible in order to optimize lead flow and the underlying campaigns.

Building the Right Formula for ROI
Laura Lewellyn, Senior Data Analyst, TARGUSinfo

Laura walked through a case study of an anonymous Online Education company by segmenting lead performance into deciles.  The analysis provided an interesting philosophical concept to consider.  Should a lead-buying organization optimize for pure conversion rate or should a lead-buying organization optimize for a pure profit through-put.  In other words, should a lead buyer cut off any lead source below, say, 7%, or should a lead buyer continue to buy leads from any source so long as they were making at least $1 more than what it had cost them (fully-loaded). 

Laura also looked at the first-call-close dimension, which was very interesting to me.  Clearly, a lead source that can provide a significant percentage of closes on the first contact is a high-octane lead source and will result in significant cost savings with respect to “follow up” resources be applied in order to close the deal on subsequent calls.  This concept is the closest I encountered to my concern about labor costs seldom being factored in the cost structures in ROI calculations. 

Laura later explained to me that TARGUSinfo provides this type of detailed analysis for free as part of their consultative and value-add sales process.  TARGUSinfo customers should take full advantage of this as it could most certainly stand alone as hourly-based consulting contracts in the future.

George Moore
CEO & Founder, TARGUSinfo
Official Opening Remarks

On Thursday morning, TARGUSinfo founder and CEO George Moore delivered the official opening remarks for the conference.  George announced that TARGUSinfo (after being built “brick-by-brick” without external funding) had achieved a $100MM run rate, and was growing 20% per year.  This is a fantastic achievement and milestone, and a testament to the TARGUSinfo team.  The majority of their revenue continues to come from their Caller-ID, Dealer-locator, and other real-time telephone services, but they are clearly bullish about the interactive leads until of their business as an important growth center.  George clearly acknowledged the growth opportunities of real time data services via the Internet.

Opening Keynote
The Rise of Online Conversion Marketing
Ian Smith (Managing Director, Allen & Co.) & Matt Coffin (former CEO, LowerMyBills.com)

The opening keynote address began with Ian Smith, Managing Director of Allen & Co.  Ian is legendary in the Internet leads M&A ecosystem, having managed the process of the sale of Lending Tree, Advertising.com, LowerMyBills.com, and NexTag.  Ian provided a historical overview of the evolution of the leads ecosystem with particular emphasis on LowerMyBills.com, including selecting historical examples of LowerMyBills.com innovative display advertisements (stretched animals, the suicidal ginger-bread man, etc.)

In one diagram, Ian posed the question: are publishers (portals, content/destination sites, etc.) moving upstream to compete with the very companies that currently buy their inventory today? 

[Personally, I believe the answer is a simple one.  It all comes down to eCPM.  Publishers almost always prefer to sell their inventory on a non-performance-based (CPM) model.  If the CPMs that they are able to command using the efficiency of the various exchanges (Right Media, CPX Exchange, DoubleClick Exchange, etc.) is significantly lower than the EFFECTIVE CPM (eCPM) of selling using a performance-based delivery model such as CPA/CPL, they will indeed move upstream in an attempt to capture additional value.]

Since 50% or more of advertising sales are reportedly from non-performance-based brand advertisements, I, like Ian, do not see the publishers moving upstream anytime soon.  Quite simply, “the juice just aint worth the squeezin’” for them at this time.

Ian then invited Matt Coffin up for a fireside chat (without the actual fire).

One of the things Matt Coffin clarified early in his discussion was that “Lead Generation is NOT a Value Proposition.”  I could not agree more.  Matt went on to predict massive innovation in the Lead Generation space based upon competitive pressures as well as the economic reality as a result of a drastically affected mortgage leads ecosystem.  But Matt was definitely betting on the innovators and entrepreneurs in the audience, which warmed my heart.  He did also warn entrepreneurs that whatever it is they are doing better bring significant value to the consumer or else the model will ultimately fail.

During the Q&A session with Ian Smith and Matt, former CEO of Experian Interactive, Ed Ojdana, was handed the microphone and asked Matt “What was the biggest/best lesson learned now that you’ve stepped away from LowerMyBills.com and have a fresh perspective” (or something of that effect).

Matt took his time to gather his thoughts before responding emphatically – “I need to break the answer up into pieces.  First, TEAM MATTERS.”  Matt went on to recount that all the great success of LowerMyBills.com have be attributed back to the addition on new rock star team members, and that the technology and the vision alone could not have produced the same results as the people.  Secondly, Matt described a culture that passionately-analytical and poured over key metrics, and would quickly “double-down” on what was working at the time in order to continue to accelerate growth. 

[Matt’s advice was quite apropos as I witnessed him later in the evening doubling-down at the blackjack table with almost eerie sense of what the next card will be – to the cheers of the folks around the table.

IAB Marketer & Agency Guide to Lead Quality

Prior to this session, attendees were provided a multi-page IAB Marketer & Agency Guide to Lead Quality, a great handout but did not include anything DoublePositive was not already incorporating.

Terrence Thomas, CMO, eLearners.com

After the break, excellent presentation by Terrence on how to attract potential students to your educational institution.

Striking a Balance Between Branding and Lead Generation
Josh Perlstein, President, Response Media

Many described Josh’s presentation as the most insightful, as there were very few brand marketers in the audience.  All I can say is that even toothpaste manufacturers buy leads.

Awards

Just before lunch, two awards were presented for Online Marketing Excellence.  The Awards were presented to David Behn, Cole & Weber, and Matt Wells, LowerMyBills.com.  Based upon Dave Wengel’s intro, it sound as though both are way beyond well-deserving of such awards.

Dave Wengel

Dave Wengel  was the most-present presenter during the second half of Thursday (delivering a similar presentation to both lead sellers and lead buyers).  Dave also provided excellent closing remarks at the end of the conference.