After working in lead generation as a lead seller for more than 10 years and generating thousands of leads, it’s clear to me that there are always challenges in this sector, as well as opportunities to learn from them.
More than ever, it is vital for marketing companies who generate and sell leads to build and maintain a strong and positive reputation in the markets they operate. In this post I will examine a few of the main challenges faced by lead generators and some steps they can take to mitigate their impact.
Rising media costs
Digital advertising across all sectors and platforms can be ruthlessly competitive and this certainly applies to lead generation markets in the financial services sectors. To highlight a couple of examples, a Google search for ‘compare life insurance quotes’ can cost as much as £38 per click and in the mortgage space, ‘best remortgage deals’ hovers around £11 per click.
These costs are incurred by the lead generator when a consumer clicks on their advert and lands on their website. Highly optimised landing pages tend to convert around 20% of their website traffic into lead submissions, so you can see how the cost to generate leads quickly adds up.
In addition to Google search ads, the cost of running paid social media ads and native content marketing on platforms such as Taboola and Outbrain are also increasing month on month as marketing companies continue to utilise these channels to off-set the prohibitive costs of pay per click ads on Google.
The CEO of one of the top lead generation agencies in the UK told us their Google rep recently confirmed that ad competition and saturation levels within UK financial services on PPC search for life insurance has increased drastically compared to just over a year ago.
The race to the bottom
With media costs and competition running so high, many marketing companies and lead generators have been unable to resist the temptation of weakening their offering to drive more clicks on their ads and improve their form conversion. When challenged they may call this ‘optimising their campaigns’ but we call this ‘the race to the bottom.’
Some may choose to include brand terms from well-known protection and mortgage providers in their ad copy or bid on spurious and boarder-line keywords which drive high search volume / low intent enquiries. Other techniques include weakening the consent message around the ‘submit’ button on an enquiry form and more generally ‘juicing up’ their messaging by using misleading headlines and attention-grabbing copy.
It’s no secret that the FCA, ASA and ICO are circling and over the past couple of years the level of scrutiny on financial services lead generation has been growing and the number of rulings and fines issued are increasing. Google made it compulsory for advertisers running financial services adverts across its platforms to be FCA authorised from 30th August last year and we expect to see more developments along these lines across the main advertising platforms in 2022.
Steps for serious sellers
Despite the current challenges, it’s not all doom and gloom for lead generation companies and there are a number of steps that lead sellers can take to ensure they are well placed to succeed and grow in a challenging environment.
· Get your house in order: if you haven’t already, start the process of FCA registration as soon as possible. A compliance consultant will be able to help you through the process of becoming directly authorised. Alternatively, speak openly and honestly with your lead buying clients about the possibility of becoming an AR / IAR and using their FCA number. Either way you will have to demonstrate who has effective control and sign off for each individual advert. Independent data certification is a powerful tool and an important step to take to prove your advertising campaigns meet regulatory requirements.
· Test new methods: With the cost of media causing real issues for lead generation marketers everywhere, never has it been more important to test all the available digital channels and different techniques across a range of website landing pages. Contact State’s lead generation performance platform enables lead sellers and buyers to create an unlimited number of campaigns and track performance by individual landing page and media source combinations. This granularity makes it easy to agree different commercial terms for different campaigns based on real performance and results.
· Streamline your tech: Lead generation moves fast and lead sellers need to be prepared to onboard new buyers at short notice for test campaigns and new commercial partnerships. Long integration lead times and inconsistency between API’s and platforms can be a real drain on time and money. For lead sellers and buyers integrated with Contact State, we do the heavy lifting for you. Integrate once with our lead delivery and certification API and we’ll take care of the rest.
· Resist temptation: Whilst we accept it is tempting in all walks of life to take a quick shortcut or cut the odd corner, there is simply no room for it in performance marketing and lead generation. Every change you make to your advertising campaigns, landing pages and call to action submit buttons has an impact on the overall performance for your lead buyers. For lead generation campaigns to be successful for both lead seller and buyer the rules of engagement must be clear and a trusted relationship built between both parties.
Digital marketing and lead generation in 2022 is a mature market and there are tools available to help lead generation focused marketing companies survive and thrive. At Contact State we may not have all the answers, but we believe we have some pretty good solutions to help both lead sellers and buyers build trust, achieve transparency, protect their business and improve return on investment from their lead generation campaigns.