See the small business marketing strategies mega consultant Paul Lemberg revealed in Lead Landslide Module of his Formula 5 course where he spoke at length about increasing your business opportunities with more leads

Hey you,

It’s Lewis a.k.a. Nerd #2.

In Part 1 of this post, we talked about . . .  

What can you effectively implement that enhances what you’re already doing . . .

How you can make referring customers & clients a pleasurable process for your existing customers and clients . . .

Finding your ideal strategic alliance partners who will take action for you in the quest for finding more of your perfect prospects . . .

And the top 6 online traffic tactics that can bring these perfect prospects with money in hand.

Now in Part 2 here we’re gonna get all geek on boosting your lead flow by 5-25% in the next few weeks and getting at least 15% increase in this area of your business.

And do it in a way that’s even with or drops what you’re currently spending to get a customer.

Sound good? Good. Let us proceed.

Every Business Model Offers Different Opportunities

When we’re measuring the results of our marketing it’s never a cost. It’s always an investment in research because when we track all of our key metrics we know sooner than later when to bail on a bad investment so we don’t get hurt.

Idiots try to spend as little as possible on lead generation.

Some people think the outcome is spend as little as possible on marketing. WRONG.

When you understand the elementary math in your business you see that being able to spend more money than your competitors to get business gives you the advantage.

If the first thing you sell somebody costs $47.00 and their average annual purchases added up $130.00, which led to lifetime purchases of $750.00, how much would you be willing to spend to get a customer?

First you have to know your lead-to-conversion ratio. Let’s say it’s 4:1. Now how much would you spend?

$11.00 dollars invested allows you to break even on the first purchase. Would you trade $11.00 to get $750.00? You’d do that all day, and all night, right?

But the only way you see this kind of opportunity is if you know which of the numbers in your business to punch into your handy calculator.

Critical Numbers For You To Know and Questions You Must Have Answers For

How Much is it costing you to get a lead?

How much does it cost to get a customer? 

What is a customer is worth to you?

Total # of Leads coming in

Total Lead Generation Expense

How much money do you invest overall?

Cost Per Lead? (Cost Per Lead = Total money spent on lead generation/Total number of leads)

Leads per Customer (to acquire)?

How many leads do you need to get a customer? (LPCC = Total number of new customers / Total number of leads)

Figure all of these by total and by channel

Per Customer Acquisition Cost 

This tells you the profitability for any customer you get.

Customer acquisition cost = Number of leads to acquire a customer X cost per lead

Cost per revenue dollar (%) (Cost per revenue dollar (%) = Total lead generation cost / total revenue * (multiplied by) 100)

Lead to Customer Conversion time (This differs depending on price point – impulse buy vs. significant expense, also known as a Sales Cycle Time)

How many days does it take between the time you first get a lead and when they buy?

Online, you’d do this by figuring out the day you got their email address because you can’t track when they first came to your site

Offline, you’d go from the time you or they first make contact. Very Important: Knowing this number helps you know what your cash flow is going to look like as a result of a marketing campaign you roll out.

Also for each metric, we want to measure by total and by channel.

For each metric you want to know the metric over… Total of all leads…

Leads by channels… Examples of channels: House List Affiliates, List Banner Traffic (per website), Postcards from a list you bought from a broker 3rd Party distributor, Joint Venture, Partner, SEO, Articles, Co-registration, Direct mail, Seminars, Trade Shows

We want to know what results came from what channel because they all have different cost per lead, conversion rates, how much they spend, the sales cycle, and how often we can test them.

Keep the Channels Separate


Simplest way to is do this online is by landing pages and the most efficient way is to do by tracking codes. At the end of a domain it might look like:

Online you can use separate URL’S, sub-domains, tracking codes

Offline: Departments, phone numbers, or code #

Cost per Lead per Channel? = Money spent on a channel / Leads from that channel

Must Know Average Metrics

Average purchase

Average First Purchase

Average Annual Purchase

Average Lifetime Purchase

These all lead to the most important metric of all: Lifetime Customer Value

This metric is the difference between success & failure of your business.

How much of what they spend is revenue? How much is profit?
You always want to be focused on profit, not revenue, if you want to know how much you can afford to buy a customer for.


Average purchase revenue * number of purchases per year * lifetime of the customer, in years.

Or, an easier way is… Average purchase revenue * number of purchases over the life of a customer

Should You Care More About Revenue or Profit?

Answer: Lifetime Customer Gross Profit because this is the number you can spend up to and still break even 
What To Do Now

1. Calculate your lead / customer conversion ratio

2. Find out what your cost per lead is

3. Find out what your cost per new customer is

4. Find out what your lead generation cost % is

5. Find this out if you can, over the gross basis for the whole business – Do this by lead source and channel

6. Find your lifetime values and averages as well

Now, ask yourself, "What do I know now about my business that I didn’t know before I had all this data?”

How does looking at your lifetime profit numbers help you see the process of investing in lead generation?

The Multiple Pillars Model: All The Marketing Tactics In the World

Most businesses only have one or two Lead source pillars supporting them.

A fact that the majority of people are afraid to embrace is that every lead source is capable of failure. Does anyone remember the government banning Infomercials? What about the Google

When it comes to generating leads, you want to be a Palm Tree. In the midst of the hurricanes blasting the coast of Florida, the palm trees always survive because they sway with the wind. Flexibility rules.

You should constantly be open to the idea of finding new sources of leads from existing channels you’re already exploiting as well as the ones you aren’t.

The straw house in internet marketing is built only on either Adwords… Affiliates… SEO… etc.

The Offline straw house is usually built on… Networking… Referrals… Salespeople… Walk in traffic…

When you add more channels to your business and hit a homerun with one, you’re well on the way to doubling your bidniz.

You definitely want to look at combining your approaches . . . 

Online + Online

Online + Offline

Offline + Online

Which one do you currently favor (or desperately cling to)? Which one should you favor?

This depends on where your perfect prospects… do business… spend time… seek out information… mingle with colleagues… go to for entertainment… vacation… shop… and . . .

Who or What Your Ideal Prospects… Read… Listen to… Watch… Already buy… Hang out with…

You also want to know precisely how other competing and Non-competing businesses are marketing & selling to the perfect prospects for you but who are actually buying from them so that you can potentially use those same channels the prospects are already comfortable with.

One Thing To Beware Of: It’s not as good just to know how a business is marketing if they’re trying to trick copy cat competitors into thinking a specific ad is working, or if they don’t track their ads.

All the Lead Generation Tactics in the World:

The Grandiose Lead Generation Question You Need Answers To –How do you get people to take action (come to your site, pick up the phone, come to your location)?

Online Tactics:

  • Search Engine Optimization
  • Pay Per Click (yahoo, MSN, Google)
  • Social Media (Facebook, Twitter, Squidoo, etc.)
  • Joint Ventures/Strategic Alliances
  • Email marketing (house list)
  • Affiliates
  • Banner Advertising
  • Ezine Advertising
  • Classifieds (like Craigslist)
  • Email marketing (other peoples lists)
  • Paid links/Text ads
  • Free links
  • Article marketing
  • Webinars
  • Directories
  • Industry/hub sites
  • Co-Registration

Offline Tactics

  • Direct Mail Letters
  • Postcards
  • Lumpy/Dimensional Mail
  • Space Advertising
  • Classified Advertising
  • Step Classifieds
  • Radio Advertising
  • TV Advertising
  • Infomercials
  • Place based Advertising
  • Tele-marketing
  • Phone Blasts
  • Coupon Marketing
  • Rack/counter Cards
  • Strategic Alliances
  • Endorsed mailings
  • Salespeople
  • Seminar Marketing
  • Teleseminars
  • Public Speaking
  • Trade Shows
  • Press Releases
  • Bylined Articles
  • Point of Purchase Displays
  • Bottom/back of Receipt
  • Bag/envelope stuffers – Ride-a-longs
  • Sponsorships

You want to remember that combing these tactics will help you break through the clutter. Especially if you’re in a market where most of your competitors only use the internet to market.

Choosing Your Tactics

  • Email to house list
  • Adwords/Pay Per Click
  • Social Media Sites
  • Postings
  • JV/Strategic Alliance Partners


  • JV/Strategic Alliances
  • Direct mail (Postcards/lumpy)
  • Telemarketing
  • Ads (Classified, space)
  • Radio
  • Networking at conferences

Criteria For Picking Marketing Tactics

  • Cost to setup and run the tactic




  • Time to Results




  • Scalability

Low: Amount of leads you can get is tiny

Medium: Potential is better but still limited

High: Lead source is deep and wide

  • Testability: relative to your bank roll

Yes; you can see if it works with betting the farm

No: it’s gonna cost an arm and a leg to test

  • Trackable 

Yes: It’s easy to tell where which leads are coming from where

No: Don’t have a clue

  • Set-Up Effort




  • Maintenance Effort




  • Selection Guidelines

1. Review Your Lead Generation Numbers

2. Evaluate Marketing Tactics Menu

3. Take Measured Risks

You want to be trying new things because when you find a lead source that works it can easily cover the cost of testing and it can uncover several tests that proved unworthy.

4. Consider the loss-affordability factor – financial and time and loss of leads if it doesn’t pull like you’d like it to.

5. Make sure you have mixed bag of tactics with a specific percentage for each tactic and numbers of leads you expect and then note the cost for each tactic.

Important Lead Generation Truths To Keep Close To Heart

Remember that the more qualified a lead is, the more it’s gonna cost.

Everything is a continual test.

Always test small, controlled and affordable media on unproven marketing.

Know what success is for you.

Test small, and then roll out bigger and bigger.

Six Steps to Lead Generation Management

Step 1: Find out how many leads you need – The amount of leads you need to reach your revenue goals based on average first year revenue

Step 2: Figure out your lead generation time – Work backwards from year-end and set cutoff dates for leads

Step 3: Know Your Lead Conversion Ratio – This is the % of leads that turn into actual sales.

Step 4: Pick Your Marketing Tactics – Pick these based on your goals, budget and sales cycle

Step 5: Set Up Your Optimization Process – Having a tracking and optimization process that constantly runs sample tests, measures the results allows you to optimize what you’re doing

Step 6: Build your marketing calendar and run full steam ahead with your lead generation system.


I imagine this is probably as “Nerd” as you’ve ever read on the topic of bringing in the leads.

It’s not pretty but’s it’s the cold truth about what to consider when you’re putting your precious dollars on the line in pursuit of bringing more of your perfect prospects into your loving arms.

If I were you, I’d either go buy the Paul Lemberg Formula 5 marketing notes here so that I had all of this priceless information on hand to use when it comes down to making sure I’m getting the maximum bang for my buck when I’m deciding what to spend where. At the very least you want these two posts off and file them to a easily accessible place.

And of course, if you have any questions/feedback feel free to drop a comment below, in the “Feedback” orange tab on the right side of the screen there or just send me a personal email.

Talk soon,

Lewis LaLanne a.k.a. Note Taking Nerd #2 a.k.a. L.L. Cool Nerd