In the realm of lucrative businesses, wouldn’t you like to build one where you don’t need to have a product to sell and still make a high income? Somewhat similar to affiliate marketing, a lead generation business generates leads and sells existing products and services for a fee.
In the United States alone, there are over 30 million small businesses that generate trillions of dollars in revenues combined. So for small business lead generation companies, there’s an almost never-ending stream of opportunities to make commissions off of.
Entrepreneurs like Anthony Sarandrea generate ~$100,000/day from their local lead generation business. Interested in starting your own lead generation business? With this article, we’ll make sure you know everything there is to know about setting up lead generation businesses.
Starting with, what a lead generation business is.
What is a Lead Generation Business?
Like mentioned earlier, a lead generation business acquires leads for clients who could then sell a product or service to these leads. Your clients pay you a fee since you are able to direct intended demand towards their products and services.
In Business to Business lead generation, clients pay for every lead generated given these leads meet specific criteria. You need not wait for your leads to make a purchase, to be paid for that lead. In other referral models, like affiliate sales, you need your lead to purchase before you can get paid.
Now we know the fact that there are more than enough clients out there you can sell leads to. Pair this with getting paid for every lead you generate, and it makes lead generation business really attractive as an opportunity.
So how do you go about building a lead generation business? Let’s explore that next.
How to Start a Lead Generation Business
Learning how to start a lead generation business isn’t very straightforward. There’s a lot that goes into building a lead generation business that scales profitably. Like how do you actually generate these leads? How do you make sure these leads are likely to buy from your client? How much do you charge your client?
We’ll cover these points in 6 steps as follows.
1. Pick a niche and geography
As the very first step, you want to pick a niche or category of products or services you broadly plan to sell. Choosing the right thing to sell will dictate your success in business lead generation services. Here are some things you need to take into consideration, as you decide onto a niche-
- How much do you know about the market
- Economics — how much can your client make in margins and LTVs (Long Term Value) from your leads
- How competitive is it?
- Is the market itself saturated?
These are listed as per the priority — so the first thing you should consider working on is to list out all the markets you can see yourself becoming an expert in. Off these, you can pick the ones that are the least competitive, aren’t yet saturated, and could make you the most in commissions.
Also remember, narrower the niche, bigger the opportunity. For example, narrow down from Finance into a subcategory, like Insurance, then further narrow down to pet insurance. This will improve your chances of success as a lot of these small categories have minimal competition in lead generation services.
2. Develop client relationships
Once you have zeroed in on your niche — start building relationships with prospective clients who might need lead generation services. Much like generating leads, you will have to sell your leads (or future leads) to your clients at the right price. Having strong relationships with clients is another very important aspect of your lead generation companies’ success.
You can start by making a list of companies operating in the niche that you wish to work with. Then using networks like LinkedIn, you can find people in Sales and Demand Generation roles that could be approached to sell leads to.
If you’re starting out from scratch and haven’t generated leads before, you can simply start reaching out to potential clients via emails. If you already have a list of clients to reach out to – you can use an email outreach tool like SalesHandy to nurture and build these relationships.
After getting acquainted with companies that are willing to work with you, you’ll need to decide the terms of the relationship. That is, what kind of leads do your clients need and how much would you be paid.
3. Finalize commissions, fee structure
During your initial research, you might have considered the LTV of an average lead for your client while deciding the niche. Use this data to your advantage while negotiating your fee per lead (higher LTV= bigger fee). While finalizing the terms, make sure you cover the specifics around evaluating lead quality, payment schedule, etc.
There are standard rates set in this space — usually, for bigger ticket products (>$100k LTV) fees per lead ranges between $100-$500. So while you might have to stick to these rates initially, you can set up clauses that increase your fees as more of your leads convert. This makes for a win-win situation since your client also grows their business when you source better converting leads for them.
4. Plan and build marketing assets
The operational success of your lead generation business heavily depends on your marketing assets. Marketing assets are web properties (landing pages, blogs, e-books, etc.) that attract leads who are looking for specific information. These leads often carry with the intent to purchase, hence making your marketing asset a magnet for these leads.
The hardest part of getting your marketing content to work is making it visible. If your leads can’t find your website or ebook, you will never be able to capture them. You can post links to your content on relevant forums and communities where your leads might spend time. Apart from that, you can work on SEO to help your content rank on search engines for your lead’s queries (eg., “insurance for dogs”).
Of course, reaching out to a large audience organically isn’t easy, so you can try other ways as well. By running lead generation campaigns using ads that direct your leads to your website or form, you can serve them with content and capture them as a lead.
5. Nurture leads before handing off
Once you’ve captured leads through your Marketing channels and lead generation campaigns, you want to make sure they are likely to convert. You can do this by enrolling them in a nurturing program. Lead nurturing is a way to exchange more information with your lead and help them get interested in your clients’ products.
You can nurture your leads by enrolling them in a lead nurturing email sequence. Again, this can be done using SalesHandy, which helps you multi-stage automated emails and tracks engagement on these emails.
Feel free to check out SalesHandy’s detailed guide on planning and testing lead nurturing email sequences.
Nurturing leads makes sure you’re only passing on quality leads and helps your client convert more. Especially if you’re dealing with high-value leads, you will need to be extra careful in passing on a lead, since your clients are paying you more upfront.
6. Track results and optimize
Once you have started passing on leads to your clients, ask them to share conversion funnel metrics with you. If you have set up different channels for your lead acquisition efforts, this data will help you decide which channel to prioritize on.
Tracking and analyzing conversions coming from your leads is crucial when it comes to making optimizations. For example, if you’re using multiple sets of Facebook Ads to generate leads for a client — conversion data will tell you which Ad set was more effective.
You also want to be able to use this data to re-negotiate terms, if your clients have been getting consistent conversions from your leads. It essentially also enables you to scale your business and run it more efficiently.
Now we’ve learned how to acquire and sell leads to clients. However, this isn’t effective by itself. You also want to be able to strategize around certain parts of your business to maximize profitability for your lead generation business.
Let’s explore some of these strategies
Strategies to find the best leads for your clients
Below, we’ve outlined strategies and tips that will help you squeeze more out of your lead generation business
1. Build authority in unexplored sub-niches
While we did touch upon the idea of getting into smaller, more specific niches earlier in the article — there’s more we can do there. If you have found such a niche where competition is non-existent, your content should also focus on being authoritative. Pump out catchy, evergreen content that’s highly shareable and eventually, you will be able to build a brand around your content.
This will ensure your content remains on the top, becomes instantly recognizable and is much more trustworthy. Even as content from other publishers and marketers start pouring in, later on, yours doesn’t lose its significance and authority. It keeps your content assets competitive and churning out more leads for your clients.
2. Attract leads with higher intent
It might seem simple and straightforward to follow this tip — it’s not. It’s challenging to know specifically what these high intent leads might be looking for. It does help to frame an ICP (Ideal Customer Profile) and work backward to find their needs and wants. As we discovered while learning about tracking and optimizations, testing different content assets for the best converting channel will also help
This approach ensures you can acquire the best converting leads without having to work on filtering out irrelevant ones actively.
3. Prioritize and nurture qualified leads
If you’ve ever been part of a sales team, you know how important it is to qualify your leads. Initially, your focus has to be towards finding the right leads, not necessarily many leads.
The concept of lead qualification ensures that you only nurture qualified leads with buying intent. This helps out everyone – your client in establishing trust with you, and you in scaling your channels to generate more leads that convert. On the flip side, if you end up nurturing and reaching out to leads that aren’t qualified, you will end wasting everyone’s precious time.
4. Build a referral system to get more qualified leads
Emphasize on the quality of your leads again, but this time, to scale your lead generation channels. Referral sales happen to be the best converting(2X better) sales channels. If your leads can refer to more leads like them, it effectively doubles your output without any efforts. Also, referred customers happen to be 25% more valuable, so your clients will be super happy with the results as well.
With the strategies and processes covered, we’ll now move on to nurturing these leads.
How to nurture and engage with your clients’ leads
One area where you’ll definitely make use of some of your strategies we covered above is nurturing your leads. In this case, we’ll see how to run lead nurturing campaigns on email outreach automation platform, SalesHandy.
Using SalesHandy to nurture your client’s leads
1. Signing up on SalesHandy
2. Creating follow-up campaigns
Getting bored — Skip reading and watch a video.
- After signing in, navigate to the Email Campaign menu on the top left side of your dashboard. Click on the New Campaign button on the top right side.
- You’ll be directed to SalesHandy’s campaign editor page. You’ll then proceed with adding CSV file with your leads emails and corresponding personalization fields.
- Scrolling down, you’ll see the email editor for the 1st stage laid out beside the personalization(merge) fields in your CSV. Add your email template content in the editor along with merge fields as necessary.
- Once you’re done with Stage 1 email, you can add a follow-up stage based on your lead’s engagement(if/not opened or clicked) on the first email. Click on Add Follow Up Stage.
- A new editor will appear below your Stage 1 email as Stage 2 email. You can set the engagement condition for the Stage 2 email to go out, based on if they’ve opened or replied to your first email.
- Repeat steps from Stage 1, to add follow-ups till Stage 10, as per requirements. Make sure you test all your emails to make sure they look good on your lead’s end.
3. Schedule to send campaigns
- Once you’re done adding follow-up stages, schedule your campaign to go out. Scrolling down, you’ll see options to schedule your follow-up campaign. You can set the campaign to go out in your lead’s timezone if they’re from different geography.
- Set the time interval between emails. By default, it’s set to 60-90 seconds, which is optimal for email deliverability.
- Once you’ve made all the adjustments, select the date and time for your campaign to go live, and click on schedule.
4. Set up templates for quick responses
Once you start getting responses to our nurturing emails, you can respond to common concerns very quickly by accessing templates using two-key shortcuts on SalesHandy’s Extension.
- Navigate to the Templates menu on SalesHandy. Click on New Template and proceed to add your template content. This content can be text only or HTML to add images.
- After adding content and assigning a shortcut key, you can go back to your Google mail/Outlook compose box and begin using your template using the shortcuts.
5. Analyze and improve nurturing playbook
- In SalesHandy’s campaign menu, clicking on your completed campaign will direct you to the campaign analytics page.
- You’ll get access to your campaign’s performance metrics, like open rate, link clicks and reply rate. You’ll also be able to see the number of opens and clicks from each of your leads.
- Along with this, you will see combined open and usage rates. This will help you analyze the performance of your templates and attachments.
With all the data pertaining to your campaign’s performance, you can then test new templates and benchmark them against your best results. This process will make it very efficient to qualify your leads before they could be dropped/passed on to your client.
Set up your email nurturing campaign[Video]
Note: Document Tracking features have been discontinued.
What to take away?
Generating leads for other companies can be a great income source for marketers and salespeople who can understand and serve the leads they acquire. It doesn’t require a product, only content, which if given visibility, can be a gold mine for leads.
Marketing assets start taking care of themselves as your content selection piles up, eventually requiring minimum effort from your side. If you’re someone who likes building and resent operating, building lead generation companies will enable you to do just that.
Are there any unexplored local businesses or niches for generating leads you have come across?
Let’s discuss them in the comments!