How Much Does Lead Generation Cost?

What are the lead generation costs you should expect to pay?

Whether you are planning on using a lead generation agency or looking for the price of lead generation tools to build a target audience yourself, we've done the hard work to predict what will result in the best ROI.

TL;DR

• Lead generation tools vary in cost. Each month you can expect to pay between $7 and $60 for CRM software, $10 to $209 for marketing automation, $119 to $999 for SEO tools, and $56 - $99 for lead scraping tools.

• Depending on their pricing model, agencies' lead generation services cost between $50 per lead and $10,000 per month.

• PPC can be a significant investment in lead generation for an SMB, with fees between $1,500 to $10,000 monthly.

• Buying lead lists and cold data is priced per record or list ($100+) and is not advised due to its high failure rate (dated data and non-compliant risk).

• Lead generation costs can be reduced by automating data scraping and list building based on buying intent signals, segmenting your lists into highly targeted micro lists for personalized outreach, and testing inbound marketing methods like lead capture forms on your SEO-optimized pages.

• CPL is calculated by dividing the total amount of money spent on a marketing campaign by the total number of leads generated.

• Use PhantomBuster to automate lead generation and reduce costs. With pre-built automations for multiple actions, including LinkedIn Search Export or Scraping leads from LinkedIn company posts, you'll keep your lead pipeline fresh and optimize costs.

Try PhantomBuster free for 14 days!

Lead generation costs

Lead generation cost can vary significantly depending on your lead generation strategy, which will dictate the tools and resources you'll need.

Here are the main cost categories you should consider:

Lead generation tools

Your lead generation efforts might include lead prospecting, lead scoring, prioritization, social selling, or even paid promotions.

Some popular tools that can help with that are:

• Lead scraping tools: PhantomBuster starts at $69 per month; Apollo starts at $59 per user per month; lemlist is $99 per month per user; and Clay's price starts at $149/ month.

Try PhantomBuster free for 14 days!

• CRM Software: pricing varies from $7/user/month for Zoho CRM, $9.00/user/month for Freshsales, $12.00/user/month for Monday.com, Salesforce Sales Cloud at $18.75/user/month, to $60/user/month (Capsule CRM).

• Marketing Automation: Mailchimp ($10-$299/month) or ActiveCampaign ($15-$279/month) will help you automate marketing efforts and nurture leads.

• SEO Tools: Software like SEMrush ($119-$449/month) and Ahrefs ($99-$999/month) are optional but can prove valuable for improving search engine rankings and driving organic leads.

Lead generation agencies

Pricing models for lead generation services can vary, and whatever you look at it, this is one of the more expensive ways of handling lead generation.

Outsourcing lead generation means you may be unable to control the average lead cost, the potential customers found, or whether the agency is also mindful of customer lifetime value.

According to Medium's research into the pricing strategies of over 100 lead generation agencies, you should expect to pay between $30 and $175 for SEO leads, $40 to $150 for PPC leads, or $75 to $125 for LinkedIn leads.

The full price you'll end up paying to an agency is built out of multiple charges:

• Charge per Setup: Some agencies charge a flat fee to set up your lead generation campaigns. Depending on the complexity, this fee can range from $1,000 to $5,000.

• Management Fee + Sales Percentage: Others may charge a monthly management fee ($2,000-$10,000/month) plus a percentage of the sales generated (typically 10-20%).

• Performance-Based: Some agencies operate on a pay-per-lead model, charging $50-$500 per qualified lead, depending on the industry.

While hiring an agency can save time, it's essential to consider the long-term costs and whether they can generate leads you couldn't get yourself. SMBs might want to start with a smaller, performance-based agency to test the waters first.

Paid demand generation cost (Ads)

PPC can cost between $1,500 to $10,000 monthly, with larger enterprise businesses spending as much as $10,000 or more.

Each industry has a variable cost per click(CPC), the price of one lead.

According to Wordstream, the average CPC in the B2B industry on Google Search is 3,33$, while consumer services are $6.40. Yet charities pay under $2, thanks to a Google policy.

The costs of creating compelling landing pages and content also need to be factored in.

Buying lead lists

You can buy lead lists on Fiverr for under $10, while other businesses offer credit packages you can use to purchase data like job role, email, or phone number that cost between $500 and $3,500.

However, buying lead lists is not advised.

You risk buying old data or non-compliant, opted-out individuals, and your lead generation campaign is unlikely to recoup even the smallest promotion costs.

They lack the signifiers that suggest intent that most lead scraping tools offer. This means the lead quality is very poor; if you convert, your cost per lead could be incredibly high!

Hiring in-house experts

The average salary for a Sales Development Representative (SDR) in the United States is $77,254 annually.

This cost will increase based on how many people you need in your team.

How to calculate cost per lead (CPL)

To calculate cost per lead (CPL), you divide the money spent on a marketing campaign by the total number of leads generated.

For example, if your company spends $2,500 on a marketing campaign and acquires 250 leads, the CPL would be calculated by dividing $2,500 by 250, resulting in a cost per lead of $10.

Cost Per Lead (CPL) formula

CPL=Campaign cost / Total number of leads generated

What is a good cost per lead (CPL)?

A good cost per lead (CPL) can vary significantly depending on the industry, marketing tactics, and channels.

For instance, in industries like real estate or financial services, a higher CPL might be acceptable due to the high value of each lead.

This metric can be tricky to understand, as CPL varies based on the source channel.

Remember that a good CPL should always be lower than the customer's lifetime value so you don't spend more than your revenue to acquire customers.

Rather than solely relying on industry benchmarks, it's a better practice to focus on knowing and improving your CPL over time.

Benchmark your current CPL, set realistic goals, and continually optimize your campaigns for better results.

Average cost per lead per lead generation channel

According to First Page Sage's Average Cost Per Lead Report in 2024 and Sopro's 15,000 client email campaigns, the average cost per lead can be as low as $25 for referrals and $31 for SEO but as high as $259 for cold calling and a $811 for trade shows.

The average cost per lead (CPL) across the marketing channels is approximately $158.23.

Average cost per lead per industry

According to Visitor Queue, while there are outliers like Hospitality at $73 and Higher Education at $982, the average cost per lead (CPL) across the various industries listed is approximately $331.10.

Lead generation strategies to improve cost per lead (CPL)

Here are the best lead generation strategies to improve cost per lead.

Automate data scraping and list building

To reduce CPL, you need to decrease time spent on admin tasks, so start automating list building using the right tools. Here's how you can do this with a tool like PhantomBuster.

Step 1: Create a PhantomBuster Account

Step 2: Choose a pre-built automation

• LinkedIn Profile Scraper: This allows you to extract data from LinkedIn profiles.

• LinkedIn Company Extractor: This allows you to extract data from LinkedIn company pages.

Step 3: Set up and run the automation on a schedule.

Step 4: Sync data into your CRM

Enrich your HubSpot data with PhantomBuster.

Using a tool like PhantomBuster to scrape leads from LinkedIn company posts and more is a cheaper alternative to lead lists, salaried employees, and agencies and ensures you always have the freshest data.

Start a 14-day PhantomBuster free trial.

Build micro lead lists for targeted outreach

Another great way to improve CPL is to segment prospects and create targeted lists.

Instead of mass-extracting data, you use a targeted approach to ensure your leads are relevant to your business.

There are a few different ways to do this:

• Build a list of prospects using LinkedIn Search Export

• Extract data from Google Maps

• Scrape data from webinar attendees

• Monitor the brand mentions of your competitors

• Extract the attendees of a LinkedIn event

• Invite your LinkedIn connections to your event automatically.

When reaching out to leads, you can use a personalized approach to increase your chances of converting them.

Use inbound marketing methods

Combining cold and warm outbound with inbound marketing is another way to improve CPL.

You can test and identify which marketing channel will drive the best results.

Search engine optimization is a popular lead generation method across SaaS, while demand generation via webinars or podcasts works well for capturing warm leads.

Conclusion

While purchasing lead lists may seem tempting or hiring an agency may seem more straightforward, you must test which channel and approach will yield the best lead cost.

The right lead generation automation tool can help you lower your cost per lead (CPL) by leveraging targeted tactics.

Try PhantomBuster free for 14 days and export fresh leads from LinkedIn automatically.

Try PhantomBuster free for 14 days!