If you are like most businesspeople, you have a bias towards salesperson generated leads. After all, a salesperson can do many things that marketing, the Internet, or appointment setters cannot. However, if you calculate the true cost of a salesperson generated lead, you may find that their cost is exceptionally high. Worse yet, the weaker sales reps tend to have off-the-chart lead costs. The example spreadsheet below will help you determine the cost of salesperson generated leads and their effectiveness. Cost of lead
| Value of a Lead |
|
Example 1 |
Example 2 |
| Avg Customer Sales/Year |
$ 10,000 |
$ 20,000 |
| Average Margin |
50% |
30% |
| Avg Years Customer Stays |
4 |
2 |
| Value of Customer |
$ 20,000 |
$ 12,000 |
| Leads/Customer |
5/1 |
10/1 |
| Value of a Lead |
$ 4,000 |
$ 1,200 |
| Cost of Salesperson Generated Leads |
| |
Salesperson 1 |
Salesperson 2 |
| Total New Leads Generated |
50 |
100 |
| Cost/Lead |
$ 416.67 |
$ 735.29 |
