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How to Generate Low-Cost Direct Response Leads

Posted by | Jun 9, 2015

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Are you under pressure to generate low-cost leads and sales from your direct response advertising? If so, it’s time to consider some proven direct response advertising strategies to stretch your marketing dollars.

Through 25+ years of experience in direct marketing, we’ve discovered what works and what doesn’t. And I’m going to share some of those lessons with you. Here are some tips on how to reach your lead acquisition goals.

Performance-Based Marketing

Performance-based marketing works best for regional or national advertisers. With this model, the marketing vendors or affiliate agencies only charge the advertiser (you) whenever they generate a lead or sale. Instead of paying on a cost-per-thousand (CPM) basis, you pay based on a cost-per-lead (CPL) or cost-per-acquisition (CPA) basis.

This is incredibly beneficial for advertisers. Why? Because the performance-based vendors take the risks for you.

Most of these types of vendors run media via online channels. A few run offline media options. Let’s examine both:

Online Channels

Third-party email (Desktop/Mobile) – Emails are sent by a vendor on your behalf using the vendor’s own list.

PPC (Desktop) – Pay-Per-Click ads such as Google & Bing are bought by the performance vendor.

Display (Desktop/Mobile) – Display banner ads run and you only pay based on the responses.

Co-Registration (Desktop/Mobile) – Your ads are shown to prospects going through a registration form or a process for something else. You pay for the submissions that turn into leads for you.

Mobile Click-to-Call – Pay-per-Click ads are shown to mobile phone searchers. If the prospect clicks on a link, they go to your call center and you pay for that lead.

Offline Channels

Live/Hot Call Transfer – A live call gets transferred to your inside sales or call center if the predefined criteria are met and the caller agrees to get transferred. You pay for the calls transferred.

Print/TV Performance Marketing – Usually the media vendor runs your advertising in traditional media channels and you only pay on a CPL or CPA basis.

Potential Obstacles

While performance marketing is a great way to reach low-cost lead and acquisition goals, it is not without challenges: 

  1. Potential Fraud. Because of its performance-based nature, fraud happens. It’s useful to have an agency partner manage the lead quality. An agency experienced in performance marketing can help you put language in your contract to protect against fraud.
  2. Clearance.  Because the performance vendors take the front-end risk, they may stop running a non-performing campaign altogether.

Traditional Remnant Media

Another great way to save money is to use remnant media to supplement your regular advertising. Think of remnant media like shopping at an outlet store. With retail merchants, most sell their products at full or near-full price at their regular stores. Then they sell unsold inventory in bulk at an outlet or to a reseller to liquidate quickly.

Remnant Media works in a similar way. Since media space and time are a perishable commodity, unsold inventory goes to waste. That’s why media vendors will sell unused inventory – at the last minute – at a deep discount.

Here are a few remnant media types DMN3 uses for clients:

  • Print
    • Newspaper (Run-of-Paper Ads or Wrap/Insert)
    • Magazine (Run-of-page Ads or Wrap / Insert)
    • Catalog (Insert)
    • Catalog Shipping Package (Insert)
    • Wraps  (On-page or Wrap / Insert)
    • Card Decks
  • Radio
  • TV
  • Direct Mail Inserts

As with any media, Remnant Media has a few things to consider.

  1. Selection. Since remnant advertising relies on last-minute, unsold inventories, you need your ads or inserts “ready-to-go” when the opportunity arises. You also will not have a choice in the placement or run-time.
  2. Limited Inventory. Sometimes the media companies don’t have enough remnant inventory. This limitation can make it hard to scale your program.

Test for Great Rewards

If done right, both performance marketing and remnant media advertising work well. Consider testing these options in your next direct response marketing campaign. However, execution of both approaches require some expertise. This type of marketing is not as straight forward as regular media.

If you are new to performance marketing and remnant advertising, contact DMN3 today for a free, no-obligation consultation. It’s a quick and easy way to see how your company could benefit from low-cost leads and sales.

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