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2007-11-28 - Pay-Per-Lead Shootout

Managing CPL lead providers is like being the sheriff of Tombstone

Written by Tom Storm, VentureDirect Online Services Group

As the pay-per-lead market continues to grow, the methodologies by which lead developers do their jobs continue to become bolder, riskier, in some cases more unethical, and certainly more diverse. This diversity, coupled with the aggregate success of these programs on a cost-per-start basis, makes it more important than ever that school marketing professionals fully understand the major and subtle differences in these methods.

Let’s begin with the definitions of the core methodologies:

Single Registration – One registrant, one form, one school. While prospects can return to the search results, they have to fill out a new form in order to request information from another school.

Co-Registration – One registrant, one form, multiple products. This is the most common form of Internet advertising, as the person who fills out the form is given multiple offers, though not always more than one of the same product.

Custom Co-Registration – One registrant, one contact form, multiple products and the ability to ask “custom” or unique questions to better qualify potential consumers.

Incentivizing – This is when the registrant is offered some type of gift or reward for filling out a form. While this concept is considered a common strategy in list building, it tends to provide extremely low-quality leads in the school business.

Interstitial Ads – Also known as “pop-ups,” these are ads or offers made while a person is navigating a web site or filling out a form.

Registration Path Marketing – This is the strategy of marketing an additional product after a prospect has completed registration to make a purchase or request information, similar to an “up-sell,” which is used frequently in telemarketing. For instance, once someone has completed a site registration or info form, a confirmation page thanks the user for his or her request while giving him or her the option to request information on other relevant products or services that might be of interest.

Affiliate – An entity that markets for you on a cost-per-lead basis or generally a web site that agrees to put your business on their site as a way to make more money, usually on a passive basis. The term “super affiliate” refers to those that aggressively pursue leads for you and have their own sub-affiliate networks to help drive traffic and leads. These super affiliates market or promote your program to a loose network of publishers that have agreed to run third-party offers on their web sites on behalf of the super affiliate. Super affiliate networks can consist of a few sites or thousands of sites, depending on the company.

Aggregator – One web site with multiple products. These sites often list up to 3,300 schools and have a distinct marketing advantage over individual schools and school groups. The plethora of content and offers is favored by search engines, as it truly does provide better results for surfers than an individual school site might provide.

So, what does all this mean to you?

1. Single registration is almost always going to provide a higher-quality lead

2. Co-registration can be good or bad, as discussed below

3. Incentivizing, in our experience, always results in poor-quality leads

4. Interstitial ads are not always bad but usually provide lower-quality leads

5. Registration path marketing, if done well and with relevant offers, providing the user the option to skip or move on at any point in time, should have no negative impact on lead quality

6. Affiliates are the key to success for any school with an appetite for lead volume … they are the TV stations and newspapers of the online world

7. Aggregators are the top-performing lead generation resources and need to be a major component in your lead generation efforts

Now, let’s focus on co-registration. With co-registration, affiliates can earn more money per visitor. The additional money they earn per visitor allows them to be more aggressive and generate more interest in education, and allows you to acquire additional leads at a lower cost-per-lead. It cannot be denied that the majority of enrollments from CPL-based affiliates come from those that practice the co-registration technique. The question is not whether or not co-registration works; rather, it’s what types of co-registration should you employ, how do you manage lead flow from these sources, and what is the appropriate price-per-lead for these leads. So, let’s consider the differences between co-registration practitioners.

First and foremost, virtually any type of co-registration is worth testing with one exception: blind co-registration (or opt-out registration). This is any process in which the prospect has his or her info delivered to a school that he or she has not chosen. Unless the consumer has taken specific action to opt out during the registration process, his or her contact data is delivered as a lead. This will produce low-converting leads, upset people who can rightfully claim that they never requested info from your school, and frustrate admissions reps. It is imperative that your interactive agency avoids these web sites to avoid damaging your reputation with both your reps and people in the community.

Unlimited co-registration is where people can choose from an entire list, which can be as high as 25 schools, just by clicking on each one after they have filled out their form. While the web site owner makes lots of money, the prospect is then inundated with calls and is often turned off to all of the schools. If nothing else, it confuses them and often turns them into non-enrolled leads.

Many schools have high conversions on sites that use limited co-registration, where only three or four offers are put in front of the prospect. It is important to note that most prospects who go to a single registration site STILL shop multiple schools, which is why the difference in conversions between single registration and limited co-registration sites is negligible. Using custom questions in the process will require the prospect to spend more time responding to your program offerings while providing your admissions reps with more information to help improve the enrollment process.

The best type of co-registration is variable product co-registration, where one or more schools might be promoted in combination with other products or service offerings. This is especially effective when the process is non-intrusive and the offers are made at the end, often in the thank you message or even by e-mail after the lead has been submitted. This is best because it has no bearing on your conversions. By providing a variety of product offerings, prospects will self-select those services that best meet their needs.

If you simply avoid blind, opt-out and unlimited co-registration (along with incentivized leads), you will be pleased with the results. Co-registration allows lead providers to more aggressively pursue leads for your school, so, in general, they are your friends. Just be certain to have your interactive agency watch your back. Yes, you can test and eventually get rid of sites using these techniques, but why waste the money? Your agency should know each affiliate’s methodology in advance to keep you out of harm’s way.

If I were to look three years into the future and try to project what the online lead generation landscape will look like for schools, I’d say that it will look a lot more like today’s TV industry. While there are many stations and shows that generate leads, you certainly wouldn’t choose one price – say, $150 – and pay that for every show on every station. You also wouldn’t run the same creative for the judge shows that you would during sitcoms. Internet will be much the same. Here are some thoughts for your consideration:

• There will likely be less truly viable web sites to choose from (consolidation and the weeding out of the poor-quality lead providers who are just here to make a buck will see to that), though new sites will constantly be popping up – many worth testing.

• Pricing will be much more varied and certainly based more on cost-per-start or conversions, as ad agencies and schools will demand that pricing reflect value.

• Multivariate testing of landing pages and choosing different landing page creative for different campaigns will become the norm.

• Media schedules will be used to show lead allocation, pricing and the creative mix, much like TV does now with spot placement, pricing and trafficking of creative.

• Prices will keep increasing. The hunger for more leads outweighs the volume that lead providers can generate. Until this changes, costs will continue to rise until the CPS begins approaching that of TV, the other volume leads resource. Using co-registration sources in your media mix will help lower your overall cost-per-lead while increasing the number of leads available.

• Once pricing has settled in, this will become a buyer’s market, not the seller’s market it is today. Schools will demand value, performance and the tiered pricing necessary to justify the fact that no two lead sources are alike in results.

We are heading toward an exciting time. This is an extraordinarily complex industry, so be sure that you’re represented well by experts who will advocate for you and stay on the forefront of this rapidly changing industry. If a lot of what you have read here is new or surprising information, challenge your advertising partner to do a better job keeping you informed and knowledgeable … it is your right, and likely your responsibility. If no one is representing you, good luck. There is a reason why the management of CPL lead generation is outsourced. No one, two or even five people could keep up with everything that is going on and know every opportunity available to your school. Your interactive agency needs the size and resources to represent you effectively. Either way, whether you do it yourself or with an online marketing partner, best of luck in your online lead generation efforts.

© 2007 The Coreg Insider