Do you want to start a lead generation business for insane profits? If YES, here is a complete guide to starting a lead generation company with NO money and no experience.
What is a Lead Generation Business?
A lead generation business is one that provides other businesses with potential client contact information based on certain criteria. Most businesses usually hire lead generation businesses to help them with mailing lists, either via postal mails or emails that would contain the potential clients needed to patronize its products or services.
This is often a very lucrative business especially if you are the innovative entrepreneur as there are enough businesses that usually source out lead generations to third credible parties so as to be able to focus on other things.
What Does It Take to Starting a Lead Generation Business Successfully?
If you intend starting the lead generation business, you would need to decide on what kind of niche you want to specialize in. Many lead generation companies often focus on niches such as geographic region, industries, or certain demographic. This means you would need to carry out a thorough research to help decide what kind of niche would be the best and provide more revenue for you.
You would need to be sure of the federal and state laws regulating the kind of niche you intend to go into. For instance, certain industries like real estate or mortgage require that you obtain a license before operating a lead generation for that business.
To run this business without any hitch, you would need to be proficient in handling a computer as well as the database software. Also, in order to provide these leads and get customers, you would need to build a lead generating system that would enable you gather the leads.
This means you would need to get a website that can allow you drive targeted traffic so that you are able to garner information from visitors. You can use other tools to drive targeted traffic and also get the right leads for your website such as online social media, blogging, networking sites, and article marketing.
The next step after getting ensuring that you have set up your website and are already driving targeted traffic to the site is to draft strategies on how you intend to get clients for your lead generation business. This includes you carrying out research, finding and eventually contacting the clients that might be attracted to the niche you are specializing in.
You can get such clients offline by cold calling or sending mails or online via social media platforms and emails. Ensure that the potential client is aware of the benefit they stand to derive from using your company.
24 Steps to Starting a Lead Generation Business for Insane Profit
1. Understand the Industry
According to research and statistics, businesses get leads depending on the avenue used; businesses in the banking, insurance and financial sectors as well as those in the nonprofit and educational sectors had more leads through direct mails than their counterparts in other sectors, which amount to 11 and 13% respectively. However, trade shows usually get double the number of leads especially during trade shows than any other business.
Interesting Statistics About the Industry
According to research by eMarketer, it was projected that lead generation advertising in the united states of America would amount to .35 dollars by 2019.
The three most commonly used strategies for lead generation businesses are email marketing which takes about 78%, event marketing which takes about 73% and content marketing which takes about 67%. Also, lead generations businesses strive to not only improve the quality of the leads generated but also to increase the quantity of leads generated.
As at 2015, marketing automation software has generated nearly more leads than marketing software. However, only 13% of lead generation strategies have been successful in achieving the intended objectives.
74% of marketers usually spend more than $50 on any lead generated and 5% spend more than $1,000. 50% of these marketers have however stated that inbound marketing strategies are usually their primary source of marketing strategies which doubles that of outbound marketing strategies.
On an average, 12 billion searches are conducted monthly in the United States alone; with 86% of consumers stating that using a search engine enabled them learn something new or important, thereby helping to increase knowledge.
50% of all the mobile searches that are conducted are done in the hopes of finding local results with 61% of these searches resulting in a purchase. Lead generation businesses that used a Search Engine Optimization (SEO) usually have a 14.6% close rate while those who use outbound leads such as print advertising or direct mail usually have a close rate of 1.7%.
2. Conduct Market Research and Feasibility Studies
- Demographics and Psychographics
The demographic and psychographic compositions of those that require lead generation are:
- businesses who are into manufacturing of goods
- product sales, as well as those in the service industry
- manufacturing companies
- real estate companies
- telecommunication companies
- hospitals, accounting firms
- and the agricultural businesses
- Private businesses
- non-profit organizations
- government agencies
3. Decide Which Niche to Concentrate On
The lead generation business is a unique one as most companies offer uniform products and services to clients. Niches in this industry will depend on the area of specialization or the different related services offered by these companies.
Some of the areas of specialization in the lead generation business include;
- Website design
- Paid search
- Email marketing
- Direct mail
- Document creation
- Web portals
Even though the areas of specialization might not seem much, any company irrespective of scale – small, medium or large – can offer some or all of these services, especially as these other services will help attract and retain clients.
The Level of Competition in the Industry
Starting a lead generation business is one of the easiest businesses for any passionate entrepreneur, especially as getting the basic equipment and tools is something that any serious minded entrepreneur can get. This therefore means that you can start on any scale you want for your business.
However, while it is easier for a big lead generation business to have leverage over the smaller lead generation business, there are still companies that would prefer to patronize smaller companies probably due to referrals or preference. Either way, it is a competitive field and requires strategies for any company to have leverage over the others, whether big or small.
4. Know Your Major Competitors in the Industry
In every industry, there are always businesses that become well known probably due to a number of factors and strategies that might have been deployed by these businesses successfully. Every new business usually looks up to these well known brands as they are regarded as those that have done something right.
Also, well known businesses usually have more customers and leverage over others. Listed below are some of the well known lead generation businesses in the United States of America;
- Strategic Sales & Marketing
- Jeff Bullas
The fact that someone else has been successful in running a lead generation business does not mean you will succeed at it if you do not take your time out to research the business you intend going into properly. Another reason why research is very important is that it helps you not only have a thorough knowledge of the business you intend going into but also to know if it will be a waste of your time, finances and effort.
The lead generation business is not a necessity and so during times of economic downturn, there is bound to be less demand for such services; this is due to the fact that companies might just prefer to use conventional and unconventional advertising means to attract customers.
The demand for lead generation services is a technologically inclines affair, and so would require you to be top notch in the game as technology and web services evolve continually, and would mean you would need to keep being updated as regards existing trends or new methods at generating leads.
While your location may not be important if you choose to operate from home, you would need to ensure that you keep your operating costs at a minimum, especially as profit making for start-ups isn’t immediate, requiring time and patience.
5. Decide Whether to Buy a Franchise or Start from Scratch
There aren’t any known franchises yet in the lead generation business and so any entrepreneur going into this business will need to be prepared to run it from scratch, if they are really interested in starting the business. Starting a business from scratch is not usually an easy thing but it allows entrepreneurs know the business from ground up as they will have to tackle challenges as they come.
Starting a business from the scratch involves lots of paper works and the need to draft strategies on how to attract and retain customers, as well as how to have an edge over your competitors. Starting a business from has its advantages as it allows you to be in charge of the business and to be able to change your strategies anytime you want if they aren’t working well for your business.
6. Know the Possible Threats and Challenges You Will Face
Every business either new or existing usually faces threats and challenges either in the course of starting the business or during its operation. Some of the threats usually faced by entrepreneurs in this business industry usually involve the pressure in being innovative enough to offer products that will give an edge over the competitors.
Other challenges might be system glitches or a downturn in the economy. Regardless of any challenges that might be thrown up either internally or externally, every entrepreneur who knows his onions will have been prepared for such obstacles and have solutions ready to tackle them as they come.
7. Choose the Most Suitable Legal Entity (LLC, C Corp, S Corp)
Most entrepreneurs usually start off their lead generation business on a small scale which invariably makes them stick to being sole proprietors. Most lead business entrepreneurs usually don’t get registered till they have gotten to a stage where the business has expanded more than it can be handled by being a sole proprietor.
Also, the reason why most entrepreneurs prefer starting off as sole proprietors is due to the fact that this is the easiest legal entity to handle as it involves fewer formalities as regards registration. The disadvantage about this legal entity though is the fact that you are personally liable for anything that goes wrong.
This is why choosing a legal entity is very important as it could affect the way your business is being handled. Choosing a legal entity cannot be undertaken alone and you would need the help of a professional who will lay out the merits and demerits of each entity and which would best suit your business.
However, if your aim is to start on a medium to large scale and you are looking towards approaching big corporations to pitch your lead generation service to them, you might look towards a Limited Liability Company (LLC). This entity protects you from being personally liable if anything goes wrong in the course of running your business.
8. Choose a Catchy Business Name
- Your Leads Inc
- Inventory Corporation
- Stacks Inc
- Database Ltd
- Leads Supply Inc
9. Discuss with an Agent to Know the Best Insurance Policies for You
Having insurance for your lead generation business is very vital as insurance protects you from being personally liable for certain incidents and errors that might occur in the process of running your business or carrying out a client’s requirement.
It is however imperative that you talk to an insurance broker or agent so as to be guided on the best insurance cover that is suitable for your lead generation business, especially if you intend to offer additional related services. You would also need to ask questions about each policy to be sure it is right for you.
Some of the basic insurance covers that you might need to consider purchasing if you intend to start your own lead generation business in the United States of America include;
- General Insurance
- Liability Insurance
- Hazard Insurance
- Health Insurance
- Life Insurance
- Errors and Omissions Insurance
10. Protect your Intellectual Property With Trademark, Copyrights, Patents
There wouldn’t be a need for one here. If you are thinking of starting your own lead generation business and are bothered about intellectual property protection, you shouldn’t be, as you won’t need to apply for intellectual property or need it to start or run your business.
If however you want to secure an intellectual property protection for your company’s logo and brand statement, then you can. However, you need to know that most entrepreneurs in the lead generation business do not bother about applying for their own intellectual property protection as they do not consider it a priority.
11. Get the Necessary Professional Certification
The lead generation business is an easy enough business and so if you decide to start this business in the United States of America, you would not need to get a certification. But be sure you have the right information.
However, it would be important for you as an entrepreneur looking to make your business grow to look out for anything that might benefit your lead generation business especially one that would boost the profile of the business as well as boost the confidence of the clients that would be dealing with you.
12. Get the Necessary Legal Documents You Need to Operate
In running any business legally, you would need to some basic legal documents if you intend to successfully run your lead generation business in the United States of America. Some of these documents include:
- Certificate of Incorporation
- Business Plan
- Business License
- Insurance Policy
- Operating Agreement
13. Write a Business Plan
Every business no matter how simplistic it might look needs a business plan. If you intend for your lead generation business to make profit, then you would need to ensure that you draft out a business plan to show how serious you are in running your business, and that you do not intend to waste money by not carrying out a serious research into the new business you are going into.
Since a led generation business is not one that is too complicated, you might not need to write out a complicated business plan, rather you can draft a simple business plan that just shows what you intend to achieve with the business and how long it will take you to do so.
A business plan is therefore a document that shows – you, stakeholders, investors – on the intended direction your led generation business would be going. The document will influence your major decisions and actions that are intended to affect the business. Your business plan is best if it is not ambiguous about the company’s plans or intentions.
A business plan is written so that an entrepreneur is able to draft strategies that will help him or her effectively handles and administers the lead generation business. The business plan should therefore cover strategies that will help in generating the start-up capital, while also attracting customers and invariably expanding the business. A business plan should therefore have some of these key components embedded.
Other key components that your lead generation business should have include;
Executive summary and Company’s descriptions
This explain the fundamentals of your business, and which should also include the concept of your business, the financial features and what will be required of your business. The business description will give a brief description of your industry and its outlook. Another thing you would need to do is describe your business operation’s structure.
Other aspects that must be included in your business plan are market strategies, competitive analysis and strategy, operations and management plan, as well as the financial factors and how they are likely to affect your business. These components are the essentials that need to be included in your business plan so that an investor glancing through could immediately see how serious you are with your business.
Due to the fact that most entrepreneurs often find it difficult to write out a business plan, especially as a business plan can be intimidating, they usually hire a business plan consultant or writer to help in writing a business plan. However, if you are running on a tight budget, then you might consider going online and downloading a business plan template to use as an aid in writing your business plan.
14. Prepare a Detailed Cost Analysis
Due to various researches, the cost of starting a lead generation business is not an expensive business venture to start out. However, your start-up costs might vary depending on many factors such as the type of equipment to be used, the kind of software, and other overhead and operational cost.
If however you are on a tight budget, you can do certain things that will reduce your start-up costs greatly such as getting fairly used equipment like a computer and operating from home amongst other factors. If you intend to start your lead generation business in the United States of America, you would need to ensure that you have the below listed items so that you can successfully operate your business.
- Incorporation fees would likely cost $500
- Liability insurance, licensing and permit would likely cost $1,500
- Website domain name and hosting would cost $1,500
- Website development and graphics design would cost $1,500
- Advertisement and publicity would cost $1,000
- Multi function printer would cost $500
- Computer system would cost $1,200
- Phone (landline, cell phone) would cost $1,000
- Software purchase would cost $500
- Cable broadband would cost $1,000
- Other miscellaneous expenses which include office supplies, business cards would likely cost $500
From the detailed analysis above, if you intend starting your lead generation business on a small scale in the United States of America, you would need an average of $10,700 especially if you are likely to operate from home.
If you intend starting your lead generation business on a medium scale, you would need an average of $21,000 but this amount is not inclusive of a facility, and you would need to shell out extra if you intend to lease a facility. For those that intend to start the business on a large scale, you should be looking at an average of $40,000 with facility lease not included.
15. Raise the Needed Startup Capital
Finance is a very essential part of a business as new businesses and even old ones usually fail due to lack of finance. If you do not have the required money necessary not only to start your business but to keep it running till it starts paying for itself, then your business idea might not become a reality. However, with certain businesses it is easier to raise capital than it is for other kinds of business but as an entrepreneur it is a task that you must go through.
Before you can source for finance from institutions of personal lenders, you must have a comprehensive business plan that shows in detail how you intend to run the business and make a profit from it. If your business plan is comprehensive enough, it will convince intending investors to provide you with the necessary funds you will need for your business.
Besides, having a business plan shows how serious you are as regards the business you intend to start or are already running. In starting the lead generation business, there are several options that you have when it comes to raising the start-up capital that you would need. The options include;
- Raising money from your family and friends
- Raising money from sale of personal stocks and properties
- Raising money from your personal savings
- Getting money from angel investors
- Raising money from online source
16. Choose a Suitable Location for your Business
Choosing a suitable location for your lead generation business is vital especially if you do not intend to operate from home. If you must rent a facility for your lead generation business, then you must ensure that your business is located in an area where your target market are situated so that it makes it easier for you to market your services to them.
Even though a lead generation business shouldn’t be selective but if you are offering a niche that is different from where you are operating from, it would not be to your advantage. Therefore choosing your location is also dependent on what niche you are offering. Ensuring that you choose a lucrative niche also means ensuring that you will be located in an area where your targeted market can easily locate you.
Seeing that this is a business that you can start from home, you do not need to break the bank in leasing a facility. You can use your den or even the garage for your paperwork and run the entire business from there. However, if you must get one, you can get a small one and then lease for a short term.
Also, if you are going to be running a large scale business that would require you employing people to work with you then you might need to lease a facility; otherwise it is of no use.
17. Hire Employees for your Technical and Manpower Needs
The equipment and tools that you would need to run your lead generation business successfully especially the computer can be fairly used a long as it was gotten in a good state. However, to be free from worries about constant repairs, it would be better if you get a new computer system with the correct specifications.
The amount needed to start the business is very cheap and so you should go for a new computer system if you can afford it. Below is some of the equipment that you would need if you intend to launch your own lead generation business;
- Database software
The lead generation business is a business that can be run from your home especially if you are just starting out or want to operate on a small scale. However, if you must get an office facility, you must ensure that you get it for a short term only. If you however want to lease a large facility, it must be due to the fact that you intend to run a large scale business that will attract not only corporate clients but even government agencies as well.
Regarding the number of people, you would need to run a lead generation business; it would vary depending on the scale of the business. This is a business that can be run effectively by one person; however, if you are intending to operate on a large scale, you might need to employ a manager, article writers, cashier, and a receptionist. This could be between 5 to 7 people.
The Service Delivery Process of the Business
The production process in a lead generation business is not one that is very complicated or bogus as this is relatively a simple business to start up and run, especially if you have the required knowledge necessary to start the business.
In starting this business you would need to build and design a website or have a developer build one for you, this is of course after getting a domain name. The website is one that should handle a huge amount of traffic without slowing down or crashing, so ensure that you get a good website host for your business.
Another process involved is the use of database software that will help in generating the leads for your business according to the specifics that you want.
18. Write a Marketing Plan Packed with ideas & Strategies
Marketing is a very essential part of any business as it is a way by which income is generated for the business. Marketing also helps to garner publicity for your business, and is a way for you to acquire new customers too. As an entrepreneur who is starting a new business, you would need to ensure that you set aside a marketing budget that will enable you reach put to customers.
However, your budget doesn’t have to be one that breaks the bank as there are several inexpensive ways you can market your business.
Before marketing your products, you would need to carry out a thorough research so that it will help determine which advertising would best suit your new business as not all means of advertising would move your business as it should.
You should also ensure that you leverage on all available sources while marketing your business. If you intend to run a medium or large scale lead generation business, you might need to hire a marketing expert that will help draft out marketing strategies for you.
Below are some of the marketing strategies that can be used for your lead generation business;
- Making use of Search Engine Optimization (SEO) to ensure that your business pops up among top searches when being searched for by clients
- Sending introductory letters both online and offline as regards your business to your target market
- Creating a website and drawing your targeted market by posting interesting articles
- Ensure that you are actively involved in other forums and blogs
- Advertise your lead generation business in newspapers and magazines
- Ensure that your lead generation business is listed in online and offline directories
- Engage in direct marketing
- Use word of mouth marketing
19. Work Out a Reasonable Pricing for your Services & Products
In setting the right price for your product, you would need to consider certain factors such as your overhead cost, your operational cost and a host of such other factors. This will enable you determine what right price you should set for your products.
Getting the right product pricing for your business is a very serious affair, as you do not want to under price or over price your business. Also, you would need to be sure that your price is the same range as that of your competitors, so that customers don’t use that to patronize from your competitors instead.
20. Develop Iron-clad Competitive Strategies to Help You Win
In every business, there are always competitors that always seem to have an edge with their winning strategies at getting and keeping customers, which might be due to a number of factors, from excellent customer service to low prices.
If you want to start your lead generation business and ensure that it remains competitive, you would need to get competitive strategies that will enable you win your competitors, increase your visibility and get to keep your customers.
Firstly, your business must be packaged in such a way that customers cannot resist not wanting to get one; it must also have an edge over how your competitors package theirs. Also, your business must be packaged in such a way that low and high level clients can comfortably get packages that are within their budget.
Another way to keep above competition is to ensure that you offer lead generation related services.
21. Brainstorm Possible Ways to Retain Clients & Customers
Every business knows how important customers are for the health of the business, which is why even though a company appears successful, it will still engage in advertisement and publicity to be able to ensure that it gains more customers, while also doing certain things to ensure that its own customers remain with it and not move over to competitors.
However, while it might be more expensive to acquire customers, it is easier to retain them, so your strategies towards retaining customers for your company should be topnotch.
Customers respond not only to excellent customer service but they also are happy with any company that not only meets but exceeds their expectations. Therefore, if you intend to retain customers so as to have a healthy bottom line, you should strive at keeping them loyal to you through these two factors.
22. Develop Strategies to Boost Brand Awareness and Create a Corporate Identity
Strategies are very important if you intend to boost the awareness of your brand as well as create a corporate identity for your lead generation business. Nowadays, there are combinations of strategies that can be used to help achieve this, but if you intend to run a large scale business and would likely feel overwhelmed at handling this aspect, then you can hire a professional to help promote your brand for you.
Some of the strategies which can be used to not only boost your brand but also promote and advertise your business include;
- Ensuring that you advertise your business in both online and offline directories
- Making use of referral programs
- Ensuring that you draw the right traffic to your website
- Using social media platforms such as LinkedIn, Twitter, and Facebook to create awareness for your business
- Advertising in business magazines and other related magazines that is likely to cause an interest for your company
23. Create a Suppliers/Distribution Network
Even though this is a service based business, it is still subject to being dependent on suppliers for certain services. For instance, the computer(s) to be used for the business will come from the suppliers as well as the database software as well. No software can work independent of a computer system; also, other equipment is needed to make the lead generation business a successful one.
This is why it is important to always be in a good business relationship. Being in one with your suppliers or distributors is bound to be beneficial to your business as you would be given tips and advices on which equipment would best serve the need of your business.
24. Tips for Running a Lead Generation Business Successfully
In order to run a successful lead generation business, you would need to ensure that you carefully research on the niche you intend going into. Once you have chosen a niche that you feel is lucrative enough, then you can decide on the best strategies to ensure that the business is being run successfully.
The lead generation business is one that helps businesses and organizations get prospective clients for their products and services as well as other related businesses that they might be into and want customers for. This kind of business thrives on visibility and so if you intend to run your lead generation business successfully, you must ensure that your business is visible enough for your clients to see.
Finally, you might want to offer businesses several incentives or packages that would enable them choose your own company over that of your competitors. Also, you should strive to always exceed your customers’ expectations, while offering the right amount of professional services.