This is a question I hear from every prospect and client that’s looking to increase sales: what do B2B lead generation companies cost? Are they effective, or should we hire a sales or marketing person internally?
I’ve done the research and testing, and in my opinion, there are pros and cons to both:
PROS:
- B2B lead generation companies handle all the hiring (and firing) that’s needed, reducing the HR management burden on a company
- Outsourced sales teams typically go through ongoing training
- These teams are typically well-trained and positioned for success
CONS:
- Most B2B lead generation companies provide benchmarks, but not guarantees, so outsourcing can be a risk for small businesses
- It’s hard to hold a third party resource accountable because you don’t have much insight into what they’re doing day-to-day
- You have little to no control over fit for your business, turnover, training, etc.
WHAT DOES IT COST?
The costs to work with B2B lead generation company vary a lot. According to the CEO of ThunderQuote (who answered this question on Quora), cost per appointment should be about $150-250. The lower the cost, the less qualified the appointment. Typically the more you pay, the more prospects have been qualified on budget, authority, timeline, etc.
Note: it is *shockingly* hard to find pricing for B2B lead generation companies online. I researched more than 20 companies to be able to write the findings below. That leads me to believe that most are likely fairly expensive programs.
I am a believer that all services should at least publish a range of prices to help curious prospects understand what to expect, but... to each his or her own! (You can find our 2017 pricing here—we’re revamping our pricing page now, so check back in a month to see our new packages!)
Blue Zebra is one appointment setting company that publishes their pricing. It appears thattheir pricing is on the lower end of my research with a $500 setup fee and $50/hr. for appointment setting; they’re one of the few calling companies that has a decent employee score on Glassdoor.com.
Boxpilot delivers “sales ready” leads with pricing from $1,400-$3,800 per month, with the smallest package including 15 hours and the largest 50. It appears that the company leads with outsourced appointment setting services and also offers a few marketing services as well.
Callbox offers lead generation services and falls into the category of B2B lead generation companies that don’t publish their pricing. However, their Yelp reviews say that customers pay about $10,000 for three months of service, putting their monthly cost at $3,334.
RESEARCH TAKEAWAYS
To summarize my experience and research on B2B lead generation companies, here are the main themes I see:
- Hire a company that guarantees leads. Most companies I researched priced based on activity metrics and hours, not guaranteed appointments. I would like to believe that all companies would work toward what they promise, but unfortunately when checking the BBB and Yelp for these businesses, I noticed that’s usually not the case.
- Use your numbers to decide how much you can spend on a lead. Most companies track customer acquisition cost (CAC) and lifetime value of a customer (LTV)—or know they should (don’t worry, we were in the “know they should” bucket for years, as most small businesses are). This article outlines how to find your LTV:CAC ratio in a fairly simple way.
- Consider whether cold calling is really a fit for your business. How qualified is an appointment set by cold calling in 2017? Today, there are so many smart marketing options that can deliver warm leads to your sales team—digital marketing should shorten the sales cycle and increase revenue.
FINAL RECOMMENDATIONS
Do your research. Don’t be dazzled by an amazing salesperson… lead generation companies all tell a beautiful story, but it’s important to dig into each to understand which might be a good fit for you.
Most companies I know that use a B2B lead generation company use inbound marketing in tandem (and some companies use inbound marketing as a replacement for appointment setting—I addressed whether marketing can totally replace sales here).
Are you using a B2B lead generation company that publishes their pricing? If so, I’d love to take a look! Please leave a comment below.