How Do I Calculate Cost Per Lead?
Cost per lead (CPL) = total campaign cost ÷ new leads
- Add up everything the campaign cost: ad spend, prize, shipping and your plan for that period.
- Count the new leads. A lead is someone you can contact again, usually a new email subscriber. Entrants who didn't opt in, or were already on your list, don't count.
- Divide the cost by the leads.
For paid ads, $3,000 of ad spend that brings in 100 leads is $30 per lead.
For a giveaway, a $500 prize plus a $120 plan is $620. If 2,000 new people subscribe, that's $620 ÷ 2,000, or $0.31 per lead.
The prize costs the same however many people enter, so every extra subscriber lowers your CPL. Viral Share helps here, because entrants bring in friends you didn't pay to reach.
Then compare the number with your other channels, and with how many of those leads go on to buy.
See Next Article
When Should You Use Paid Ads Instead of a Giveaway?
Use paid ads when you need ready buyers or a set number of leads by a deadline. Use a giveaway to build an audience you keep.