Get to Know Deeper What is Cost Per Lead and How It Works
Cost per lead (CPL) is a form of performance-based digital advertising. You only need to pay for advertising when there are consumers who are interested in your offer, and they are willing to register themselves. This is also often referred to as lead generation. CPL advertising is usually used by businesses that offer subscription services or who sell high-value products.
Unlike cost per mille (CPM) and cost per click (CPC) advertising payment methods that require you to pay for impressions (views) and clicks, in CPL ads, you only need to pay when there are consumers who register themselves, no matter what the impression amount or click on it. With CPL advertising, the money you have spent will give you guaranteed results.
How and Why Businesses Use CPL
- The CPL advertising pricing model is generally used by businesses that are building email lists, running customer acquisition programs, or conducting prize programs.
- Some businesses rely on CPL advertising to connect with consumers who are very enthusiastic about a brand, product, or are experiencing a problem. These consumers are usually highly valued because of the potential to make repeat purchases. They also tend to be more active in recommending your product to others who have similar interests.
- CPL advertising is also more often an option for branding, because your company has full control over your brand throughout the entire marketing process. This is done as a preventative measure if other entities misinterpret your company’s message on another channel.
Consumers show their interest by registering, and not just looking. They are qualified leads, or in other words, they are people who have shown their interests, needs, or desires for what you have to offer. CPL is more likely to result in conversions, and can even develop into regular customers.
How CPL Works
When the audience clicks on the ad, they will be sent to your landing page. There, the audience is directed to participate or register in the marketing program that you are running, whether it’s a discount, a mailing list with the lure of coupons, sales that are available for a limited time, and so on. If the audience decides to register, this means that you have got a lead, and the publisher (where you place the ad) will get compensation according to the cost per lead following the previous agreement.
How to calculate CPL
CPL is the first formula in a set of marketing metrics that can help you measure your marketing effectiveness and budget.
You can calculate CPL by sharing the total marketing costs incurred with the leads obtained. The total marketing expenses include advertising expenses, third party expenses, or other related expenses.
You spend an advertising budget for inbound marketing of $ 5 million in one month. From here you get 10 thousand page views and 500 clicks from ads. While from the number of visitors, there are about 500 people who visit your website, and 50 people who subscribe to the newsletter. From this example, CPL can be calculated as follows:
$ 5 million (total advertising costs): 50 (number of leads) = $ 100,000. Thus, the CPL is $ 100,000.
Thus the discussion about cost per lead and how it works. And don’t forget to advertise through our services, you can start by advertising your product, so that later you can increase visitors to your online business portal. Froggy Ads is an online advertising service that can help you control all your product campaigns. helps you target the marketing targets you want and gives you many choices for marketing your product.