Pay Per Sale marketing is unique. Very few companies offer it. Why? It’s hard. It’s expensive. It’s risky, especially if the advertising agency isn’t great at what they do.
There is also a certain amount of risk related to the business and whether or not they can convert leads/appointments to sales. It requires a lot of communication, trust, and hard work on both sides.
However, when it works it produces amazing results. Most marketing agencies want to be paid by the hour regardless of results. With a pay-per-performance digital marketing model, a business only pays for those sales generated through online acquisitions.
This forces the agency to only spend time on the activities which will generate revenue for the business, not for the agency.
What are the Benefits of PPS Marketing?
Why is it important to Pay on sales and not leads? Not all leads are equal. It’s much easier to generate leads than it is to create leads that turn into sales. If you are paying for leads you are hurting your business more than you may realize. What are some of the issues with buying leads?
- Branding the lead generator, not yourself.
- Creating demand in your area for lead generators thereby increasing your costs.
- Higher quality leads will help salespeople produce significantly more revenue for the company.
- More profitable sales are produced by sales teams with leads that are exclusive.
Issues with Lead Generation Companies
- Lead generators often sell leads to your competitors forcing you to participate in a “race to the bottom” for the final price which may have little to no profit left.
- Poor customer experience when potential customers are often tricked into thinking they are applying with a business.
- Customers may have their information passed on indefinitely by bad actors that participate in the program looking to recoup some of their costs by selling lead data.
- Customers are often badgered by aggressive commission-only salespeople and if their lead is sold 5 times they have 5 times as many calls and can be burned out.
- Negative impact on your sales team. Imagine having to work 100 leads for 1 to 3 sales versus 5 leads for 1 sale.
- Companies are more likely to generate additional sales from other product or service lines for customers that were generated directly to their website as lead generators will “own” that lead and may remarket to them for competitors in the future.
Pay Per Sale Gives You an Experienced Marketing Team
Finally, with a Pay Per Sale marketing arrangement, you will have access to a significantly more experienced team than you could afford to hire internally.
Imagine if you could literally sign on the dotted line and launch a digital marketing plan that is out of your budget and requires a fraction of your time to get results that have never been achieved historically.
How to Get Started with PPS Advertising
What does a company usually need for a great Pay Per Sale program?
A company needs to have figured out what it does well and the processes necessary to be successful before it can participate in a PPS marketing program
In order for a Pay Per Sale program to make sense for a marketing agency the opportunity needs to be large enough to pay for the people, ads cost, time, and the opportunity cost of doing other work
There needs to be a lead management system in place that can tell the marketing agency what the disposition of every lead is so they can be paid on sales.
Further, the disposition of qualified leads, out of the market, and no opportunity leads helps the digital analytics team to continually refine the program to drive more high converting leads and fewer bad leads
This can be a difficult metric but a necessary one nonetheless. Every company is different and the acquisition cost of a company that offers to finance to any level of credit could be much lower than one that only serves customers with perfect credit in the same industry.
Acquisition cost should include the cost of people, ads, software, etc. that currently go into the cost of a sale. Also, you should estimate this on the high end of the spectrum in order to give the program the largest growth opportunity.
Grow Your Company’s Revenue
PPS Marketing is not meant for companies that want to maximize profit per sale, it is meant for companies that want to grow their revenue, client base, and market share by large amounts with the smallest acceptable margin possible.
When done correctly, we’ve seen companies grow enough through this plan to be acquired by multi-billion dollar conglomerates.
Final Thoughts on Pay Per Sale Marketing
Pay Per Sale advertising is based on trust. When both parties are working towards the same goal and considering the needs of one another there is no marketing arrangement that works better. The results from PPS marketing will far exceed any other plan since both companies profit only from the sales generated.
Pay Per Sale is truly the ultimate compensation plan for businesses looking to drastically increase their inbound sales revenue.