In this YouTube video, Eric Deeran argues that pursuing the cheapest lead cost is counter‑productive because low‑cost leads tend to be low‑quality. Drawing on experience with around 800 clients, he explains that the key performance indicators to evaluate leads are lead cost, cost per qualified call, show rate, close rate, and average order value (AOV). He consistently observes that leads with higher cost per lead book at higher rates, show up more often (about 80‑82% show rate), and close at higher rates (35‑40% close rate), resulting in higher AOV. Consequently, Eric prefers to pay more for leads that generate booked calls and higher conversions, allowing him to maintain a smaller, higher‑performing sales team that earns more, stays longer, and delivers better quality work, rather than a bloated team with many low‑producing reps.
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I think it's funny when everyone says they want the cheapest lead cost, um, and they're always trying to get the cheapest lead cost because at the end of the day, the cheapest lead is always the worst lead from what we've seen. Um, I mean, we've worked with like 800 clients at this point, um, and the biggest thing I always see is people, oh, the lead cost is too high. Oh, it's too high. The lead cost is too high. I said, okay, great. So let's look at it. Um, what's the lead cost? And then what is your cost per call? What's your cost per qualified call? What's your show rate? And then what is your close rate? And almost every single time what I've seen is the leads that cost more book at a higher rate, so they book more often, they show at a higher rate, and they close at a higher rate, and they have a higher AOV. And so even though you're paying more per lead, they're typically better leads that close and show up more often. And for me, for my sales team, I would rather optimize around leads that show up and close than leads that are cheap but don't show up and close. I mean, on average, our show rate for what we do is around 80-82%, and then our close rate hovers between 35 and 40%. And that, that is because we pay more per lead, we pay more per booked call. And some people would look at my cost per call and be like, oh my God, that's crazy, like you're willing to pay that much? And yeah, absolutely, because I'd rather have less salespeople that close more money than a bunch of— and I had this before, like a bloated sales team of tons of people where no one's really making that much money. We've done both over the past like 10 years, and I always prefer having less people that make more money because they stay longer, they make more money with you, and at the end of the day, like, they just— they're better quality people too. So
