metricsAn ineffective advertiser and his (or her) money are soon parted.

There are many great third-party web sites that will consume a portion of your online advertising budget—,, and many, many more. So, how can you possibly figure out which one is the best place to invest in online lead-generation efforts?

First, all sites are NOT created equal. Even though some may provide less leads, they might be more qualified leads that are more likely to convert to sales. Others may provide more leads but at a lower conversion rate. At the same time, some sites will direct more traffic to your website—because they have much larger audiences, for example.

A simple system delivering objective web-site comparisons.
Even though it may seem daunting at first, there’s a fairly simple system for ranking the effectiveness of lead-generation web sites. The key is to track conversion rates and metrics from the leads you receive by setting a value for appointments made and contracts written. It is a true, objective barometer of marketing success.

Here are a few examples:

Scenario 1
Say an online lead source provides 100 leads per month. Fifteen leads become appointments, and two of those result in contracts. Your overall cost per month for these sources is $2,500. At first, you might calculate that each lead only costs $25 from this source—but you’ll soon realize that unqualified leads are worthless. Only appointments (which become contracts) have value, so in this case, each appointment costs $166.67, and each contract costs $1,250.

Scenario 2
In this case, you pay $1,000 per month—and you receive 50 leads. Of those leads, you’re able to convert nine to appointments and one to a contract. When you do the math, you’ll see the good news: this time around, you’re paying only $111.11 per appointment and $1,000 per contract—for a better return on investment.

Of course, keep in mind that you can’t track everything from these sources. Often, a prospect will just print directions and stop by a property without ever submitting a lead.

Four more steps to online marketing success.

Based on my experience, I suggest four additional recommendations for measuring your online marketing:

  1. Be patient—give yourself at least three months. You need adequate time to accumulate accurate data and make informed decisions. Personally, I always negotiate for a three-month trial or discount period—and I never sign a contract longer than that if I’m not already familiar with the service.
  2. It’s all relative. Just because one source performs better than another, that doesn’t mean you should eliminate a source altogether. Just make sure you’re getting a good return on your investment and make on-the-fly adjustments as you go. Spend more with the better performers, sure, but spread the love far and wide to increase exposure.
  3. Examine other conversion results. Remember, appointments and contracts are the name of the game. Still, consider traffic directed to your web site and the number of directions printed from the advertising source. They’re ALL good indicators of interest.
  4. Monitor continually – You need to be tracking these results every month and adjusting as necessary. One of the benefits of online advertising is that you can adjust at the touch of a button.

The bottom line? If you’re not constantly monitoring metrics, you’re just “guesstimating” and hoping—and that’s never a good strategy for success.

Sign Up & Stay Ahead Of The Curve With

The Latest & Greatest

Video training, articles on current trends and best practices, and a dose of humor! No hidden agendas. No sales pitches. We're here to help you - not sell you. Simply click the subscribe button below, and never miss out again.

A weekly podcast 100% focused on online marketing for home builders & developers.