Lead generation is a lucrative business model, especially in today’s highly data-driven world. It refers to a service model where a business sells different types of leads to customers, which are mostly other businesses.
Today, nearly every business is competing fiercely to get more customers, expand their client base, and earn more revenue. In this competitive environment, a lead generation business can be a profitable and highly scalable venture.
In fact, Research and Markets indicates that the “lead generation solution market” could grow by a staggering Compound Annual Growth Rate (CAGR) of 17.5%. That means, the market could be worth over $9.5 billion by 2028.
This post will be a helpful guide for those looking to tap into this lucrative market and kickstart a potentially profitable venture selling leads to other businesses.
It is a process that involves identifying and attracting potential customers (leads) to a business to sell products or services. According to the Benchmark Report of 2017 from HubSpot indicates that organizations were generating 1,877 leads per month on average. It’s such a popular business model, that there are lead generation books in the market too!
However, those numbers have had to change drastically considering the rapid increase in internet use and digital marketing efforts worldwide. In 2024, HubSpot also reported that a majority of marketers had “lead generation” as their top priority.
Businesses use lead generation to grow their business by expanding their customer base and increasing sales. It helps them drive up revenue while building new customer relations and improving existing ones. Such businesses also sign up with professional, reliable email list providers, like BookYourData, to get started with their outreach campaign.
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Depending on the industry, the lead generation process could vary. Usually, it involves social media posting, running email marketing campaigns, SEO, and paid advertisements. The main goal is to gather emails, phone numbers, and other relevant contact information of potential clients.
Of course, this needs to happen within the data privacy and online security regulations of the specific region. Once this data is available, businesses can qualify and pursue the most valuable leads to gain their interest.
Why would someone start a lead generation business? As the above-mentioned statistics indicate that lead generation is a lucrative market, it could help create a recurring revenue stream. But there are more reasons as well.
By investing in a lead generation business model, entrepreneurs can create an additional - or primary - revenue stream. Once the business is up and running, the company can attract potential clients and start selling them qualified leads.
Be it a small business or a large enterprise, every business needs customers. And bringing in new customers is an effective outcome of the process called “lead generation”. It is a highly valuable and in-demand service.
A great benefit of starting a lead generation business is that there are a ton of tools and software solutions in the market. They serve as assets that make scaling easier for the business as it grows. Moreover, email verification tools like the online tool at BookYourData help verifying emails in bulk to save both time and resources.
Unlike a brick-and-mortar business, a lead generation business can be run from the comfort of a couch. The majority of the processes involve using software tools, digital applications, and CRM systems. While manual intervention is necessary, it isn’t the main determinant of success during the startup phase.
As said earlier, lead generation business is a highly flexible option. Since it involves the use of digital applications and tools, entrepreneurs can run it from anywhere. That too, without bearing overhead costs like renting a large office space
It’s not just one industry that wants leads, it’s many. From real estate to healthcare, there’s a long list of industries that turn to lead generation services to gain new clients. So, a diverse client base is likely.
Before a lead generation business kicks off, it needs to ascertain what type of customers it is looking for. Since lead generation services are required by so many industries, there are several factors for consideration that can pinpoint the most lucrative target audience for such a business model.
The business should start with research into potential customers. For example, the lead generation business could target B2B companies or small local businesses that want to expand their customer base.
After identifying the target audience, the next step involves separating qualified leads from the list. These are prospects that are more likely to convert into paying customers. In a report by Semrush, attracting qualified leads was a top challenge for marketers.
Once qualified leads are sorted, creating ideal customer profiles (ICPs) can help. This details the individual client needs and pain points. Moreover, it can also help with audience segmentation based on common parameters.
After the target audience is all set and identified, the next step will involve creating an effective lead generation strategy. Here’s how a budding enterprise can create a targeted lead generation strategy:
It is ideal to begin by exploring the best channels for lead generation. These will include Google Ads, SEO, and LinkedIn - they can also serve as part of a comprehensive strategy.
Using cold emailing software and dedicated B2B lead databases can also help a lead generation business attract “leads” for itself.
Among the many services available, BookYourData is a top choice for any lead generation business because of its deep knowledge of email marketing and its wide array of business tools, such as a built-in real-time email verification function upon each export and industry-first 97% accuracy guarantee.
It is always advisable to include targeted email campaigns into the mix. They can not only help bring new clients but also nurture them to encourage purchases. That’s something many lead generation companies also help, like BookYourData.
A lead generation business will need to optimize its sales funnel by regularly checking the performance of active campaigns and sales efforts.
Cold emailing is one of the best practices to attract prospects. Moreover, it benefits from personalized messaging, relevant content, and clear CTAs to improve conversions.
It helps when the business leaders have an in-depth understanding of the lead generation process. Of course, that is one of the first things to do when starting a lead generation business.
Marketing is a huge part of the process. It involves advertising, social media campaigns, and SEO to gather the attention of potential clients and start generating income.
Since not all leads are equal, the lead generation process requires professionals to gauge the interest levels of leads to see which ones are more valuable.
While starting a lead generation company is a relatively more nuanced process that involves more than five steps, summarizing it into just 5 highlights the key processes.
The professionals at the head of such business ideas need to consider laws like the CAN-SPAM and GDPR to ensure compliance with regulations.
The next step is to assess the potential costs involved with starting this business. It is important to mention that lead generation startups have low initial costs.
There are different ways to make money in a lead generation company. For instance, the most popular income models include:
Such businesses usually turn to content marketing and social media - cost-effective methods - to connect with potential clients. Tapping into LinkedIn networks is also a viable strategy.
For the business to be successful, there needs to be regular performance monitoring. It will lead to better strategies and help in optimizing processes to get better results.
A company can use numerous methods to generate leads. Here are a few of the most effective ones:
There are dedicated B2B contact databases where they can find potential leads.
Cold emailing and cold calling can also help to connect with prospects.
Through local and general SEO, businesses try to rank higher in search results for relevant keywords. This puts them closer to potential clients.
Paid ads through different platforms - like Facebook and Google - can also help reach new clients.
Social media platforms like LinkedIn (a prominent B2B platform), Instagram, X (formerly Twitter), and Facebook are excellent channels for reaching potential.
For any lead generation business, having a handful of marketing and other tools is necessary. For instance, automation tools and CRM systems can help a lead generation business stay organized. Such tools offer streamlined data management and data sharing capabilities.
Moreover, they also come with analytics features that improve decision-making. However, the type of tools a lead generation business needs might depend on their budget, immediate requirements, and a few other factors. Let’s take a look at the most common tools such a business can use.
A B2B contact database is where most companies find qualified leads. What’s important to note is that these databases are usually highly optimized which makes finding specific leads, sorting them, and managing them extremely easy.
With BookYourData, there's a demonstrated history of success, evidenced by their 100k+ users and 20k+ paying clientele. Furthermore, their flexible pricing model accommodates both pay-as-you-go options and the benefits of tiered pricing with volume discounts.
Hearing “email provider” would instantly make a professional think about popular emailing platforms. Gmail, Outlook, and ProtonMail are some of the examples of an email provider service. They are not just useful for sending and receiving emails. In fact, they help with running and automating email campaigns.
Operating without a CRM system is among the cardinal sins of running a modern business, especially in the lead generation niche. These software solutions offer a way to track and manage leads by optimizing the sales funnel. Hence, they help a lead generation business make sure that no opportunities go untapped.
Growing a local lead generation business begins with investing in local SEO. This could include setting up a “Google My Business” profile with relevant information. Here’s more!
Here, creating backlinks to local sites and directories could help. Moreover, the site should appear in the “Google My Business” profile along with accurate contact information (and website link). Also, integrating the site with relevant keywords should help it rank higher for local searches.
SEO-optimized content is one of the best ways to attract local clients to the business. This means generating content that is relevant, up-to-date, and includes the right keywords. For instance, Backlinko revealed that nearly 76% of searchers who use “near me” in their searches tend to visit within a day.
A local lead generation site can benefit from regular social media activity. Since there are over 5.1 billion social media users around the world, being on relevant platforms could help a business connect with its target audience cost-effectively.
Another way to boost the local site is to run targeted ad campaigns. These would appear on search engines, social media platforms, and other sites. This strategy mixes both content marketing and keyword optimization to reach the right audience.
So, starting a lead generation business can be an excellent way to generate recurring income. Like any other modern business model, it will require extensive research and planning to get a lucrative start.
However, it will be continuous learning and process improvement - along with regular monitoring - that lead to stable operations. More importantly, that is what will help in creating a steady stream of income.
When selling leads as a lead generation company, it is important to abide by the laws and data privacy rules to prevent legal complications. At the same time, using the latest tools and optimizing lead generation strategies will help deliver effective outcomes at a consistent pace.
Technology, healthcare, finance, real estate, and marketing are just some of the industries that usually focus on lead generation services.
The inbound strategy uses SEO and content marketing to ‘lead’ customers to the business. Whereas, the outbound strategy involves cold outreach emails and calling to ‘reach out’ to potential customers.
The price of leads can vary significantly - anywhere from $30 to $400 per lead. It depends on lead quality, volume, and industry.
Signing up with BookYourData with 10 free leads offers a strategic advantage for those venturing into lead generation. With their expertise in digital marketing, they can segment and refine data, ensuring it aligns with the target audience's interests.
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