PPC ROI – The Simple Formula for Calculating Revenue Per Lead

Calculating Revenue per lead for SEM Programs

Calculating revenue per lead is not necessarily as simple as dividing the cost per lead by the revenue earned per lead. In order to effectively calculate revenue per lead, you need to set up a system that will connect high quality leads to the dollar amount spent per each individual lead. Instead of relying on intuition alone, connect marketing strategy and sales in a meaningful way, and fully leverage the power of the data.

At face value, the formula for calculating revenue per lead is fairly simple:

Total Revenue Generated/Total Number of Leads=Average Revenue Per Lead

However, finding the average returns is not a long-term recipe for success. You need to be able to triangulate between PPC site traffic and CRM sales.

How to Get All of the Necessary Variables in Place

First, develop a lead scoring system with robust CRM and keyword tracking technology. Be able to easily connect specific PPC site visitors with sales. Track big data, and input subjective data regarding personal experiences. Track which clients and customers stood out as exceptionally good leads throughout the sales cycle, and connect each with corresponding PPC site traffic data.

Further develop PPC ROI reports that focus on what you care about, results. Track year-over-year data as well as monthly data. Instead of only relying on statistics or only relying on intuition, combine the science and the art of effective digital marketing to drive ROI. In numerous instances, marketers do not properly connect revenue earned to cost per lead. The average ROI for any given PPC campaign is not the best way to derive meaningful insights. Use a results-driven approach, and work backward instead of using a much more rudimentary “guess and check” approach to PPC ROI.

Calculate Anticipated ROI Before Calculating Anticipated Site Traffic

Generic site traffic from PPC campaigns can have numerous pitfalls. Additionally, working backward improves bidding strategy. Instead of hoping for the best, score leads and use money keywords for results-oriented PPC campaigns. Take measures to get highly qualified leads from the first click, and connect marketing strategy with sales strategy in a way that makes sense.

How to Get the Final Results and Know What Cost Per Lead Is

By having a system that allows you to connect leads, sales, and PPC strategy, you can properly calculate the cost per lead. Return to the simple equation Total Revenue Generated/Total Number of Leads for a meaningful analysis of PPC ROI. Take a scientific approach to calculating revenue with an appropriate amount of anecdotal evidence based on recent experiences with customers and clients.

Find Out More About Driving PPC ROI Per Lead
Contact our team at HawkSEM at 800-316-2220, or request an ROI Strategy today.