Internet and Businesses Online

Selling Leads vs. Getting Commission

The business of lead generation has taken off in recent years and many people are starting to realize its potential. Selling leads can be a way to make money online and in business in general. Many people are still unfamiliar with this business model, but it could be a worthy source of income generation for the right business.

How it Works

Many websites and marketing firms use methods that are designed to gather information from prospects. Once the prospect provides his name and contact information, this is considered a lead. That lead can then be sold to many different companies who are willing to pay for it.

Businesses know that finding new customers is hard. They also know that they are much more likely to close a sale if they are talking to someone who is interested in what they have to sell. Cold calling takes a lot of time and resources. It is usually not that effective for most businesses. Instead of calling on customers who may not be interested in what they have to sell, they would prefer to talk to prospects who are interested.

Many different companies and industries are willing to pay for good leads that are generated. For example, a debt relief company may be willing to buy leads from a website that is related to that niche. The debt relief company knows that people who are interested in getting help with debt are more likely to visit that type of site. If the site owner collects contact information, he can then sell that information to the debt relief company for a price.

Selling Leads vs. Getting Commission

The big difference between selling leads and getting a commission for selling a product is that with leads, the prospect doesn't need to buy anything for the referrer to get paid. A lead is only someone who is a prospect and is potentially interested in what the seller has to sell. The referrer gets a payment for each lead that he provides, regardless of whether the sale is closed or not. This makes it possible for referrers to make quite a bit of money off of this process even if the sales are not made.

Trust Issues

When running a website or a business that generates leads, some trust issues could come up. In order to get the contact information of the people who are considered leads, the company has to develop some level of trust with them. People do not just give their contact information to anyone these days. Since the prospect is trusting the company that is collecting its information, that company has an obligation not to betray the trust. This means that the company has to be careful who it sells the leads to. Otherwise, the company may end up losing the trust of future prospects once they realize that they are simply collecting information to sell it to the highest bidder. When selling leads, businesses have to work with other companies that are reputable and actually have a good product or service to offer. This can help avoid confusion and trust issues between prospects and the sites or companies that collect their information.

Before getting into the lead generation business, an entrepreneur should make sure that he has enough sway to get enough referrals. Otherwise, it may lead to a fruitless endeavor over the long-term.