Make Money With Your Own Lead Vending Machine

Many business need leads - MLM and biz-op people, mortgage brokers, insurance brokers, attorneys, etc. Just about any business can use more leads. And you can be providing them to these businesses for healthy profits.

The Business

This is a business that is pretty simple to understand. Basically people who are in business need leads. The more leads they get, the more sales they will make. Your job in creating and running a Lead Vending Machine is to create a system whereby your customers (the people who want leads) can purchase the quantity they want, make the payment and have them delivered to them all in an automated way.

First, what is a lead. A lead is a way of contacting someone. It can be just an email address, a name and a phone number, name/address/phone/email address, or name/address/phone/email address, along with additional qualifying information. The very best leads for a business are those that have specifically requested information based on a presentation. For instance, if you were in an MLM and you ran a specific ad for your opportunity that people responded to, those would be the best leads for your business. The second best lead would be people who responded to a generic MLM opportunity ad and so on.

There are two basic types of leads - brand new fresh leads and aged leads.

• Brand New Leads - these are leads that are delivered at point of contact. In the traditional marketing world, this would be someone who called your business from an ad you ran in a publication. In the online world, it means someone who filled out an inquiry form and the data was emailed to you within minutes of that form being filled out. A brand new lead lets you get back to the inquirer while the reason that person inquired is still fresh in his mind. Generally speaking brand new leads are delivered to the customers within a day of their collection. However in many industries, brand new leads are leads that are less than 30 days old.
• Aged Leads - Aged leads are older leads. In most marketplaces, these are leads that are 30 or more days old.

There are businesses on the web that offer one or the other or both types of leads. The reason people buy new leads is because these people will supposedly be hot and ready to make a deal if the opportunity is right. The reason people buy aged leads is because they are cheap and you can buy many more leads for your money. Aged leads are not as good but the volume of leads bought for the same funds can make up for the lower quality.

To give you an idea of the price disparity, new leads in the MLM arena can sell for anywhere from $2-6 each and new leads in other industries like insurance can sell for as much as $20 each. By comparison, aged leads will typically sell for 5 to 20 cents each in quantity (although some companies sell "young" aged leads - leads 15 to 45 days old - for 50 cents to $1 each.) Another differentiator on price is how many times you sell the leads. For instance, some companies will sell new leads to 3-10 people and will call new leads anything less than a week old. These companies generally charge less per lead but in reality make much more money due to the multiple sales of the leads - provided of course that they have enough customers to accomplish this.

The tools you need

You will need a few tools to make this business work for you. They include

1. A website for your customers to come and purchase lead packages from you.
2. A website to collect leads if you are collecting them from direct advertising as opposed to buying them from a co-op advertising source.
3. A merchant account to take purchases. This can be a regular merchant account on an online payment provider like PayPal.
4. Software to run your system. You can either write your own if you have that talent or you can use a bidding service like scriptlance to find a programmer to develop the software for you.

Profit potential

The success and profit of a business on this is going to depend on two factors: how many customers you can get (and how many are repeat customers) and what the cost per lead is going to be for you.

Let me give you an example I am intimately familiar with as I built the software for this person. I'm not naming the website for privacy reasons.

He sells to customers who want diet leads. The customers are in an MLM where the top selling product is a diet package. The average price per lead is $3 and the average cost per lead (including credit card charges and the cost of his referral system bonuses) is just over $1.50. So, he is making about $1.50 per lead sold. With this system, he sells about 10,000 leads per month. He makes about $15,000 per month on this system. We also built a similar system for MLM leads that does an equivalent amount of business a month. So from his two lead systems, he is earning about $30,000/mo net.

His business is what I would consider a smaller lead business as he grows strictly from referral marketing and does no other advertising to get new customers.

Keys to success

Assuming that you choose to deliver new leads (where I consider the bigger money to be), the two keys to success are to grow big enough to get your cost per lead down as cheap as possible and to keep a flow of leads coming into the system rapidly enough to service all your customers in a timely manner. If you can master these two points, you will be able to build a very substantial business with a great cash flow - all from the internet with no physical product to deliver, no office, no employees, etc. This type of business is as close to a hands off cash cow as could be created.

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