What Is The Difference Between Organic Leads And Paid Leads?Sep 21, 2023
Many digital marketers who specialize in lead generation have argued for decades over which form of lead generation is the best, either organic lead generation or paid lead generation. In this article we're going to highlight the main difference between each form of lead generation and why they both have great potential for growing your business over time.
While they both can allow your business to grow & generates customers for years to come, they each have their own advantages depending on your business current goals.
What Is The Difference Between Organic Leads And Paid Leads?
The key difference between organic leads and paid leads lies in how they are acquired. Organic lead generation is accomplished through using free and "attraction based" marketing, while paid leads are generated through some form of paid advertising such as PPC or CPA networks.
Here's a detailed walkthrough of how both organic leads and paid lead are generated, step by step.
How Organic Leads Are Generated
- Acquisition Method: Organic leads are generated naturally through non-paid marketing efforts. They result from strategies like content marketing, search engine optimization (SEO), social media engagement, word-of-mouth referrals, and other unpaid methods.
- Cost: Acquiring organic leads typically does not involve direct monetary expenses. Instead, it relies on investments in content creation, SEO, social media management, and other forms of organic marketing. Thus, it takes more time to generate organic leads, but it cost much less in terms of money.
- Time Frame: Building a base of organic leads can take time, as it often involves cultivating relationships, establishing trust, and gaining visibility over the long term. Usually organic lead generation is a long term strategy.
- Quality: Organic leads often have higher quality and a stronger potential for long-term customer relationships because they have shown genuine interest in your offerings. Organic leads often have not been "convinced" to buy your offer through ads and follow up, they usually have generated an attraction and are drawn to your products.
How Paid Leads Are Generated
- Acquisition Method: Paid leads, on the other hand, are obtained through advertising and promotional campaigns that require a financial investment. Examples include pay-per-click (PPC) advertising, social media ads, display advertising, and influencer partnerships that involve payment.
- Cost: Acquiring paid leads involves direct monetary expenses. Businesses pay for ad placement, clicks, impressions, or other predefined actions that drive traffic and conversions.
- Time Frame: Paid lead generation can produce results relatively quickly, as ads can reach a targeted audience immediately. However, it depends on the effectiveness of the campaign.
- Quality: Paid leads may vary in quality, as they are driven by advertising and may not always represent individuals with a strong intent to purchase. Some may convert quickly, while others may require further nurturing. If you don't have the right targeting or copy, you can waste a lot of ad spend. So be careful running paid ads if you don't have any prior experience.
To summarize what we've just walked you through - the primary distinction between organic and paid leads is the method of generation and the cost. Organic leads result from unpaid, long-term strategies aimed at building relationships and trust, while paid leads are obtained through advertising and require a direct financial investment. Both approaches have their merits, and many businesses employ a combination of organic and paid lead generation strategies to diversify their customer acquisition efforts.
Are Organic Or Paid Leads Better For Your Business?
The choice between organic and paid leads depends on your business goals, budget, and overall marketing strategy. Both types of leads have their advantages and can be beneficial in different situations.
Here's the list of circumstances in which you should consider doing organic lead generation...
- You don't have a big budget to spend on ads
- You have never done paid lead gen before and you don't have any training
- You want to keep & sustain higher profit margins
Here's the list of circumstances in which you should consider doing paid lead generation...
- You have an excess budget and can afford to spend money on ads
- You want to scale faster and acquire both leads & customers without waiting
- You are okay with having lower profit margins
Consider both sets of circumstances when deciding if you should do either organic or paid lead gen.
We personally recommend that you do both paid and organic lead generation. While organic lead generation converts higher and makes it slightly better then paid lead generation, it takes a lot more time to do.
Should Use Both Organic & Paid Lead Generation?
Yes! Most successful businesses use a combination of organic and paid lead generation strategies - you should consider doing both as well. This balanced approach leverages the strengths of each method. For example, you might use organic methods to build a strong foundation and reputation while using paid advertising to accelerate lead generation during specific campaigns or product launches.
Ultimately, the "better" approach depends on your unique business objectives, available resources, your budget, and the specific dynamics of your industry. You should make sure to analyze your top competitors for the strategies they're using, consider your goals, and experiment with different strategies to determine what works best for your business. In most circumstances, a diversified approach that integrates both organic and paid lead generation efforts can yield the most sustainable growth for years to come.
Final Thoughts On Organic Leads VS Paid Leads
In the ongoing debate of organic leads vs. paid leads, it's essential to recognize that there's no one-size-fits-all answer. The choice between these two approaches should align with your specific business goals, budget, and overall marketing strategy. Here are some final thoughts to consider when navigating this decision:
- Complementary Strategies: Organic and paid lead generation strategies can work hand in hand. Organic efforts, like content marketing and SEO, provide a solid foundation and long-term sustainability, while paid advertising can offer quick results and scalability. A blend of both can create a well-rounded lead generation strategy.
- Budget Allocation: Consider your budget constraints and allocate resources strategically. In some cases, you may need to prioritize one approach over the other based on available funds. However, keep in mind that organic efforts often have a more extended ROI timeline.
- Audience and Industry: The nature of your target audience and industry can influence the effectiveness of organic vs. paid strategies. Some industries may benefit more from precise paid advertising targeting, while others thrive on organic content and word-of-mouth referrals.
- Testing and Adaptation: Lead generation is not a one-time decision; it's an ongoing process. Regularly assess the performance of your strategies, test new approaches, and adapt to changing market dynamics. What works best may evolve over time.
The choice between organic and paid leads is not a matter of one being definitively better than the other. The most effective lead generation strategy often involves a dynamic and adaptable approach that leverages both organic and paid methods. By understanding your unique business needs, staying flexible, and regularly assessing your results, you can optimize your lead generation efforts for the perpetual future.
With our kindest regards,
Jon Weberg & The Profitalize Team