What is Cost Per Lead (CPL)?

One of the most popular models for online advertising, Cost Per Lead, or CPL, uses the number of qualified leads gained as the base for both marketing budgets and payouts. A type of “performance-based” advertising, the CPL model is something like a balanced “middle ground” where the publishers and advertisers share an equal responsibility for generating results. On the publishing side, Cost Per Lead campaigns require a targeted audience and an offer that elicits a response. Advertisers, on the other hand, then have to take those leads and convert them into sales, whether through a compelling product or an engaging experience.

Although there are a variety of other options when it comes to online advertising, a lot of businesses choose to go the CPL route because it’s fairly straightforward. For brand marketers and direct response marketers, CPL campaigns are an effective way to:

  • grow lists
  • acquire new customers
  • build momentum with rewards programs

Other brands use CPL campaigns for creating a deeper connection with their customers. In this case, CPL campaigns are most effective when the brand supports a compelling cause, like donating money to an organization with each purchase or creating products in a unique way with a special group of people in need.

One of the biggest benefits of investing in Cost Per Lead advertising is that they offer almost complete marketing and branding control. While other types of online advertising can be effective, the CPL model is one of the only ways to retain control and avoid brand misrepresentation. Another reason CPL advertising is so popular is that it generates more qualified leads. Rather than just “views” or “clicks”, “leads” demonstrate an active interest in the product or brand, which means investing in them is more likely to result in conversions.


So how do effective CPL campaigns actually work?

In most cases, a brand partners with an affiliate in order to display their advertisement. Rather than paying out the affiliate just for getting views or clicks, CPL requires an action to take place, like opting in to an offer or newsletter list. Because of this, CPL campaigns almost always result in more valuable leads for a business because they’re asking people to qualify themselves before having to pay an affiliate or publisher.

Similar to Cost Per Acquisition (CPA) campaigns, CPL advertising is different because it requires an active lead — not an actual purchase. So, although CPAs have immediate conversions (the sale has to happen in order for it to qualify within the model), CPLs are more affordable, making them more accessible to brands and businesses wanting to grow in a sustainable way.

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