Marketing & agency
Lead Generation Cost Calculator
Works lead generation cost, where cost per qualified lead is the useful figure.
Result
The qualified rate is the input that changes the picture, and it is the one nobody tracks. Leads outside your area, for work you do not do, or that never answer the phone cost the same as good ones and are worth nothing, so cost per raw lead flatters every channel that delivers volume. The break-even figure is the useful number when buying leads: it is the most you can pay and still make money, and comparing a lead seller's price against it answers the question directly. Purchased leads are treated more harshly because shared leads close worse when several contractors call the same homeowner within minutes, and the penalty applied here is a planning assumption rather than a measurement of your market.
Get a Free Business AuditHow the calculation works
Total spend divided by leads, and then divided by the qualification rate to give cost per qualified lead. The second figure is the one that matters, since an unqualified lead consumes sales time and produces nothing, which makes it a cost rather than an output.
What moves the number
- Qualification rate by source.
- Spend across channels.
- Sales time consumed by unqualified leads.
- Whether leads are exclusive.
Where this one goes wrong
A cheap source with a poor qualification rate costs more per qualified lead than an expensive source with a good one, and it also consumes sales time that nobody counts, which means the cheap source is frequently the expensive one. Measure cost per qualified lead by source. Unqualified leads also damage morale and response speed, since a team wading through poor leads responds more slowly to the good ones.
Before you quote
- Measure cost per qualified lead, not cost per lead.
- Track qualification rate by source.
- Count the sales time unqualified leads consume.
Questions
About this calculator
Why is a cheap lead source expensive?
Because a poor qualification rate means more leads per qualified one, and the unqualified ones consume sales time nobody counts. Cost per qualified lead frequently ranks sources in the opposite order to cost per lead.
What does an unqualified lead cost?
Sales time, plus a slower response to the good leads because the team is working through poor ones. Both are real costs that do not appear on any invoice, which is why qualification rate belongs in the comparison.
How should lead sources be compared?
On cost per qualified lead and, better still, cost per closed customer. Those incorporate the qualification and conversion differences between sources, which are frequently larger than the price differences.
The formula
cost per qualified lead = total spend / (raw leads x qualified rate); break-even per lead = gross profit per job x close rate
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Please keep the attribution line. It is the only thing we ask in return.
How to use this calculator
- Compare. Enter your own figure; the page starts at Several channels side by side.
- Paid advertising per month ($). Enter your own figure; the page starts at $2,500.
- Leads from paid advertising. Enter your own figure; the page starts at 28.
- SEO and content per month ($). Enter your own figure; the page starts at $1,200.
- Leads from search and content. Enter your own figure; the page starts at 22.
- Referral and repeat programme per month ($). Enter your own figure; the page starts at $400.
The result updates as you type, so you can try a figure, see what it does to cost per qualified lead, and change it back. Nothing you enter is sent anywhere or saved.
A worked example
These are the figures the calculator opens with. Every number in the results column below is produced by the same calculation the page runs, so you can follow it through before putting your own figures in.
What goes in
| Input | Value |
|---|---|
| Compare | Several channels side by side |
| Paid advertising per month | $2,500 |
| Leads from paid advertising | 28 |
| SEO and content per month | $1,200 |
| Leads from search and content | 22 |
| Referral and repeat programme per month | $400 |
| Leads from referral and repeat | 15 |
| Leads that are genuinely qualified | 65% |
| Qualified leads you win | 35% |
| Average job value | $950 |
| Gross margin | 45% |
What comes out
| Result | Value |
|---|---|
| Cost per qualified lead main result | $97.04 |
| Total spend | $4,100 |
| Raw leads | 65 |
| Qualified leads | 42 |
| Cost per raw lead | $63.08 |
| Jobs won | 15 |
| Cost to win one job | $277.26 |
| Gross profit per job | $427.50 |
| Gross profit after the spend | $2,222 |
| Most you could pay per qualified lead | $149.63 |
$4,100 produces 65 leads, of which 42 are worth working. That is $97.04 per qualified lead against $63.08 per raw one. You win 15 jobs at $277.26 each, and break even at $149.63 per qualified lead.
How sensitive the answer is
Holding everything else steady and changing only paid advertising per month, this is what happens to cost per qualified lead. It is worth knowing which of your inputs the answer actually hinges on, and which barely move it.
| Paid advertising per month ($) | Cost per qualified lead |
|---|---|
| $1,250 | $67.46 |
| $1,875 | $82.25 |
| $2,500 example above | $97.04 |
| $3,750 | $126.63 |
| $5,000 | $156.21 |
Every other input is held at the example value while this one changes, which is not how a real job behaves. Treat it as a guide to which number matters most, not as five separate quotes.
What each figure means
- Compare
- Choose from Several channels side by side, One channel in detail, Bought leads from a lead seller.
- Paid advertising per month ($)
- A money amount, between 0 and 1000000, starting at $2,500.
- Leads from paid advertising
- A number, between 0 and 100000, starting at 28.
- SEO and content per month ($)
- A money amount, between 0 and 1000000, starting at $1,200.
- Leads from search and content
- A number, between 0 and 100000, starting at 22.
- Referral and repeat programme per month ($)
- A money amount, between 0 and 1000000, starting at $400.
- Leads from referral and repeat
- A number, between 0 and 100000, starting at 15.
- Leads that are genuinely qualified (%)
- In the right area, the right work, and contactable.
- Qualified leads you win (%)
- A percentage, between 0 and 100, starting at 35%.
- Average job value ($)
- A money amount, between 0 and 500000, starting at $950.
- Gross margin (%)
- A percentage, between 0 and 95, starting at 45%.
What the results tell you
| Result | What it is |
|---|---|
| Cost per qualified lead | The headline result. A money figure. |
| Total spend | A money figure. |
| Raw leads | A number. |
| Qualified leads | A number. |
| Cost per raw lead | A money figure. |
| Jobs won | A number. |
| Cost to win one job | A money figure. |
| Gross profit per job | A money figure. |
| Gross profit after the spend | A money figure. |
| Most you could pay per qualified lead | A money figure. |
Attribution is the weak link
Return and cost-per-lead figures depend on knowing which enquiries came from which source, and most home-services businesses do not track that reliably. If the source data is guesswork, so is the return.
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