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Cost-per-Lead in a Recession

Back in 2008-2009 we were curious about the variation in cost-per-lead. Some clients wanted to cancel their campaigns because they were afraid it was going to get too expensive.

Those who stopped their programs regretted it.

As you can see from the graph, cost-per-lead does go up during a recession. This is primarily because contact rates (dials-per-contact) go up as people become harder to reach. However when we do get them on the phone, they're more likely to engage, and express interest. So, while the cost-per-lead goes up, it does not go to infinity.

Even more important was the observation that close rates tended to go up quite a bit, although the sell cycles protracted.

The net effect was that the profitability of the program can go down a little in a recession, or go up a lot, depending on what you're selling. But stopping was universally a bad idea.

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