Cost per lead is useful. It tells you how much you paid, on average, to generate a lead. The problem begins when CPL becomes the final measure of whether acquisition is working.
What CPL actually tells you
If a campaign spends $10,000 and generates 100 leads, the CPL is $100. That tells you something about acquisition efficiency, but almost nothing about what happened after those leads entered the business.
Look beyond the lead
- Was the lead reachable?
- Was the lead qualified?
- Did the lead become a real sales opportunity?
- Did the opportunity produce revenue?
Ask a better question
Instead of asking only which campaign produced the cheapest leads, ask which campaign produced the leads that were most useful to the business. CPL can still be part of the answer. It simply should not be the end of the analysis.