If you need more student leads for your institution and have been considering education lead generation for a while now, you’ll most likely get some value out of this post.
In short, you know what you need right now, that’s student leads. Whether you are looking to scale your institution to the nines or you are just after a few extra enrolments a month. Either way, it’s a fact.
But when it comes to lead generation in higher education marketing, the next obvious question is what price should you be paying for leads before you get ripped off?
It’s a very good question…
and I’m excited to share with you some of the knowledge we’ve acquired over the last 7 years doing education lead generation and fine-tuning the price of student leads in this industry.
The answer has less to do with how much you “THINK” you should pay per lead and more to do with how much “KNOW” you can pay per lead.
When we talk with clients for the first time, we let them know that if they want their campaigns to be successful, they first need to know:
1) Their current in-house conversion rate. (The percentage of how many leads you currently get now and convert into paying enrollments)
2) Their target cost per enrollment. (The amount of money you are willing/able to spend in order to get 1 enrollment for your institution without eating into your profit)
If you can understand those 2 numbers and how to leverage them properly, you can scale your institution’s enrollment numbers astronomically (we’re talking into the millions)
Without actually breaking the bank. It’s called safe spending.
I’ll reveal more about how those numbers work together later in this post but for now, I think it’s important to outline how most education providers justify what they think they should be paying for leads first.
So when we talk to most education providers that are seeking higher education marketing specialists, they flat out just want to know:
- How much each lead is.
- Decide whether or not it’s in their budget.
- Move on.
Which sounds logical right? It’s the same but totally not the same as shopping for washing powder. You want one that will clean well, brighten and smell good but needs to be at a price you can afford. Same deal with leads, they need to be qualified, they need to be enthused about studying your course and they also need to be acquired for a price that your budget can afford.
We 100% get it. But a lot of the time, the perceived value in leads and their prices can be misconstrued because the education provider who is buying the leads is so tightly focused on not busting the budget and still making a fantastic ROI.
This tight focus usually puts them in a position where they aren’t open to paying anything higher than what they are already used to.
(Also understandable, you don’t know what you don’t know, right?)
Cheap Education Lead Generation Prices
In most cases, education providers in this predicament will be familiar with online course directories or course comparison sites that offer a flat rate of $50 per lead or something similar. Which sounds reasonable and truth be told, the quality of the leads you get is pretty good.
The thing is though (and most directory listing sites won’t tell you this), is yes they can generate good quality leads at a cheap price, however, the traffic is all organic from google so they:
a) Don’t have complete control over how many leads you get because the traffic is limited.
b) They don’t even pay for the traffic themselves as google give it to them for nothing. Which is how you are able to get the leads at such a cheap price in the first place.
Talk about easy money right?
Our Get Course directory get’s over 11,000 visitors per month and we generate quality leads from it all the time.
But we can’t help our clients scale with control with these numbers alone. Don’t get me wrong, we love our directories specifically for that reason. They can be a great source of income for a business that just wants to plod along.
For me personally, I’m extremely growth orientated and the idea of just running a course directory would never be enough for me. I need more stimulation lol. That’s why I’ve had so much fun playing with paid higher education marketing for the last 3 years and generating millions of dollars for our client using paid ads.
Yes, the leads are more expensive, but if you can calculate the bigger picture and assess your ROI’s properly before spending a cent, you can actually make way more money and get way more students into your courses than you ever thought possible.
Honestly, once our clients see paid ads work for them, they straight up go from that “uptight no spend budget mentality to a more relaxed spend more to make more mentality.
There’s so many differences between paid and organic traffic that are important to know when it comes to higher education marketing. I’ve done other posts about that stuff too but right now, let’s get to the bottom of how much you should be paying for student leads.
Check out our case study on how we helped Didasko and La Trobe University increase their numbers by 320%
“In the time we have worked with Illumewise, our numbers have increased by 320%.”
– Stuart Law, Didasko Latrobe University.
Paid Education Lead Generation Prices
So, already in this post, I’ve covered how much you can expect to pay for student leads when you source them from a course directory or course comparison site. But what about when you are sourcing them from a paid advertising source like instagram or facebook? Or even google adwords?
The first thing you need to know, is forget what you know about organic lead source prices. If you enter this game with the expectations of getting cheap leads and great conversions like the ones you got from the directories, you are going more than likely end up disappointed.
The second thing is, don’t forget the whole point of this is to safely spend more money in order to make more money. By spending safely and keeping a close eye on the numbers you can easily manage the risk of losing money and busting the budget.
How to Spend Safely Using CPA Figures
The trick in paid advertising is not worrying so much about how much each lead is going to cost and worry more about how much you are willing to spend before you get one conversion. (we’re getting to the good bit now)
We call this your CPA which stands for cost per acquisition or in higher education marketing, I guess we can call it CPE, cost per enrollment.
From experience, our most successful clients are willing to put 10 -20% of their course price towards acquiring 1 student. Obviously when working out your own CPA you need to make sure all of your expenses are covered as well as your profits.
The idea here is to make money, so as long as your operational expenses for one student are covered and you have a decent profit you should have a good idea of how much you are willing to put towards acquiring 1 student.
For example, if your course price is $10,000 and you were willing/able to put 10% towards acquiring an enrollment for your institution, that means you are willing to spend $1000 if it means you get one enrolment. This then makes your target CPA or CPE $1000. Once you have this number you can then figure out how much a reasonable student lead price is for you.
How to Spend Safely Using CPA Figures
So once you have taken your inhouse expenses into account and calculated your CPA/CPE. You then need to work out what your conversion rates are.
From experience, most institutions I’ve worked with covert our leads at 10%, meaning every 10 leads we send them, they gain one enrollment. So let’s use this number in our example.
You’ve calculated your CPA which is $1000 and you’ve figured out that your conversion rate is 10%, great. Now all you need to do is divide your conversion rate by your CPA and you’ve got your max lead price.
In this case, $1000 divided by 10% equals $100. This means the maximum lead price you can safely afford to pay based on these numbers is $100.
Because you know that 1 in 10 people you get, will convert into a paying student. Provided your lead price remains within that $100 budget, you make will make money because you have already calculated your profit and in house costs before you converted the lead.
I understand calculating all these numbers to begin with can be a little overwhelming, so to make it easier I’ve created a calculator that can do all the calculating for you!
If you know your current conversion rate and CPA, try using the calculator below to see what an education lead generation campaign could do for you if done correctly.
How to Scale With Education Lead Generation
How can you scale with the above numbers? It’s simple, once you know your target CPA, all you need to do is test your audiences and your ads to find a good balance.
Once you’ve converted enough students using this method and prove that the numbers work, you can move forward confidently by upping your spend, knowing full well that as long as you stay in the lines of your target CPA, you’re will win over and over again.
Unless of course, your CPA is too low. Because the landscape in education lead generation can change frequently, prices can go up and down. So depending on the flexibility of your CPA, your survival rate in this game could be affected.
The reason a low CPA can have such an impact on your results is because if the landscape changes due to either a drop in market interest or the number of competitors becomes greater, the fight for attention and audiences can become higher.
For example, If your CPA was $1000 and you were getting leads for $100 each. If the landscape shifts and suddenly the type of lead you were to buying becomes $120 dollars, you are then going over CPA.
However, If your resources can allow for a higher target CPA like $1200 instead of $1000, you are then able to continue competing for the leads and still make a profit. The point I’m making here is, the higher you can set your CPA in the beginning, the less recalculating you’ll have to do later and the more audience attention you’ll be able to cultivate without your competitors getting in the way.
Book a Free 30 Minute Lead Generation Strategy Session With Us
Understandably, all of this can be overwhelming and confusing, but that’s why we do what we do. So education providers can work out the numbers, and let us do the rest.
It’s also why we do free education lead generation trials for institutions we match with. So they can see how this method of education lead generation can dramatically change the way they run their business.
Of course like anything, this type of education lead generation isn’t for everyone. We only really like to work with ambitious education providers who want to scale their business to $1,000,000+ per year. We also value working together as partners rather than just clients, it make the job more human and creates good vibes all round.
If you are looking to grow your institution and wanting to build meaningful business relationships too, make sure you click here for a compatibility call with us. We’ll jump on call and discuss how we can help you and if we’re a good match, give you a trial.
Conclusion – Is Education Lead Generation for You?
The short answer is yes, the quicker education providers realise that they can actually engineer their success with a few calculations and testing, the sooner the tight grip of the monthly budget can be loosened.
Things to remember:
- Online course directories and course comparison websites are indeed an excellent method when it comes to education lead generation, however, they:
a) Don’t have control over how many leads you get, which makes it hard for you to grow when you want to.
b) They don’t pay for the traffic they receive, which is the reason why they are able to give you high converting leads at extremely cheap prices.
- If you really want to scale and grow, figuring out your target CPA and using it to leverage your exposure in the marketplace will get you amazing results if done right.
- Leads that come from paid advertising sources are always going to be more expensive.
So forget what you know about education lead generation in terms of course directories and course comparison sites. They are 2 different games.
- If you are ambitious and want to build solid relationships with people that want to grow in business just as much as you do, we’re guys and you should contact us.
Thank you so much for taking the time to read this post and if you like to get in touch simply enter details in the form below and we’ll be in touch shortly. If you’d like to see more content, head to our YouTube channel where you can see me talk more about education lead generation.