Organic Free vs Paid Leads: Which is best?

To get clients with lead generation, there are two paths you can follow:

• The fast and expensive way (paid leads)
• The slow and more profitable way (free leads)

Both paths can work. So which one is best?

Over the years, I’ve worked with hundreds of clients and helped them with both free and paid lead generation strategies. This puts me in a unique position to see what works best and give you the pros and cons of each option.

In this article, I’ll compare free & paid lead generation strategies in depth to help you decide which is best for you.

Tip: If you want help with implementing these lead generation strategies, be sure to watch my free training that explains how my lead gen strategy works in more detail.

Free vs Paid Lead Generation: What’s the difference?

Here’s a quick summary of free and paid lead generation strategies.

As you can see, the main difference between organic and paid lead generation is the amount of money and time you spend on each type of marketing strategy.

• Organic lead generation requires very little (if any) money. But it does require a time investment.
• Paid lead generation requires money in advertising for it to work. But it often requires much less of a time commitment.

Both methods can work well, so which method is best for you?

Let’s find out in more detail…

By the way, if you want to learn how to use both free and paid lead generation strategies to get leads in your business in a way that is automated, profitable and scalable, watch my free Masterclass training here.

What are the best free organic lead generation marketing channels?

Here are some of the best organic free lead generation strategies:

1. Search Engine Optimization (SEO)

Ranking higher on Google for keywords related to your business is one of the best ways to generate free organic leads. This is called SEO lead generation.

Benefits of SEO include:

• Free leads. You do not need to pay for any leads that find you through Google organic search.
• Quality leads. Leads are often actively searching for a solution, so they convert quicker than other marketing channels.
• Predictable results. Once your website is ranking at the top of Google, the results are fairly stable each month.
• Builds trust. If your website appears at the top of Google organically, people often assume that your website is there because it’s the best result. So you instantly build a lot of trust with new prospects.

Problems with SEO:

• Requires a lot of time investment. To rank higher on Google, you need to create a lot of written content. This takes time, but you can use AI writing tools to make it easier.
• Results take time. Do not expect instant or very quick results with SEO. Often it can take at least 6-12 months before you see results.

Tip: You can speed up the process it takes to get results from Google by creating more content more often.

To learn the best type of content to create to rank higher on Google as fast as possible, see Step 4 of this video.

2. YouTube Search (SEO)

Ranking higher on YouTube for keywords related to your business is another great way to generate free leads.

Benefits of YouTube SEO include:

• Free leads. You do not need to pay for any leads that find you through YouTube organic search.
• Quality leads. Similar to Google SEO, leads from YouTube are often actively searching for a solution, so they convert quicker than other marketing channels.
• Predictable results. Once your videos are ranking at the top of YouTube, the results are fairly stable each month.
• Builds trust. A video where people can see or hear you can build trust with leads more quickly than written content.
• Double the results. YouTube videos can rank at the top of both YouTube and Google. This means you can double your results for some of your videos without any extra work.
• Faster results vs SEO. YouTube videos typically have less search competition compared to blogs written for Google search. As a result, you can rank for competitive search terms much quicker compared to Google SEO on its own.

Problems with YouTube SEO:

• Requires a large time investment. To rank higher on YouTube, you need to create a lot of video content. It can take a lot of time and effort to create this video content.
• Results take time. Do not expect instant or very quick results with YouTube. Often it can take at least 6+ months before you see results.

Tip: You can also get free leads from YouTube by appearing on the YouTube recommended homepage. A high converting video title and thumbnail can help you do this.

To learn the best type of content to create to rank higher on YouTube as fast as possible, see Step 4 of this video.

3. LinkedIn Outreach

Are you looking to generate B2B leads for free? If so, LinkedIn is an excellent free way to prospect for more leads.

Benefits of LinkedIn outreach include:

• Free leads. You do not need to pay for any leads that find you through YouTube organic search.
• Mostly automated. You can use LinkedIn lead generation automation tools to automate your LinkedIn prospecting. If you use LinkedIn automation tools, it will only take a few minutes a day to manage. Without LinkedIn automation tools, it can take a few hours a day to manage.
• Great for B2B. LinkedIn’s advanced search filters allow you to target people by job title, industry and company size. For certain types of businesses (such as B2B) it can be a very effective way to win new clients. However, to do this, you will need a LinkedIn Premium Sales Navigator account.
• Better than cold email or Facebook outreach. If you use the right LinkedIn lead generation strategy, you can generate a lot more leads than cold email, cold calling sales leads or messaging people in Facebook groups.
• Generates leads fast. LinkedIn allows you to generate leads very quickly (usually within the first few days of starting a LinkedIn lead gen campaign). However, leads can still take time to convert (see below).

Problems with LinkedIn outreach include:

• Leads take longer to convert. LinkedIn leads are not actively searching for a solution that you provide (unlike SEO or YouTube leads). This means the leads you generate may not currently be in the buying phase. Consequently, it can sometimes take longer for LinkedIn leads to convert into paying clients.
• Not very scalable. There are currently LinkedIn weekly limits to how many people you can connect to and message per LinkedIn profile. So it’s not very scalable, unless you use multiple LinkedIn accounts.

Tip: Do not spam or pitch your services on LinkedIn. This is a very ineffective way to generate leads on LinkedIn (and it’s what most people are doing). To learn a better LinkedIn strategy (that will double the amount of leads you get and can still be automated) see Step 4 of this video.

4. Lead generation tools

There are also a variety of lead generation tools powered by AI that can help you generate leads at a much lower cost compared to running paid ads.

Even though these tools require some money, they are usually a lot more cost-effective when compared to paying for leads with ads.

AI lead generation tools will help you:

• Get leads for a small monthly software cost
• Automate your lead generation
• Reach out to new clients automatically
• Create content with AI
• Edit videos with AI

And more.

5. Cold Email

Another great way to get more leads at a low cost is to use cold email software. It can help you generate leads, get more sales appointments and find new clients.

Cold email refers to sending unsolicited emails to potential customers who haven’t explicitly opted-in to receive messages from you. When done correctly, it allows you to initiate a conversation with promising leads in a personalized, non-spammy way.

However, it’s important to remember that the effectiveness of cold email depends on how you use it. To get the best results from cold email, it’s important to:

• Contact the right people
• Give away something of value (e.g. a free lead magnet)
• Follow up often
• Add warm leads (people who respond) to your email marketing campaign

Now that we’ve covered the best free organic lead-generation strategies, let’s move on to the best paid lead generation strategies.

What are the best channels to get paid leads?

Here are some of the best ways to pay for leads:

1. Facebook Ads

Facebook Ads have been a game-changer for businesses of all sizes. With its detailed targeting options, it allows advertisers to reach their ideal customers based on demographics, location, interests, behaviors, and much more.

The platform’s versatility supports various ad formats like video, image, carousel, and slideshows.

Additionally, Facebook’s Lookalike Audiences feature can help you target users similar to your existing customer base, increasing the chances of conversion.

Facebook is one of the best paid advertising platforms currently available.

In my experience, the average cost for a Facebook lead is about $20, and the average cost of a booked appointment is about $200. Of course, this can vary depending on your industry and target audience. For example, if you’re targeting high net worth investors, you’ll probably pay more for a lead because the audience is more competitive.

2. Instagram ads

Instagram is a visual-first platform that offers brands a unique opportunity to connect with a highly engaged audience. Advertisers can showcase their offerings through photo ads, video ads, carousel ads, and story ads.

The relatively recent addition of Instagram Shopping also enables direct purchases from the app, bridging the gap between browsing and buying.

Meta owns Instagram, so when you use Facebook ads, you can easily turn on Instagram ads as well at the click of a button.

In my experience, Instagram ads work better when you use video ads, and Facebook ads work better when you use text and image ads.

3. TikTok ads

TikTok, the short-form video app, has witnessed explosive growth recently. Although its user base is predominantly younger, it also has a fast-growing older demographic.

In fact, it has over 9 million users over the age of 55+ in the USA. This makes it a good option to target seniors and even business owners.

To run TikTok ads, you need to record a 60-second video that sends people to a sales funnel where they can learn more about your services.

In my experience, running TikTok ads is more cost-effective than other advertising platforms such as Facebook, Instagram and YouTube. The only downside is that TikTok might be banned at some point in the near future, which could make your advertising campaign redundant.

On average, my clients generate leads for about $15 and appointments for $150 using TikTok ads. This can vary depending on your target audience and industry.

4. YouTube Ads

As the second largest search engine in the world, YouTube is a powerful way to generate leads. You can advertise on YouTube using a variety of ad formats. My recommendation is to use “skippable in-stream ads” because you only pay if someone doesn’t skip the first 5 seconds of your ad.

With YouTube’s detailed targeting, businesses can show their ads based on specific keywords, interests, and demographics.

However, in my experience, YouTube ads are more expensive than to Facebook, Instagram and TikTok ads. So, for service-based industries like financial advisors and insurance agents who sell annuities, I’ve found that other advertising platforms tend to work better.

5. Google Ads

Often the first platform that comes to mind when businesses think about pay-per-click (PPC) advertising is Google Ads.

They offer a variety of ways to help you generate leads:

I would recommend starting by targeting low-competition and high-converting keywords that directly indicate someone is looking for your services.

However, keep in mind that Google Ads are often more expensive compared to other paid lead generation strategies. So you may find more success generating leads with SEO instead.

With Google’s vast reach and advanced targeting options, advertisers can ensure their ads appear at the right moment to the right audience.

6. LinkedIn Ads

Especially beneficial for B2B companies, LinkedIn Ads allow brands to target professionals based on factors such as job title, company size, industry, and more.

Sponsored Content, Sponsored InMail, and Display Ads are some of the formats available on LinkedIn to attract potential leads.

However, in my experience, generating leads for free using LinkedIn automation software is much more profitable than running LinkedIn ads alone.

7. Buy leads

Another way to pay for leads is to buy leads from other lead generation companies. However, buying leads has pros and cons.

As someone who has both sold leads and helped leads generate their own leads, I’ve found that, in most cases, business owners should get their own exclusive leads and be in control of their marketing.

If you’re looking to buy leads, you can often expect to pay between $100 and $500 per lead and about $1,000 to $3,000 for a booked appointment.

The cost can vary depending on your industry. For example, finance and life insurance leads tend to cost more than cleaning leads.

8. Other paid advertising platforms

There are lots of other paid advertising platforms you can use to buy leads.

How much does it cost to buy leads with paid ads?

Once you spend $1,000 to $2,000 on an advertising channel, you’ll get your cost per lead. Once you know your cost per lead, you can buy leads (as many as you like) directly from the advertising channel.

With additional split testing, you can potentially reduce your lead cost.

This is something we help clients with in our lead generation online course.

Benefits of paid advertising:

• It’s mostly automated. With paid advertising, you spend money, not time, to get new leads, sales appointments, and clients. As a result, most of your lead generation can be automated (assuming your ads are converting well).
• It is also extremely scalable. You can get as many leads and sales appointments as you like (or that are possible within your market). If you need to scale up, all you need to do is increase your budget. Facebook ads (or any other advertising channel) will keep delivering leads as long as new people in your audience are interested in what you offer.
• Retargeting: If you’re on a smaller budget, you can retarget website visitors on social media or with Adroll ads. This is a very cost-effective way to use paid advertising and only spend a small amount of money (typically $10/day) to win new leads and clients. However, it only works well if you’re already getting traffic from your website (e.g. from organic marketing channels).

Problems with paid advertising:

• Risky. There’s no guarantee of sales when running paid ads. Therefore it does come with a risk that you will spend money without getting a good return on investment. There are ways you can reduce this risk which is covered in Step 5 of this video.
• It is not as profitable as other marketing channels. Whenever you spend money on ads, it will cost you money to acquire a new client. Rising advertising costs can definitely eat into your profits for each new client you win. However, many business owners are happy to make less profit per client if it means they can scale up and win more clients.

See also: How to target business owners with FB ads

Multiple Marketing Channels with ONE strategy

Interestingly from all the marketing channels mentioned so far (both free and paid channels), you can generate leads using ONE strategy.

What strategy is that?

It’s by using an Automated Appointment Funnel combined with a video sales letter (VSL).

With this strategy, you attract clients by showing them how to solve a problem they have.

If they need more help after watching your video sales letter presentation, they can schedule a call with you to learn more. The more leads that watch your VSL, the more sales appointments you’ll get.

You can see an example of my VSL to generate leads and more sales appointments by clicking here.

Paid vs organic lead generation: who’s the winner?

As you can see, paid and free organic lead gen channels have pros and cons.

So, my advice is to do both!

Both are extremely powerful ways to get more leads, sales appointments and clients in your business.

However, if you’re on a smaller budget, then it makes sense to only start with organic free lead generation channels first.

Once you’re regularly winning clients using the free organic channels, you can invest some of your profit in paid advertising channels when the time is right for you and your business.

Want to learn how you can use both organic and paid client attraction strategies to generate more sales appointments in your business predictably every month? Click here to watch our free lead generation training.