Why Paying More Per Lead Could Lead To Your Most Profitable Year Yet

FACEBOOK ADS COST PER LEAD

When it comes to Facebook Ads, many business owners become fixated on one metric: Cost Per Lead (CPL).

Whilst it’s natural to want to keep costs low, focusing too much on CPL can actually be one of the riskiest mistakes you can make with your Meta Ads.

In fact, paying more for your leads might just be the key to achieving your most profitable launch yet. 

Here’s why.

THE TRUE COST OF CHEAP LEADS

It’s tempting to chase the lowest possible CPL, but cheap leads often come with hidden costs. These include: 

• Low Conversion Rates: Leads who opt in because of generic or overly broad targeting or lead magnets may lack genuine interest in your offer. 

• Poor Engagement: Cheap leads are less likely to open your emails, attend your webinars, or take meaningful action.  

• Wasted Resources: You spend time and money nurturing leads who will never convert, while your high-potential leads go ignored.

By focusing solely on CPL, you risk filling your pipeline with unqualified leads who ultimately drain your time and money rather than contributing to your bottom line.

WHY PAYING MORE PER LEAD CAN BE SMARTER

High-quality leads—those who are interested, engaged, and ready to buy—often cost more to acquire. Here’s why investing in these leads can lead to better results:

1. Higher Lifetime Value (LTV): High-quality leads are more likely to purchase AND become repeat customers and refer others to your business. 

2. Better Conversion Rates: When your leads are already aligned with your offer, they’re more likely to say “yes” when it comes time to buy. 

3. Stronger ROI: A smaller pool of high-quality leads can generate more revenue than a large pool of cheap, unqualified leads.

HOW TO SHIFT YOUR FOCUS TO QUALITY OVER COST

To embrace a strategy that prioritises high-quality leads, follow these steps:

Step 1: Redefine Your Metrics for Success

Instead of focusing solely on Cost Per Lead, track Revenue Per Lead instead:

Here’s the calculation: Total Revenue Generated By Ad leads / Total Number Of Ad Leads. 

For example: $10,000 / 100 = $100 per lead.

Aim to grow this figure.

This metric will give you a clearer picture of your campaign’s overall performance and profitability.

Step 2: Invest in Precision Targeting

To get better quality leads, use more specific targeting.

The targeting options you choose will greatly impact the quality of leads you bring into your sales funnel.

Use Meta’s advanced targeting features to attract leads who are most likely to convert. Focus on:

• Custom Audiences: Retarget website visitors, email subscribers, or previous customers. 

• Lookalike Audiences: Target cold audiences based on your highest-value customers. 

• Interest and Behavior Targeting: Narrow down your audience by specific interests, job titles, or behaviours. 

An example of someone I would target using interest based targeting as a Meta Ads specialist for course creators is Amy Porterfield. Amy is perfect as she teaches people how to create courses and those people are going to want to go on and scale their programs with Meta Ads.

By targeting more precisely, you’ll attract leads who are genuinely interested in your offer, even if it costs more upfront.

Step 3: Qualify Your Leads with Better Forms and Offers

High-quality leads often come from offers that appeal to their specific needs and pain points. To attract them:

• Create Premium Lead Magnets: Offer value-packed freebies that solve a real pressing problem for your ideal audience. 

• Add Qualifying Fields to Forms: Ask questions that help you gauge intent and fit and weed out those less likely to go on and convert. 

   

Step 4: Craft Persuasive Creative

It is now more important than ever to use ad creative that attracts your ideal audience.

The creative includes the graphic, primary text, headline and call to action button.

Download our free high converting Meta Ads post and story graphic templates to give yourself a head start.

To stop the scroll and get your audience's attention, you need to understand your dream buyers’ pain points, dream solution and what is keeping them up at night.

Clear messaging ensures you attract the right leads who value your solution.

Your ad copy should speak directly to your ideal customer and highlight the value of your offer.

Use:

• Benefit-Driven Headlines: Focus on outcomes your audience wants 

• Clear Calls to Action (CTAs):  Encourage users to take the next step. 

• Social Proof: Showcase testimonials, case studies, or results.

    

Step 5: Test and Optimise for Profitability

Constantly test your campaigns to find what works best.

Monitor:

• Which audiences convert best?
• What lead magnets and offers drive the most engagement?
• Which creative elements  (images/videos/copy) perform best?
• Which messaging (pain points and solutions) perform best?

You’ll then be able to determine what is attracting the highest quality leads into your funnel and produce more content just like this to drive results even higher.

Focus on profitability, not just upfront costs, when evaluating results.

REAL LIFE META ADS A/B TEST

This is an example of a recent test we did on different lead magnets for The Digital Exchange.

We used the same graphic style but changed the copy for each.

Our goal was to see which lead magnet brought in the highest quality leads. We did this by screening the emails of people that downloaded each lead magnet to see if they looked like our ideal buyer.  

We tested different targeting (you can see the different interests we are targeting like Female Entrepreneurs) and then the creative underneath. 

You can't test everything at once. You always need a controlled variable, otherwise you won't be able to attribute where the quality lead came from.

Try testing different audiences and creative the next time you create Meta Ads.

A PROFITABLE LAUNCH EXAMPLE CALCULATION

Here’s why it pays to spend a little more to get a high quality lead 👇

Imagine a course creator who spends $1,000 on Meta Ads. They can choose:

• Option A: Get 200 leads at $5 each, but only 1% convert, leading to 2 sales.
• Option B: Get 100 leads at $10 each, with a 5% conversion rate, leading to 5 sales.

Even though Option B costs more per lead, it generates more than twice as many sales, making the campaign far more profitable.

Let’s say the course sell price is $1,000 💸

• Option A: 1% leads convert, leading to 2 sales x $1,000 = $2,000
• Option B: 5% leads convert leading to 5 sales x $1,000 = $5,000

Which one would you choose? 🤔

Final Thoughts

Focusing solely on cost per lead might seem like a smart way to save money, but it can actually cost you more in the long run. By investing in high-quality leads, you set yourself up for better conversions, higher profits, and a more successful launch.

Remember, the goal isn’t to spend less—it’s to make more. Shift your mindset, refine your strategy, and watch your results soar.

Not sure if you're ready to get started with Meta Ads?

Download our free guide, "How to Figure Out if You’re Ready for Meta Ads" and find out in six simple steps if Meta Ads are the right move for your next launch. 

Let’s make this the year you finally reach your revenue goals.