Higher Ed Marketers: Do You Know the True Cost of Bad Leads?
April 16, 2021
Your goal is encouraging prospective students to raise their hand and ultimately enroll at your school. And I’m sure you closely monitor your cost per lead and enrollment. But we’ve seen a sizable number of Higher Ed marketers overlook a key number in their formula.
Few include all the costs associated with acquiring their leads: the cost to qualify leads along with the real and, in many cases, high cost of driving a large number of leads that don’t convert.
Most Higher Ed marketers quantify campaign cost by dividing media spend by leads. But this omits the costs associated with the time that salaried Admissions staff spends to weed out poor leads. It also fails to account for poor-quality leads that get tossed. In essence, an overfocus on short-term metrics (initial cost per lead) blinds many marketers to the long-term cost – and impact.
The True Cost of Qualified Leads
Let’s explore the issue by seeing how Jenny, a Higher Ed marketer, goes about this.
Jenny’s goal is to drive as many leads possible at the lowest cost for her university located on the east coast. The school employs 10 Admissions officers, each of whom can follow up with 32 leads per week, or 320 leads total per week.
Knowing she can cast a wide net and reach many potential students on a large social media platform, she runs a campaign that yields 500 leads. Since Jenny spent $37,500 on the campaign, she calculates her cost per lead (CPL) as $75:
Campaign cost: $37,500 / 500 leads = $75 / lead
Jenny is happy with that CPL. However, because the Admission officers couldn’t handle that many leads in a week, they only followed up with 320 of them. Jenny spent considerable money on the 180 leads that were not followed up on:
Cost of ignored leads: 180 ignored leads x $75 = $13,500
Plus, Jenny needs to account for the time and expense of the Admissions officers weeding out low-quality leads. But that’s not the end of the calculation.
Jenny meets with the Admissions manager who says that of the 320 leads her office followed up with, only 156 were qualified and considered a high likelihood for enrollment. In other words, 164 were considered bad leads – another number Jenny needs to account for in her CPL calculation.
Cost of disqualified leads: 164 x $75 = $12,300
Final cost of ignored and disqualified leads = $28,500
Final cost per qualified lead: $37,500 / 156 = $240
So, the CPL ends up being 220% higher than Jenny originally calculated ($75/$240).
Not only was the total campaign cost far higher than Jenny had originally calculated, $25,800 was ‘wasted’ in just a week due to ignored and disqualified leads. With many marketers adopting “always-on,” year-round campaigns, that adds up to a potential $1,238,400 ($25,800X4X12) lost on too many and/or poor-quality leads sent to Admissions.
Drive an Efficient Cost Per Enrollment With LinkedIn
So how can you avoid the costs associated with ignoring leads and weeding out bad ones? The key is to start with high-quality leads.
While another large social media platform seems more cost-efficient on the front end, the cost is far higher in the end, as Jenny found out. A big reason for that is the mindset of the people you’re trying to reach.
Because LinkedIn members are on the platform to nurture and advance their careers, they are more receptive to content about education and careers than people on another general social media platform. In fact, our research shows that LinkedIn members are more in-market for education.
Once she learns this, Jenny decides to run LinkedIn campaigns and is confident that she can produce a much higher number of high-quality leads with the same weekly budget of $37,500.
Her colleagues in Admissions urgently need to fill a number of classes with high-quality applicants with a high likelihood of enrollment. She sets up a new campaign in LinkedIn’s Campaign Manager:
- Campaign goal: Drive net-new leads targeting prospective students with Bachelor Degree without Master’s degree or higher, 3-5 years’ work experience in High-Tech industries. Budget: $37,500.
Jenny launches the campaign and as the leads roll in, the Admissions office identifies ideal leads as those who score high on each of the criteria below:
- Talked to Admissions Officer
- Earned a bachelor’s degree and has 3-5 years of work experience in the High-Tech industry
- Located in the same states as the main campus
- Started application process
- Financial aid approved
The following week after campaign launch, Jenny presents these results to her boss and the Admissions office.
- Jenny delivered 240 net new leads with CPL of $113 ($37,500/240).
- 195 out of 240 leads were considered high quality by Admissions. The rest, 45 leads, were disqualified.
- Cost of disqualified leads: 45 x $113 = $5,085, which is 57% lower than that on the large social media platform.
- The final cost per lead was $192 ($37,500/195), which is 20% lower than the initial campaign on the large social media platform with nearly twice total net-new leads.
How much time and money does your university waste on bad leads? You can flip the formula by advertising where prospective students are in the mindset to further their education and careers. Reach out to the LinkedIn Marketing Solutions team for help calculating the cost of your bad leads and find out how to develop a full-funnel strategy on LinkedIn.
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