Lead aggregation has been in the news a lot lately, at least in the SEO industry news that I tend to spend my free time reading. Depending on the source, lead aggregators are either cures for low lead volume or are symptoms of a larger, as-yet-unregulated problem. How do lead aggregators affect your business and when is the right time, if there is such a time, to utilize lead aggregation services?
What are Lead Aggregators?
Lead aggregators, generally speaking, accumulate leads from interested customers and resell those leads to businesses. Most of the activity takes place behind the scenes where customers are often completely unaware of the process. This system in principal is not unethical, and in many ways can benefit customers (lead aggregation often provides a one-stop shop for comparing service rates). What makes lead aggregation potentially problematic will be addressed later in this post.
Perhaps the best way to describe a lead aggregator is by way of a hypothetical example:
Let’s say Carl is in need of storage services. Carl uses a search engine to find a local self-storage provider. He visits Google, types in self-storage in Kansas City, and is provided with a list of relevant websites relating to self-storage companies in Kansas City. So far, so good, right? Many of the search listings are for true local self-storage providers. Fred’s Storage, Storage Express, and FastStorage Self-Storage are but a few made-up examples. However, StorageAggregator.com (which at the time of this writing does not exist) may appear above all of the other local storage listings. When the user clicks through to StorageAggregator.com, instead of finding contact information for a local storage facility, he instead goes into a queue to be called by a local storage facility that has had to pay for the privilege of providing his service. From the customer’s perspective, unnecessary steps had to be taken to reach a storage service. From the business’ perspective, it doesn’t seem ethical to pay for a customer who originally wanted to connect directly with the storage facility in the first place.
Lead aggregators may utilize various methods to generate leads such as paid search advertising (Google AdWords, for example), organic search (as exemplified above), online directories, online local business listings, mobile platforms, social media channels, and even offline media.
Lead aggregators tend to thrive in the home services industry—storage, moving, pest control, carpet cleaning, general contractors, plumbers, etc.—which makes sense, as a service business model tends to be more flexible with pricing than, say, a product driven business model.
What aren’t Lead Aggregators?
There are many forms of online marketing services and ad placement, many of which operate in the same physical screen space as lead aggregators. Therefore, before we move on it is important to note what ISN’T a lead aggregator.
- Paid placement such as Google AdWords ads and IYP ads are NOT exclusively lead aggregation sources. Lead aggregators may use these mediums (as I mention above), but they are not solely vehicles for lead aggregation.
- Providers of optimization services that enhance online profiles and websites WITHOUT compromising the business contact information itself are NOT lead aggregators. For example, it is okay for your local search agency to optimize and verify accuracy of your local business profiles. It is NOT okay for an agency to replace any of your business data with their own. More on this example below.
What are the right ways for lead aggregators to generate leads for a business?
Due to so many unique situations and strong opinions on the topic, I won’t insist that there is a universal scenario in which lead aggregators should be utilized. Situations do exist, however, which may make lead aggregation more appealing for some businesses.
- Lead aggregators may be beneficial when a business lack robust SEO resources. Ideally, a business will want to hire an agency to optimize their own web presence to help capture leads directly so that lead aggregation middleman can be avoided. But sometimes, SEO may not be a possibility. Lead aggregators may be able to supplement offline lead generating methods.
- Meeting sales goals when nearing a deadline. Lead aggregators can often provide quick, though expensive, leads which may benefit a business looking to meet a sales goal as a deadline approaches.
Generally speaking, lead aggregators can be beneficial when they generate truly incremental leads to the business by advertising in media platforms that would otherwise be missed. The theory being that there are more places for an advertiser to spend money than there are budget dollars available to cover them all. Therefore finding cost effective and incremental leads is a valid and encouraged way to utilize lead aggregators.
What are the wrong ways for lead aggregators to generate leads for a business?
For the purposes of this blog post I will be focusing on one particular aspect of unethical lead aggregation behavior as it relates to SEO and local business listings. Lead aggregators, in the way I refer to them in this post, are websites that intercept leads in the organic search space with intentions to sell those leads to other businesses.
A common example of unethical lead aggregation would be deriving leads from hijacked branded terms or from an advertiser’s business listing. This can be as simple as changing a phone number on a site for the client’s location to include the lead aggregator’s billable phone number or a link to the lead aggregator’s billable contact form (instead of the client’s actual site). The logic being that by capitalizing on a company’s own branded terms or business listings, the lead aggregators are essentially reselling leads to advertisers that the advertisers would have received anyway…charging them handsome fees for these high conversion branded opportunities.
Advertisers feel stuck, because some of their “best” leads come through these types of lead aggregator channels, and they don’t want to risk shutting off the valve. Their ignorance about the source of the leads actually perpetuates lead aggregators to continue engaging in these, and similar, unethical tactics; for example, building out deep website content filled with the client’s branded terms. Eventually, the aggregator’s site actually starts to compete with the client’s site organically and may even outrank the client’s site for branded terms.
Medium-sized companies with adequate, though comparatively low, SEO budgets (comparative to lead aggregators, who exist entirely online and have no service business model overhead) have the most to lose when lead aggregators proliferate. How can these medium-sized businesses compete in a world of lead aggregators?
- Ensure that resources have been properly allocated to your own website SEO. Without a properly optimized website, the online lead aggregators will dominate the organic search results every time. Likewise, work directly with an agency to place, and optimize, paid search ads, local listings, IYP ads, and social media advertising.
- Leverage lead aggregators for advertising opportunities that might otherwise be unobtainable to you. In other words, don’t feel as though you should pay for leads that you could get on your own (see above, What are the right ways for lead aggregators to generate leads for a business?)
- Insist that your lead aggregator vendors provide transparency as to the source of the leads. When possible, use tracking numbers that terminate at your business, not the lead aggregators’ offices.
- Continually revisit your lead aggregation campaigns to ensure that you are not overpaying for leads, and that those leads are not ones that you should be capturing anyway (branding traffic from organic sources, for example).