Insights · Lead quality

A cheap enquiry can be an expensive lead.
Count what happens next.

Romaan Sheikh, Cofounder · Published 15 October 2026

Cost per qualified lead is the cost you choose to include divided by the number of leads that meet an agreed qualification definition. It is useful only when that definition, cost basis and reporting period are clear. A lower cost per enquiry does not tell you whether more suitable people became customers.

Define the stages before comparing the cost

Qualification might depend on service area, suitability, budget, timing or another legitimate requirement. Choose criteria the team can apply consistently and record a reason when a lead does not qualify. Do not quietly tighten or loosen the definition halfway through a comparison.

Use the same cost basis in each formula

• Media CPL = advertising spend ÷ enquiry records.
• Media cost per qualified lead = advertising spend ÷ qualified lead records.
• Media cost per customer = advertising spend ÷ attributed customers.

If you add management, production or other acquisition costs to the numerator, label the measure accordingly and use the same basis on both sides of a comparison. “Acquisition cost” without a list of included costs is difficult to interpret. When the denominator is zero, the cost per result is undefined; it is not £0.

A worked comparison: fewer enquiries, more suitable people

Illustrative example only. These are two fictional campaigns with equal media spend and the same qualification rule. They do not describe a LYM client or predict results.

Campaign A wins on the cheapest enquiry. Campaign B produces twice as many qualified records and customers for the same media spend in this example. Neither table alone proves profit: customer contribution, management and production costs, cancellations and retention still matter.

Keep reporting periods and cohorts together

A lead cohort is the set of records being followed, such as enquiries first received during September. If some of those people buy in October, a September-only sales snapshot can understate their eventual conversion. State the enquiry period and the date on which later outcomes were last checked.

Do not divide this month’s spend by customers from an unrelated earlier lead cohort and call it a like-for-like acquisition cost. If two reporting periods are added, say whether records were deduplicated across them. Counts of records and counts of unique people are different measures.

The published Just Foster campaign record shows why this matters: it distinguishes enquiry records, client-shortlisted qualified records and approved foster carers. Qualification is not approval. Read the definitions, reporting periods and exclusions beside the figures before reusing them.

A small feedback loop is more useful than a bigger dashboard

1. Agree the definition. Write down the conditions and who decides whether a record qualifies.
2. Record the source and date. Keep a consistent record identifier so follow-up can be matched without unnecessary personal information in marketing reports.
3. Update the stage. Record successful contact, qualification and customer outcomes separately, including unknown or pending outcomes.
4. Review reasons. Distinguish poor fit, unreachable contacts, delayed follow-up and a prospect who chose not to proceed.
5. Change one relevant part. A location mismatch may call for clearer eligibility; unanswered enquiries may require a follow-up process. Neither is solved automatically by a different advert.

The owner of the campaign and the person handling enquiries need to review the same definitions. Missing follow-up outcomes should remain “unknown”; turning them into failures or successes produces a misleading conversion rate.

Which number should you optimise?

Use the furthest reliable outcome you can measure within a sensible review period, while retaining the earlier stages to explain it. For a long sales cycle, qualified leads can be a practical interim signal. When customer outcomes become available, revisit whether the qualification rule is actually identifying valuable prospects.

Use the ad-economics calculator for your own numbers and read which campaign costs to include. A forecast built from assumed conversion rates should remain labelled as an assumption until records support it.

Sources and scope

The formulas above are arithmetic definitions; the comparison is hypothetical. The linked Just Foster case is a separate published evidence record with its own scope and caveats. Published 15 October 2026.