More on lead gen: Where’s the distribution?

Earlier this month, I commented on incentive marketing practices driving lead generation for Yahoo Autos!

With some of today’s comments, it begs the question: Where does the distribution come from for a burgeoning lead generation firm.

To be fair performance marketing is very Darwinistic, where the fit survive by adapting and mastering their domains. However, consider some of the major news surrounding performance-based media in the last six quarters:

– Q3/Q4 2006 – Google changes their quality ranking which has a profound impact on lead gen landing pages. Search traffic declines for lead gen companies.

– Q1 2007 – The mortgage shakeout. Well that actually collapses a vertical not a distribution point? Well, sort of. It was the high economic monetization of mortgage ads that got many companies into display marketing. This allowed companies to sprinkle in other offers to generate traffic when mortgage marketing was not working. A comment adage heard in lead gen, “Nothing monetizes like mortage.” Take this away, and now you have companies like LMB trying desperately to optimize around auto insurance. The numbers just don’t compute.

– 2007 – The meteoric rise to economy of scale of Facebook (in parallel with MySpace) along with applications that contribute to more social media usage. Why does this matter? Less time in email (or for many potential lead gen customers, less exposure to spam and questionable subject lines). Combine that with better spam filter and declining open rates, circle “email distribution” as a tougher acquisition channel

– Q4 2007/Q1 2008 –  Potential FTC legislation around behavorial marketing. Inmarket indicators in display, poof, maybe.

To be sure many companies will adapt to these changes and continue to aggressively grow their businesses.

LowerMyBills upsells credit report customers. Quinstreet has moved into new verticals.

It will be interesting to see the new marketing vehicles that take hold if some of the tried and true lead generation distribution points stumble a bit.


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