Hey everyone! I’m really excited to dive deeper into this topic: How much should you pay for lead generation? I’m curious about the types of lead generation costs, the average cost per lead by industry, the average cost per lead by different channels, and how company size or revenue can change those costs.
Could we explore those areas in detail? I’d love some real numbers or examples so I can compare industries and see how budgets might shift depending on a business’s scale.
This is one of those topics where the answer is always, “It depends.” But I’ll do my best to explain it to you 
You know how we have multiple types of lead-gen costs—advertising, marketing, sales team salaries, and so on… Well, each of those inputs has a direct impact on what your final cost per lead (CPL) looks like.
There’s a helpful YouTube video on this topic that breaks it down further. You can check it out for quick insights:
Take financial services; for example, CPLs can easily hit $600+ per lead. Look high, right? But when one closed lead could mean a high-value contract or mortgage, companies don’t mind spending big to get high-quality leads.
On the other end, Ecommerce is way lower, around $91 per lead (shoutout to First Page Sage’s 2025 Report). Makes sense because E-commerce is more about digital traffic and quick conversions instead of long sales cycles. 
| Industry | Cost per Lead |
|---|---|
| E-commerce | $91 |
| Real Estate | $448 |
| Engineering | $287 |
| Higher Education | $982 |
| B2B SaaS | $237 |
| Entertainment | $114 |
| Hotels & Resorts | $266 |
| Staffing & Recruiting | $497 |
| Environmental Services | $278 |
| Manufacturing | $553 |
| Financial Services | $653 |
| Healthcare | $361 |
| Fintech | $452 |
Different Channels Mean Different Lead Generation Costs. Where you get leads from also makes a big difference in cost. For example, here’s what I’m thinking based on the datas from the same report:
| Lead Generation Channel | Cost per Lead |
|---|---|
| Online Retargeting | $31 |
| Search Engine Optimization (SEO) | $31 |
| Email Marketing | $53 |
| Social Media Advertising | $58 |
| Display Advertising | $63 |
| Webinars | $72 |
| Referrals | $73 |
| LinkedIn Advertising | $75 |
| Content Marketing | $92 |
| Search Engine Advertising | $110 |
| Video Marketing | $174 |
| Public Relations | $294 |
| Traditional Marketing (TV, Radio, Print) | $619 |
| Event & Tradeshows | $811 |
I think the average cost per lead by company size and revenue is a more straightforward topic.
Smaller businesses tend to pay more per lead because they’re still building brand awareness and don’t have huge marketing budgets.
Bigger brands? They usually have better ad deals, more brand recognition, and bigger campaigns, so their CPLs tend to be lower.
That said, if a smaller company has a super niche audience and knows exactly who to target, they can keep their CPL low by being ultra-specific with their marketing. It’s really about being smart with your targeting and not wasting money on broad audiences.
At the end of the day, CPL only matters in the context of what a lead is actually worth to you. Like, if you’re paying $500 per lead, but each customer brings in $5,000+, that’s a solid return.
Some industries (like Higher Education) have CPLs that top $900, but when a single student is paying tens of thousands in tuition, it still makes sense.
So, it’s not just about the number but what that lead brings in. Hope it helps Michelle 
that’s so insighfull thank you! 
now I’m curious about a couple more things. 
First, how do I figure out exactly how many leads I need to hit my revenue goals? I keep hearing about formulas and break-even points, but I’m not sure how it all works in practice.
Also, I’d love to learn more about costs of lead generation service providers—like if I decide to outsource. And can u suggest any tools that could help me generate more leads? I want a sense of what’s out there before I jump in.
Hey Michelle! I will break it down into two parts; calculating lead needs and understanding lead generation service costs (I will also try to give a few examples of providers). I will keep it as simple as possible:
For how many leads I need, I usually start by asking, “What’s my revenue target for this month?”
Essentially, I keep multiplying out until I see the final number. That’s my target. If I’m short of it, I know I need to ramp up marketing campaigns or try new channels.
As for choosing a lead-gen service, I’ve seen three main ways they bill you:
And some of my favorite tools that you can use to optimize your lead generation cost;
) is a powerful lead-generation tool that helps you capture on-site leads effortlessly. You can create targeted popups, using smart segmentation and a variety of templates tailored for different goals.Thx Ece!! I’ll try the tools u suggest!! the last thing I want to ask: In data from a source, Sue gave the lead generation cost for real estate as 448, which seems a bit high to me 
How can I specifically optimize the lead generation cost for real estate? How can I reduce this cost?
I understand that the cost of per real estate lead is shocking,I think so too 
but I can explain as best I can how you can reduce that cost while still getting quality leads:
-First, I’d suggest taking a good look at where you’re spending right now—maybe it’s Google Ads, Facebook, local flyers, you name it, and see which channel actually brings in the best results.
-In real estate, location is everything; your targeting should reflect that.
-Real estate is visual; small tweaks can have a big impact on conversion rates.
-Not every lead is ready to buy today, but that doesn’t mean they won’t be in a few months.
-Most buyers start their search on Google. Are you showing up?
-Real estate isn’t e-commerce; people don’t decide overnight.
Yes, real estate leads can be pricey, but the commissions are worth it. With smart targeting, analytics, automation, and local SEO, you can turn that $448 into something much more manageable, and see real ROI.
Thanks so much girls! This was super insightful!! I’ve got plenty of strategies (and tools!) to explore. Appreciate all the great advice 
Hello mam, I don’t want to divert away from the topic. But since you mentioned about lead generation through display ads, is it actual possible to generate leads through google display ads. What targeting options do you suggest. I am asking this because you seem to have experience in this field.
Hi @Pranava
I’ve been digging into how much lead generation costs, especially through Google Display Ads, and I wanted to share what I found. Someone asked me if it’s even possible to generate leads this way and what targeting options work best—so here’s the friendly scoop!
Totally! These are those banner or video ads you see popping up on websites, apps, or YouTube. They’re awesome for reaching tons of people (like 90% of the internet!), and you can use them to nudge folks into signing up for stuff—like newsletters, freebies, or demos. It’s less “buy now” and more “hey, wanna learn more?” vibe, which works great for grabbing leads. I found some cool info saying they’re perfect for finding people who might convert later, even if they’re just browsing now.
Alright, so how do you make these ads hit the right people? Here’s what I’d go with (and why):
Mix and match these based on your goals. Google’s got some neat tools to play with here, and it’s all about testing what sticks!
Here’s the money talk! Costs vary, but for Google Display Ads, you’re looking at about $60 to $130 per lead. Why the range? It’s all about your clicks and conversions:
For example:
$0.63 CPC + 1% conversion = ~$63 per lead.
$1.00 CPC + 0.5% conversion = ~$200 per lead (ouch, but possible if targeting’s off).
Calculating Cost Per Lead: Using these figures, the cost per lead can be calculated as follows:
| Conversion Rate | CPC ($0.63) | Cost Per Lead | CPC ($1.00) | Cost Per Lead |
|---|---|---|---|---|
| 0.5% | $0.63 | $126.00 | $1.00 | $200.00 |
| 1% | $0.63 | $63.00 | $1.00 | $100.00 |
| 2% | $0.63 | $31.50 | $1.00 | $50.00 |
Most folks land in that $60-$130 sweet spot, though. Fun fact: display ads can sometimes cost more per lead than search ads because the audience isn’t searching for you—they’re just scrolling. So, killer landing pages and targeting are key to keeping costs down!
I was surprised to learn that even though clicks are cheaper on display ads, the lead cost can creep up because fewer people convert compared to search. It’s like casting a wider net—tons of fish, but not all bite!
Key Sources: