Calculation of all Marketing expenditures and the total number of new leads driven to a business. The average cost for 1 lead based on all the Marketing and Advertising expenses is the CPL. Cost Per Lead effectively tells a business how much they spent for each unique lead over a given time period. It could be CPL for the year, CPL for the month, or CPL for the quarter. You want a low Cost-Per-Lead because that means you are driving leads effectively and efficiently. Now, you still need to consider lead quality, but CPL is important as well.

CPL Formula:

Cost-Per-Lead = Total Marketing Expenses / Total Unique Leads

CPL Example:

My flooring company needs new leads so we plan to drive them with SEO, PPC, and Social Media. Here are our expenses:
SEO & Content = $24,000/year
Social Media = $9,000/year
PPC Advertising = $15,000/year
Total Cost = $48,000
New Leads = 960
CPL = $50