What Is A Lead And Why Is It So Important For Your Business?

On your journey to becoming an Entrepreneur, the chances are that you have come across the word “lead” a number of times. If you’ve been asking yourself “what is a lead?”, this article will help you to understand.

While researching how to start your business, you might have discovered that it is very important to know your buyer’s persona. This is a fictional representation of who exactly needs your products or services, ie. who is your target audience or the ideal client whom you would love to work with.

Your marketing strategy should be designed to get the attention of your ‘Buyer Persona’, your ‘Ideal Client’ or ‘Avatar’, in order to get them informed about your business and how your products or services might help them to get the results that they need and want. The description of your Ideal Client must be very specific, so that you know whom you are communicating with at all times.

The marketing strategy of your business ought to include forming a relationship with your potential buyer or client, which then hopefully leads to having them make a purchase with you. That, in turn, leads to you nurturing the relationship beyond the initial contact, sale or sign-up.

Ideally, you want to turn your buyers into loyal customers and brand advocates, who keep coming back to you and who are naturally very willing to tell others about you and your services.

Apart from growing your mailing list through paid or organic marketing, there is nothing more powerful in business than the natural rapport that comes through word-of-mouth and quality referrals. These provide you with positive social proof and sincere testimonials, to back up what you communicate with your audience.

What is a Lead?

A lead is someone – a person, a business, or an organisation – who is or might be interested in your products or services and what you have to offer.

While your ‘buyer persona’ is fictional, a lead is a real person … your potential customer or client.

Lead vs Email List

Think of a ‘a lead‘ as a prospective client or customer. They have a tendency to want to buy from you, because of how carefully you ‘target’ them in your marketing and with the offers that you create specifically for them and their needs. You are always keeping them in mind, in particular, when creating whatever you are offering and through the marketing of same.

An email list for this purpose, is a list of all the leads that you collect or are able to generate through specific marketing efforts. Your email list might have different categories and tags applied to it, to organise your prospects’ contact information and easily sort or filter how your services relate to them, as well as effectively collating their interaction with you. The way you manage your email list depends on whether you are offering several products and/or services and, perhaps, also doing campaigns, launches or sending out email broadcasts at different times as well.

How Many Leads Should You Generate?

This is a very interesting question and there is no specific answer in terms of numbers, other than to say “the more the merrier” … and constantly!

As a business owner, you want to generate as many leads as possible, because you want to sell as much or as many as possible of your products or services, on an ongoing basis.

How many leads you need at any given time is, of course, dependent upon the nature of your business.

Every business has to have a flow of leads coming in all the time.

Without leads and constant sales, we really do not have a business. In that case, it might be more accurately described as a hobby!

For business, we need a constant stream of new leads and we must be making sales. How many depends on your business and your requirements.

If you do one-on-one coaching, for example, you only need as many clients as you can accept to work with, within a specific period of time. You might also create a waiting list for those who want to work with you and are prepared to wait to do so.

For someone who has digital product/s to offer, you would want to have as many leads as you can get, constantly coming in. This provides ongoing opportunity to create income through a ‘passive’ (automated) process or one that you might manage manually.

If you do one-on-one coaching and want to increase your income further, adding even more value for your clients to be able to access, you might also have a range of digital products or other additional services to offer them. Your clients could then go on a journey through the ‘value ladder’ in your business and might choose to purchase further useful resources or services from you.

Your leads may well come to you through word-of-mouth, but in most cases you will need to ensure that you have some sort of continual stream of leads as a foundation anyway.

If you are selling products, it is essential to have new leads coming in all the time, whether they are digital or physical products. This is just as it might be with any brick-and-mortar business that always needs a stream of footfall to keep the cash registers working, shelves stocked, the staff employed, all overheads and costs covered, as well as to create a wholesome profit for the business.

New leads are essential in any business, to one extent or another, regardless of what your focus is.

Without quality lead generation and flow, we do not have a sustainable business.

Summing up: Marketing and Sales are exquisitely vital in any business, no matter the size, the niche or the ideal audience. This is a very important factor to bear in mind, all the time, when setting up and running a business.

For success, we need sales and we want happy customers!

Types of Leads

Depending on what stage of the ‘sales funnel’ process you acquire them, a lead is categorised as either cold, warm or hot.

A cold lead is a lead generated at the top of the sales funnel. These people are just beginning their journey with your business. They are not necessarily ready to make any purchases yet, as they have not yet become acquainted with you or what you offer.

In exchange for their contact information, you might provide them with helpful information or free resources that solve a problem that they have. You might add extra value for them in some other way. It is at this stage that trust can begin to be built, which is so important.

Warm leads are those people who are interested in how you might solve certain problems for them. They might have already identified what those are themselves. These people have begun to develop an interest in your business and they have a level of trust in your status as a problem solver for them. They might have been around you for a while, online or in person or have heard of your services, and they might be in your ‘sphere of influence’ already. In other words, they have some awareness of what you do and they know you to some extent or know of you, at least.

These leads are generated in the middle of the sales funnel. It is possible for these people to come to you already willing to purchase or sign up, even if they began their ‘sales’ journey at the top or entrance to your funnel.

Hot leads are those people or organisations who are ready to purchase your products or services. They are at the ‘bottom’ of the sales funnel. They have been sifted from the casual lookers or the ones who are still considering or those who have only recently become aware of you, your products, your services. These people trust you, know you and believe that your products or services will deliver their desired results and solve their problems with or for them.

Another way of referring to warm leads or hot leads, is to say that they have already been ‘preframed’. They know what it is that they are purchasing or signing up for and are confidently committing, or almost ready to do so. In other words, they are informed and they are (emotionally or logically) bought into the idea or almost there, already.

Why Do You Need An Email List?

Anyone on the internet can stumble across your website or landing page once, get the information they need and leave. The probability of these visitors returning is usually very slim. This factor drastically reduces your chance of making any form of sale or completion of other type of ‘transaction’ with them. For example, completing an application or an event sign up, or having them book an appointment with you, etc.

In order to ensure that these visitors can come back to you, it is essential to get their name, email address and sometimes also their contact number. This means that you could potentially reach out to them, to see if you can help them to make their decision, or find out if there is any other service or product that they might have preferred, or what questions they might have about your offer and so on. When you have other quality content to offer, which they might like to have or to be made aware of in the future, they might wish to buy or apply at that time. You would then be able to reach them easily, if they are already in your organised List System.

There is a phrase that is often heard in marketing circles: “The money is in the List.”

Your mailing list matters a lot and, indeed, it can be the very pivot that your entire business depends upon and is sustained by.

Regardless of the state of play in the world or with ‘popular opinion’ or whatever the social media algorithms are getting up to, your email list is a powerful and hugely valuable business resource:

~ It gives you and your business a certain amount of freedom from the constraints placed upon you by host platforms and trends.

~ It affords you the luxury of direct communication with those who are your potential or existing clients, without having to rely on a middle man to deliver on your behalf.

Your ’email list’ could also be a list of names, addresses and telephone numbers of people whom you send physical mail to…

In other words, it is your MAILING LIST, in whatever form, and it has a vital and profoundly valuable function in your business.

Start building and curating it well now!

Let’s assume that everyone on your email list had willingly given you their email addresses, in exchange for a type of value or an offer. This means that, when you have another offer (perhaps a paid one this time), these people are more likely to also purchase from you.

Your email list is a collection of your prospective and existing customers and clients, whom you have gathered, because they have shown an interest in what you have to offer.

What better place is there to make sales and grow a loyal client base, where you can add value on an ongoing basis and find additional great ways to over-deliver to your audience, for their and your sustainable success?

The bottom line is that your email list is your own market place.

Think about that for a moment.

How Do You Generate Leads?

There is no shortcut to building your email list or generating leads.

Yes, you heard that correctly.

You might ask, “But what about the email list that one could buy from somewhere?”

The truth is, that is NOT going to make you any money.

How can we be so sure?

Think about this…

If you randomly received an email inviting you to purchase an umbrella on any random day, for example, would you bother to contemplate it, let alone follow through?

The likely answer is “No” … at least, not unless you had already intended to buy an umbrella…

But what are the odds?

You don’t know this seller, you aren’t even looking to buy an umbrella.

Result: Confusion.

That is how the majority of people on a purchased email list usually feel and it leads to: No Action Taken.

It might, also, not take long before you are reported for sending spam and could eventually lead to nobody receiving your mail.

“So how do you build a legitimate, successful email list?”

There are several ways to go about this.

Here are a few things to consider:

FUNNELS

One way that you might build your list, is by employing the use of funnels.

Funnels are different to websites or website landing pages, in that they take someone on a specific journey. It starts with the visitor providing their email address and takes them through a simple, straightforward process to achieve a purpose.

With websites, on the other hand, a visitor has no clear direction to take, potentially has a lot of choice in what to look at or click on. Most often they will visit and disappear, which ends the opportunity for any type of connection or value exchange.

Funnels keep the visitor focused and on a clear path, which they can choose to continue on or to leave. They are clearly helped to progress on the journey towards a desired result. There is no opportunity for distraction in a funnel that is built correctly and speaks to the right audience for that product / service / event and so on.

Funnels simplify processes.

Websites are like brochures. They offer a ‘smorgasbord’ of choices, but rarely lead to specific outcomes. They are also more like walks around the park!

So, to most effectively collect leads and get people to easily opt in for what you are offering, funnels are a super efficient and intelligent resource.

We highly recommend ClickFunnels for this purpose, as well as for the number of other services that their exemplary software and community can help you with.

You can get a free two week trial to try out the ClickFunnels software by clicking on this link.

Alternately, you might like to sign up for the ClickFunnels ONE FUNNEL AWAY CHALLENGE. This would not only give you the use of the superb software, but you would also receive training. It would help to get you up and running quickly and sustainably, using all that the ClickFunnels’ recorded and live training sessions provide for you. After that, you could decide whether you wish to continue on the monthly subscription rate or take their discounted annual fee route. The ONE FUNNEL AWAY CHALLENGE offers exceptional coaching and community support.

ClickFunnels offers a thirty day money back guarantee on their software, with no questions asked.

A truly simple solution for all sorts of effective business resource, management and lead generation.

Regardless of how you go about building your email list or generating leads, the first thing you must get clear about is:

“WHO IS MY IDEAL CUSTOMER?”

Know Your Target Audience

It is imperative that you know:

(a) whom you wish to serve and
(b) where you might find those people congregating already.

The first step to building a legitimate and successful email list, is that you must KNOW YOUR TARGET AUDIENCE.

You already have a business idea and you know those whom you want to serve…

Now you must look deeper.

You must become very clear about your ideal clients…

Who are these people?
What do they want to know about?
What do they consider valuable?
What are their pain points?
What is the dinner table conversation that they have?
What are their interests?

etc

Knowing your target audience properly will give you key insight into what they want, when they want it and how they want it.

Your ideal audience may well be ‘the person you were five years ago’.

Being a few steps ahead, places you in an excellent position to help those who are struggling to find their way still or are just starting out on the journey that you have already taken. You would then be their guide and would be helping them to be the hero of their own journey to their positive results and hoped for outcomes.

Automatically, as if by magic, if you speak specifically to these people in all of your marketing and communications, your audience will most likely find you, providing you address them in the right way and on the right platforms and so on.

This is why it is so key to your success, to know your ‘Avatar’ and to really do a thorough study on who they are and how you might bring value to them, in ways that will really hit the spot for those particular people.

Engage Them With Valuable Content

It is important to create quality content that is helpful to your niche audience.

Tell them what they need to know and help them to make informed decisions, in as simple a way as possible.

You will invariably be building trust and your reputation by doing so.

Remember this key marketing gem : “A confused mind says NO”.

You want your prospects to say “YES” to you…

So keep it simple.

Speak to your chosen audience in their language and ensure that as few steps as possible are required to be taken, in order for them to acquire what they need from you, to achieve their desired results.

Deliver the value to your client as simply and as smoothly as you can, so that they can soon begin to see the results that they are after.

This is one way to really nurture your people and have them wanting to come back to you for more… over and over again.

Create A Lead Magnet

One effective way to bring in a new audience or to bring your audience into a new campaign or membership, for example, is to create a lead magnet.

More often than not, this will either be something that you offer for free or it will be offered at a lower price, in order to draw them into a process at an easy level for them.

Offer your audience something that they cannot resist, in exchange for their contact information – such as an email address – when they opt-in for an event or for something else that you are promoting or selling.

The above steps will help you to generate ‘organic’ leads, with which to build your valuable email list over time.

If you want to invest money into a lead generation process, you might consider running targeted paid ads.

Targeted Paid Ads

These paid advertisements would allow you to input the specific demographic information of your target audience, ie. your ideal client avatar. Your offer would be placed right in front of that particular audience, carefully achieved by you giving the platform, that you are advertising on, all the relevant information needed for them to do so.

If your carefully crafted headline engages your audience well and your offer is irresistible to them, your prospects will give you their email address in exchange for the offer, once you have sparked their interest.

It can really be as simple as that.

Nurture Your Relationship With The List

While building an email list is relatively easy, you want to ensure that you nurture your leads by providing them with useful content and sending them mail routinely.

You do not want to bug your customers by sending emails every day and you also, preferably, do not want to send emails once in 6 months either. Find a good balance, that suits you and your audience and keeps them aware that you are in business and that you care about them.

The majority of entrepreneurs send important, useful emails to their list weekly or monthly. They might send emails more frequently, whenever they have a product or service to promote or for sale or during a particular campaign, for example.

Nurturing your list helps you to convert leads into buyers and to have that process continue indefinitely.

As you form a relationship with your leads and your ideal clients, you take them along the buyer’s journey – from simply being aware of your brand, to where they become your advocates and even your raving fans!

Make sure you over deliver, where possible.

Remember: “There is money in… THE LIST.”

There is also business and personal autonomy in the mailing list, as you have direct contact with your people and your business prospects, with particular traffic sources earmarked for your lead generation.

Your LIST is made up of precious and very valuable LEADS.

Your LIST is the backbone of your business.

THIS is why a LEAD, every lead, is so very important.

Here’s to your LIST growing sustainably, consistently and well, with new LEADS flowing into your business constantly, while you offer what inspires, empowers, uplifts and both you and your business thrive.

To your success!

We aim to help YOU to succeed.

This article was first published in June 2021.
UPDATED: June 2025

Generate New LEADS That You Can Connect With…
Create simple funnels that quickly capture your visitors’ contact information,
so that you can generate new leads to follow-up with again and again,
even after they leave your page!