Dedicated BDR vs Pay-Per-Lead Sales Models: Which is Best? 

If you’re a B2B business considering the benefits of BDR vs pay-per-lead models, you’re certainly not alone. Each promises to fill your pipeline with leads, but each works in a very different way, and often delivers quite different results. 

There are key differences in these sales approaches and your choice needs to consider a number of factors, including:

• Budget
• Pipeline quality
• Brand integrity
• Alignment
• Sustainability

We’re going to take a close look at BDR and pay-per-lead sales models, comparing their pros and cons to help you make an informed decision and select the right approach for your organisation. 

What Is a Dedicated BDR Model?

A dedicated BDR sales model means outsourcing or hiring a Business Development Representative (or multiple BDRs) who will generate leads for you. BDRs are experts at prospecting and qualifying leads, and their goal is to book sales meetings that they can hand over to your team and hopefully convert.

A dedicated BDR learns everything there is to know about your product offering, your brand and your ideal customer profile (ICP). In this way they become a flexible extension of your sales team, and one that refines their approach continuously based on real-time feedback and hands-on experience.

What is a Pay-Per-Lead Model?

As the name suggests, a pay-per-lead (PPL) model is one where you pay a third party to provide you with sales leads, and you pay by the lead. Similar to BDR, PPL agencies take responsibility for prospecting and outreach, before handing leads on to your in-house sales people. 

In this performance-based model providers tend to work with multiple clients at the same time, and they often use standardised processes and databases to help them generate leads at scale.

Pros and Cons Comparison

Let’s explore the pros and cons of dedicated BDR vs pay-per-lead models to help you choose the right approach to support your pipeline development.

Dedicated BDR Model – Pros

• Higher Quality, Tailored Messaging – Dedicated BDRs thoroughly research prospects to make sure they properly understand their pain points. The fact that they work for you and you alone also means that they can really get to grips with your voice, allowing them to create messaging that reflects your business and its values, and resonates with your ICP.
• Better Brand Representation – Because BDRs get thorough training on your brand guidelines they can make sure every interaction with a prospect reflects how your business operates. Consistent communications are vital to build trust and credibility, and this is particularly important in the complex B2B sales environment. 
• Strategic Alignment with Your Internal Team – BDRs are especially valuable when it comes to handing you leads that are warmed up and properly qualified against your ICP criteria. One of the ways they achieve this is by working closely with your marketing and sales people. This includes sharing feedback on the effectiveness of company messaging and sales approaches, and vitally, it enables them to adjust and improve their strategy to optimise results.
• Predictable Outreach Consistency – Dedicated BDRs are transparent with you about what outreach is going on and what is planned, which helps you forecast pipeline growth and revenue. This insight also allows you to make data-driven decisions about when and how to scale.
• Stronger Feedback Loop & Better Insights – A real pro of BDRs is that they get more effective over time. Through experience and feedback they learn what messaging resonates and how to overcome blockers, improving the quality of your pipeline continually, and delivering better returns. 

Dedicated BDR Model – Cons

• Higher Upfront Investment – Outsourcing your sales to a BDR agency certainly costs more than PPL initially. While this is cheaper than hiring more in-house capacity, early-stage businesses and companies testing new markets might be put off the BDR model because of the financial commitment required. 
• Dependent on BDR Quality and Management – Success with a BDR model of course depends on the ability of the individual BDRs themselves, as well as their managers. A subpar BDR team could therefore waste budget and effort and fail to deliver the leads you’re looking for, so it’s essential to do your research and look at things like testimonials and case studies.

Pay-Per-Lead Model – Pros

• Lower Upfront Cost – A big attraction of PPL is that the initial investment is small. You only pay for the leads that are delivered, so this is a way to keep costs down on your sales support.
• Faster Initial Results – As there’s no hiring or onboarding necessary with PPL, you start receiving leads almost immediately. This is because PPL businesses use existing processes and databases when prospecting for you.
• Risk Shared with the Provider – As we’ve said, PPL is performance-based so you only need to pay for the leads you receive. This puts the onus on the provider to deliver results and limits your financial risk.
• Easy to Trial or Scale Short-Term – PPL is often attractive to companies that don’t want to commit to a longer-term lead gen agreement. You can usually try it out and if it doesn’t work, scale down or stop without too much hassle.

Pay-Per-Lead Model – Cons

• Lower Lead Quality/Poor ICP Targeting – Poor lead quality is a common complaint when using PPL generation. Because PPL providers often work with a number of different clients at the same time and use broad strategies, this can translate to leads that don’t closely match your ICP. 
• Incentivises Quantity Over Quality – The PPL business model focuses on quantity of leads because that’s what they’re paid for, but this means quality can suffer. This focus on quantity sometimes leads to suboptimal outreach tactics and a large number of poor leads. 
• High Rate of No-Shows/Unqualified Meetings – A result of these badly matching leads is that when meetings are booked your sales people find that prospects aren’t really interested – or that sometimes they don’t show at all. 
• Minimal Brand Control – PPL agencies want to deliver a lot of leads quickly, and this can result in sales approaches that don’t truly reflect your brand or values, risking reputational damage.
• Can Harm Domain Reputation Through Aggressive Outreach – Aggressive, high-volume and automated outreach also runs a high risk of damaging your reputation with prospects. And if emails are being sent from your domain they could be marked as spam and make it harder to reach prospects by email in the future. 

Which Is More Economical Long-Term?

When considering which model offers the most value, it’s important to look beyond the initial investment required. 

Comparing Average Market Costs

Outsourcing sales to a dedicated BDR agency usually costs thousands of pounds per month. Using a PPL provider, on the other hand, will cost you around £50-£200 per lead if you’re a B2B business. However, this comparison doesn’t consider lead quality, conversion rates or the cost of wasted time pursuing unsuitable prospects.

Predictable Pipeline vs Volatile Pipeline

Dedicated BDRs provide you with a sustainable, predictable pipeline, which enables you to forecast accurately and plan strategically. 

Per-per-lead-generated pipelines are often more volatile. Because lead quality varies significantly, it’s hard to predict conversion rates and even harder to forecast or plan with confidence. 

ROI Expectations for Each Model

ROI is usually worse with a PPL model because of the poor lead quality and lack of alignment with your team and brand. So while the initial cost is less, the final cost of closed leads – when considering the amount of time wasted – is higher. 

A BDR model, while more expensive monthly – delivers a lower cost per qualified opportunity. It also provides sustainable ROI over time because more effort goes into alignment, targeting, research and continuous improvement. BDR is therefore the more economical choice over all.

Common Mistakes Companies Make When Selecting a Model

The errors that occur the most in selecting a sales support partner include:

• Choosing based on price alone: Cheap leads are inevitably attractive, but more expensive leads that convert and provide sustainable ROI are far more valuable. 
• Expecting PPL providers to act like full BDRs: PPL providers don’t do the same things as dedicated BDRs and you can’t expect them to have the same product knowledge and sales alignment, or be as invested in your success. 
• Not defining ICP or qualification criteria: Whichever model you choose you need to clearly define your ideal customer, qualification criteria, and what success looks like.
• Underestimating Management Requirements: For both models you need to provide coaching, feedback and direction to ensure success. This is especially true for PPL, where ongoing comms and quality control are a must.

What’s the best choice for your business?

The best choice for you depends on your budget, your sales cycle, your long-term goals, and how important quality vs quantity is when it comes to leads. 

For complex, high-value, relationship-driven sales a dedicated BDR is the wisest choice. But for some businesses wanting to try out inexpensive, rapid campaigns, PPL could be worth further consideration. Just remember that price and value aren’t the same thing.

If you’d like to take advantage of dedicated BDR support, or you just want to learn more about it, E360 can help. Get in touch with us today to discuss how we can help you grow.