Episode #087: Free Lead Gen vs Low Ticket Lead Gen?
Free Lead Gen vs Low Ticket Lead Gen?
When it comes to growing your email list, should you focus on getting as many free leads as possible, or is it better to attract buyers right from the start with a low-ticket offer?
This debate has been heating up in the online marketing space, and in this episode, we’re breaking down the pros, cons, and hidden truths behind both strategies.
Before you make your next move, you’ll want to hear this. Here’s what you'll discover when you tune in!
Why some marketers claim "free leads don’t work"—and what they’re not telling you
The surprising math behind customer acquisition costs and conversions
How to balance short-term cash flow with long-term audience growth
The critical mistake many people make when running ads to a low-ticket offer
My approach to blending both free and paid strategies for sustainable success
Whether you’re just starting out or refining your marketing game, this episode will give you the insights you need to make an informed decision.
Hit play now and let’s dive in!
Key Timestamps
04:56 - The “Cost Dynamics of Paid Leads" that most people aren’t talking about when the tout the value of paid lead generation…
09:18 - Audience Growth Challenges with Low Engagement
12:25 - Is Email List Building REALLY good for business growth, let’s talk about it!
19:37 - The “hidden” value in using lead magnets (hint: the industry is facing severe skepticism!)
20:54 - Having a warm audience is a HUGE benefit when it comes to this…
Links Mentioned:
Full Transcript:
Zach Spuckler:
This is Not Your Average Online Marketing Podcast, episode number 87. And in this episode, we're answering a hot question of the season. Is it better to get people on your email list for free or to sell a low ticket offer and build a list of paid leads? So let's get into it. Hey, hey, hey not-so-average marketer. Welcome to another episode of the podcast.
Zach Spuckler:
Now I am very excited for this week's show. One, because we're back. It's always nice to be back, and it's been a little while since we've dropped an episode. My goal this year is to drop a couple of month, and we're we're prerecording. We're batch recording today a few different episodes. But we're covering a really interesting topic, and I'm very excited about this topic because, to be honest, I get asked this question a lot. And, really, what prompted me to make this episode was I was out this past weekend, just kinda running errands, you know, doing random things. And one of my friends texted me someone who's in the online marketing space, and he said, hey, man. I was curious.
Zach Spuckler:
If you had to choose, would you focus on building an active and engaged email list, say, to a million people? Or would you rather have a smaller list, but get as many buyers as possible joining your email list? I think mold both might be the right answer, but I wanted to hear your perspective. And then he said, if you think this would be a good piece of content, don't be afraid to create it. And I was like, oh, this is a great piece of content. And, really, I'm seeing this question kind of surge a little more in the last six to twelve months. And it kinda reminds me of back in 2019, there was this big kind of talk online of, like, webinars are dead. Show up rates were down. Engagement rates were down. And the argument was like, oh, webinars don't work anymore.
Zach Spuckler:
Then the pandemic came in. People moved online. Webinar show up rates and engagement and conversion rates kind of skyrocketed. And, admittedly, it has slowed back down a little bit. But what I realized is that vilification without justification is really just marketing. And I know that sounds a little tongue twistery, but what I mean by that is a lot of the times when I see messages like webinars are dead or only grow your email list with paid leads or people on your email list are freebie secret tire kickers. And it's like, is that person trying to sell you an alternative? Right? A lot of the time when I see like, don't grow your list with free leads, it's by someone selling a low ticket offer product. Right? Let's just call a duck a duck, so to speak.
Zach Spuckler:
And so I just always point out the fact that when someone says something's dead, something doesn't work, when everything is very black and white, oftentimes that vilification of something without the justification is really just marketing you to buy their product. Because in our business, to be honest with you, we have freebies. We have low ticket offers. We have a mid level course. And then our high ticket is, like, our services, coaching, consulting, agency. And in January of twenty twenty five, we just collected a hundred k in cash. In fact, I wrote a whole blog post on it. I'll link it up in the show notes for you on how we did a hundred k cash a month, like, what our our breakdown was.
Zach Spuckler:
And I share that with you because I want you to understand that I think that there isn't necessarily a right or a wrong way to do things. I have friends that are, like, don't run a lead magnet. I have friends that only run lead magnets, and I have friends that run lead magnets and low ticket offers. I think where I'm where I'm saying be mindful is when someone's telling you something doesn't work, like point blank, black and white, no room for this is the way to do it, that's marketing. When it's, hey, I think this could work better. Here's the reasoning. Here's my thought process. Here's how it's worked for us.
Zach Spuckler:
That's justification. That's explaining your stance on something. And so when a hard line is drawn in the sand, I always say, look at it with a critical eye. And so I want you to know that my goal with this episode is not to say one is better, one is worse, but rather to answer the question, are paid leads better than free leads in the capacity of what's gonna grow your business faster, more efficiently, and get you better leads on your email list. So here's the thing. In short, is a paid lead better than a free lead? In short, yes. Paid leads are generally more likely to ascend to higher level offers because the cost to acquire a customer and then reconvert them is actually, easier in the capacity of someone who buys once is more likely to buy twice than someone who buys never is likely to buy once. Let me say that a different way.
Zach Spuckler:
Turning a free lead into a paid lead happens at a lower rate than turning a paid lead into a recurring customer. So in short, yes, paid leads are generally more likely to move into higher offers. But, and here's the but, it's also a higher cost per acquisition. What that means is if you're running ads to grow your list and you focus exclusively on paid offers, it costs more to get someone to spend $10 and then it does to get them to give you their name and email. And so one thing that I don't see a lot of people talking about around this is if you're gonna grow your email list with paid leads mostly or exclusively, you need a bigger budget. Right? You need to spend more money. In one of our promotions on cold traffic, we paid $80 to get someone to become a customer of a 25 product. Now, yes, we had order bumps, upsells.
Zach Spuckler:
We we got a little more than the $25 front end purchase. But if you want 10 customers, that means you need an $800 budget. That same $800 budget at our current cost per free lead acquisition would actually get us over 240 leads. And even if those 240 leads converted at only about 2%, we would still have five customers. So five customers versus 10 customers, but you don't get the leads along the way. Right? The second thing to consider is growing an email list with a freebie is much less work than growing a list with a low ticket offer. So with a freebie, all you need is a a PDF, a lead magnet, whatever you're giving away for free, an opt in page, and an email sequence. With a low ticket offer, you need the sales page.
Zach Spuckler:
You need the checkout. You need the delivery sequence. You need the upsell sequence. You need the resources to move that paid offer into another paid offer, which means you actually need two paid offers. You also need the low ticket offer itself. Right? It's like for me to create a PDF, I can sit down and do that in a morning or an afternoon. To create a low ticket offer takes me, you know, if I'm fully focused on that, no other work, no client work, no student work, no membership support is gonna take me several days. Right? So there's also more work that we're not talking about.
Zach Spuckler:
It's also gonna be more work to get the back end to convert. Right? So when you do a lead magnet to an offer, you have that front end funnel. And, yes, you're going to want more funnels down the road. But with low ticket offer, you actually have multiple funnels you have to build. You have to build the funnel if they buy the low ticket offer to ascend them. You have to build the funnel on delivery of the ascension offer. You have to build the funnel of if they opt into the low ticket offer and they cart abandon. Right? So it's more work to actually move people from the back end to or I should say the front end to the back end offer.
Zach Spuckler:
Right? And like I mentioned earlier, if there's a higher cost per acquisition, you're generally making your money on a low ticket offer, not on the front end low ticket offer. Right? I know a lot of people kind of sell this like, oh, make all your money back on advertising. A lot of people I work with who have a low ticket offer, they don't make their money back on the front end. They make their money back on the front end. Their goal is to break even, but most people I work with, they're not massively breaking even on the front end. Right? They're making maybe a little bit of money on the back end. They're you may be even in most cases losing a little money on the front end. And then when people buy the offer after the low ticket offer, that's where they profit.
Zach Spuckler:
And so not only do you need a higher budget, but you also need the cash flow. Right? So here's the thing. It's it's not all sunshine and rainbows. And so that's kind of coming back to what I originally mentioned is, like, vilification without justification, that's just marketing. Right? Because you're making it's like, oh, I don't want freebie seekers and tire kickers. And it's like, well, okay. But do you want a higher cost per acquisition? Do you want to do more work on the front end? Do you have the systems process and experience to convert low ticket buyers into high ticket buyers? Right? The other thing is it's not a volume play. Right? It's it's not.
Zach Spuckler:
It's you're gonna have less total audience. And so depending on what your goals are, if you're trying to grow an audience of people to follow you on Instagram, listen to your podcast, read your blog, you're going to have less people that engage with your content. That also means it's harder to get people to share your content because there's less people. It's harder to get people to share your blog, your podcast, tag you on Instagram because less physical people are seeing it. And in a lot of ways, the online marketing game is a volume game. So to recap, because now I've kind of like into what I was just saying, like, I've kind of vilified this low ticket offer. Again, they're great in the capacity of they convert people much more easily to a secondary customer. I think it is, in my experience, easier to go from, like, a $25 offer to our membership than than it is to go from a freebie to our membership.
Zach Spuckler:
We know because we've split tested the numbers. When we bring somebody in low ticket, they convert to our higher level offers much more easily. So yes, that's the benefit. And don't forget to look at the other side of the coin. So again, just a super quick recap. You're going to get more people to buy your offers on the back end as a percentage, but you have a higher cost per acquisition. There's more front end work and content to create, and it is not a volume play. So let's have the same analysis for lead generation.
Zach Spuckler:
Right? So lead generation, typically, what happens is you're going to pay much less to get someone on your list. Right now, we're kind of in the neighborhood of, like, $3 to $3.50. And admittedly, we need to work on our ad copy and ad creative because we're kind of just leaning on what we've been doing. And it's on my list of things to do. It's like, Zach, get your act together and create a better Facebook ad for better conversions. But over our most recent campaign, we've generated, right around 1,400 leads, 1,478 at $3.25 a piece. So this isn't based on a small, small sample, but it's not based on a massive, massive sample. But compared to when we run ads to our low ticket offer, we're at, like, 5% of the cost per acquisition, maybe even a little less.
Zach Spuckler:
Right? So it is much cheaper to get someone to join your email list and nurture them. Right? So I argue that having a healthy mix is good because yes, 100% you are going to convert, like I said, less of your free leads into paid offers. But I also find it gives me more space to nurture people. Right? I think one of the things we're not talking about is that in 2025, people are more experienced and therefore more skeptical. What I mean by that is it's a lot more rare that you come by somebody, especially if you have an online course, who's like an online program. I've never heard of that or a freebie. I don't know what that is. A lot of people, especially in the B2B space, they're savvy.
Zach Spuckler:
They're familiar with this. You're not the first person to make them an offer to take a digital training. And so there's a level of skepticism that is it's harder to convert people to those low ticket offers, but it's easier to get them to give you their name and email. So I find that in some ways, getting the name and email is easier, but it also gives me more capacity to nurture and show people the value of my offers. Right? So the pro to that is, yeah, I get more people, but that means I need to create more nurturing content. So because I'm using email list building as a primary driver of growth in our business, I also need to email every week. I need to release podcasts on a regular basis. I need to write really good blog posts.
Zach Spuckler:
And to be clear, the content actually has to be good. Let me say that another way. You're not just creating content to talk to people and talk to customers. You have to create conversional content that makes people interested in buying. Like, I'm gonna level with you. This podcast is intentional because we have paid offers and low ticket offers. And we also have webinars that are coming up in the next four to six weeks. And so everything that I do with this podcast is a calculated move to talk to you about the value of our free webinars and our paid bootcamps.
Zach Spuckler:
Right? So I'm not just creating content that's like, oh, if you get a free lead and you give enough value, they'll buy from you. You have to be intentional with your content. Right? So the pro of free leads is I get more of them, more people listen to my podcast, more people digest my content, and I also have to create the content that nurtures and shows them the value of growing the audience. Right? Or the not the value of growing the audience. I should say the value of of buying our products as a result of growing my audience. Right? So in short, are paid leads better than free leads? Yeah. You're going to get more people to buy your offers on the back end of a paid lead magnet. Free leads take longer to convert.
Zach Spuckler:
So, but, and there are pros and cons to each. So the long answer is, yeah. Sometimes they're beneficial and no. Sometimes they're not beneficial. It depends on your ability to spend, your capacity to, you know, withstand the risk, your cash flow. So our solution, if I can be totally candid with you, is that we do both free leads and paid low ticket offer lead generation. So when I look at my overall Facebook ads budget, about 60 to 70% of our budget is growing the list. We are growing our email list every single week.
Zach Spuckler:
If I look at the last seven days in our Facebook ads account, we've spent about $1,500 on list building, actually about $1,600 on list building and about a hundred dollars on some miscellaneous things, promoting some content that we think is gonna nurture and sustain and grow our audience. Right? But overall, about 60 to 70% of our budget on Facebook ads over a year is on list building. About 20 to 25% is on paid offers, and about five to 10% is miscellaneous, you know, promoting the podcast, promoting really good blog posts that I've written, basically engaging the audience to want to continue to work with me. Right? I think that there's so much value in having a healthy mix. Right? And we have a podcast episode coming up where we're gonna talk about kind of how we think about our business in ninety day cycles, but we always have, in a ninety day period, kind of these these three things happening. So number one is evergreen all the time, we're growing the list. And the way that I look at list building is I'm not abandoning the low ticket concept. I'm actually running ads to a free lead magnet.
Zach Spuckler:
We do a $15 a Day Facebook Ads guide with Facebook ads, and then that moves people into our low ticket Facebook and Instagram Ads for Listbuilding Bootcamp. So I'm always growing the list with leads, but I'm also pushing them to a low ticket offer still. Right? Because why wouldn't I, knowing what we talked about earlier saying that paid leads are generally more likely to ascend to higher offers, why wouldn't I turn my free leads into paid leads? Right? So this is kind of like I'm double dipping. And then if someone buys our Facebook and Instagram Ads for Listbuilding Bootcamp, I move them into a sales funnel for our membership. Right? So all the time, we're growing our audience with a free list builder, but we're also growing our paid audience and we're ascending that paid audience into our membership, which is $67 a month and creates recurring revenue for the business. And every quarter, we do a Facebook and Instagram Ads for Listbuilding Bootcamp. So right now, we do that for $25 for a live ticket. We have a $55 VIP upsell, but we run traffic directly to that boot camp, both cold and warm.
Zach Spuckler:
So one of the unsung benefits of growing this freebie audience is that when we have a paid offer, we have people that I've been nurturing. So I have people that have been listening to the podcast, you know, reading the blog, following me on Instagram. And so when I say come to my $25 Facebook and Instagram ads for list building boot camp, guess what? People will. And I'll pay less to move my freebie leads into the boot camp than I will to pay to move completely cold leads into the boot camp. And then yes, 100%. We go right from low ticket hopper to membership. Right? And every quarter, not every quarter, most quarters, where our plan is every quarter this year, we also do free launches. So for our program, the challenge launch engine, which is our signature process for running five day challenges, we go free webinar right to course.
Zach Spuckler:
And we will bring a healthy amount of leads from both cold and warm into that webinar and then move them into our mid ticket offer. Here's what I really want to stress about this. That is fundamentally our basic flow. Right? Free to low ticket to membership, low ticket to membership, and free to course. We also, within that, are always having on our website and available and communicating that I do consulting, I do coaching, I have the agency where we take about 10 to 15 clients at a time to manage their ads for them. And so I think that's what's really great about this is that we have a combination combination of free low ticket, mid ticket, high ticket, and I think that's what's really allowed us to crush it over the past, especially twelve to eighteen months. Because here is the thing, I mentioned this earlier in passing and I really want to go a little deeper on it, is that there is a level of skepticism in the market. Some people have the, you know, fortitude, for lack of a better word, to say, look, I'm willing to spend $50 to see if this person is legit.
Zach Spuckler:
If it if it's a really great low ticket offer, I'll spend $50 to see if it's legit. Right? Some people have been burned ten times over, and they're like, I'm not even gonna talk to this person until I get a free PDF and read their strategy. And as a side note, that's why free lead magnets need to be high value, not bulky, not meaty, not massive, but high value. Do you actually give value in your lead magnet? And some people are gonna be like, look, I have heard your name. I've heard about you around the streets of the interwebs, and I'm ready to just get on a sales call and book a high ticket service with you. But to say that someone who has been burned five times over and wants to download a freebie before they talk to you, that is not the equivalent of saying everyone who grabs a freebie is a tire kicker freebie seeker. I have had people on my list go from freebie to sales call to $10,000 client because they just want to know the process before they touch a phone and feel like they're gonna be in a high pressure sales situation. To be clear, we don't do high pressure sales on our calls, but again, they don't know that because they don't know us, and they only know the skepticism and burns that they have from what they've faced so far.
Zach Spuckler:
And I I really wanna stress this, that growing a warm audience, it gives you the opportunity to test offers, ideas, promotions with way less friction. Right? So yes to all of what I said, and having an email list means when we have an idea, we can throw it out there. Right? Like, let's say this podcast was the basis for a new product. It's not, but let's just say. Right? If it was the basis for a new idea, guess what? I can take this podcast, email it to my email list of about 20,000, and say, how is it received? Does it get more downloads than normal? Do more people DM me on Instagram about it? Or are more people reposting and resharing? And if the answer is, yeah, totally, great. I know I should move forward. Whereas if I only had a hundred students, yeah, maybe that data is more impactful, but it's a smaller sample size. Right? Said another way with numbers is when we do our Facebook and Instagram ads for list building boot camp in January, when we did it in January, we paid about 20 to $25 for someone in our audience to buy the boot camp versus someone who wasn't in our audience, a completely cold audience.
Zach Spuckler:
We paid about $80 to get someone to buy the boot camp. Right? So growing a warm audience also gives you this capacity to, like, dabble, play, investigate, survey, find out what's working, find out what's not working, and kind of go from there. I just think there's so much value in having an audience that amplifies your message and responds to your message. Right? It's like, would I rather have an audience of a hundred buyers or a thousand people on my email list? Maybe a hundred buyers, but that discrepancy is not always the same. Would I rather have an email list of a thousand buyers or ten, twenty thousand freebie buyers or freebie opt ins? I argue that the audience of 20,000 freebies can include the 200, three hundred buyers. And so a combination of free, low ticket, mid ticket, and high ticket is really the way that I'm looking at continuing to expand the business. Now, if I had to choose one to focus on, I would say, grow the email list. It's the easiest, lowest form of barrier to entry advertising you can do.
Zach Spuckler:
Grow an audience 500 to a thousand, start making them offers, whether that's lower mid ticket, see how those perform, use that data, take the low ticket, import it into your front end process a little bit, and then continue to scale from there. Right? Again, I've said this a couple of times. I'm gonna say it again. Vilification without justification is just marketing. My goal with this episode is not to vilify freebie or, or low ticket or high ticket or service or this model or that model. It's to tell you we use all these models, justify where and when they make sense and show you the value in using them. And it's still marketing. We still have offers that we're gonna roll out around all of these things.
Zach Spuckler:
So if you're sitting here saying, are paid leads better than free leads? The short answer is it depends on your goals. It depends on what you need. It depends on what you can spend and it depends on your budget. So I hope you've gotten massive value from this episode. If you'd like a recap, the show notes, links to anything that we've mentioned, you can head over to heartsoulhustle.com/nyap087. Again, that's heartsoulhustle.com/nyap087. For Not Your Average podcast, episode number 87 will have the outline, the transcript, the links, all that good stuff that we usually upload. And, really, I just wanna leave you with this.
Zach Spuckler:
When someone tells you something is bad, not good, doesn't work, and you have to do it their way, always take a second to step back and say, what's the justification and what am I being sold? There's always a benefit to going a layer deeper, and vilification without justification is really just marketing. So I hope you've gotten value. I hope you have an incredible rest of your week. We have more podcasts coming your way soon, but until next time, stay not so average.
