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- Gifting a product or service in exchange for contact information can help engage new customers.
- Known as a lead magnet, the gift should be tied to the value your company offers.
- Develop and market a lead magnet like any other product or service.
- This article is part of "Marketing for Small Business," a series exploring the basics of marketing strategy for SBOs to earn new customers and grow their business.
Lead magnets are a critical tool for growing a thriving email- or text-marketing list and getting customers into a sales funnel.
A lead magnet is a gift that a business offers people in exchange for their contact information, such as a free course download or a one-time discount.
"More than ever, lead magnets are important because people are a little stingier with their email addresses," Jenn Robbins, founder of The Flexible Funnel Studio, a digital-marketing agency, told Insider.
Given how easily we can get inundated with emails these days, a high-value lead magnet can entice people to connect with your business, allowing you to deepen the relationships and turn them into clients or customers. Best of all, you don't have to be a marketing expert to see results.
Ashley Louise, a cofounder and the CEO of Ladies Get Paid, an online platform that offers paid courses on career advancement and money management for women, started experimenting with lead magnets last year. In the past year, more than 8,500 prospective customers have downloaded her free e-books and printouts.
"The best thing about these assets is that they have a long tail distribution, meaning they continue to be found and shared, increasing our surface area for acquiring new email addresses," Louise said.
Insider spoke with small-business owners about what they'd learned about making a lead magnet successful.
Give a peek at the value your company offers
Robbins said a good lead magnet achieved two things: It gives the customer a taste of the value your company offers, and it relates directly to something you're trying to sell.
In other words, it's not about baiting people into your company's orbit to boost your email list.
"If your lead magnet doesn't specifically tie to something you offer, then you're going to lose people along the way," Robbins said. "It doesn't matter if people have an email list of 30,000 people — if nobody's buying, then everybody's wasting their time."
For example, Robbins worked with a farmer whose lead magnet was a recipe book, which enticed people to buy the company's products featured in the recipes.
When brainstorming ideas for lead magnets, Louise considers what made her opt in to other companies' lead magnets. Often, she'll Google a question and download a resource that promised a solution.
She said to ask yourself: "What is the very specific problem that someone would use this lead magnet to solve — and then you need to deliver them the exact solution." She added that she often looked to her membership community for inspiration.
This approach led to her company's most popular lead magnet to date: a beginner's guide for ChatGPT, which had 5,000 views on its landing page within two weeks of launching.
Use your established marketing channels
When you promote a lead magnet, it's best to treat it like any other product or service you're selling.
"You're not asking them for money, but you're asking them for their time and their email address," Robbins said.
Distribute your lead magnet via the channels that are effective for your other marketing efforts, such as social media, podcasts, online advertising, or linking to your lead magnet in blog posts or articles.
Then, make sure you're pointing people to a strong landing page — not just asking them to "download my freebie" with no context.
Instead, Robbins said, explain what the free item is, what's included, what the person can get out of it, plus who you are as a business owner and why you're the right person or company to offer this solution.
Follow up quickly
Follow up within a week of a new sign-up, Robbins said, with a welcome sequence of five to seven emails that further introduce your work; share more resources, such as a blog post or podcast; and suggest a call to action to keep them engaged. Open rates tend to be highest in the first email sequence, she said.
Lead magnets can also be an effective tool for segmenting and reengaging existing email subscribers, Louise said.
When she sent a free course to her email list on how to use ChatGPT in a job search, an automated follow-up email went to those who downloaded the course, touting other job-search products available at Ladies Get Paid.
"That was a way for me to identify people who are not just readers, but they're engagers," Louise said. "Those are the people who are more likely to buy our products."