Art & Ann Jonak enjoy a private boat ride in Venice, Italy with master networkers Mike & Tiffany Potillo.

Art & Ann off to find their favorite restaurant in Rome.

Several times a year Art Jonak conducts opportunity & training meetings all over Italy including Rome, Milan and even historic towns like Matera.

Tom “Big Al” Schreiter attacked by pigeons in Piazza San Marco.

Loretta & Wydell Madison, Art & Ann Jonak and Mike & Tiffany Potillo savoring tasty Italian Gelato during a late night shopping excursion.


Several times a year my wife and I visit Italy to shop, eat, visit friends and build our network marketing business. On a recent trip, a few fellow networkers from the United States joined us and boy, did we have fun! One day the topic of working leads came up. Here’s the training I shared.

There are a lot of misconceptions about leads (some of which may well have been influenced by late-night meetings and lite beer). Leads have at least five critical factors: 1) what they cost; 2) their conversion rate; 3) unit of sale size; 4) repeat orders and residual value; and 5) hassle factor.

1) Cost per Lead

This factor is easy to understand. Simply take the cost of the advertising campaign and divide it by the number of leads you receive. If your advertising campaign costs $1,000 and yields one hundred leads, then your cost per lead is $10.

All marketers want to lower their cost per lead, but this is only part of the formula. If you concentrate only on the cost per lead, you’ll miss the other four important components that may mean the difference between success and bankruptcy.

2) Conversion Rate

Knowing the conversion rate must be part of the evaluation process for your advertising campaign. How relevant is your cost per lead if none of your leads convert into sales or distributors? Even if your cost per lead is only one penny but none of your leads convert, you’ve paid too much for the leads.

3) Unit of Sale Size

This factor reflects how much business you get from a single sale of each converted lead. Let’s say you’re selling weight-loss products by using leads from classified ads in health magazines. Compare the following numbers:

• Converted leads from Diet Today buy an average of $100 of weight-loss products on their first order.

• Converted leads from Calorie Busters buy an average of $15 of weight-loss products on their first order.

It doesn’t take a converted leads expert to see that leads from Diet Today are more than six times better than the leads from Calorie Busters.

4) Repeat Orders and Residual Value

Customers who come back for repeat orders are more valuable than customers who order only once.

Let’s say distributors recruited from Greed & Power magazine make a single product order of $100. They quit your network marketing program after one month.

Distributors recruited from Hype & Shout magazine continue with your networking program and regularly order $100 in products every month for an average of two years.

That means you receive a total of $100 from distributors from the first group and a total of $2,400 from distributors from the second. You would clearly prefer the second group of distributors, so you expand your advertising campaign in Hype & Shout.

5) Hassle Factor

What good is your campaign if it is a hassle to administer? If the leads are difficult to convert, requiring several follow-up mailings and telephone calls? If many of the leads abuse your good nature and take advantage of your time and resources?

If the cost to service and develop each lead is exorbitant, your advertising campaign is doomed.

How about your leads? Do you consider these five critical factors, or do you simply calculate the cost per lead and wonder why your advertising campaign isn’t working?

ART JONAK is a Networking University faculty member,
a successful network marketing leader and widely respected trainer.