Lead buying: costs, risks, and smart strategies for businesses

For more than half a century, companies have paid for access to names and contacts, first through mailing lists, then telemarketing databases, and now through sophisticated digital platforms. 

What has changed is the scale, speed, and polish with which these leads are packaged and sold. In this article, we’ll walk through the basics of lead buying, uncover key realities that many firms prefer to keep hidden, and offer practical guidance for those considering this path.

You may be inclined to buy leads when:

• You’re just starting out and don’t yet have a marketing system or strong brand presence.

  
  

• Your sales team is under pressure to meet quotas and needs more prospects fast.

  
  

• Your business model depends on high volume, low-ticket sales (e.g., insurance, real estate, solar, auto sales).

  
  

• You’re expanding into a new market and need contacts quickly without building awareness from scratch.

  
  

• You need highly specific contacts or niches that would take too long to gather organically.

  
  

Who sells leads and what they cost

The market for buying leads is wide and varied. On one end, you’ll find large data providers like ZoomInfo, Apollo.io, Lusha, and Clearbit, who sell B2B contact lists at scale. 

Then there are marketplaces and networks such as HomeAdvisor, Thumbtack, EverQuote, or Quinstreet, which specialize in industries like insurance, finance, home services, or real estate. 

Platforms like Zillow Premier Agent or CarsDirect cater to specific verticals. And finally, countless smaller brokers and pay-per-lead agencies generate leads through ads or SEO campaigns, often selling them to multiple buyers.

But not all leads are worth the same. 

Exclusive, real-time leads (sold only once, right after they’re generated) command much higher prices than shared or recycled lists, which are cheaper but less reliable. 

Note that most small and mid-size businesses end up with shared leads, unless they specifically pay extra for exclusivity. And yes, recycling is common, though it’s usually hidden behind marketing language.

Estimated Yearly Cost of Buying Leads (100 leads/month)

B2B Enterprise Leads → $20 to $500 each. Prices climb when targeting high-level decision makers with verified contact info (e.g., CIOs, CFOs).

Insurance Leads → $15 to $150. Auto insurance is cheaper on the low end, while life and health insurance leads sit at the top due to higher commissions.

Real Estate Leads → $20 to $200. Shared buyer leads are at the lower end, while exclusive motivated buyer or seller leads push into the higher range.

Solar & Renewable Energy Leads → $30 to $250. These are costly because of long-term customer value and high installation ticket sizes.

Home Service Leads (roofing, HVAC, pest control, landscaping) → $15 to $100. Pricing depends on exclusivity and urgency of the service.

Legal Leads → $50 to $500+. Among the most expensive, particularly in personal injury, workers’ comp, or mass tort cases where settlements are large.

Auto Sales Leads → $10 to $70. Lower per lead, but dealerships usually buy in bulk packages to sustain volume.

This is an enormous spread, but the principle is consistent: the more exclusive, targeted, and fresh the lead, the higher the price. And with that price comes both opportunity and risk.

Of course, not all companies buy this volume, some buy far less, others far more. But this gives a realistic annual ballpark if a business is actively feeding a sales team.

The small print

When business owners ask the million-dollar question “Will these leads actually convert, or am I wasting money?” lead sellers rarely give a straight yes. 

Instead, they highlight that conversion depends on how fast and effectively your sales team follows up, stressing the “speed to lead” rule.

They’ll reassure you by saying their leads are “verified and qualified,” sometimes offering replacements for bad contacts, and often point to glowing ROI case studies from other clients. But the fine print is clear: they guarantee volume, not sales, the burden of turning a name into revenue falls on the buyer.

That means that buying leads is not a guaranteed path to sales.

For many companies, especially those that promise “just buy this list and get sales,” the results are weak or disappointing.

Pros of Buying Leads

(from real users & studies)

✅ Speed / Scale

Buying leads gives you a fast influx of prospects. If you need volume right away (e.g. for testing, ramping a sales team, entering a new market), purchased leads can fill in gaps quickly. (Sopro)

✅  Lower upfront effort

You skip much of the content creation / organic traffic building / SEO / inbound pipeline building. You get lists without having to generate them yourself, which saves time & often money in the short run. (marketing.biz)

✅  Predictability of cost

With purchased leads, you can often estimate a cost-per-lead (CPL), and forecast (if you know your conversion rates) what ROI might look like. This can help with budgeting. (Sopro)

✅  Useful for testing

If you want to test messaging, offers, sales cadences in a new vertical quickly, purchased leads can be a way to experiment without having to build a full funnel first. It lets you iterate fast. (Generate Future Leads)

What the problems / risks are

(from real users & studies)

❌ Low Quality / Low Conversion Rates

Many leads are cold: people who didn’t ask for your offer, who may know nothing of you or your credibility. This usually means lots of nurture / follow-up effort for little pay-off. (1827 Marketing)

Data / contact info decays fast (emails change, people move roles, businesses close). So stale/outdated lists are common. (Generate Future Leads)

❌ Shared / Non-exclusive leads

Usually you’re competing with others contacting the same purchased leads. Sometimes a lead list is sold to many companies. If many people pitch the same lead, your message is less effective. (Sopro)

❌ Higher costs in the long run & lower ROI

Because of low conversions and needed follow-up, what seems cheap per lead can become expensive per sale. Some industries show sub‐1% conversion rates from purchased leads if they’re cold. (Martal Group)

❌ Reputation / legal / compliance risks

If leads did not consent, or privacy/data laws weren’t properly followed, you might be violating CAN-SPAM, GDPR, TCPA etc. Also, unsolicited outreach risks spam complaints, hurting sender reputation and deliverability. (Generate Future Leads)

❌ False sense of progress

Some people say buying leads can make you feel like you’re making sales progress (more names, more numbers), but it doesn’t always correlate to real growth. The “activity” is high but the outcome might be low. (1827 Marketing)

❌ Dependency & lack of organic growth

If you lean too much on purchased leads, you may under-invest in building your own pipeline (content, brand, referrals) which often gives higher quality and longer-term stability. (leadgenerationblog.net)

What people say from forums

• Many marketing / sales people on Reddit say purchased leads often don’t pay off unless you have strong follow-up, very precise targeting, fast response time, etc. Without those, a lot of leads just “ghost.” (Reddit)

  
  

• There’s also the sentiment that leads are promised as “interested” but actually aren’t. They might have consented somewhere, but not in your offer, or they just signed up to get something free. That doesn’t mean they are ready buyers. (Reddit)

  
  

• Some who’ve used lead providers say they barely break even: the cost of buying + cost of outreach + cost of nurturing eats into margins heavily. (Reddit)

When buying leads does work (and how to do it right)

If you decide to go this route, there are conditions that make it more likely to succeed.

Track real metrics, not vanity

Cost per lead is useful, but what matters more is cost per sale, conversion rate, lifetime value, shrinkage from bad leads. Always get good feedback loops.

Cost per sale (CPS) is the actual cost a business pays to acquire one paying customer.

It’s calculated by taking the total amount spent on acquiring leads (or ads, or both) and dividing it by the number of those leads that actually turn into sales.

✅ Example with leads:

• You buy 100 insurance leads at $50 each = $5,000 total cost.

• Out of those, 10 actually buy a policy.

• Cost per sale = $5,000 ÷ 10 = $500 per sale.

  
  

So while a lead might look cheap on paper (say $50 each), the real cost per sale is much higher, because not every lead converts. That’s why CPS is the number that really matters for profitability; it tells you how much you actually spent to win one customer.

Only buy exclusive / qualitatively vetted leads

If you can get leads that are exclusive (not sold to others), preferred.

If you can vet them: source, recency, how “warm” they are (did they express some intent, even minor).

Implement fast, skilled follow-up

If you don’t follow up quickly and well, a lot of purchased leads go cold. Having a sales process built out (scripts, training, nurture flows) matters a lot.

Good lead scoring / segmentation

Filter bought leads by meaningful criteria (industry, demographics, firmographics, expressed interest). Score high vs low so your team spends their time where ROI is plausible.

Integration with other channels

Bought leads shouldn't be your whole strategy. They work better when mixed with referrals, inbound, content, brand awareness. Use paid leads to supplement but not substitute.

Compliance + Ethics

Make sure you know how the leads were acquired, that the people consented, that you’re not violating laws. Also, ensure your outreach doesn’t hurt your brand’s reputation.

Bottom line

Buying leads can work, but usually only under tighter control, good lead quality, quick and skilled sales follow-up, and realistic expectations (i.e. don’t assume 50% conversion).

Most successful long term growth tends to come from building your own leads (inbound, referrals, content, brand), because those leads are usually higher trust, more engaged, and more cost-effective over time.