Lead Magnet

DEFINITION of 'Lead Magnet'

A lead magnet is a marketing term for a free item or service that is given away for the purpose of gathering contact details. Lead magnets cover a wide range of offerings, including trial subscriptions, samples, white papers, e-newsletters, free consultation and so on. Marketers use lead magnets to create a database of sales leads. The marketers may use the database to move leads further along the path towards being a paying customer of the product or service that was given away for free or they may use the database to market unrelated offerings.

BREAKING DOWN 'Lead Magnet'

When a customer signs up for a trial version or provides a name and other details for a free sample, they’ve effectively exchanged their information for a lead magnet. Sometimes the nature of this exchange is made explicit, but not always. As a result, some types of lead magnets have come under fire for their deceptive nature.   

Types of Lead Magnets

The most common type of lead magnet is the report/guide/tip sheet where the prospect gives over personal information for content that is not otherwise available. When it is a guide or resource, the exchange of information comes upfront. The contact information is often then used to put the prospects in a sales funnel where progressive contact nudges them towards an actual purchase. This type of lead magnet often makes an extreme claim in order to entice people into accessing the content. For example, “6 Foolproof Tips To Get A Six Figure Salary” or “8 Easy Renovations That Triple Your House’s Value.” These exclusive pieces are ideally unique, valuable content that are not publicly available. It is not unheard of, however, for the content to simply be ripped from various publicly available resources and repackaged. 

Another type of lead magnet is the quiz or survey, where the prospect may not realize that their email or other information will be needed to see the results. These are usually matched thematically with the type of lead the marketer is looking for. For example, a car dealership might have a survey titled “How Much Is Your Car Really Worth?” Someone looking to sell a car or upgrade will go through the survey only to find that the final result will only be sent to the email address they provide. 

Like most lead generation techniques, lead magnets can be used well or they can be abused. Marketers who abuse lead magnets may see success in growing their database, but the actual conversions are often lower as a result.