For an IT reseller hungry for business, buying potential prospects may seem like a natural course of action to boost its customer base. But, in our experience, it’s rarely a worthwhile decision, with the results typically ranging from disappointing to disastrous.

Why Buying Leads Is Tempting

The main reason that channel partners buy potential prospects or subscribers is that it’s a cheap way for them to immediately gain access to hundreds or thousands of email addresses. The addresses are cheap both in terms of time and money. That stands in contrast to other methods of generating leads, which generally require substantial commitments of time and/or dollars.

Why Buying Leads Is a Bad Idea

It might be illegal

While the laws and enforcement vary greatly depending on country and jurisdiction, buying email lists often puts a business in a tenuous legal situation. In the U.S., for instance, buying lists is not illegal, but it’s possible that the entity selling the email addresses acquired them illegally. Businesses that sell lists often gather email addresses by “harvesting” them from various websites that have not volunteered to share their information. Sending an unsolicited email to a harvested email address is a violation of the CAN SPAM Act of 2003 and can result in a fine of up to $16,000.
It leads to poor engagement
The buyers being targeted in the world of IT sales are unlikely to engage with a marketing campaign from a sender they’ve never met or heard of. They likely receive dozens of marketing emails everyday from senders with whom they have no affiliation. Their past experience tells them that most of them are junk. Therefore, they’ll more likely than not treat a message from an unknown IT reseller the same way as the others: They will hit the delete key, or worse, report it as spam.

It can damage a reputation

There’s little worse in the world of marketing than developing a reputation as a spammer. People don’t like the idea of their email address being traded around the internet. As a result, even if some customers are gained from it, spam-style tactics can hurt a business’ image in the long-run. It can lead buyers who may have become customers to dismiss the reseller as a bottom-feeder.
On a practical level, if a large number of those receiving the campaigns report them as “spam,” the partner risks being blacklisted by major email services, such as Gmail, meaning that the partner’s future emails will be automatically directed to the recipient’s Junk Mail. Getting off of blacklists can be very difficult.

The Advantages of Organically Grown Leads

An organically-grown list is made up of prospects who have a connection with the partner or have signaled an interest in the channel partner’s products. The most important, of course, are former and current customers. However, organic leads may also be those who interact with social media content provide by the partner or visited the partner’s website and signed up for its newsletter. These are the types of leads that Extu has proven experience generating by providing partners with high-quality content to use in digital marketing campaigns and on social media.

High quality

It may take longer for a channel partner to grow its leads organically, but those it acquires will be of much higher quality. In other words, they’re much more likely to become a paying customer. That’s because organic lead generation focuses on targeting those who have either demonstrated an interest in the partner’s product (by clicking on a blog post, opting into a marketing campaign, etc.) or who have a connection to the channel partner in some way, such as a mutual business relationship.

High engagement

Another advantage of organically grown leads is the degree of engagement the channel partner will see from its marketing outreach. Monthly newsletters will have higher open and click-through rates than the industry average. Prospects are far more likely to attend webinars and events when the invitation comes from a source they already trust. Most important of all, promotions and call-to-actions will see higher-than normal conversion rates, resulting in a far better return on marketing investments.

Always legal, always ethical

When channel partners are generating leads on their own and have full control over the sourcing of the email addresses, they can be sure that everything they’ve acquired is legal. As a result, a partner does not have to deal with the threat of being “blacklisted” as a spammer.