18 June 2024 | By - Sudha Mariappan

In the diverse field of digital marketing, it is important to note that capturing future customers’ attention as well as collecting their contact details can be quite helpful in making lasting relationships and driving sales.

To get those contact details from users, marketers use an old trick known as a lead magnet.

In other words, a lead magnet is a piece of highly engaging material that you can offer to those who are willing to submit their personal information.

This material includes special webinars or e-books that are only available when subscribed to, usually in the form of an email address.

In this blog, let’s discuss what a lead magnet is, how it incentivizes sign-ups and why businesses use them.

What is a Lead Magnet?

A lead magnet is an incentive or a small piece of content that will attract future customers by offering something for free.

It's free, though it requires visitors to provide contact information in exchange.

It's a tool that helps generate leads for a business by giving future customers a reason to share their email addresses or other contact information.

For example, Flipkart often gives out free coupons or access to sales a day before, if people subscribe to their newsletter.

In this way, they capture the potential buyer but can further engage them with regular email updates.

Similarly, UrbanClap, which is an Indian-based home services booking platform, is helpful since the company provides consultation services for free in exchange for the target's contact information for those who may need home maintenance or renovation services.

The lead magnet primarily draws the leads and captures them to get a database where businesses can target customers who'd be interested in their offer.

It's one of the starting points of every customer journey, where businesses need to get leads by achieving target marketing efforts and making them loyal customers.

How to Incentivize Sign-Ups:

It is a process of offering some type of content that will obviously be considered valuable by the audience and making them feel it's worth giving their contact details in exchange.

The offer should align with some need or interest on the part of the target audience.

Which is a successful approach by means of exclusive content.

For example, BigBasket, the biggest online grocery vendor in India, offers exclusive recipe eBooks or meal planning guides for whoever subscribes to their email list.

It's just the type of content that is of importance and real utility to their target audience, which is going to drive those sign-ups. One of the most motivating incentive strategies you can offer is to reward a sales rep with additional paid leave.

Other ways are through discounts and special deals. Nykaa generally runs some discount and limited-time deals on beauty care products as offers to newbie subscriber users.

Giving instant savings with special offers always interests the users in subscribing to their list, and this way, the customer base is sure to increase alongside sales.

Another strong motivator you can use is to offer free trials or demo services. For example, Byju's is a huge educational institution that offers free trial classes or demo sessions for their educational programs.

When one gets to try before buying, the chances are there will be more sign-ups and eventually the conversions will spike from leads to customers.

Also, by linking lead magnets with your targeted audiences’ needs and preferences, your business can motivate appropriate sign-ups by growing more email lists with genuinely interested leads.

Why Businesses Create Lead Magnets:

Why do businesses create lead magnets? The motives are in several forms, and they circulate around a business to capture prospective customers. Businesses create lead magnets to increase conversion, which ultimately helps them scale up the business.

Lead magnets are the cornerstone of any business lead generation strategy. It holds a lot of advantages:

Firstly, they grow email lists. A strong email list is important in order to directly communicate with the target audience, making sure to have personalized or targeted messages that drive engagement and conversion. Here are some easy ways to collect email addresses, that you can utilize in marketing to increase conversions.

For example, Swiggy runs its promotional codes and offers very frequently as lead magnets to increase subscribers. This definitely facilitates Swiggy in building up more and more subscribers, but it also helps users be glued to updates and offers.

Source: Pinterest

Secondly, when a valuable piece of content or resource is offered free of charge, a business proves its worth. You can build solid credibility with this strategy.

For example, Zomato provides detailed guides on restaurants or discounts on dining out for their subscribers as a strategy for lead generation.

This plan is useful in drawing prospective customers, and it positions Zomato as the information market leader in the food and dining sector.

Finally, lead magnets provide an opportunity for businesses to segment their audience. By keeping track of which particular lead magnet's audience signs up for, companies get some valuable information into the needs and behaviors of their customers.

This helps them get targeted and personalized in their marketing efforts in the future. For example, ClearTax is an Indian tax filing and financial services platform that runs very different lead magnets, from tax-saving guides to investment tips. So to get leads for all kinds of audiences, they target people who want to save on taxes and people interested in financial planning.

Lead magnets are a powerful and versatile tool with which a business can attract leads, build relationships, and make sales, specifically through focused marketing efforts.

How to Build an Effective Customer Persona to Know Your Ideal Customer:

A lead magnet in practice goes through a number of steps, all of which are quite important for getting more customers and leads. Normally, this would include the creation of the lead magnet, then promoting your brand, capturing your leads with the lead magnet, and following up later on.

Creating the Lead Magnet:
This will involve the lead magnet being designed with regard to the needs and interests of the target audience.

For example, in the case of the leading Indian online travel company MakeMyTrip, travel guides, checklists, special travel deals, or any other travel related information may act as their lead magnets. All these resources give real value to their target audience, either in the form of worthwhile know-how or discounts that can make the process of planning trips easier and more cost-effective.

Promoting the Lead Magnet: Once a lead magnet has been created, it needs to be promoted so that it is within the visibility domain of your target audience.

This could be through websites, social media, email campaigns, or online advertisements. BookMyShow is India's biggest online ticketing platform that pushes lead magnets like free movie vouchers or event discounts through its website and social media channels to acquire new users and get them to sign up.

Capturing Leads: The process now proceeds with the sign-up form capturing user contact information in exchange for the lead magnet.

This form should be simple and to the point. It should collect basic information, such as a name and email ID. Paytm has a similar strategy where it came up with forms offering cashback or some exclusive deal on transactions, and it lured users to share email IDs.

Follow-up:
Generating leads is just one step in the lead capturing strategy, but retaining customers is more important. In this step, it includes mailing a copy of a lead magnet that will open up a series of follow-up emails so that the subscribed customer gets to have the latest information from time to time.

It may include a welcome email to make your subscriber feel welcomed, then explain your brand through an informative email or personalize your brand offers according to the tastes of your customers. For example, in Amazon India, follow-up emails with recommendations or promotional emails are sent based on the user's first activity against its lead magnet.

In practice, a well-designed lead magnet can be the key to significantly improving the number of leads who can turn into loyal customers and retain them in the long run.

If you need any assistance regarding email marketing, creating lead magnets, or acquiring lead generation, connect with us at info@ontogendigital.com. Subscribe to us for more blogs.