Lead Value Calculator
What one lead is worth — and the most you can pay for it.
Your numbers
Profit value per lead
₹2,400
Revenue per lead
₹4,000
Max CPL (break-even)
₹2,400
Target CPL (3:1)
₹800
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Definition
Lead value is what one enquiry is worth to you on average, before you know whether it will close. Multiply your average gross profit per customer by your close rate. It is the number that turns cost per lead from a bill into a judgement about whether you are buying profitably.
The formula
Lead value = Average gross profit per customer × Close rate
Gross profit, not revenue, and close rate measured from enquiry to sale rather than from qualified opportunity. Using revenue and a flattering close rate is how businesses convince themselves an expensive channel is affordable.
A worked example
A Delhi NCR modular kitchen business
- 1Average project value: ₹3,20,000. Gross margin about 32%, so ₹1,02,400 of gross profit.
- 2Of every 100 enquiries, roughly 9 become projects — a 9% close rate.
- 3Lead value = ₹1,02,400 × 0.09 = ₹9,216.
- 4They had been refusing to pay more than ₹2,000 per lead.
Every enquiry is worth ₹9,216 on average. At a 3:1 return they could pay up to ₹3,072 per lead and still be comfortably profitable — which unlocks auctions and channels they had ruled out on instinct.
How to move the number
Raise close rate, not just lead volume
Close rate multiplies directly through lead value. Moving from 9% to 12% raises what every lead is worth by a third, and makes previously unaffordable channels profitable overnight.
Value leads by source
A referral and a cold display click do not close at the same rate. One blended lead value hides which channels deserve more budget and which are quietly subsidised.
Feed lead value back into the ad platforms
Passing a modelled conversion value to Google and Meta lets their bidding optimise toward revenue rather than raw lead count — usually the single highest-return tracking change available.
Where people get this wrong
- Using revenue instead of gross profit, which overstates lead value by the whole cost of delivery.
- Measuring close rate from qualified opportunities rather than from all enquiries, which inflates it substantially.
- Applying one lead value across sources that close at very different rates.
- Setting a cost-per-lead ceiling from gut feel rather than from this calculation — almost always far too low.
Lead Value Calculator — questions we get
How do I work out my close rate?
Take a fixed period, count every enquiry that arrived and count how many became paying customers, allowing for your sales cycle. Enquiries from January judged in January will understate it if your cycle is sixty days.
What if my deal sizes vary enormously?
Segment. Calculate lead value separately for the small and large segments, because a blended average that sits between two clusters describes neither and will misprice both.
How does lead value set my maximum cost per lead?
Divide lead value by your target return. At ₹9,000 lead value and a 3:1 target, ₹3,000 per lead is your ceiling. Anything under that is profitable; the ceiling is usually much higher than businesses expect.
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