There’s a question that comes up constantly in the online business world: should you run a lead magnet funnel, or run ads direct to a low-ticket offer?
Most people will tell you to pick one. Or they’ll give you a theoretical answer based on what sounds good in theory.
We ran both. At the same time. For 90 days. With real ad spend and real results tracked across 30, 60, and 90-day windows.
And the answer is more nuanced than you might expect.
The Setup
Two campaigns ran simultaneously over the same 90-day period, with a similar number of people moving through each, and the same offer waiting at the end.
Campaign One: Lead Magnet Funnel People opted in for a free lead magnet, moved through an email sequence, and were sold a low-ticket product at the end. Total ad spend: $6,311 AUD. Total leads generated: just over 1,200. Cost per lead was around $4 AUD in reality (Facebook tends to overreport). The ROAS upfront was about 0.6 — not breaking even, but offsetting more than half the spend.
Campaign Two: Direct Sales Funnel Ads ran directly to that same low-ticket product. Total ad spend: $76,000 AUD (roughly $50,000 USD). Total revenue: over $160,000 AUD. ROAS close to 2. Around 1,100 sales — a similar number of people to the leads in the other campaign, which made this a genuinely useful side-by-side comparison.
The immediate result?
The lead magnet funnel made a $3,000 loss upfront. The direct sales funnel made a $75,000 profit.
But that was only the beginning of what we were tracking.
What Happened Over the Next 90 Days
The more interesting question wasn’t who won upfront. It was: what happened when those people moved further into the funnel?
Specifically — did someone who purchased a low-ticket offer convert to higher-level programs at a different rate than someone who came in through a free lead magnet?
We tracked this across three time windows using a custom dashboard, looking at sales of other programs and offers (not the original product) from people who came through each funnel.
Here’s what the numbers showed:
At 30 days, the lead magnet group produced 3 sales of other offers. The direct sales group produced 15.
At 60 days, the lead magnet group had made 9 sales. The direct sales group had made 37.
At 90 days, the lead magnet group totalled 15 sales. The direct sales group totalled 50.
That’s roughly a 3:1 ratio in favour of buyers over leads when it comes to ascending to other offers.
What This Actually Means for Your Business
The direct sales route won — and if you have the budget, the skills, and the appetite for risk, it won convincingly. Spending $76,000 to get back $160,000 immediately, plus 50 additional sales of other programs over 90 days, is a strong result by any measure.
But not everyone is ready for that. And that doesn’t mean the lead magnet route is the wrong choice.
For someone earlier in their business journey, a $3,000 investment that builds a list of 1,200 people and produces 15 sales of other offers over 90 days… actually puts you in profit. That’s around $1,000 a month and roughly 5 additional program sales per month. With the right expectations, that’s a very solid start.
The key phrase there is “with the right expectations.”
The lead magnet funnel isn’t slower because it’s broken. It’s slower because it’s lower risk. And for the right stage of business, that trade-off makes complete sense.
The direct sales funnel rewards you faster and bigger — but it requires a tested offer, some experience with paid ads, and a budget you’re genuinely comfortable with. Going in before you’re ready on any of those fronts is where things go sideways.
The Question Worth Asking Yourself
Before deciding which route is right for you, get honest about where you actually are:
Is your offer proven? Have you sold it before, and do you know it converts?
Have you run ads before? Even dabbling gives you a foundation. Going in cold with a big direct sales budget is a risky move.
What’s your appetite for risk right now? Both funnels can work. One just has a much higher upfront cost — and requires the skills and data to back it up.
The full breakdown of how each funnel performed, the tracking system used to measure long-term ascension, and a clearer picture of which route fits which stage of business is all covered in this week’s episode of the Doing It Online podcast.
Not sure which funnel strategy makes sense for where you’re at right now? Come and find us on Instagram and let’s chat.
DM @hellofunnels and we’ll help you figure out your next move.
P.S. Whether you’re at the lead magnet stage or ready to scale with direct sales — the system underneath both funnels is the same. And that’s exactly what we build inside our programs.
