The short answer
Exclusive, for anything residential and monitored, and the margin is not close. A shared home security lead costs $30 to $80 and an exclusive one costs $80 to $150 or more, so the sticker gap is roughly $70. The gap that actually decides it is the recurring monthly revenue you sign, because your company is valued at 25 to 50 times that number rather than on the install ticket.
Every other trade compares these two lead types on close rate. In alarm, close rate is the smallest of the three things a shared lead takes from you. It also takes the monthly rate and the contract term, and both of those get multiplied by 25 to 50 on the day you sell.
The metric this decision runs on
Alarm companies are bought, financed and benchmarked on recurring monthly revenue, and transaction pricing is unambiguous. Michael Barnes of Barnes Associates, presenting at ESX and reported in the August 2025 issue of Security Business, showed that in 2024 companies with less than $50,000 of RMR sold at an average of 36 times monthly revenue, while companies above $500,000 averaged 46 times. CT Acquisitions, updating its alarm valuation guidance in April 2026, puts residential monitoring on multi-year contracts at 35 to 50 times RMR, small commercial at 32 to 45, and month-to-month accounts at 50 to 70 percent of the multi-year multiple.
By the numbers
Barnes flagged rising net RMR creation multiples as the industry's most concerning metric, noting that creation costs increased in 2024 as companies reinvested through increased marketing spending, sales hiring and competitive pricing. That is a precise description of what buying shared leads does to a dealer. The industry has already run this experiment at scale.
So the question is never "which lead is cheaper." It is: what does each channel cost me per dollar of RMR created, and how good is the RMR it creates.
What each type actually costs
Published pricing across the home security category is consistent enough to work with.
| Lead type | Cost per lead | Sold to | Typical close rate |
|---|---|---|---|
| Shared broker lead | $30 to $80 | 3 to 5 dealers | ~10% |
| Exclusive broker lead | $80 to $150+ | You only | 25% to 35% |
| Exclusive inbound call | ~$65 per qualified call | You only | ~35% |
| Pay-per-click | $50 to $200 | You only | Varies by page |
| Google Local Services Ads | $40 to $120 | You only | Varies by market |
The exclusive call numbers come from a pay-per-call network reporting a 35 percent conversion rate on home security calls, an average call length of about seven minutes, and a competitive bid around $65 for a qualified 90-second call. The same source puts local call leads at 25 to 40 percent conversion against roughly 2 percent for online form fills. That spread between a phone call and a form is doing more work in this table than the word "exclusive" is.
One caution on vendor claims. A well-known exclusive pay-per-call provider advertises that its contractors set appointments on 70 to 80 percent of the leads it generates. That is an appointment-set rate on inbound calls, not a signed-monitoring rate. Every exclusivity vendor quotes the metric furthest from a signature.
The arithmetic that matters, worked
Here is the calculation almost nobody in this category runs, because it only exists in trades that sell recurring revenue. Your real unit is not cost per lead or even cost per job. It is lead cost as a multiple of the RMR it creates:
creation multiple from lead cost = (cost per lead / (close rate x attach rate)) / monthly RMR signed
Attach rate is the share of closed jobs that actually sign monitoring. Run both channels through it with honest inputs.
Shared lead. $50 per lead, 10 percent close rate, 60 percent attach rate because a share of the wins are camera-only jobs from a homeowner who was comparing four quotes, and $32 monthly because you met the lowest caller somewhere in the middle.
$50 divided by 0.06 is $833 per created account. Against $32 of RMR that is 26.0 times.
Exclusive lead. $120 per lead, 30 percent close rate, 85 percent attach rate because you are the only conversation and can lead with monitoring rather than defend a price, and $45 monthly at your rate card.
$120 divided by 0.255 is $471 per created account. Against $45 of RMR that is 10.5 times.
Watch out
Look at what 26.0 times means. If your total creation budget is around 30 to 36 times RMR, covering the panel, the sensors, the communicator, the technician's day, the sales time and all advertising, then shared leads have consumed 72 to 87 percent of the entire budget before anyone opens a toolbox. That is not an expensive channel. That is an account you should decline to create.
Now invert it. What could you pay for the exclusive lead and still be no worse off than the $50 shared lead? Solve for the price that lands the exclusive channel at 26.0 times:
26.0 x $45 x (0.30 x 0.85) = $298.
Against a $50 shared lead, exclusivity in this trade is worth roughly $298 per lead. Almost no vendor charges anywhere near that. Which means the $70 sticker premium you have been resisting is priced at about a quarter of what it is actually worth, and the cheap lead is the expensive one by a factor of nearly two and a half.
The reason most dealers cannot run this calculation is that their system records jobs booked, not RMR attached per source. A CRM that reports created RMR, attach rate and average signed rate by lead channel answers this in one quarter instead of one exit. We build that.
The discount is a balance sheet event, not a margin event
This is what separates alarm from every other trade a lead broker sells into. When a roofer discounts to beat two other bidders, they lose margin once and move on. When you drop the monthly from $45 to $32 to beat the three other alarm companies dialling the same homeowner, you lose $13 every month for the life of the account, and then lose it again at a multiple when the company changes hands.
| Monthly concession | Annual revenue lost | Enterprise value lost at 36x | At 45x |
|---|---|---|---|
| $5 | $60 | $180 | $225 |
| $10 | $120 | $360 | $450 |
| $13 | $156 | $468 | $585 |
| $20 | $240 | $720 | $900 |
Two hundred accounts signed at a $13 concession is $93,600 of company value gone. That is more than most dealers spend on marketing in a year, and it never appears on a marketing report because it is not an expense. It is an asset that was never created.
The homeowner side of this is easy to observe. In one r/homesecurity thread, a homeowner quoted $50 per month by ADT plus a $50 reactivation fee asked whether that was normal. Within 49 comments the crowd had produced counter-quotes at $22, $20, $19, $18.50, $15 and $8.95, one commenter noting they pay $4 to $7 wholesale and resell at $15 to $20. The verdict: "$50 a month is ridiculous."
That thread is what a shared lead does to your quote, compressed into an afternoon. The exclusive lead is not immune to it, but it does not manufacture it on purpose.
Contract term leaks more than close rate does
Here is the second-order damage, and it is bigger than the first.
A homeowner fielding four calls has leverage on more than price. The concession that closes a competitive alarm deal is very often not a lower rate, it is no long-term agreement. That feels harmless in the moment. It is the single most expensive thing you can give away, because month-to-month accounts trade at 50 to 70 percent of the multi-year multiple.
Run the same $32 account both ways. On a three-year agreement at 36 times, it is worth $1,152. Month-to-month at 60 percent of that multiple, roughly 21.6 times, it is worth $691. The $45 exclusive account on a multi-year contract is worth $1,620.
Same trade, same van, same install week. The asset you created is 2.3 times larger on the exclusive lead, and the entire difference came from who else was on the phone.
The third leak: accounts won on price do not stay
Attrition is where the compounding finishes. The industry standard for gross attrition sits around 10 percent annually, and keeping it at or below that level is the baseline for building company value.
The valuation ladder is steep. Sub-5 percent annual attrition supports 40 to 50 times RMR. Eight to 12 percent supports 32 to 40 times. Twelve to 18 percent supports 25 to 32 times. Above 18 percent, most account books become unsellable to institutional buyers.
An account acquired because you were the cheapest of four callers is, by construction, an account whose owner optimises on price. Barnes reported that dealers implementing 3 to 4 percent annual price increases saw minimal attrition impact, and that customer acceptance has been higher than expected. That pricing power is real, and it is exactly what a price-won account does not give you. Your rate increase is the moment they go shopping again.
The flip side of the same data: smaller companies consistently show lower attrition than larger competitors, because personalised service and local knowledge retain accounts. Buying shared leads is a decision to compete on the one axis where the nationals beat you and abandon the one where you beat them.
"Exclusive" means four different things in this trade
Before you pay the premium, establish which one you are buying. The word is used for all four.
- Exclusive to you, permanently. Sold once, never resold. This is what you want, in writing.
- Exclusive for a window. Sold to you first, then resold as an aged lead after 30, 60 or 90 days. Your monitoring pitch reappears in a competitor's dialler at the exact moment a hesitant homeowner is ready.
- Exclusive to a territory. One dealer per postcode. Fine rurally, meaningless in a metro where your coverage spans nine adjacent zones sold to nine other dealers.
- Exclusive inbound call. The strongest version, because the buyer initiated it and only your phone rang. This is where the 35 percent conversion figures come from.
Ask two questions vendors rarely get. What is your resale policy on unworked and unanswered leads, and will you show me the source page and consent record for any lead I dispute.
If you cannot answer "what did this vendor do to my average signed rate and my contract mix," the exclusivity question is unanswerable and you are guessing with a multiple attached. We fix that reporting first, then the channel decision makes itself.
Exclusive lead does not mean exclusive buyer
The most expensive assumption in this category is that an exclusive lead is an uncontested one. Exclusivity is a contract between you and the vendor. It says nothing about the homeowner's browser.
SafeHome's 2026 Home Security Market Report, a survey of 2,435 US adults published in April 2026, is blunt about the buyer you are calling. Forty-nine percent of alarm users installed the system themselves. Ease of use was the top decision factor at 50 percent, monthly cost was second at 46 percent, and ease of self-installation third at 31 percent. Only 5 percent of non-users said they were interested in professional monitoring in the next 12 months. Barnes's segment data agrees: residential and small business intrusion and fire is growing at only around 3 percent.
So exclusivity solves a competitor problem, not a category problem. The homeowner on your exclusive lead has still read the comparison sites and still knows a $20 self-install option exists. What exclusivity buys is the chance to run your own conversation, which is the only condition under which the monitoring case can be made at all. Necessary, not sufficient. The channels that produce buyers with a trigger rather than a shopping list are ranked in best lead sources for security alarm companies.
The consent question nobody asks their vendor
Shared leads have a structural feature that has nothing to do with conversion: they normally rest on one consent form naming a list of partner sellers. You are one of the names.
The FCC tried to end that. Its December 2023 order required consent to name no more than one identified seller, explicitly to close what it called the "lead generator loophole." On 24 January 2025, a unanimous Eleventh Circuit panel vacated the rule in Insurance Marketing Coalition v. FCC, holding the Commission had exceeded its statutory authority because the restriction conflicted with the ordinary meaning of prior express consent. The FCC formally repealed it in a final rule in September 2025.
Note
The 2012 prior express written consent standard still applies. What changed is that bundled multi-seller consent is lawful again, so no regulator is filtering your lead vendor's paperwork for you. Some carriers and messaging platforms still enforce one-to-one as a business rule regardless.
This is a practical point, not a legal lecture. When four dealers dial the same record, the homeowner gets four calls from a bundled consent they barely remember giving, and the complaint attaches to whichever named seller was rudest or last. Exclusive leads are not automatically cleaner, but there is one company to trace back to, and requiring a source page and a timestamped disclosure naming your business is far easier when you are the only buyer.
When shared leads are genuinely the right buy
They are not universally wrong. They are wrong for the specific transaction most dealers buy them for.
- Commercial and fire enquiries. A $150 per month account carries roughly a $4,500 creation budget at 30 times. A $60 shared lead at a 10 percent close is $600, which is 13 percent of budget rather than 87 percent.
- Takeover, service and reactivation. No panel to fund and no rate to defend. The creation-multiple maths does not apply.
- Genuinely idle install days. If the technician is paid and the truck is parked, thin margin beats no work. That is schedule filling, not pipeline.
A business development lead at a Philadelphia-area security integrator, posting in r/lowvoltage, listed his two problems plainly: "avoiding price-only comparisons" and "standing out when everyone does cameras and access control." Shared leads are a machine for producing the first one.
A 30-day test scored on the right numbers
Do not test these channels on close rate. Test them on what they create. Run both for 30 days, tag every lead by source, and record five fields per closed deal.
| Field | Why it is on the list |
|---|---|
| Monthly RMR signed | The concession shows up here first, and it is the multiplied number |
| Contract term | Month-to-month costs you 30 to 50 percent of the multiple |
| Monitoring attach rate | Separates real accounts from hardware-only jobs |
| Cost per created account | Lead spend divided by monitored accounts, not by jobs |
| 90-day cancellation rate | Early churn signals a price-won account |
Then compute the number that decides it: cost per created account divided by average RMR signed. Above about 12 times on lead cost alone, the channel is eating a third of your creation budget and has to justify itself. Above 20 times, stop buying.
Two dealers can report identical cost per lead and identical close rates and be running completely different businesses, because one signs $45 on three-year agreements and the other signs $30 month-to-month. The ceiling behind those budgets is worked through in how much do security alarm leads cost, and the same comparison without any RMR to protect looks very different, as the HVAC version shows.
The bottom line
Buy exclusive for residential monitored work, and be willing to pay far more than the market asks for it. The break-even premium against a $50 shared lead is close to $300 per lead in this trade, because exclusivity protects three things at once: the odds of winning, the monthly rate you sign, and the contract term you hold. Shared leads attack all three and then hand the damage to a 25 to 50 times multiple.
Use shared leads deliberately and narrowly, for commercial, for takeover and service, and for filling days you have already paid for. Everywhere else the cheaper lead is the one that quietly costs the most, and the invoice arrives years later at valuation. If you do keep buying shared, the one lever that still moves the odds is how fast you respond to a lead.
Sources
- Barnes Associates ESX keynote, reported in Security Business magazine, August 2025 issue: industry size, 2024 transaction multiples of 36x and 46x, rising net RMR creation multiples, segment growth rates, attrition and pricing power. securityinfowatch.com
- CT Acquisitions, Alarm Company Sale or Acquisition: RMR Multiples in 2026, updated 27 April 2026: RMR multiples by account type, attrition ladder, month-to-month discount. ctacquisitions.com
- Acquisition and Funding Services, Attrition in the Alarm Industry: gross versus net attrition and the 10 percent industry standard. afssmartfunding.com
- Home Security Lead Generation: Cost Per Lead and ROI: shared, exclusive, PPC and Local Services Ads price ranges and the price-shopping mechanic. nizamuddeen.com
- Soleo, How Home Security Businesses Win with Pay-Per-Call: 35 percent conversion on home security calls, 25 to 40 percent call conversion versus 2 percent form fills, roughly $65 competitive bid. soleo.com
- 33 Mile Radius, Home Security Leads: the 70 to 80 percent appointment-set claim on exclusive inbound calls. 33mileradius.com
- SafeHome.org 2026 Home Security Market Report, survey of 2,435 US adults published April 2026: 49 percent self-install, 46 percent monthly cost as a decision factor, 5 percent professional monitoring intent. safehome.org
- Kelley Drye, Eleventh Circuit Vacates TCPA 1:1 Consent Rule, on Insurance Marketing Coalition v. FCC, 24 January 2025. kelleydrye.com
- Goodwin, The FCC Issues Final Rule Formally Eliminating the One-to-One Consent Requirement, September 2025. goodwinlaw.com
- r/homesecurity, "Is 50 bucks a month high for just monitoring?": homeowner counter-quotes from $8.95 to $30 against a $50 ADT quote. reddit.com
- r/lowvoltage, "Lead gen and winning jobs": a Philadelphia-area integrator on price-only comparisons. reddit.com