Lead generation

Is there a hidden downside to lead generation?

by Kevin Hawkins on December 16, 2015

Real estate lead generation research tells us only about 1 or 2 percent of all purchased online leads become transactions. Another way to say that is 98 out of 100 times, an agent fails to turn a lead into a client, or 98 times out of 100, they are being rejected. Yet, the conventional wisdom in real estate is that you only need to turn one lead into a transaction to pay for all the leads you’ve purchased this year many times over. But is there a problem with this logic? Is it looking at only one side of the equation, that is, the upside? But isn’t there a downside once one considers all the collective human capital that is expended to find that one needle in the proverbial lead generation haystack? Is lead generation also creating a tremendous waste of human intelligence? The cost of human rejection Most of us probably don’t think too much about the impact of the massive rejection that online lead generation is creating in real estate today. There is a reason we have robo-calls and don’t have door-to-door sales anymore: As humans, it’s tough to tolerate this kind of continuous rejection. It’s likely the main reason why sales call centers have incredibly high turnover rates. When someone hears “no” 99 times out of 100 calls, it has to be demoralizing. Is it really any different in real estate? A UCLA-lead team of psychologists found that two key areas of the brain appear to respond to the pain of rejection in the same way as physical pain. The study’s lead author, Naomi Eisenberger, told ScienceDaily, “There’s something about exclusion from others that is perceived as being as harmful to our survival as something that can physically hurt us, and our body automatically knows this.” We know rejection is painful, yet real estate subjects tens of thousands of hard-working real estate agents to this process all the time. Is it any surprise, taking these numbers into consideration, that real estate agents struggle in following up on all the leads their brokers give them? (See this WAV Group study.) One has to wonder if online lead generation isn’t contributing to weakening teams and agents. Breaking bad habits An argument can be made that the correct way to handle this type of lead generation is to use employees and agents who are independent contractors to handle these leads […]

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Brokers and Franchise Remove Barriers to Marketing

by Victor Lund on October 14, 2014

Marketing is a key component to success in real estate. I hate stating the obvious, but if you don’t start with it, one can hardly understand the reality of the impact that the cost of marketing has on the adoption and utilization of marketing plans by various segments of real estate professionals. Franchise giant RE/MAX announced an agreement with Imprev for marketing solutions. You can see the program in the video below. In the past, the fee for access to these marketing tools was $299 per year. For the sake of argument, lets presume that the pricing is fair. Judging from our appraisal, it would be a fair price at $1000 per year. That is where the price barrier comes in. RE/MAX just launched the Imprev program for free – no cost to the agent. Here is why. Top producing agents do not blink at $299. That is the cost of dinner for two and a bottle of wine at a nice restaurant. Agents who do transactions every month or two are always marketing and they use the tools provided by the franchise and broker and flourish other marketing plans over the top as their secret sauce. This is the top 20% of agents in real estate. The middle 60% of agents in real estate do somewhere between 3 and 10 transactions a year. This is a mixed bucket. Some use the marketing programs and some don’t. In truth, it depends on the economic vitality of the household at the time when the marketing investment is demanded. Some of these agents will make the investment. Others will hold off and hope for the best. Still others will totally ignore it and not do any marketing that is not free. The bottom 20% of agents is the worst group at adoption of marketing solutions. They are broke, or only do real estate part time. They do between 0 and 3 transactions per year. So, why did RE/MAX go with free marketing? Because, marketing works and it works every time. It is good for the brand, good for the agent, good for the broker, and amazing for the consumer. RE/MAX is raising the bar. In truth, they are matching programs offered today by other franchise brands too. It keeps them competitive. The philosophy of RE/MAX has always been to keep costs low and commissions high. This fits, even if it burdens profits […]

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And the Lead Goes Round and Round

by Victor Lund on September 23, 2014

I had a rather interesting conversation about lead management and lead sales today. The story went something like this. A broker enhances listings and purchases zip code leads from a portal. The broker believes that there is some form of exclusivity on the leads generated through the system in so far as the lead is only distributed once. In his case, he distributes the leads as they come in to one of his agents. To test the system, the broker had a staff member go to the publisher site and generate a lead. The lead came through to the broker as promised. However, the broker (pretending to be a consumer) also got a call from a mortgage company to pre-qualify for a loan. During the call with the loan officer, they suggested that he work with one of the mortgage company’s network of agents and asked if he needed help finding an agent. To the broker, that caused the lead to be “sold” twice. He was rather upset. The portal takes the lead that they provided to the real estate agent and also sells that lead to the mortgage company. In this case, the mortgage company also has a lead network where they take leads that they generate for mortgage and provide that lead to a real estate agent partner. So the same consumer lead went to the publisher’s broker partner and the mortgage company’s broker partner – one lead just became 3 – 1 to the publishers premium broker; one to the mortgage company (unbeknownst to the premium broker); and again to the mortgage company’s real estate agent network. Poor consumer gets hit 3 times just for asking if the fireplace is wood burning or gas. I do not see that the portal sold the lead twice – so in my opinion, the portal is not undermining their product sold to the brokerage. But they may be conspicuous if they are not telling the premium brokerage that they are selling the lead to other home services companies like the mortgage firm. The publisher probably just said that they only sell the lead to one real estate broker/agent. In 2009, WAV Group did an analysis of the “fine print of listing syndication.” The paper can be viewed here http://waves.wavgroup.com/2009/11/10/listing-syndication-be-sure-to-read-the-fine-print/. The take away is that, unless you have a well crafted agreement with a publisher, all of your content – listings […]

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Your Spam Filter May Be a Lead Source

by Victor Lund on July 23, 2014

Leads sometimes come from humans. That’s a light joke. The point it is that when technology companies test lead capture and routing systems, they typically test them with stock lead content. Unfortunately, many real human leads do not contain stock text. Real humans write real questions and sometimes use language that may not be white listed for your spam filter. **It happens! One of the good ways to check your lead generation and delivery engine is to compare reports. Look at the lead reports that you get from publishers like Trulia, Zillow, Realtor.com or Homes.com. Look at them carefully and pull a sample set of the leads and check your lead delivery tool to see if they made it through.  Every broker I speak to tells me that the leads reported from publishers are always higher than the portals’ lead count in the broker’s back office system. Where did the leads go? They probably went into the spam filter. In January of 2014, WAV Group released what is believed to be the largest study of lead responsiveness : If you did not get a chance to read it – please do. http://waves.wavgroup.com/2014/01/13/agent-responsiveness-study-reveals-critical-flaws-in-real-estate-lead-response/. The observations are pretty bleak. 48% of buyer inquiries were NEVER responded to Average response time was over 15 hours. Could the spam problem really be that big? Probably not, but it may be significant in your business. Check your spam filter to find out. You may realize that your spam filter has a bunch of leads in it. When you find false positives in your spam filter, it is important to train the filter to let those emails through. One broker we know took the drastic measure of blocking email from a company that was pounding their agents with sales and marketing information. When they did that, they did not realize that they would also be compromising or blocking all of the leads from that company. OOPS! Brokers are becoming more and more like technology companies every day. Keeping pace in this ever changing world requires that brokers have a good understanding of how technology works – or employ staff or advisors that do. If you are lacking this in your business, you better consider a plan to fill that void sooner rather than later. Somehow I don’t think that technology is going away anytime soon. p.s. be sure to test leads generated on company listings and […]

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What is Your Lead Conversion Strategy?

by THE WAV GROUP on July 9, 2014

This is a guest post sent to us by Carl DeMusz of NORMLS – https://www.linkedin.com/pub/carl-demusz/4/749/249 Real estate markets are cyclical and change with the economy. They tend to be closely linked to employment which is also impacted by the economy. We have often observed times when the housing market can lead the economy out of recession. One thing that helps improve the housing market is a well-informed consumer who realizes that while housing markets are cyclical they always recover. They know that if they buy a home and hold on to it, the value will rise over time simply because people need homes to live in and buildable land is in short supply. Here, the laws of “supply and demand” eventually kick in. That is why for most Americans their home is their most valuable possession. Did you know the most qualified buyers are usually the most impatient when it comes to finding their home? These are the buyers who web search a listing, find ones they are interested in and want facts on the property as quick as possible. How fast are you at responding to an Internet Inquiry? Response time is so important that the WAV Group, a Professional Consulting Firm, did a study of real estate agents responsiveness. I’ve posted a few of their results below. WAV Group evaluated agent responsiveness this year by becoming a homebuyer lead across hundreds of brokerages in 11 states. Our findings may shock you. • 48% of buyer inquiries were NEVER responded to • Average number of call back attempts after the initial contact was 1.5 • Average number of email contact attempts was 2.07 • Average response time was 917 minutes (or 15.29 hours) Agent Responsiveness Study Download Report: http://s3.amazonaws.com/mtssdhosting/wavgroup.com/wp-content/uploads/2016/03/15085006/AgentResponsivenessStudy2013Final.pdf The worldwide web is a great tool for advertising plus a whole lot more. We can help you increase your lead conversion rate by speeding up your response time to consumer inquiries. Another valuable tool available to NORMLS members working with consumers is the Client Portal in the Matrix system. Each day hundreds of thousands of listings are viewed by consumers through our Client Portal right here in Northeast Ohio. If you are a NORMLS member and are not currently setup to use the Client Portal, I would be remising if I didn’t mention the “GoNEOHREX Mobile App”. This App is available for iPhones/iPads as well as android and tablets. If […]

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Increase Home Listings By 27 Percent

by Victor Lund on May 30, 2014

How would you like to increase your business garnered from your website by 27%? That’s right, 27%. I had to say it again because people often do not believe in testing or research to determine what works best for their business. In fact, many companies today “take the high road” and completely ignore trends and tactics that can improve their business because they get stuck with their fondness for what they have and stop moving ahead. Here is the example of how research and testing can drive improvements in company online effectiveness. Thankfully, the company the largest broker in the Neatherlands, so we can avoid domestic conflict.   The company did A – B testing on their website. For some visitors, they added a java script popup window that asked a question – “We are so pleased that you are considering using us as your broker. Could you tell us why you would choose our services?” The rest of the consumers saw the site with out the java script popup. Interestingly enough, if you spend much time on Zillow or Trulia – you will find that they are constantly A-B testing their site features by diverting some of their traffic over to test sites. The results of adding the popup were overwhelming.  The popup window increased home listings by 26.6%! The popup loaded 90 seconds after the visitor landed on the website. The coolest part is that they did not use it to drive traffic to a lead conversion form. They simply asked the consumer to make a self-commitment to the broker – also called a ‘self-generated” persuasion effect. It sets the consumer in more of a conversion-oriented mindset. Ok – on your marks, get set, go. Implementing this exact tactic is super easy. Java Script light boxes that pop up are cross browser compliant and mobile friendly. You can even get the code for free by doing a search for Java Light Boxes – I think the first result is Fancybox – which we have used and it is super easy. You simply design your box and paste the code into your site like adding a youtube video. It is that easy. If you use an open source website platform like Joomla or WordPress, you can find lots of plugins that do the same thing. This single idea can boost your online effectiveness by 26.6% if your results are […]

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Agents Only Get 12 Leads a Year

by Victor Lund on January 21, 2014

Returning from the Real Estate Connect Conference (aka Inman NYC), you would think that any agent or broker who is not 100% dedicated to cultivating the online customer is doomed. Yet surprisingly, nothing could be farther from the truth. In fact, if you read between the lines of a recent press release from Realogy, the global leader in size for a real estate group, your take away might be that online marketing and lead generation is a complete distraction and waste of time and money. Headline: Realogy’s LeadRouter System Delivers Record 3 Million Online Leads to Its Affiliates in 2013, an Increase of 13% from Prior Year About Realogy Holdings Corp.: 244,000 independent sales associates Do some quick math and you will see that each sales associate gets about one lead per month. This is in no way a critique of REALOGY. Their LeadRouter system works just fine, and it manages leads from 20,000 offline and online sources. That is quite a wide swath of marketing. Simply stated, lead capture and lead routing volume is not enough to build a business on. It’s not even close. At Inman, I stood next to Ben Kinney. His “team” sells about 500 homes per year at a production volume of $100 million in a very competitive market. His secret – 50 calls and 50 emails a day. His goal for lead conversion is to close two transactions out of every 100 leads. Most agents are lucky to do one closing from every 100 leads. Some really smart people have figured out that there is no ROI on chasing online leads, but they do it anyway because you cannot have a rational conversation with an agent or a seller about it. So many people live in a fog that makes them believe that the Internet sells homes. Nothing could be further from the truth. Century 21 put out a press release about their website being the number one brand website for real estate traffic. Clearly they get their share of leads that sells some homes. But what it really sells is franchises, helps franchisees recruit and retain agents, and sounds spectacular in a listing presentation. The moral to this story is that nobody should build a business plan around building a successful real estate business based on online leads and lead conversion. Companies should be built around CRM solutions that keep real estate agents […]

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Some Brokers Really Suck

by Victor Lund on December 16, 2013

WAV Group is blessed to work with some excellent brokers. We have never worked for an agent unless it was through their broker. Regardless, we try to keep the agent in clear perspective because agent retention and recruiting are the mantra of the best brokerages in America. Yesterday, I ran across the path of a brokerage that really sucks. Here is the story. A young family with three children struggled with a stay at home mom who nurtured each babe through adolescence and into first grade. The mother was raised a dancer and supplemented her sanity and the family income by teaching dance classes at night. This is how we met. When her youngest child entered school, she added more part time jobs to help the family. Eventually she found her way to becoming a real estate agent. Still in her first year, she worked as a buyer’s agent in six transactions, procured two listings and sold one. Clearly this gal has skills. We were sitting together last night when a tweet popped up on both of our phones from Point2, something about a sale on leads. We both chuckled at the irony of following the same company on Twitter, but she asked me about leads and Point2. I retorted with questions about how she generates leads today, how many leads her current listing is pulling in per month, and how she follows up on leads. To my surprise, she said that she did not get any leads. Since I am a “fixer,” she and I set out to see what was broken. We checked online and saw her listings syndicated everywhere. I suggested some improvements to her profile and told her how to modify the description text on portals to generate more calls and clicks. Then we tested the lead routing solution from her broker. I inquired about her listing and we watched her phone for the lead to come in…silence. After five minutes, still silence. She went to teach class and left her phone with me. I was monitoring email for both of us. An hour passed and she returned. “So, did it come in?” she asked. Nope. I asked her to log into the Realogy back office and the broker back office to show me where her leads come in. My fear was that she had been kicked out of rotation for not responding to leads. This […]

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RE Technology’s Top 5 Articles of the Week

by Victor Lund on September 23, 2013

Does Your Website Capture Leads or Let Them Get Away? Getting visitors to your site is only half the battle of online advertising. If your website does not convert even the highest quality visitors to leads, your online lead generation efforts are doomed to failure. Your website needs to both engage your visitors with the information they are looking for and ask for their contact information so you can reach out and turn them into clients.  5 Reasons to Use a Virtual Tour In conversation with Tim Denbo of VirtualTourCafe, we asked a simple question: “Why should agents create a virtual tour for heir listings?” Tim obliged with a compelling list of substantive reasons. If you’re not using a virtual tour solution, here are five reasons you may want to reconsider. PPC – Overlooked and Underrated When you talk to real estate professionals or business owners who have been unsuccessful with PPC, they usually say something like “it cost a lot of money and I didn’t have good results or generate leads.” They’re not inaccurate, just uneducated in how to do PPC right, and one other very important bit of information. They’re not aware of Google’s Ad Quality Scoring and how it changes everything. E-Marketing 101 If you asked agents a decade or so ago, most would likely say e-marketing meant somehow placing your listing on a silly thing called the Internet. Just five short years ago, many agents wouldn’t know what a text message was. Yet now, we can’t imagine leaving the house without our smartphone. Checklist: Are You Using These Tools for Customer Service? Our business is all about referrals, and gaining referrals is all about providing optimal customer service. I’ve talked to David Lester of Sequent Systems, an efficiency expert of sorts to get his top tools for customer service – and I’ve compiled them into a checklist so you can see how well your practice measures up.    

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Leads are for Losers!

by Victor Lund on August 13, 2013

If America’s real estate agents and brokers had to build their business on online leads, they would be out of business. On all accounts, online marketing and lead generation tactics over the past decade have left brokerages with lighter wallets and little to show for it. Recently, the world’s largest real estate organization, REALOGY posted that they had generated 1.56 Million leads over the past 6 months for 239,000 agents. It is not really fair to double that number and annualize it to 3 million per year because November through January is a pathetic lead generation period. Regardless, even at 3 million leads per year, that equates to about 1 lead per agent per month. Consider the millions of dollars that piled into generating those leads and you will soon observe that this is an ill-fated strategy for real estate. Consider the broad and recurring observation that fewer than 50% of those leads are ever responded to and you track toward a keener understanding of the effectiveness of online marketing. Move down the funnel even further and look at the lead to close ratio of 100 to 1 and you begin to realize just how off track our industry has become. Online marketing is a drag on brokerage and franchise resources and does not provide ROI for outcomes. Don’t get me wrong. I strongly believe that consumers should have access to real estate listing information online. I strongly believe that the source of that information should be based upon MLS data (accurate, timely, detailed). I strongly believe that behind every listing should be a responsive and informed professional real estate agent. There is no doubt that the purpose behind online marketing is seller driven. Sellers believe the hype that online marketing sells real estate. Somehow, our industry has failed to promote the MLS, and cooperation among real estate brokers as the true source of generating maximum exposure for property marketing. Why aren’t we publishing seller reports about the number of times a listing appeared in an MLS search result? Why aren’t we publishing seller reports about the number of times a listing detail page was viewed in the MLS? Why aren’t we publishing the number of times an agent, representing a buyer, inquired about a listing? Why aren’t we publishing the number of times a property has been emailed to buyers from the MLS system? Brokers are failing to communicate […]

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Turn Social Networking into a Lead Generation Engine

by Marilyn Wilson on July 21, 2011

social bios tn

While social media has become a very important part of the real estate sales process, many agents still struggle with how to leverage it effectively. They don’t know how to keep up with Facebook, Twitter, etc., and they definitely don’t know how to use the tools for lead generation. Move, Inc. must have recognized this challenge that agents are facing, and they have come up with a solution to help agents deal with this problem. The company announced this week that they have purchased the SocialBios platform. SocialBios allows individuals and companies to create one social hub for their online profiles through an interactive ‘About Us’ page.  The tool simplifies the discovery of shared connections on Facebook, LinkedIn, Twitter, Foursquare and Google without sacrificing the consumer’s privacy.

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