Find out how to be successful with online lead generation services and what you may be doing wrong with your real estate leads.
Online lead generation companies are a huge source of real estate leads for Realtors and a great resource to help grow an agent's business. However,
many lead generation companies are constantly slammed by agents who have used the service and had little, if any success with the real estate leads provided. In my experience, this dissatisfaction often comes because the agent has unrealistic expectations of the service and little to no knowledge on how to develop a good follow up campaign with their real estate leads.
The first thing you need to realize as an agent is that lead generation services aren't magic listing trees. Typically you shouldn't expect to get listing after listing from a service. Most services work on the following basis: they provide online marketing in the agent's specific area, the natural result of which is homeowners in need of information filling out lead contact forms. This contact form is sent to the agent in the area, and that is their “lead.”
So what does this mean exactly? Well, it means the real estate leads provided will be people with different types of real estate needs and in different stages of the process. If an agent signs up for a service for a 3 month contract and expect a listing within the first month, they are likely to be disappointed. Immediate listings with real estate leads DO happen, but they aren't the norm.
Realty Times analyzed more than one million real estate leads captured and cultivated online and then compared them to public records of home sales from across the country. They found that only about 7.3% of consumers sold their home within 3 months of filling out a lead form, but the percentage grew to 22% after 12 months and to over 40% after 28 months. This means that purchasing real estate leads online is a LONG TERM investment, not an immediate source of money. Real estate leads generated online MUST be aggressively followed up with to convert them to clients!
Therefore, as a real estate agent, you must look at lead generation services in the same light as other marketing endeavors. When you implement direct mailing campaigns and send out information several times a year to 5,000 homes, do you expect to get 5,000 listings within the year? No. Direct mailings are more likely to result in accumulation of real estate leads over the next year or two which you then must nurture into clients looking to buy or sell.
There are typically four types of real estate leads received by online lead generation companies: buyers, sellers, refinancers and fakers. Buyers may be in different stages of the process, as may sellers, so you may have to follow up for 2 years before actually getting their business, or you may have a listing within 3 months. It depends on where the consumer themselves are at in the process. Obviously buyers have a great potential – you may be able to sell one of your listings to them and if they need someone to list their current home, you've got a double whammy of a lead. Same goes with a seller looking to list – maybe they'll be interested in purchasing one of the homes you already have listed, and if not, perhaps they'll still consider you for a buyer's agent to represent them when they purchase a new home. Again, a double whammy of a lead.
Just because the seller isn't going to sell for 2.5 years doesn't mean you should drop them – on the contrary, you now have 2.5 years to get a leg up on the competition by working closely and sending the lead any information to make their real estate process easier. It all comes down to an agent's sales ability – lead generation services can get your foot in the door, but it's up to you to sell yourself to your real estate leads.
Often real estate agents complain the loudest about getting real estate leads of people looking to refinance or get a home equity loan. “These aren't real estate leads, I'm not a broker, what am I supposed to do with this lead, it's worthless,” they say. That is absolutely FALSE and the wrong way to look at these leads. First off, any real estate agent worth their salt should have a close working relationship with one or more mortgage brokers to refer these type of leads on to. In the spirit of reciprocation, the mortgage broker should be referring buyers and sellers back to you!
Even before you refer the refi lead to a broker, you need to do some work on your own. Talk to the lead, get to know them and their situation, educate them in anyway possible on refinancing as opposed to buying or selling. Sometimes these leads can be converted to listings, depending on what their situation is and what path makes more sense for them. Even if they do wind up going to your mortgage broker, that's still one more homeowner out there that knows your name and how willing to help you were – they may wind up needing you a few years from now or referring their family and friends to you. You never really know what could come of your real estate leads unless you try.
Last but not least, we have the fake real estate leads – people who fill out information forms but give not ONE good piece of contact info. A lead that has a fake name, number, email and property address is admittedly, a bad lead. There's no way to contact the person and find out who they are. However as long as even ONE piece of information is correct (name, phone number, property address) then a little detective work with public records can help you get to the bottom of the lead. Agents who consider a lead bad just because it has a fake name will wind up missing out on MANY commission checks.
The best way to have success with real estate leads generated online is to have a strong follow up campaign. Give the lead service a chance to work for you, but be realistic – not all leads turn to listings and not all listings happen overnight. Patience and persistent and consistent follow up is the true path to success with real estate leads and online generation companies. It just takes time.
