Refrigerated Real Estate Consumers
My definition of a real estate lead
A lead to me includes absolutely the following:
- the full name of the buyer (both persons if a joint purchase)
- an exact capture of their area and style of housing
- pre-qualified with a qualification letter
- a signed agreement that they consent to the distribution of their information to me and understand they’ll be working with me.
- the lead must be exclusive to me or my company.
What most supply
- name (sometimes correct)
- email address (rarely their best contact)
- city or zip code searched (is this narrowed or a broad general search)
- share the fragment of information with 2-10 additional agents
What ends up happening
- You and upto 10 other agents bombard the consumer with updates and QUESTIONS
- You turn off the consumer because you’ve been left with more QUESTIONS than answers
- You lose the consumer to someone else and are left begging for a response
- You’re left discouraged and with a hole in your wallet
It seems to me
A better approach for any aggregator would be to connect locally a partnership with a Broker, and provide a lead capturing solution supported by their national site. Endorsing the Brokerage from a national level gives the local Broker credibility allowing a transaction to take place on the local site- The transaction of information.
The wrap
Agents must raise the bar and and begin to ask serious questions of the vendors that would provide fragments of shared information. You must learn to just say no to antiquated products and force vendors to raise their bar. By doing so you force aggregators to engage a solution for consumers that is valuable enough that they would want to willingly submit their information, agree to pre-qualification, and yes, make the home buyer eager for the call by the agent by asking permission upfront- Permission marketing.
In the end, the consumers experience is what is most important, but the almighty dollar seems to continue to fuel poorly conceived dot-disasters to the online market place. These so-called lead generation opportunities leave buyers frustrated and with a feeling of refrigeration- consumers are not meat.
Are there dot-somethings out there that aim to bridge the gap from search to purchase? If so, I’ve not received your email.
Matthew Rathbun
April 9, 2008 at 1:27 pm
I’m reminded of issues that a certain company went through when they were “generating” leads from ther employees to ensure that minimum commitments were met. I got out of all my on-line lead generation systems. What I found was that the “lead systems” were costing me as much as I was making. So, had just one lead not worked out, I would have been in the negative.
Agents need to do a little market research and check with other users out of their markets before signing up for services that generate potential client contacts.
This is still a social buisness and it seems that some lead services are hoping that something comes by, as opposed to actually engaging folks and finding out what they are looking for. This goes back to Boardman’s post, yesterday. It’s important to have a connection and realistic mentality with your client. Why pay for a “lead” if they aren’t going to be a good fit for you?
Sorry, Benn, if this wasn’t your primary point, but it’s a topic, that I think all agents should explore more.
Benn Rosales
April 9, 2008 at 1:31 pm
Matthew, no, it strikes at the heart- the solution (technology in this case) needs to bridge and build warm contacts, not refrigerated meat. The solution is introducing me to an opportunity, not an email address.
BawldGuy Talking
April 9, 2008 at 1:46 pm
As usual, Benn, you’ve called it as it is.
Leads generated by the agent’s own efforts, at least in my personal experience, are golden. Our batting average with those coming to us through our sites is well over half.
I can’t even imagine the conversion rate you enjoy with the leads you generate.
Teresa Boardman
April 9, 2008 at 3:33 pm
Better yet lets not treat consumers like leads and let’s cut out the middle man. They add no value for consumers. If agents stopped working with the lead aggragators they would cease to exist and consumers would come to us.
Benn Rosales
April 9, 2008 at 3:42 pm
Teresa, that isn’t going to probably happen, they’re like weeds. The best we can hope for is a company that fills the void with a product that bridges the gap. I am no fan of aggregators by any stretch of anyone’s imagination…
Jay Thompson
April 9, 2008 at 4:17 pm
I hate the word “lead” and try to avoid it like the plague. Leads are people. People buy and sell homes, not leads….
Jonathan Benya
April 9, 2008 at 4:30 pm
Here’s what I don’t understand:
I have my own independent blog, and I get 50-100 visitors daily.
I average 3-4 first-time calls from potential clients weekly.
I average 3-4 first-time emails from potential clients weekly.
So weekly, I’m looking at 6-8 possible leads.
I spend $15/month on the blog hosting.
I spend approximately 1 hour a day blogging.
I can close a lead a week (actually 1.2) from blogging leads alone.
If I can close 4-5 leads monthly from blog traffic alone, at a cost of $15 & 30 hours of prospecting (writing) each month, why on EARTH would I pay $50-$75 for a lead with a company that averages a 20-25% closing ratio? I figure if a lead generation company charges me $60/lead, and 20% (1 in 5) make it to closing, I’m paying $300 per lead that actually closes, right?
Let’s say my time is worth $50/hr. That means the time I spend blogging each month is worth roughly $1,500. ($50x30hours). I close 5 leads that month, and I’m spending the same amount on my blog as I would for a lead generation service, PROVIDED THEIR LEADS CLOSE AT 20% or BETTER!!
It sounds to be about the same, but the difference lies in the fact that I’m being called by the client, not the other way around! By the time they contact me, they feel as if they already know me because they’ve met me, my listings, my team, my dogs, you name it, and there is a personal connection to me before they’ve ever even heard my voice! It makes transactions go much more smoothly, in my opinion, and instantly eliminates many of the hurdles you see with leads you’re paying for!
Gabe Sumner
April 9, 2008 at 4:50 pm
This post demonstrates an extreme ignorance about how the Internet works and what Internet consumers want.
Internet users enjoy the anonymity of the Internet. They enjoy being able to browse at their own pace. They want to be empowered to do their own searches and research. When they have questions, they want clear simple, truthful answers. They do not want to be forced to submit information they are not ready to give or take steps they aren’t ready to take.
It might take MONTHS for the lead to mature; as a person progresses from curious, to interested, to serious, to ready. When the time comes though, most people will remember the agents, companies, and web sites that were honest & helpful to them.
Any web site that makes someone pre-qualify for a loan to even ask a question (or worse do a search) will fail! Miserably!
To speak to your points above; you will never get want you want because the Internet is purely consumer driven. There are thousands of web sites and the successful web sites will be those that allow consumers to approach the home buying process on their own terms.
I understand that in an ideal world you would like leads where the person is primed and ready to hand you a stack of cash with minimal fuss…but there isn’t any web site that will be able to do that for you.
Eric Blackwell
April 9, 2008 at 6:18 pm
Jay, you nailed it, man. I agree totally.
I feel a post coming on…. These folks are PEOPLE who are searching for what we have to sell. They may not be ready to buy yet, buuuuuttttt…they will decide whom they buy through based on who is helpful.
“Lead” well and “lead generator” ought not to be in the lexicon IMO.
Best;
Eric
ines
April 9, 2008 at 8:43 pm
I’m with Jay – the first step is to stop calling them “leads”.
If I may interject here: Gabe – as much as I totally agree with you and so will most of us in this platform (sorry if I generalize) – this post is about Lead Generation Companies that actually sell a product, they “sell” leads. I personally don’t use don’t companies and use the process you describe in my own site – the question for me is, if these companies are going to sell these leads, shouldn’t they be complete? and real? if not, what exactly are they selling…….people’s privacy and anonymity? ……just a thought.
Bill Lublin
April 9, 2008 at 11:19 pm
@Benn – I have a ton of stuff to say about this whole thing, but frankly its another post – I think you are absolutely on the right track and have part of the answer, but haven’t yet gone all the way with it – leaving a little for me to get my teeth into later on – for which I thank you “oh provider of all things that are good” (or more appropriately, the husband of “the provider of all things that are good”!)
@Jay AND Eric – As another Bill once said ” what’s in a name?, a lead by any other name would smell as sweet…” They are leads until we meet them – at which time they become people, but while I don;t agree with much of what Gabe said. I do agree that anonymity is part of the internet experience, and until we remove that anonymity, the “leads” haven’t yet coalesced into “people” because we haven’t yet met them.. and that part is our job – and one that we shouldn’t allow anyone else to do – unless we don;t want to be in business any longer…
@Gabe – I admire your courage if not your perception when you say “This post demonstrates an extreme ignorance about how the Internet works and what Internet consumers want.” about this particular author and these particular commentators in this particular arena –
And I have to disagree with you when you say “the Internet is purely consumer driven” – That is simplistic and untrue – the majority of succesful business models are either ad driven, or looking to be driven by fees and referrals paid by real estate professionals – Is there another internet service which is paid for by the consumer using it? Even Amazon, Ebay, and every other e-commerce site I can think of has their business model fueled by the vendor rather then the consumer – The only part of the Internet that comes to mind as completely consumer driven might be the pornographic portion of the net which I am told by others is actually paid for by the consumers- and if I did miss one or two examples which are not ad driven or fee & referral based, they are in the underwhelming minority-
Brian Columbus
April 9, 2008 at 11:49 pm
On the surface, your “lead standards” make sense. There’s validity in not wasting time with half-hearted buyers. Like any relationship (business or personal), there needs to be some level of commitment for both sides in order for things to work out. So I ask, why bother “chasing leads” at all? Why not spend your time marketing to the type of customers you really want: sincere, motivated and qualified consumers. Focus on getting referrals and repeat business. Focus on the relationships (people) and not the data (leads).
(BTW – If you’re looking for a dot-something to help with that…I’ll send you an e-mail shortly.)
Benn Rosales
April 10, 2008 at 7:55 am
The post that says leads are a bad word and aggregators that lack a product that they own will surely fail, have already been written- I know because I wrote them.
This post is something much deeper and much to the heart of any startup that wants to offer antiquated methods to real estate practitioners that lead them down a 1.0 path. Some here get that, some here do not, but my larger point will be understood by a vendor that is looking for the niche that will fly through the ages,
It is the point that will build what some used to call a lead into a buyer who wants to willingly participate. The meat being if you had reached that level of bliss with the consumer with a product they wanted, you’d have recieved more than bits and bits should not be sold (or purchased). When purchasing bits the consumer is destined to become chewed by the pack. Again, this method was created by aggregators but somehow the agent becomes the vilain.
There is a better way… I’ve seen it, and I’m going to show it to you… stay tuned.
Gabe Sumner
April 10, 2008 at 8:24 am
Bill Lublin,
I don’t believe saying “the Internet is purely consumer driven” is simplistic. Instead, I believe it is a fact to keep in mind for anyone who wishes to succeed in this environment.
Of course there are web sites that are supported by ads or sales. However, those web sites delicately place their revenue model on top of a solid customer-centric experience…or they will become irrelevant.
Google is a very good example. In the beginning Google was a text box, one click and then the answer to your question. With this “simplistic” approach they became the greatest force on the Internet.
Now Google obviously has AdWords; but notice how careful they have been about infusing ads into their product. Notice they have never allowed the “natural” results to be tainted with ads. Do you know how much companies would be willing to pay for top-spots? Millions & millions of dollars are being lost. But Google understands that as soon as they start down this path, they lose the confidence of their users. That confidence is really the only thing of value they have.
If I have a web site where I am trying to offer value to customers during the real estate transaction, it is not in my customers interest to:
– Demand of them questions they are not ready to answer.
– Exclusively give their “lead” to 1 agent who may or many not respond.
ines,
Regarding the companies you describe, it does not surprise me that the leads they generate would be flawed. Their core business model is flawed. Thank you for the clarrification.
Gary Ashton
April 10, 2008 at 1:06 pm
Hello,
I think that really we have to view our lead generating websites as a 24hr virtual open house.
We all know that the best way to meet buyers, the traditional way, would be to sit in a well publicised open house or in a heavy traffic area, and wait for potential buyers to walk through the door.
Well, in actual fact, the open house brings in all sorts of potential buyers as well as plenty of lookers, from the next door neighbors to the couple doing some remodelling and looking for interior design ideas. They are all interested in the home but with varying degrees of interest towards actually buying a home.
The internet lead is very similar and in a lot ways exactly the same. It’s an virtual open house that the buyer can enter at any time of the day or night…and we don’t need to be there.
Most real estate sites at some point will require the user to provide some kind of information about themselves. Those who have no intention of revealing their identity can create a fake, but plausible e-mail address, and a fake, but plausible phone number, and then they have access to the rest of the site.
Other users will only provide a good e-mail and yet others will provide a working e-mail and a working phone number. However just because the working phone number and working e-mail user has provided all the correct information doesn’t mean that they are looking to buy a home. They may still be a inquisitive neighbor or some one doing research regarding interior decorating and they needed to see pictures of homes etc.
The point is that internet captures leads at all stages in the buyers life cycle just like the buyers and people coming to view traditional open houses. Some maybe in the very early and formative stages and have 2 years to incubate before they buy. Others may not even know they are thinking about moving but the research they do for another project brings them to the realization that they need to “upgrade” to get what they want in a home ie they can’t make a silk purse out of a sows ear 😉
I guess all I’m saying is that internet leads are at the end of the day either real people or fake. The real people will at some point be looking for a home. It may not be next week, next year or the next decade but it’s very likely they or someone they know will be involved in a real estate transaction. If you treat that lead with respect and give them some attention they will remember you via your drip campaign when they do enter the actual buying stage.
I don’t reject someone just because they are using my site for research. I hope they will remember it as a user friendly site and refer their friends and family and eventually become a client themselves when it’s their turn to buy 🙂
I look forward to hearing any one elses opinions as I would like to convert more of my leads just like everyone else that uses the internet as a way of generating business for themselves and their team 🙂
As exclusive agents for Nashville.com we generate anywhere from 15 to 50 leads a day…and not all are immediate buyers 😉
Vicki Moore
April 10, 2008 at 2:28 pm
There is a better way… I’ve seen it, and I’m going to show it to you… stay tuned.
I wait excitedly, Obi Wan. 🙂
Bill Lublin
April 10, 2008 at 2:39 pm
Gabe;
When I said simplistic I meant just that – not dumb, just simplistic- It (the statement) didn’t take into account all of the levels that truly drive the internet- And please don’t get me wrong – I am not suggesting that there are not sites that are simply there for fun or for the experience of sharing like the gutenberg project or archive.org, I objected to summing up the entire nature of the Internet in that one sentence-
I would disagree with your perception of google’s careful insertion of adwords- they’re just geinb honest about identifying ads- something that newspapers have done for years, and a laudable action, but since they’re banking large, I would respectfully say that the reason is not because they love the consumer experience, but because they don’t need to do anything else. Businesses need to act as businesses in order to survive and to have the participants in those businesses survive and even thrive- I don’t think that is a bad thing or a good thing – just a thing we need to recognize when we look at the structure of our electronic workplace
I do agree with you that we need to keep the consumer’s experience in mind, because even if the motivation of the business or person operating the web site is commerical, they defeat their own pupose if they don’t make it a good consumer experience, because many consumers will then choose not to participate.
David Carroll
July 6, 2009 at 2:11 am
Brilliant article and the comments are equally as insightful. If only I got my head out of the gutter of software development with our FREE IDX Property Search a year ago and found this very post, I would have had a great reference for all the naysayers about redefining lead capture I’ve encountered this past year. Check out our video on this very subject and let me know your thoughts. http://www.softRealty.com/video/LeadCaptureRedefined/.
I never understood the mentality many agents have regarding the “unregistered” use of their IDX Search. Some agents believe that if you’re not ready to pony up some identification with “forced registration,” you have no business on their site. How ridiculous!!! Gary Ashton’s comment said it perfectly in his assessment of people who do or don’t give their information. I talk to brokers and agents everyday who say they force registrations to capture leads, but would never fill out those forms themselves. However, if they don’t push some sort of registration, they won’t be able to begin nurturing a relationship with this lead. What they don’t consider is you also can’t connect with qualified home buyers leaving your site or giving you fake information. The very people that do give you factual information have probably given it to every other site they’ve visited and may not be a qualified buyer.
As a “dot-something” technology company, as it were, we have addressed the concept of nurturing relationships online with “Lead Capture Redefined.” This is where we approach the lead capture process with a consumer driven approach. Let them search anonymously while giving the agent the ability to connect online. If the consumer sees value in the correspondence, they’ll identify themselves. There is much to be afraid of with identity to begin with on the internet. Give your new visitors time to get to know you as an agent, search your site, and return periodically. Don’t give them a reason to “lie” with fake information. Rather, engage early and establish trust.
Bill, Ines, and Teresa, we met at REBarCamp PHL. I wish I was following this site earlier on. You guys ROCK!!!
Benn, I’m digging Agent Genius with every new article I get a chance to read. I feel that guy who just discovered the box set of “Lost” for the first time and am playing catch up from several seasons back.