NOTE: Part 1 of a 2-part Series on Real Estate Leads
At some point, the majority of the most successful real estate agents and brokers out there will pay for a lead generation system to drive more buyer and seller leads their way. In fact, most Realtors make it part of the operating baselines of their businesses - and for good reason.
In any business, those who know the value of marketing understand the vital, even critical importance of reaching out to customers directly to attract them to their brand, products, and services.
As a marketing guru and friend told me early in my career, "If you don't stay in front of your customers ever day, you disappear - and your business soon after."
It's an adage I've found to not only be true but easily observable by those business owners who diligently pay attention to their business performance from the smallest details on up. You know, the "winners" out there.
But, in our wildly digital and mobile age, lead generation is neither a miracle cure nor easy and affordable to do. That said, it is a must for your revenue stream now and even more so for the (looming) future.
The Problem with Real Estate Lead Generation
For most agents, lead generation is highly costly, it's hard to measure results and it's not very tailored to their specific markets. It's overwhelmingly viewed as a necessary evil and almost universally loathed.
So, why? Here are three big reasons (three more coming in Part II).
- Most lead generation tools force agents to share leads - Whether it's Zillow/Trulia (we say "Zulia"), Boomtown, or any one of a thousand other systems out there, 99% of lead generation forces Realtors to sign up for a zip code or area that they also sell to as many as a hundred other agents. It's done to maximize profits, lower costs and reduce maintenance for the vendor. Often times, agents are then pretty much extorted to "move higher" or "get more leads" by, you guessed it, paying more. So why does anyone do this? Well, it's a whole lot of vendor-induced peer-pressure psychology with a little bit of "status quo" thrown in that makes for a bad tasting stew that can harm your business. You see, most agents assume if they're not "in the game" the way their peers are, they're somehow missing out. It's not true, of course, but "crowd thinking" is powerful, if not very harmful. The better way? Find a custom lead generation solution that focuses just on your business, your market and, exclusively to you, your zip codes. Lead generation isn't something you turn on and off, it takes a long-term commitment. By committing to an exclusive vendor, you gain increased benefit over time. So, stop sharing. It's bad and a portion of every dollar you spend actually goes to help competitors get leads. Just think about it.
- Sloppy and unfocused Pay-Per-Click (PPC) and social advertising - At some point, every Realtor will think PPC and social media digital ads are a good idea. And they'd be very right. The problem, however, is with the execution. Sometimes, agents try the DIY route for digital ads. Big mistake. Most times, they use a lead generation or a local marketing company vendor to do it for them. More costly, more inefficient mistake. You see, the problem with almost all digital ads run by Realtors is that to be worth anything, the ads can't just be turned on and splashed across the web for anyone to click up. They have to be surgically targeted from the start, analyzed and maintained over time thru changes in customer habits, your market, your brand and about 100 other criteria. In other words, someone has to be at the wheel configuring them just for you, then regularly examining and tuning the results each and every month so your ads keep hitting their target. It's kinda like adjusting sights on a rifle for distance, wind, weather and the moving target itself. Any hunter or military sniper will tell you, it's art, science, skill and a hell of a lot of hard work. Companies like Boomtown, Placester, CINC, and literally hundreds of others sign you up, crank out templated websites and run Google and Facebook ads for your city and some number of miles around your city. When they get clicked up and you get lots of "noisy" leads with a low conversion rate and a high level of effort to work, you 're asked for more money to double or triple that volume leads. You see, they know the status quo: most agents equate volume with quality, so they send you a lot and sell you a lot. Combine that with the peer-pressure psychology mentioned in bullet #1 and you get a recipe for vendor profits. All the while, you continue to ask, "why isn't this working? I'm paying ____ each month?"
- Unreasonable expectations - I can honestly say that in over 85% of customer engagements with agents and brokers here at HomePocket for our lead generation, websites and marketing services, customers initially have the same, almost subconscious mindset about leads: there's an infinite pool of leads out there for real estate in my area, I just have to find the right solution to reach them. This is probably the biggest "lie to yourself" danger happening in real estate today. Why? Two reasons really. For starters, it's an assumption that makes Realtors avoid the golden rule of marketing: consistent hard work over time and based on continuous examination of performance and iterative adaptation to your changing market does pay off. In other words, it makes you think you can pick services and products "off the shelf" and they'll handle it for you without you having to break a sweat or even think about lead generation again. Secondly, it causes impatience and "product flipping" from one lead gen tool to the next before the right one pays off. In all, it's simply unreasonable to think that any magic tool exists that can - on demand - veritably bring into being a consistently huge number of leads for your business. Does. Not. Exist. You can't force customers to buy or sell a home, so the volume of customers looking for homes in your area fluctuates daily, widely and, sometimes, there are very few of them out there at all. It's best to seek out a lead generation solution that, each and every day, puts your brand in front of as many people as possible who are actively looking for homes or looking to sell homes in your area. It takes data science, analysis and a sophisticated set of systems to do so. We think there's only one system out there that does lead generation the right way.
Stay tuned for three more BIG reasons why buying real estate lead generation is so problematic in next week's installment...
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About the Author
Jason Polancich is founder and lead architect of HomePocket, a data-driven, residential real estate marketing and listing network. Polancich also founded SurfWatch Labs, a cyber data analytics firm founded in 2013 that provides highly accurate, timely and actionable information to businesses regarding the cybercrime threats they face. Polancich is a serial entrepreneur focused on solving complex internet security and cyber-defense problems. Novii Design, a company he co-founded in 2005 with Rebekah Lewis-Polancich, was based on his contributions to cloud architectures, distributed computing, data analysis and systems integration. The company assisted the U.S. Intelligence Community and Department of Defense in building some of the largest data warehouse and analysis systems ever put into operation within the government and defense contracting sectors. Novii Design was sold to Six3 Systems in 2010.Follow on Twitter More Content by Jason Polancich