Primary marketLook At Internet Leads In A New Way
What makes for a good lead?
Within the real estate industry, it is widely accepted and frequently reinforced that a lead is a good lead if the homeowner plans to take action (buy or sell) in 90 days or less. Everyone else has the potential to waste a lot of your time, the general thinking goes, so they have little or no value.
Therefore, when agents spend time and money on prospecting and marketing efforts, we do so with the expectation of finding good, hot, motivated leads. These marketing activities frequently generate “contacts” or “inquiries”, but not motivated leads, and are considered failures. A high percentage of open house and Internet leads are perfect examples.
This is precisely the point where most agents lose the opportunity. If we are unable to identify the prospect’s level of short-term motivation, we frequently fail to follow up.
If we do this, we are thinking short-term while the prospect is planning longer-term. In a highly competitive market, with big-ticket transactions, this is a critical mistake. Trying to build a business based on swooping in at the last minute to capture the deal is exactly why agents so frequently are frustrated with their sales and marketing efforts.
Many agents and real estate trainers will argue that this long-term view is a mistake because it has historically been time-consuming to implement. But today we have hard evidence that demonstrates the patterns of real estate consumer behavior as defined above.
My company recently analyzed more than one million consumer leads captured and cultivated online, and compared them to public records of home sale transactions from across the country. We were astonished with what we discovered. Only 7.3 percent of consumers had sold their home within three months, but the percent of transactions closed climbed to 22 percent in 12 months and 40 percent after 28 months.
This data conclusively shows that the new Internet-enabled real estate consumer is beginning their research online well in advance of doing a transaction. If you are operating with the mindset that a lead is only good “if they plan to take action within 90 days or less,” you are missing a huge opportunity to capture more business. The close rate of those one million seller leads over 12 months is nearly three times that of the industry average for general farming techniques.
Think long term when you’re developing relationships with prospective sellers, and don’t ignore leads that aren’t yet in a short-term cycle. This strategy will net you more listings, more commissions and greater success as a real estate agent.
Mark Powell is a second-generation real estate agent, and is founder and CEO of HouseValues, Inc.