Real estate brokers and salespeople should realize customer acquisition is now a science that requires more than mere advertising, mass mailing or telemarketing, and they should develop and execute customer acquisition strategies in line with that realization, a new industry white paper suggested.
The paper, “Real Estate Confronts Customer Acquisition,” presents an overview of why businesses need customers along with three technology-based customer acquisition case studies, a history of buyer agency and a brief conclusion.
The most interesting part of the paper is the case studies. This section opens with the observation that the average online customer acquisition cost should increase from $95 in 2000 to $120 this year, according to International Data Corp. That trend line suggests realty brokers and salespeople need to maximize the cost-efficiency of their online ad strategies.
“Customer acquisition solutions should provide integrated programs to cost-effectively acquire high-quality prospects and convert them to lifetime customers,” stated authors Stefan Swanepoel, managing partner of RealSure, and Janet Branton, VP of business specialties.
The case studies illustrate cost-effective, business-efficient and innovative ways salespeople can make contact with potential customers online to obtain new business.
The first case study is HomeGain, which has generated 1.4 million customer leads for 68,000 agents representing 3,200 real estate brokerages since its inception in 1999, according to the white paper.
HomeGain enables home buyers and sellers to anonymously compare local real estate agents’ services. Sellers also can request a home price estimate and receive a mini-price analysis with the agent’s contact information. Buyers can search for-sale homes in specific markets and be directed to an through agent’s Web site to view MLS inventory. Agents pay a $29.95 monthly fee, plus a 25 percent referral fee when a transaction closes. A separate service provides ZIP code-specific leads. (Inman News Publisher Bradley Inman is also CEO of HomeGain.)
“HomeGain basically works because it provides a low-pressure marketplace in which customers can comparison shop and choose a local real estate professional. It allows customers to self-identify their interest in buying or selling, something traditional paper or advertising-based lead generation programs fail to do, and perhaps most important, the agent incurs almost no cost until a transaction is completed,” Swanepoel and Branton concluded.
The second case study is GenuTec Business Solutions, a public company that sells messaging, communication, voice portals and telecommunications services. The company’s Click4info product allows customers to initiate a telephone call directly to a salesperson through a Web site or e-mail with one or two mouse clicks. The prospect clicks on a button and fills in a telephone number, the telephone then will ring in about three seconds and the prospect will be speaking directly with the real estate agent. The system logs every call with the date and time and the telephone number, name and address of the person making the inquiry.
“This (technology) is one area to keep an eye on as numerous new enhanced communication and unified messaging products redefine the traditional ways in making and maintaining customer contact–at a cost of pennies per call. As Click4info is just being rolled out to the real estate industry this year, its success in the industry is unknown. However, based on the interest and quick acceptance in other industries, it appears that the product should do well,” the authors wrote.
The third case study is PreList America, a system in which prospective home sellers agree in advance to list their home for sale with a specific broker or agent at a possibly undetermined time in the future. Nonprofit organizations, company human resource departments, lenders or builders can offer the service to their customers or employees. The company or organization sends the customer or employee an agreement that is signed, then assigned to a participating local agent, who pays a 29 percent referral fee (20 percent to the originator and 9 percent to Prelist America) on each transaction side. The agent also pays an assignment fee of $49.50 per transaction. Some HR departments kickback the 20 percent referral fee referred to the employee as a benefit.
“(PreList America) is really a very innovative way for real estate agents to circumvent certain existing lead generation strategies and to acquire new customers. The concept provides customers with the ability to benefit today by committing to a future business transaction through a legally binding contract. This contract now forms the foundation for the future business relationship, thereby pre-empting other strategies, and giving the agent the security that there will be a financial return on the initial time and energy spent building and servicing the relationship,” the white paper authors surmised.
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