Editor’s note: This is the second of a two-part series. See Part 1.
According to the National Association of Realtors’ newly released 2014 Home Buyer and Seller Generational Trends report, only 4 percent of sellers and 9 percent of buyers found their agent on a website. If you’re spending gobs of money on pay-per-click, search engine optimization (SEO), and other online advertising formats with the idea of generating buyer and seller leads, your money may be better spent elsewhere.
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As an agent, you are constantly bombarded with advertisements and recommendations about the various ways you can generate buyer and seller leads. Should you have a website? Should you spend money on online ads? Should you pay for Internet leads? Should you market using calendars, magnets and postcards? Here’s how to decide.
1. What’s working now?
The most important step that you can take to determine where your hard-earned marketing dollars are best spent is to ask, “What’s working to generate closed business for you right now?”
To do this, make a list of the properties you have closed during the last 12 months. Divide the list into two categories: buyers and sellers. For each closed transaction, note where the lead originated. Then note which activities have generated the most closed transactions. The largest proportion of your ad spend should be on generating more leads from these sources.
2. The problem with Internet leads
Agents consistently complain about the quality of Internet leads. In fact, most agents (50 percent) don’t even bother responding to the Internet leads they receive. Of the agents who do respond, many report that about 1-3 percent of the leads that do come in are ready to transact.
There are three issues here. First, the research consistently shows that if you don’t respond to a Web lead in about five minutes (and the same is true for sign calls), that lead is gone.
Second, most people begin looking online 12-18 months before they’re ready to transact. This means that the agent must have a system to regularly stay in touch until the lead is ready to transact. Most agents are looking for “right now” business rather than business 12-18 months from now.
The third issue is the most serious: Websites usually rely on passive advertising.
3. What worked poorly yesterday still works poorly today
Passive marketing approaches have never been as effective as active marketing approaches. Whether you merely stick a sign out in front of your open house, send out postcards, advertise in the newspaper or online, or wait for the phone to ring while doing “floor duty,” these passive approaches have resulted in the poorest return on your marketing dollars for decades.
The NAR report bears this out. Internet sites, search engines, newspaper ads, Yellow Pages, home book ads, direct mail, and advertising specialty (calendars, magnets, etc.) account for less than 15 percent of all closed buyer leads and less than 11 percent of the closed seller leads.
4. Active marketing still works
Whether you are advertising online or offline, don’t waste your money on passive techniques. If you want to make the shift from passive ads that yield poor results to active techniques that work, here’s what to do.
Yard signs with only your phone number are normally considered a passive approach. You can improve your return by adding a call capture or SMS capture system. These systems automatically text or email you the caller’s contact information. They also provide the caller with immediate access to the information the buyer is seeking. At this point, you can actively engage the lead by contacting the buyer.
Here’s an important point to note: Calling or texting someone without them actively requesting that you contact them can be perceived as stalking.
To create a better return from your website, make sure that your website visitors can be automatically notified of all new listings that meet their search criteria. This is still passive, however. To shift to proactively engaging your Web visitors, go through the listings they receive and identify the top one or two properties that you believe best fit their criteria.
Third, to shift your open houses from being passive, door-knock around your open house and invite the neighbors to attend.
You could also hold a private open house exclusively for the neighborhood. Serve refreshments and make it an event. A variation of this approach is to invite the seller’s sphere of influence.
To make your print advertising more effective, have a specific call to action that provides something of value. For example, how to file an appeal to reduce their property taxes or information on where the homeowner can obtain energy rebates.
If you are spending money on passive marketing techniques, look at your production. If these techniques are not producing closed transactions, dump them now or change strategies. Otherwise, you are needlessly throwing your money away on strategies that simply don’t work for you or for other agents either.
Bernice Ross, CEO of RealEstateCoach.com, is a national speaker, author and trainer with over 1,000 published articles and two best-selling real estate books. Discover why leading Realtor associations and companies have chosen Bernice’s new and experienced real estate sales training for their agents at www.RealEstateCoach.com/AgentTraining and www.RealEstateCoach.com/newagent.