SAN FRANCISCO — Generate them yourself, buy them from aggregators, or hire somebody to drum them up for you. If you’re in the real estate or home lending business, you need sales leads.

Experts with companies that do all of the above were at Real Estate Connect San Francisco Wednesday to offer advice.

With more people shopping for mortgages online, lenders who want to generate their own leads can try optimizing their Web sites or paying fees to make sure they are featured prominently in search-engine results.

Every month, 9.4 million people get on the Internet to shop for a mortgage, said media analyst Greg Sterling, citing research by Compete Inc. Sterling, the moderator of the panel, “Top of the Funnel: Search Engine and Portal Marketing,” said one in four consumers find their way to lenders’ Web portals through links from other real estate sites. Search engines drive about the same percentage of traffic to mortgage lenders. 

Search engines like Google, Yahoo! and MSN use formulas that attempt to rank results based on their relevance. You can hire an expert in search-engine optimization to make sure your site shows up higher in the so-called “natural” results.

If you’ve got the money to burn, another way to drive traffic to your site is to place bids on the keywords consumers use in their searches. The highest bidders end up on top of the paid search results, placing them in “the golden triangle” — the area of a consumer’s computer screen that’s most likely to catch their eye and generate a click, Sterling said.

Dean DeBiase, chairman and chief executive officer of Fathom Online, said he recommends that his clients focus on paid search, spending about $9 on that for each dollar they spend on search-engine optimization.

But turning up on top of paid results can be an expensive proposition. Surveys show aggregators like LendingTree and are willing to pay up to $8 a click for keyword search terms like “mortgage” and “refinance,” Sterling said. That’s part of the reason aggregators — Web sites that generate leads for lenders — get 75 percent of online home loan applications.

With national lenders and aggregators willing to pay top dollar for keywords, “You’re talking about a real inventory squeeze,” Sterling said. “What the hell do people do when they get squeezed out of these top spots?”

For smaller firms working local markets, “It’s better to go after the longer tail,” said Jamie Glenn, vice president of product development for Trulia, a vertical real estate search site.

Glenn recommended bidding for more specific keywords that describe the product you’re offering or the market you do business in — like a city or neighborhood. One drawback to that approach is that you may have to bid on, and track the results of, hundreds or even thousands of keywords.

Sam Sebastian, Google’s director of classifieds and local advertising, said sometimes it makes more sense to just buy leads, rather than generating them yourself.

“If you’re a smaller, more local lending organization, don’t spend a ton of money on search,” Sebastian said. “Buy leads. Because it’s much more efficient to buy that lead from LendingTree than trying to get better terms on Google or Yahoo!”

ROOT Markets lets buyers and sellers trade leads in a setting modeled after stock markets and commodity exchanges. The quality of the leads is validated and verified by TARGUSinfo.

The panelists agreed that online marketing, paid search and search-engine optimization are best used in conjunction with — not instead of — traditional print, radio and TV ads.

“If someone runs a billboard in a local market, or ads on local TV stations, you can see how those offline campaigns perform via the metrics on search,” Sebastian said. “I think online and search can help evaluate offline campaigns and results. It’s easy to change message and test things.”

Steve Horowitz, senior vice president of product and business development at mortgage aggregator, said that in addition to its Web site, the company sells consumer mortgage guides in about 500 newspapers.

“We’ve had people come off the Bankrate (Web site) table, and move all their money into print,” Horowitz said, largely because the types of loans originated by newspaper ads are more profitable to lenders.

There’s no one-size-fits-all formula for deciding how much to spend on online marketing efforts versus traditional mediums.

“We have some companies spend 80-20 online-traditional, and others that do just the opposite,” Fathom Online’s DeBiase said. An interactive marketing firm, Fathom Online provides analytics that help its customers determine how effective their online campaigns are — a must for any business, panelists said.

“We’re getting people to spend 5 to 10 percent online to jump in, and more as analytics prove to you effective marketing media,” DeBiase said.

Generating your own leads or buying them from aggregators aren’t your only options.

Companies like Ingenio and LeadQual help their clients use the Internet to generate phone calls from prospective customers.

Ross Weinstein, Ingenio’s director of sales and business development, said the company is geared for the estimated 13.8 million businesses that either don’t have a Web site, or whose Internet presence is limited to “brochure ware” marketing, rather than e-commerce.

Ingenio uses an auction model. Clients pick the geographic area they are searching for leads in, the hours they want to take calls, and then place bids, paying for each call they receive.

“You do not have to worry about bidding for thousands of keywords, which if you don’t have a lot of time can be unmanageable,” Weinstein said.

The cost per call varies according to industry. The minimum bid is $2 a call, with real estate firms paying $10 to $15 per call and mortgage lenders $40 to $80 per call, Weinstein said.

“That just means the call is working for these people,” he said. “They are converting, or they would not pay for the calls.”

LeadQual helps companies convert their online leads into sales by making sure they are handled quickly.

When a potential customer fills out a form on your Web site, “you can all but guarantee that person has filled out another form (at a competing site), and you’re in a race to get in touch with the client,” said co-founder Glenn Houck.

In real estate, only 52 percent of Internet leads actually get called, he said, and of those, only 62 percent get a call the same day, he said.

“Leads are falling through the cracks, and response times are slow,” Houck said.

LeadQual employs operators who call Internet leads within minutes, qualifying them and “hot-swapping” calls to clients’ sales staff along with the information needed to close a sale.


Send tips or a Letter to the Editor to or call (510) 658-9252, ext. 150.

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