- First uses predictive analytics to rank an agent's contacts based on how likely they are to buy or sell a home in the next year.
- The software nudges agents to reach out to high-value contacts on a regular basis and when it detected life events.
- The goal is to help agents tap their existing contacts for more business.
Many agents get so caught up in the online lead craze that they often overlook what some experts say is the most effective use of digital marketing: using the technology to tap existing contacts for business.
First is one of the latest digital tools designed to help real estate agents sift their “sphere of influence” for clients, not just strangers who might be months out from buying or selling.
Ranking leads by likelihood to move
The startup — which was a runner-up at Realogy’s recent startup contest — ranks the contacts in a user’s database by how likely it deems they are to move in the next year, and it nudges agents to reach out on a regular basis and at pivotal moments.
The goal is to empower users to concentrate their marketing on the contacts ripest for outreach, so they can convert more of their sphere of influence into clients.
First uses predictive analytics to process massive amounts of information on people — including property, demographic and school data — to link attributes and actions of people to a high likelihood of transacting in the next 12 months.
Life events known to trigger people to move — such as job changes, pay cuts or childbirths — influence First’s assessment of a contact’s readiness to transact. First relays these events to users to prompt engagement.
For example, if a contact announced on Facebook that her child had turned four, First might alert a user to the event and add the Facebook post to the woman’s profile in First’s database. The post would then serve as reference material for the next time the agent wants to call the contact.
The event also might earn the contact a spot on First’s list of the most transaction-ready contacts, since people are more likely to move when their children approach school age. First then regularly reminds the agent to pepper the contact with marketing.
But First CEO Mike Schneider emphasized that “trigger” events are only so helpful with predicting transaction-readiness. To achieve a high level of accuracy, algorithms must link myriad combinations of attributes and actions to transaction rates.
If the woman with high income is living in a 1,500-square-foot home that’s located in a low-performing school district, she might be four times as likely to move in the next year as a woman with medium income living in a larger home located in a high-performing school district.
First ensures that the contact is flagged as a higher priority for outreach if she fits the first profile rather than the second, Schneider said.
Listings in your sphere
On average, a little more than 5 percent of contacts in an agent’s client database moves within a 12-month period, according to Schneider.
If an agent or team has 5,000 contacts, that means about 25o will move in the next year — representing at least 250 potential transactions.
First’s list of the top 20 percent of a user’s most high-value contacts (a list of 1,000 contacts) should capture more than 125 of the 250 contacts that will move in the next year.
Instead of blanketing 5,000 contacts with generic marketing, users can focus more of their time and resources on targeting the 1,000 contacts deemed most likely to bear fruit. They could spend either less on marketing, or they could concentrate the same or more spending on high-value targets.
“Knowing who isn’t going to move is equally valuable,” Schneider said. “You can save precious marketing dollars and focus exclusively on content to drive referrals.”
Specialized, integrated marketing
First’s predictive capabilities may also encourage agents to invest in specialized marketing that tends to be the most effective with consumers gearing up to buy or sell, such as handwritten notes, market updates and buyer and seller guides, Schneider said.
One way Schneider says First stands out from the competition — which would include SmartZip and ReboGateway — is through a focus on ease of use and integration with marketing tools that agents are already using (even if the startup is only beginning to execute on that focus).
The company imports contacts into a database on behalf of agents, not only adding contact information, but also pulling in reference material for agents, such as LinkedIn profile information and recent Facebook posts (assuming a contact’s privacy settings permits this).
If an agent only has a contact’s name and email address, First might also be able to dig up the contact’s phone number, and vice versa.
The process could involve manually importing contacts from a file and automatically importing contacts from Google and Outlook email accounts.
Behind the scenes, First generates its own dossier of attributes and past actions on contacts. Its algorithms will update the files when events occur or attributes change and continually run them through predictive algorithms to determine if contacts deserve a spot on the agent’s list of high-priority contacts.
First is working on helping agents seamlessly target the contacts its flagged through integrations with various marketing providers. That, Schneider claims, sets First apart from some competitors, who he says tend to offer limited marketing options within “walled gardens.”
First has already integrated with AdWerx, a tool that helps agents create and syndicate online ads, and it’s working on synchronizing with email marketing software Happy Grasshopper.
First also wants to integrate with services that mail handwritten letters on behalf of agents that are penned by someone other than the agent, such as Mail Lift.
The last integration points towards the view that agents can get much more out of digital ads by marrying them with offline marketing.
Some experts say online marketing has come to hog so much spotlight that print advertising has quietly recovered potency over the last few years.
Print advertising “probably used to have a high ROI (return on investment) and then went down, but now it’s coming back because no one’s doing it,” said Brandon Doyle, an agent team leader who wrote a book on digital marketing and tracking ROI. “We’re seeing four to 5-times (ROI) for print.”
One reason why agents often fail to make the most of digital marketing products is that they never learn how to use products effectively. First seeks to address this by offering coaching on how to extract the most value from its offering.
First costs $399 a month per agent, including coaching and database creation, but a 50 percent promotional discount may still be available for some agents.