Real Estate in a Virtual World.

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The Secret of Converting Internet Leads

The real estate industry has always focused on the listing side of the business as a way to attract buyers. The more listings a Realtor had the more buyers the Realtor would attract. Providing outstanding customer service as a way to attract buyers was a secondary consideration.

Times have changed. Today's buyer will not tolerate poor customer service. If they feel that their needs are not being met, they will move on instantly and find someone who will meet their needs. Realtors need to be re-trained to provide a level of customer service that effectively communicates, connects with and establishes a rapport with buyers.

 Integrating technology into their business processes, and in particular using the Internet to generate leads, is one way Realtors can greatly improve their customer service and conversion rates. It can also help build a continuous pipeline of customers. 

The new consumer-centric process begins with a Web site that attracts visitors. It should offer valuable content to encourage registration and capture contact information. Research shows that consumers typically register on Web sites as long as the information they are trying to access has value to them.

The Realtor then needs to follow up-and quickly, but can only do so if he/she is immediately notified of a buyer's registration. Studies by the NAR have shown that an immediate response to a buyer inquiry is essential for converting Internet leads. Another study by real estate customer relationship management company Virtual Homes, Inc. shows that 73% of Internet leads that were successfully reached and qualified through their system were contacted within 3 minutes of registration (Figure 2).

  

Bar Graph

Figure 2: Of 13,000 leads generated since July 1, 2007, 10% were of referral quality. Of those referrals, 73% were reached on the first call (3 minutes). The remainder was reached with 2-4 calls. (Virtual Homes Research Study -Virtual Homes Real Estate, http://www.virtualhomes.com.      

In fact, most buyers visit multiple Web sites, so first responders have the best chance for success. For longer-term buyers, technology tools that allow agents to easily manage nurturing activities and future follow-up are essential to maintaining a pipeline of future business.

Most real estate companies do not have the expertise, time or investment capital to internally develop the Web site lead generation, notification, and follow-up processes necessary to convert Internet business. However, success depends on it. Therefore, it is important to find a vendor that offers engaging content on their Web site, and the tools to manage and develop long-term business opportunities.

Customer relationship management (CRM) systems are crucial for managing customers, prospects and clients. CRM systems help Realtors create relevant dialog's with buyers and accurately elicit and capture a buyer's needs and wants. Since most Internet leads are at least 6 months out from making a decision, a CRM system becomes crucial in helping nurture the sales process over long periods of time and in maintaining a pipeline of business.

Furthermore, Internet communication technologies such as Webinars, IM and micro-blogging sites such as Twitter and Pownce can also help Realtors interact with today's buyers in ways their customers prefer. These technologies also maximize the reach of the Realtor by providing constant, up-to-the-minute accessibility.  Social networks like Active Rain, LinkedIn and Face Book provide additional options.

Since the Internet is the new marketplace and younger agents are the best suited to service the tech-savvy Internet buyer, then attracting new and younger agents will be critical to the future success of real estate companies.

Comment balloon 18 commentsFred Doleac • November 11 2008 06:20PM

Comments

I respond as soon as a lead hits my inbox -- but technology being what it is, that could be a day or two from the date that the prospect hit send.  99% of the leads I get don't have a phone number or the phone number is invalid -- guess those folks aren't really serious. ~ Evelyn

Posted by Evelyn Panning (Property Connections Realty Inc.) about 12 years ago

I do not pick up the phone and call an internet lead out of the box.  They made the initial contact by email and that is most likely how they expect a response.  Once real contact has been established by email then and only then do we have a phone conversation.  It has worked well for me. 

Posted by Cindy Jones, Pentagon, Fort Belvoir & Quantico Real Estate News (Integrity Real Estate Group) about 12 years ago

Hello Fred........

This is the paradox.

Earning a living in real estate has always been predicated on listings.

73% of earnings are derived from listings.

I have always been in the minority, yet still enjoying the challenge of working with buyers.

Having said that, let's keep an open mind as to how you want to be a successful Realtor.

RJ Curtis

Posted by Ronald Curtis, Negotiating the best price and terms for my Buyers (Manes Realty Group) about 12 years ago

Fred - I think a quick response is important. In this day and age everybody wants an answer right away.

Posted by Robert Schwabe, Orange Park Real Estate (EXP Realty) about 12 years ago

Serious home buyers and sellers will pick up the telephone and call you instead of signing up for a home evaluation on my website. I have never had any success calling someone who have contacted me through e-mail they usually call me instead. Great post.

Posted by Lanre-"THE REAL ESTATE FARMER" Folayan, I don't make promises.I deliver results.SOLD HOMES (Keller Williams Select Realtors-Buy a home in Washington DC. Sell a home in Washington DC) about 12 years ago

When I first began this business with a major entity, I was also told that listings were the only way to make money.  They may have been correct for their busines model.  However, I wanted to buck the system and have always been primarily a buyers' agent.  That meant I had to give the best customer service I could phyically and mentally provide.  I started in '05 which was the end of the party.  (Little did I know).  But, given I had always wanted to be on the "other side", I didn't really care, either.  Now, I'm reaping those benefits.  Hooray for great customer serviced and client rapport!  Nothing is so satisfying at the end of the day than knowing you were there when someone needed you. 

Posted by Suzanne McLaughlin, Sabinske & Associates, Realtor (Sabinske & Associates, Inc. (Albertville, St. Michael)) about 12 years ago

Your input is a good one, thanks.  Don't forget that some of we senior citizens learn fast and are pretty internet savy. Even my 90-year old mom is active with email, something she thought she could never learn.

Posted by Richard Dolbeare, R(B), R(B), ABR, CRS...Hawaii Multi-Island Specialist (eXp Realty) about 12 years ago

Fred - Great information - not exactly sure that "newer" leads are better leads; think persistence & follow up has a lot to do with it.

Posted by Bobby Wallace, Sell Your Vacant Land The Hassle Free Way! (Vacant Land Solutions) about 12 years ago

ALoha Fred,

You snooze you lose.  Getting back and staying in touch with your internet leads is a must.  So how is cyberspace treating you.

Steve

Posted by Steven Nickens, R(S)GRI ABR, Maui Real Estate Hawaii (Wailea Realty) about 12 years ago

Evelyn- there are lead notification tools that will send the leads to your cell phone via text so you can follow up immediately.

Cindy - we tested it both ways and found that there was only a 31% reduction in lead registration when we required a phone number and since 65% are valid we end of with fewer leads but they can all be called.

RJ - Newer, younger agents find it difficult to compete for listings. So, the Internet, buying side allows them to survive before they can thrive.

Posted by Fred Doleac, Real Estate in a Virtual World (Fred Doleac - Bean Group) about 12 years ago

Suzanne - Congratulations for finding the path and your persistance.  You will continue to take market share and think about your buyers that will be selling in a few short years.

Steve - outperforming the market.  Qualified, motivated buyers is our shift in strategy.  If you have the right mindset, systems and tools, anything is possible.

Posted by Fred Doleac, Real Estate in a Virtual World (Fred Doleac - Bean Group) about 12 years ago

Suzanne - Congratulations for finding the path and your persistance.  You will continue to take market share and think about your buyers that will be selling in a few short years.

Steve - outperforming the market.  Qualified, motivated buyers is our shift in strategy.  If you have the right mindset, systems and tools, anything is possible.

Posted by Fred Doleac, Real Estate in a Virtual World (Fred Doleac - Bean Group) about 12 years ago

Richard - no slight intended.  The post is a commentary on the industry as a whole.  Did you know that 53 was the average age of Realtors in 2007?  That is my age and is "getting up there"  for any industry.

Posted by Fred Doleac, Real Estate in a Virtual World (Fred Doleac - Bean Group) about 12 years ago

I like the numbers you posted on NAR stats. However, there are many that do not provide real phone numbers. I do feel sad and wish that if they didn't want to be called, just post a phone number that others would know is not real so that it doesnt waste people's time. Oh well. What do I know.

Posted by Loreena and Michael Yeo, Real Estate Agents (3:16 team REALTY ~ Locally-owned Prosper TX Real Estate Co.) about 12 years ago

Fred, Great information and great chart for us visual folks, it makes an impression on me, I've got to get quicker on my response.

Posted by Chris & Karen Highland, Integrity, Experience, Enthusiasm! (eXp Realty) about 12 years ago

Fred,

Great info, with so many realtors today, it's easy to go to the next.

Posted by Johnathan Mullaney, Broker, Flagstaff Real Estate (Village Land Shoppe) about 12 years ago

Chri and Johnathan- It is about customer service, not us.  thanks for the comments.

Posted by Fred Doleac, Real Estate in a Virtual World (Fred Doleac - Bean Group) about 12 years ago

Chri and Johnathan- It is about customer service, not us.  thanks for the comments.

Posted by Fred Doleac, Real Estate in a Virtual World (Fred Doleac - Bean Group) about 12 years ago

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