Internet Leads are WORTHLESS!!!

By
Real Estate Broker Owner with Joel McDonald -- www.AutomatedHomefinder.com

As the owner of a Colorado real estate company, I end up "talking shop" quite often with other Realtors®, and conversation inevitably ends up around our online business model and how our agents depend almost entirely on internet leads for getting new business.  No cold calls. No farming. No open houses.  Just internet leads.  In response, the Realtors® I'm talking with usually say "How can you do that?  I've always found internet leads to be worthless and a big waste of time."  The funny thing is -- I partly agree with that statement.  At face value, an internet lead not properly followed up with is practically worthless.  Proper followup, however, makes all the difference in the world and can change your odds of closing an internet lead from about one tenth of a percent -- to 5%, 10%, or even higher.

 

We've studied tens of thousands of internet leads.  Automated Homefinder has generated tens of thousands of internet inquiries in the 12 years since our inception, and we've learned a lot from our successful closings with many of those leads.  We've learned even more from those who don't buy through our agents.  The biggest lesson: Within the first six months of signing up, approximately 40% of the people who unsubscribe are doing so because they bought a home, or are under contract to buy a home. Let's not forget that this statistic excludes those who bought a home through one of our agents!

In other words -- when you get an internet lead, you have well over a 40% chance that they're going to buy a home within 6 months.  Knowing that a prospect who signed up on the internet has well over a 40% chance of closing within 6 months of them signing up with you, does that change your motivations about how to treat that lead?  If so, Your job is simple: You just have to convince them to buy a home through you vs. one of your competitors. The best way to get them to buy through you? Follow up with them early and often.

An interesting statistic from another internet company:  I was at the 2008 NAR conference just last week, and I heard an interesting statistic from J. Lennox Scott - CEO of John L. Scott Realty.  He said that you are 21 times more likely to close an internet lead if you call them within 30 minutes of their inquiry -- and 100 times more likely if you call within 5 minutes!  At first, this seemed like a bit of an exaggeration, but the more I thought about it, the difference between our producers who sell $10 to $12 million in sales per year, and our agents who close only $2 or $3 million with similar volumes of leads comes down to one thing:  Our $10 to $12 million a year producers follow up with new leads as soon as feasibly possible.  I was once at lunch with one of our top producing agents, and he called two of his internet leads right then and there while we were at lunch.  Since he was at lunch with me, he told them he was at an appointment, but wanted to call just to introduce himeself, and that he'd call them back to see what they think of the houses he sent a bit later.

You might be thinking "How in the world can I be expected to follow up so quickly with internet inquiries without being tethered to my computer all day?"  The solution is simple: Whether you have an IDX solution with an opt-in, a direct response system (free reports, home valuation requests, etc), or something else, odds are that you are able to get an email alert whenever you get a new lead.  If you can get an email, you can get a text message.  If you can get a text message, you can call your new leads -- ALL of your new leads -- within minutes of them signing up.

To get an instant text message as soon as a lead signs up, all you have to do is find out what your carrier's email extension is.  Once you know your "email to text" email address, all you have to do is enter that email address in your prospect alert system.  For example, if you are with Verizon and your cell phone number is (555) 555-1212, your email address is 5555551212@vtext.com Here are some of the email-to-text addresses for the major cell phone carriers:

  • Verizon: 10digitnumber@vtext.com
  • AT&T: 10digitnumber@txt.att.net
  • T-Mobile: 10digitnumber@tmomail.net
  • Virgin Mobile: 10digitnumber@vmobl.com
  • Voicestream: 10digitnumber@voicestream.net
  • Sprint: 10digitnumber@messaging.sprintpcs.com
  • Nextel: 10digitnumber@messaging.nextel.com 
  • Alltel: 10digitnumber@message.alltel.com

In summary, if you've been in the camp of "Internet leads are worthless", and are letting those leads sit dormantly in your database because you don't want to waste any time on them, try calling them within minutes of them signing up & see what happens.  If they don't answer, hang up and try calling from a different phone.  I'd be willing to bet dollars to donuts that if you simply make an effort to call them ASAP, you'll see a drastic improvement in your conversion rates.

Good luck!  Leave me a comment & let me know how it goes!

 

 

close

This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Spam prevention

Accessibility option: listen to a question and answer it!

To submit the form,
drag the tag to the circle on the side.

Type below the answer to what you hear. Numbers or words, lowercase:

Topic:
Real Estate Sales and Marketing
Groups:
Coaching and Mentoring
Free Tools For Real Estate Agents
Marketing and Technology Idea Exchange
New Technology, Gadgets and Things To Make Life Easier...
Tags:
internet leads
internet marketing
real estate leads
real estate prospecting
effective marketing methods
online marketing strategies

Comments 30 New Comment

Anonymous
Post a Comment
Spam prevention

Accessibility option: listen to a question and answer it!

To submit the form,
drag the magnifying-glass to the circle on the side.

Type below the answer to what you hear. Numbers or words, lowercase:

Rainer
26,859
Joel McDonald
Joel McDonald -- www.AutomatedHomefinder.com

Marcy -- Agreed!  There certainly is a need for speed when getting back to a lead. ;-)

December 01, 2008 11:18 PM
Ambassador
1,518,686
Christine Donovan
Broker/Attorney 800-610-7253 DRE01267479 - Costa M
Donovan Blatt Realty

I find that phone calls to my internet leads make a huge difference as does constant follow up.

January 03, 2009 12:20 AM
Rainer
11,697
Cindy Hartpence
Edisto Real Estate Company

Thanks ..this is where having a blackberry has helped me a great deal. Folks often respod by, "Oh how quickly you've gotten back to me"; speaking with them helps build rapport"

Thanks,

Cindy

January 04, 2009 01:28 PM
Rainer
11,188
Ron Spanton
Kentucky Lake Area
RE/MAX Real Estate Associates

I agree that the internet shopper wants information fast! But either through an email or by phone I let them know that their privacy is very important to me and I would be happy to answer any questions they may have. I've been able to build real relationships leading to closings from the internet.

January 04, 2009 01:50 PM
Rainer
7,998
Julie OnullBrien
The Right Choice in Realtors
Keller Williams

I really need to work on my website.  I've been missing the boat!

That you for all your information.  It is so helpful.

May 11, 2009 04:19 PM
Anonymous
Post a Comment
Spam prevention

Accessibility option: listen to a question and answer it!

To submit the form,
drag the sunglasses to the circle on the side.

Type below the answer to what you hear. Numbers or words, lowercase:

Rainer
26,859

Joel McDonald

Ask me a question
*
*
*
Spam prevention

Accessibility option: listen to a question and answer it!

To submit the form,
drag the lamp to the circle on the side.

Type below the answer to what you hear. Numbers or words, lowercase:

Additional Information

As the owner of a Colorado real estate company, I hope to be able to share my 15 years of real estate marketing advice with anyone who is interested. I also look forward to interacting with the rest of you in the AR community who have so much to share.

To receive email updates of my new blog posts, enter your email address below:

Delivered by FeedBurner