DRA Homes Chat: Why Lead Conversion Rates are So Low

Talking about NW Metro Atlanta real estate; including Cobb, Cherokee, Paulding, Dekalb, Douglas, Forsyth & Fulton counties. Tracking market trends, pricing and other real estate related issues. Chatting about lifestyle and fun events around the metro!

Why Lead Conversion Rates are So Low

There is a wealth of information available via the Internet to prospective home buyers and sellers around Real estate lead conversionthe country.

Unfortunately, that wealth consists mostly of fool's gold.  

The ZRT portals feed the consumer false information about property values either directly through their faulty home valuation tools or indirectly by supplying outdated listing information.

Of course, there are the real estate gurus and hucksters to contend with that prey on the desperate, uneducated and credit challenged.  Promises of loans for basement level credit scores, no money down or down payment assistance, rent to own schemes and so much more.

When these "prospects" finally stumble upon their local real estate expert they are so clouded by false claims and mis-information they are nearly impossible to convert into bonafide buyer or sellers.

What is the local expert to do?

How do we communicate effectively with consumers when presenting information that conflicts with what they think they already KNOW?

The conversation always starts out the same...

Generic seller: "I'm ready to list my home for sale, I want to list it for and I need to sell it in "

Generic buyer:  "I'm ready to buy a new home, I recently filed for bankruptcy and I have no money down. I want a 4 bedroom home in and I want to pay no more than .  I need a great loan officer because I also need to close in 3o days or less because my apartment lease is expiring."

I'm not trying to be a "NEGATIVE NELLY", this is only an attempt to understand why our lead conversion rates are so low, 1% on the bottom to the stellar conversion rate of 4% with an average incubation period of 6-18 months.  Whether they are leads generated & captured online through our own marketing efforts or some form of purchased web lead through ZRT the results are about the same.

One approach that I have taken in an effort to overcome this issue of low conversion is to stop forcing registration on my site for information that the public wants.  

I don't need to capture a host of contact names, phone numbers and email addresses (40% of which are bogus in the first place) of people that I am going to have to endlessly chase down in hopes of converting them to an actual client.

I provide excellent local content for the areas that I service and valuable information on the niche markets that I serve.  I promote local businesses, review local restaurants and share information on local news and events.  I interact with my community via social media outlets such as Facebook groups, YouTube, Google+ and, of course, ActiveRain.  

Cobb County Real Estate HotlineI don't buy leads but I do buy a lot of postage and I generate valuable responses through my targeted direct mail campaigns.

I stay in touch with past clients and customers through email and phone conversations but I don't have them on an email drip campaign that bombards them with weekly or monthly contacts.  

My goal, above all, is to have my phone ring.  

I want consumers who are READY WILLING AND ABLE to participate in the market, who have determined that, based on my online presence, I am the person that they want to work with, that I am someone that they can trust and that I am someone who understands my local market area.

I may not generate 100 leads a week but the ones that I do generate are much more valuable to me than any 4% conversion rate!

Share your best advice for lead conversion...

DRA Homes | My Momentum Team
DRA Homes on Facebook
DRA Homes on Google+Jenna Dixon on LinkedInJenna Dixon on Twitter

Jenna Dixon
Associate Broker
DRA Homes

Buy Cobb County Homes
JennaDixon@Outlook.com
(770) 374-4230

Fair Housing Act

DRA Homes
An Affiliate of Maximum One Realty Greater Atlanta
5041 Dallas Highway, Suite 700, Powder Springs, GA 30127
Office Phone: 770-919-8825 ext. 318

 

 

 

Comment balloon 34 commentsJenna Dixon • January 23 2016 10:25AM

Comments

direct mail still works well in my market also

Posted by Joe Jackson, Clintonville and Central Ohio Real Estate Expert (Keller Williams Capital Partners Realty) about 2 years ago

Hi Jenna, most of what we do is lead generation. Whatever method we choose, it's a numbers game and our follow up. Most realtors stop after the second(maybe third) contact. We have to keep in mind that buyers and sellers start their search 12 months out. So most leads we generate from online sources need nurturing. Ideal position is to have a great referral source(SOI). There's more than one way to generate leads, whatever fits our personality and business model is the one we should go with. Best advice is to follow up!

Posted by Beth Atalay, Cam Realty of Clermont FL (Cam Realty and Property Management) about 2 years ago

Jenna, We share a similar approach.  Our IDX search is also no registration.  I"m a realist, I don't have a lot of time to be chasing down contact and trying to "make" them work with me.  Thye can look all they want, to save a search they have to register, but other than sending them one email to the effect of "hey thanks for signing up and call me if you need me", I'm not chasing them.  They'll call me if/when they're ready.

Posted by Liz and Bill Spear, RE/MAX Elite Warren County OH (Cincinnati/Dayton) (RE/MAX Elite 513.520.5305 www.LizTour.com) about 2 years ago

Because I sell second homes sometimes we have to cultivate for YEARS before they really are ready, but I have a great conversion rate for those who find us on line. I don't mind setting anyone up a search and letting them do their thing and browse, they call when they are ready. I show the value we provide and they will call.

Posted by Tammy Lankford,, Broker GA Lake Sinclair/Eatonton/Milledgeville (Lane Realty Eatonton, GA Lake Sinclair, Milledgeville, 706-485-9668) about 2 years ago

Same here. An agent I spoke to told me today that the leads when calling back ASAP are often dead leads.  On postlets I rec'd 15 leads I contacted all mostly by eMail saying I will be showing the property on Sun PM and left 2 VM on the later ones 2 weeks ago.  None except the lone person came and took the house.

You have no time for me and vice versa.

Posted by Sam Shueh, mba, cdpe, reopro, pe ( (408) 425-1601) about 2 years ago

This year it is mailing and traditional human contact or referral. I asked a painter to pass my biz cards out.

Posted by Sam Shueh, mba, cdpe, reopro, pe ( (408) 425-1601) about 2 years ago

agree most will stop at 2-3 calls i did that and chased new new ones no more, working with local biz which is producing better results. direct mail works a lot better. if some one wants to do direct mail usps offers EDDM a great way to save on postage and reach more household. 

Posted by USHA CHANANI (KELLER WILLIAMS ) about 2 years ago

Excellent article explaining why coversion rates are so low. I'm going to be doing a combination of door knocking (oops!) and direct mail this year with very specific marketing.  

Posted by Pamela Seley, Residential Real Estate Agent serving SW RivCo CA (West Coast Realty Division) about 2 years ago

I think one reason conversion rates are low is the average online buyer lead is 9 months + from decision making. Without a CRM with perfected drips you will lose them when they are ready to transact

Posted by Joy Bender, Who You Hire Matters (Pacific Sotheby's) about 2 years ago

Jean, you are smart to look beyond your web site for clients.  The NAR stats show that while people might start their search for a home on the Internet, they tend to find their agent someplace else.

Posted by Patricia Kennedy, Home in the Capital (RLAH Real Estate) about 2 years ago

Hello Jenna,  excellent post and so very true.  It always seems to boil down to the good ole face to face, and ability to gain ones trust.  Make it a great weekend.  Mark

Posted by Mark Don McInnes, Sandpoint, North Idaho Real Estate - 208-255.6227 about 2 years ago

Every lead I receive pretty much is generated from the internet, and I work with my buyer's agents on what to say, plus I hammer home reality to the prospects who call me, and my conversion rate is averaging around 32% to 35%. That's basically one out of 3, so it's worth it to me. Being not afraid to lay it out there for them is key, I think.

Posted by Elizabeth Weintraub Sacramento Real Estate Agent, Top 1% of Lyon Agents, Put 40 years of experience to work for you (Lyon Real Estate) about 2 years ago

I also don't force registration on my site. If people need to register they will either leave for some other platform or put in false information anyway. I have always found the the really strong leads pick up the phone and call or register without needing to.

Posted by Jane Peters, Connecting you to the L.A. real estate market (Home Jane Realty) about 2 years ago

Not every client is willing, able, and or ready to buy.  These are the clients you want to become your clients.  Who doesn't want a no issue file? Regardless if lending, brokering, selling, and or insuring. Unfortunately, this industry regardless of which side you are on, you have to take the good and the bad together.  I may write a blog about converting dead clients. 

Posted by Christina Hayes, Credit Repair Expert (Everlasting Credit Repair) about 2 years ago

I have given it my best with 3 or 4 sources and they were all pretty much the same. The ones you could ever reach were surprised that you thought they were interested in selling or buying. Many were just playing around on the Internet and had no interest. Others would be interested when they got through their bankruptcy or in a few years. The money spent was a waste and I realized I wasn't willing to pay for leads of this quality and then have to nurture them for years. 

Posted by Debbie Reynolds, Your Dedicated Clarksville TN Real Estate Agent (Platinum Properties) about 2 years ago

Jenna - Certainly quality beats quantity every time for me. No sense in getting hundreds of leads if they are all bogus. I would much rather have a couple legit leads to work.

Posted by Troy Erickson, Your Chandler, Ahwatukee, and East Valley Realtor (Diverse Solutions Realty www.ChandlerRealEstate.weebly.com) about 2 years ago

Jenna Dixon one should work with the 'system' that provides them the best return on investment.

Working by referral by far is the best system that I can think of - no direct mail, no Internet advertising, no sign up for homes when they visit our IDX, no knocking on 'unknown' doors and no calling stressed expired!

Yes, provide them something of value regularly - and they will send referrals!

Just my two cents.

Posted by Praful Thakkar, Andover, MA: Andover Luxury Homes For Sale (LAER Realty Partners) about 2 years ago

Registration is not required for IDX searches through my site.  Those who are serious buyers or sellers email me through the system, or call.  Most of my marketing is to my sphere and clients.  The majority of my business comes from that marketing.

Posted by Sharon Parisi, Dallas Homes (United Real Estate Dallas ) about 2 years ago

Quality over Quantity, which nets you not only a better conversion rate, but a much more effective use of your time as well.

Well thought out approach.

Posted by Claude Labbe, Realty for Your Busy Life (Real Living | At Home) about 2 years ago

Good morning Jenna Dixon . Congratulations on the feature. The Internet is both a blessing and a curse in our business.

Posted by TeamCHI - Complete Home Inspections, Inc., Home Inspectons - Nashville, TN area - 615.661.029 (Complete Home Inspections, Inc.) about 2 years ago

Jenna - I agree, not forcing registration is better.  I let my customers self select and they tend to be higher quality.

If I were you, I would also look into strategies that keep customers on your site longer.  That will lead to stronger loyalty and higher conversion.

Posted by Women of Westchester Working Together, Women helping Women get ahead (Women of Westchester Working Together) about 2 years ago

While I work quite a bit on improving my website (and no forced registration), my business over the years shifted from Internet-driven to referral-based. Over the yeals, my "meals" tab in my business expense have increased tremendously and will continue to do so.
Like you, I believe in building long-last relationships and for me - for the bigger picture. (Hence my latest blog post). 

Posted by Loreena and Michael Yeo, Real Estate Agents (3:16 team REALTY ~ Locally-owned Frisco TX Real Estate Co.) about 2 years ago

Don't throw money at RTZ and expect the results you want. The best ROI is to blog, use video, link with a plan in the social media round robin and have the inventory. Inventory is king.

Your marketing is up to you as the local expert. Cover your local beat like no other and be the local authority. Plow the money you fork over for stale lists of leads that just make you spin and stay busy in an unproductive way. Plant those seeds to harvest better results from your own end of the funnel. Don't run everything through RTZ.

Provide your information delivery in a buffet rich of everything for any hour of the day on whatever device the buyer wants to use. No emails, addresses, names or retina scans to get it all. They will be back if they love what you prepared for them... like Grandma's cooking. Hook them with a better online presentation, experience. Treat them like you would want, expect to be treated.

Posted by Andrew Mooers | 207.532.6573, Northern Maine Real Estate-Aroostook County Broker (MOOERS REALTY) about 2 years ago

I recently began using a forced registration and my conversions increased dramatically. Website traffic for return users is up and clients that I can call and talk to AND that are ready to buy is up too. I think that the site itself if better than what they are finding elsewhere so they LIKE to use it. Since the content and format are well designed ( thank you to my Tech guy) I get compliments that it is a great site. I think that is super important.  

Yes, there are tons of tire kickers, but I believe that is going to happen even with just someone that picks up the phone and calls for free information.

Posted by Janis Borgueta, LIC RE Salesperson - Hudson Valley Homes for Sale (Key Properties of the Hudson Valley ) about 2 years ago

Jenna Dixon This is the absolute BEST post on this topic that I've ever read.

Your observations and conclusions are directly on point. And, you methods of developing your own leads are unquestionably the most productive.

Thanks for a GREAT post!

Posted by Ken Jones, ASA, CRES, Kenneth J. Jones (Institute of Real Estate Technologies) about 2 years ago

Some agents act like predators making the business they are in prey food

Posted by Richie Alan Naggar, agent & author (people first...then business Ran Right Realty ) about 2 years ago

Jenna, you hit on the reason I quite requiring registrations on my website. So many of the sign-ins were bogus, or useless leads. It ended up being a waste of my time. 

Posted by Mike Cooper, Your Winchester, VA Real Estate Sales Pro (Cornerstone Business Group Inc) about 2 years ago

I read this last night and it struck a chord with me. I have rarely asked for sign up and when I did the results were...blah. So I no longer bother. I prefer the phone calls but also have contact forms scattered through my web site and they get use. Works for me and not going to change it, too much time wasted to chase down 500+ so called leads each month.

Posted by Corinne Guest, Managing Broker, The Best in Buyer Representation (Barrington Realty Company) about 2 years ago

Jenna Dixon - I am in agreement with you. Better to get 1 ready, willing and able lead than hundreds with only a 4% conversion low rate. Good thing takes dedication, persistence and hard work. There are no short cuts in the real estate business.

Posted by Les & Sarah Oswald, Broker, Realtor and Investor (Eastvale Team Realty & Property Mgmt) about 2 years ago

Jenna. Many excellent points. I like quality over quantity. The responses of so many are so good and interesting. I am looking forward to more of your  posts.   Dave 

Posted by David Jones, BuyersAsk.com (BuyersAsk.com) about 2 years ago

Jenna,  You are so right ... the gurus teach agents that it is all about the numbers ... get 100 nos and you are closer to a yes. In the process agents are taught by the gurus to beg ... hound .. and invade privacy to get to people. There is a better way.  So glad to see this Featured.

Posted by Kathleen Daniels, San Jose Homes for Sale-Probate & Trust Specialist (KD Realty - 408.972.1822) about 2 years ago

You are right about not forcing people to register to see listings or keep your content behind a registration wall.

"Experienced" Realtors don't understand the sales pipeline is no longer 3 to 6 months.  It can be 2 to 3 years.  

You need a plan to keep your prospects educated and in touch for when they are ready.

Posted by David Barr (Berkshire Hathaway HomeServices Florida Realty) about 2 years ago

I do have forced registration but I don't "hound" the registrants. Instead they get regular property updates from their saved searches. When they are ready to buy, they call. I find that buyers are happy to provide their real contact info if you provide them something of value as well. My bounce rate is low (under 30%) and my return visitors are high (60%) so I must be doing something right. Interestingly, 90% of my business last year came from the internet. BTW, I don't do any PPC or buy leads. All my leads are generated organically through my website and blogging.

Posted by Tammie White, Broker, Franklin TN Homes for Sale (Franklin Homes Realty LLC) about 2 years ago

Jenna Dixon 
Isn't vocabulary interesting? One has to define "Lead" - "Client" - "Customer" - "Contact" - in order to have this conversation. Jenna - thanks for brining up this subject! Corinne Guest, Managing Broker reblogged it and added some thought of her own. Great conversation! COngrat's on the FEATURE!!! Lynn

Posted by Lynn B. Friedman, Concierge Service for Our Atlanta Sellers & Buyers (Atlanta Homes ODAT Realty Call/Text 404-939-2727 Buckhead - Midtown - Westside -- and more ...) about 2 years ago

Participate