Commentary by Brian Wildermuth
RISMEDIA, Oct. 16, 2007-The past several years have been an interesting time with respect to technology and the application of technology tools to business processes. In the field of real estate marketing and advertising, innovations in technology have created a particularly fascinating atmosphere. As the Internet has advanced as the primary marketing tool for real estate firms, agencies’ and individual Realtors’ marketing efforts have turned and become hyper-focused on lead generation and lead management.
This year, hundreds of thousands of dollars (millions for that matter) are being spent on search engine optimization, Web site content, robust lead capture reporting tools, pay-per-click, and other forms of Web advertising-each new tool trying to capture the most leads. I am reminded of The Brady Bunch’s middle sister, Jan, perpetually obsessed with her sister Marcia-”Marcia, Marcia, Marcia.” For the real estate industry, it’s, “Leads, Leads, Leads.”
After listening to all the hype around these new technologies, I have to ask: Is this fixation with the latest and greatest technology really paying dividends?
I, for one, am not convinced that the return in this area is equal to the time, money and energy being spent. It seems like yet another example of how our industry chases the latest technological trend in search of the best quick fix. Don’t get me wrong, Internet leads definitely have a place in the marketing mix; however, a strict adherence to one form of marketing/advertising will undoubtedly expose you to greater competition from firms who take a more balanced approach.
I am concerned when I hear firms touting that they are or should be dropping all of their newspaper ads and transferring those spends to the Internet. Their rationale is that a large percentage of consumers are on the Web looking for homes. But do we really know that they are looking to buy soon, now-or later? With a 3% average conversion rate on so-called Web leads, it’s clear to me that these consumers are home looking, not home shopping.
The pervasive interest our culture has in homeownership hasn’t changed; it’s just found a new place to be inspired. In my opinion, online home shopping is no different than the old days of drive-by viewings, yard-sign searching, or scanning the newspaper each weekend.
The big advantage with the Internet, of course, is that you can see who is looking around and make a list of “leads.” You can then “scrub” the leads to qualify them and then “incubate” them until those less ready to buy become more ready to buy.
I see Web leads as an electronic form of farming. In traditional farming, you acquire a list of homeowners (typically at no cost), you mail direct-response pieces to those consumers seeking out “leads;” you sort responses (scrub); and continue to mail (incubate) to those non-responders or those not yet ready to purchase. How is this any different?
The issue I have with this all-or-nothing obsession with Web leads and Web leads spend, is that most firms and/or agents are continuing to miss huge opportunities to develop lifelong relationships with their past or current consumers.
The 2006 NAR Consumer Behavior Study revealed that over 70% of all transactions are generated through some form of repeat or referral business activity. Many consumers will go to the Web to search for properties, but a large majority of them will turn to the agent that provided them or a friend great service in the past, not some stranger who electronically reaches out to form an e-relationship.
A healthy mix of sphere marketing, Web-lead acquisition and follow-up, farming, and online and offline advertising would likely yield greater results or, at a minimum, a more steady flow of “leads” into a firm or agent. With a lot of companies focused on the latest shiny object like Web leads, blogging, the use of video, texting and other related forms of “new” communication, the firm or agent who focuses on getting back to basics will likely thrive in any type of market.
Brian Wildermuth is president of SharperAgent.
For more information, visit www.SharperAgent.com.
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