If you’re a realtor, you’re probably familiar with the concept of online lead generation. If you aren’t, do yourself a favour and learn; online lead generation has been used by top relators for years now, as it allows agents to build out teams, increase sphere of influence, and ultimately make more money. So where’s the catch? It can’t be as simple as “do online lead generation and make more money”, can it? Well, I would argue that it can and should be that simple…with the right agents. So what makes the right agent? Why do some agents praise the world of online lead gen, whereas other agents seem to have nothing but horror stories? The answer has many facets, but it’s ultimately as simple as this: online lead gen isn’t for everyone. Here are the top 6 reasons NOT to do online lead generation.
You are a Part Time Agent:
Online lead gen takes routine commitment and consistent follow up. More importantly, it takes numbers. The average agent only closes around 2% of the leads that they’ve generated online. You read that right folks: 2%. As a general rule of thumb, closing at 2% means you’ll close 1 in every 50 leads. What this means, clearly, is that you need to follow up with a great deal of leads to find the small number who will make you a big profit. And you have to follow up on a regular basis. As a part time agent, are you going to have the time to dedicate to consistent phone calls, emails, setting up listing matches, and staying on top of your leads? Are you prepared to consistently follow up with 50 leads who seemingly don’t want to give you the time of day, in order to find that 1 lead who will convert? This is the reality of the online lead gen world, and as a result, you need to be able to dedicate full time hours to this work.
You Don’t Have a Solid Financial Foundation:
Like anything worthwhile in life, online lead gen doesn’t come without investment. Agent Locator generally recommends for single agents to commence with a starting budget of around $300 a month (including management fees). While this may not be an obscene amount of money to invest in your business (really, it’s a fraction of the cost of your monthly bills) it does add up over time and it is an investment. Along with the “2% rule” listed above, keep in mind that the 2% will not convert overnight. Generally speaking, you’ll want to give an online lead gen campaign a good 6-12 months to start making you money. While it’s not unheard of for agents to close business in their first 1-6 months, it’s not something you should bank on. The question you need to ask yourself is this: Can I comfortably invest $300 a month (or a larger amount should you want more leads) for 6-12 months without closing a deal? Assuming the worst will give you a safety net. This tie’s into reason #3:
You Lack Patience:
This is where you’ll have to be very honest with yourself. If patience is a virtue that you lack, then you may be better off staying away from the online lead gen world. With that said, Real Estate in general is a bad career choice for a person who struggles with patience; deals can take a long time to convert, and can sometimes be few and far between. With online leads, this is especially true. Online leads are early in the buying or selling stage. They aren’t looking to buy or sell now. With that said, there are always exceptions to the rule, but you should typically assume the worst when you’re projecting results; assume these leads won’t buy for another year, and exercise patience in combination with consistent follow up.
You Don’t Understand How it Works:
Understanding how online lead gen works is the first step to harnessing it as a medium to drive revenue. If you don’t understand the concept, then you’ll have a hard time implementing the steps necessary for success. You need to understand how these leads are being generated so that you can grasp the mind frame of the lead. This lead typed key words into a search tab, or they clicked on a paid advertisement on Facebook/Twitter etc. They didn’t call you, and they weren’t looking for an agent. They were looking for information. So when you follow up, the goal shouldn’t be to sell the lead on you as an agent yet, but rather to present yourself as a source of information and aid. The lead, whether intentional or not, reached out a hand by filling out an online form. That doesn’t mean they are ready to take you on as their agent, but it does mean that they are seriously contemplating listing or purchasing. Be the help they inadvertently went looking for. That way you’ll be top of mind when they are ready to start making moves.
You Don’t Research Your Partner Options:
In relation to my point above: understanding how it works will help you to choose the right partner. Any horror stories you may have heard in the past don’t always relate to an agent who wasn’t fit for the arena. Sometimes, the agent simply chose a bad lead gen provider. When exploring lead gen partners you should ask yourself these questions: did the company take the time to demo their product to me, and explain how every facet works? Does what they showed you make sense? Does the company offer training? Does the company have a dedicated support staff? Does the company have a track record of successful agents? Does the company offer a low cost per lead? If the answers are a resounding “yes”, then the only question is if you’re prepared to commit to the campaign. If the answers are “no”, then you’d be better off finding another provider.
You are Complacent or Content:
Are you happy doing 10 deals a year? Have you found a nice work/life balance? Does the added work involved with building your business scare you off? Or maybe you’ve been in business for 20 years and your sphere of influence consistently drives a yearly revenue and workload that you’re comfortable with. If you fall into these categories, online lead gen will simply be a burden on your finances and time. Long-time agents banking on their sphere of influence don’t need the extra work. Some of you may have families that you don’t want to take time away from. If you are at a stage in life where you simply don’t want to build you’re business anymore, then online lead gen is a venture you are better off leaving alone.
Where Does This Leave You?
In conclusion, online lead generation works…for the right agents. If you genuinely want to build you’re business, and sphere of influence alone isn’t getting the job done, you should consider online lead gen. If you are an intelligent, dedicated realtor with knowledge and capital to invest, then online lead gen can help you to reach levels of business that you’d struggle to achieve without it. That being said, you need to be honest with yourself in determining if you want to do this full time, if you have the funds to invest, if you understand the time commitment and follow up required, and if you have a good lead gen partner who will man the stations allowing you to do what you do best: sell!