Understanding Lead Behavior and Maximizing your Return on Investment

How do real estate professionals turn a monthly online marketing investment in to a significant monthly return?  One answer is understanding lead behavior.  Maximizing your return on investment when working online real estate leads, or any leads for that matter, takes more than good old fashioned elbow grease (aka Hard Work); is takes knowledge and understanding of what is happening and how to work those inquiries.  First and foremost, you need to know where those leads are stored and managed.  In the case of iHOUSEweb’s Elite Pro Websites, you will want to take advantage of the Leadtracker system built directly into the iHOUSE Elite platform.  When a prospective home buyer registers on your website, that information is logged in to the lead tracker system.  Now I could do a whole series on managing your leads within Leadtracker which I will likely discuss more in the future, but for now I will focus on lead conversion alone.

Often I hear real estate professionals, who wisely invest in online marketing, tell me that they have one major concern that they seem to never be able to eliminate.  That concern is the quality of the leads, or lack thereof.  Though there are techniques to reduce the amount of spammer type leads or people providing false information so they can continue looking, the trick is to know who are the good prospects and what to look for.  As I begin to write about finding those individuals in the coming weeks, I would like you to think on this: “The Rule of Thirds”.

Over my professional sales career, as well as reading numerous strategy books, I have found that there is a recurring theme of thirds.  In this case I adopted my “Rule of Thirds” when it comes to the quality of leads.  Over the last 12 years, my sales experience in Escrow, lending and online marketing for real estate has has taught me that not all online leads are created equal.  In fact only about one-third of them were ever top notch.  The “Rule of Thirds” taught me that no matter what I did one-third of my leads were going to be terrible: false information, bad information, spammer type, etc…  in addition one-third of my leads would be people who were interested in buying, however they had bad credit, not ready now, low debt to income ratio, and so on.  Now those third may pan out in time, but the sales cycle is typically longer.  The remaining one-third were the “Hot” leads.  These are the leads that require my immediate attention because they are looking to buy now.  I am sure that you, as a real estate professional, already know that when it comes to a potential homebuyer who is looking for a real estate agent the first professional agent to call and talk with them will be the one that the homebuyer works with.  When working your leads, you want to monitor and label these leads as “hot” so that they receive your attention.  You definitely do not want to let them slip through the cracks.  The second third I talked about should be the ones that you keep in touch with periodically over time to be aware of when they transition from lukewarm to hot.  The first third should just be deleted from your system

When I worked from this understanding, my “Rule of Thirds, I found my focus was on the good leads that I had, and not on the bad ones.  After all, a positive outlook creates a positive outcome.  What happened was my conversion rate of those good third of the leads climbed to make a top performer out of me because I knew where to invest my proactive energy.  It also allowed me to avoid the peaks and valleys challenge that many in sales encounter simply because I knew which leads to work.  Trust me when I say those leads were worked.  And to be honest; forget that old saying “work smart not hard”.  I found that working smart and working hard is how you get the results you are striving for.