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Lead Generation Companies - Good or Evil?

With my Austin real estate web sites I generate quit a bit of leads and inquiries regarding buying and selling homes in the Austin, Texas area. A couple months ago I signed up with HomeGain.com on their BuyerLink program. One of my agent said he worked at a company that got a lot of leads from this program and I signed up for $500/month without reading too much about it. Stupid mistake!

How is works: you pay HomeGain.com every time someone clicks a link to your site. It's not a link that says "Click here for an Austin Realtor" or anything like that. It just says at the top of the page, "Search Homes in the following area: Dallas, Houston, and (in my case) Austin. Visitors click it and you pay HomeGain about $2.50 (cost is different per area). Basically it's a cold pay-per-click (PPC) lead for about $2.50/click. HomeGain.com encourages its members to have a sign up page as their landing page. If you don't know how to build a landing page, HomeGain.com will sell you a cheap template for just $30/month/every month.

Over the course of 2 months and about $1,000 later, I got about 20 inquires and none of them worked out. A couple of them where from Mickey Mouse and qefqerfvqec. Neither Mickey or qefqerfvqec have replied to my emails yet. I've got my fingers crossed and they are in my drip programs.

From my experience, natural search traffic is of much higher value than a deciving $2.50 PPC visitor from HomeGain.com. If you want to drive more traffic to your website, use Google Adwords or Yahoo! Search Marketing for your PPC traffic. You can create keyword campaigns with ads that are relevant to the specific keyword phrase. You can also make the landing page very targeted per keyword phrase. For example: if you want traffic for the keyword phrase "Lake Travis Homes for Sale," you use the following landing page in your ad: "Lake Travis Homes for Sale."

I would be very interested to hear agents experiences with HomeGain.com and other similar lead generation companies. I have heard so many horror stories about scams and "false promises" from lead companies. They lock agents into contracts and fail to deliver.

Tell us your story. Don't be afraid to name names!

Posted by Ronnie Bredahl on 09/24/2007 03:54 PM

Comments (10)

homegain, homegaincom, lead generation, ppc, keyword, austin real estate, lake travis homes for sale

10 Comments on Lead Generation Companies - Good or Evil?

SEP

2007

I have used HomeGain.com, HouseValues.com, and several others. Folks, save your money and make your website move up the ranks in Google organically. You will save yourself tons of money and aggravation.

SEP

2007

I have done everything including organic and pay per click on Yahoo and Google. I have been using Homegain for about a year now it has been extremely successful. Yes, 50% of the leads have bad phone numbers...no different than my leads I get from Yahoo and Google, however my lead rate is double the rate I get from Google and Yahoo. Cost per click runs a little cheaper doing Homegain but more importantly I receive double the lead flow. I have tried many other services and homegain is the only one that works. With that said, if you don't have great lead capture tools and great conversion tools I don't care how you are getting your leads. Our company has close to doubled its business this year based on my relationship with Homegain and my development company that develops my software for me. We have created the McDonalds of Real Estate and are getting ready to franchise throughout the state of Florida. I intend to become even a stronger partner with Homegain. If you have any questions, please feel free to call me at 321-258-4150. I'm always available to help others out as long as they are not competing in my area!

Those sales people pushing this sure seem to think they have the hottest ticket in town. Because they tell a different story.

We need more posts like this to educate the newbies.

SEP

2007

I receive calls from HomeGain sales people every other week. They are very agressive in their pitch to force me to purchase their Buyerlink product. I believe that if your product is good enough then word will get around and you do not need to pressure me into buying it. I am not buying it for that reason. Maybe if they stop hounding me I will look into it. For now STOP CALLING ME!

SEP

2007

Personally, I love lead generation companies. My experience with justlisted.com was nothing but positive - $300/month to get the names & numbers of people who only want properties emailed to them (and nothing else) - How can I renew, and can I sign up twice? I love starting off any customer relationship with deceipt & misdirection. Couple that with their phenomenally outdated client management software, which they insist you use - or lose the coveted "preferred agent" status which does NOTHING for you - and DING DING, we've got a winner! I know that you're only supposed to tip waiters & bartenders, but I made an exception here.

BTW - the captcha on this is "bigay" - did you pick that, Ronnie?

OCT

2007

Eric, no I did not pick that captcha. I believe the captcha program digs through the visitor's computer to find the most commonly used word on their hard drive! haha

DEC

2007

Homegain's zip-code program works ok and its only like 56.00/month or something like that per zipcode. The only draw back is that its at the buyer own risk. IF no one enters that zipcode then you don't get any leads. I just wasted like $500.00 on a website that produced no leads. I think that I overestimated the web and its effect on rela estate. I think that poeple only use the web to search for homes while they are at work and etc. I think that they already have a relator in mind who they want to work with. I have found that P2p marketing is the best. The only drawback is that you can't be everywhere at once, but you will find that they are the most solid leads you can get.

JUL

2008

"A lead, is a lead, is a lead"...right? Absolutely not! All leads are different, and our program is definitely different from companies such as Homegain, Homes, Realtor, etc... In honesty one of the hardest hurdles for us to over come are back experiences with these companies who sell leads of seller value. More than likely 2 out of 10 realtors you talk to will describe a bad experience from a lead generation company. Ranging from non-exclusive, leads were slow, non-scrubbed leads, bad leads, and I could never get a hold of the company.

Leads are the life-blood of most successful realtors, either by receiving leads by your own advertising means, or using a 3rd party company. I can tell you that there are a lot of very bad lead generation companies, and then there are a few really good ones. Having 70% of your clients renew, sending out more leads then they are guarnteed, trying to get them more phone number contacts, EXCLUSIVE leads, and making sure the leads are fresh.... that is a company that Realtors do want to sign up with. No mind you I do work at a Realtor Lead Generation company (and no need on my end to spam the name) so I am a bit biased. But there are many successful realtors in the business who are receiving leads from companies such as mine. So the cup doesn't have to be half-empty. Just my $0.02

Companies such as Homegain, Homes, Realtor seem to be a complete waste of time. As some of you have indicated, "Bad phone numbers", "not exclusive", "old leads" etc... etc... With the company I work for we only send out EXCLUSIVE, Fresh, Scrubbed Leads.. and this honestly should be the industry standard. Anything else.. is quite frankly... misleading. I hope this post helps.

AUG

2008

Are there any good lead companies out there? it seems like you have one bad experience and that agent is ready to curse the whole industry...kinda like what the public does when they have a bad experience with ONE agent.

MAR

We're designing a web site, looking for input, whereby at least we'll have two categories; "Request More Info" and "Schedule a Private Showing" I would think a "Request for a Private Showing" would demand some immediate attention, wouldn't you?

We also have read the statistics about how important a timely response is, i.e. an MIT study showed a 100 X great chance of a favorable result when you respond in 5 minutes vs. even just 30 minutes.

The average consumer starts on the internet, goes to 5 sites, fills out 3 forms, and 98% will choose the first Agent to reply. Combine these statistics with our "Instant Agent Alert" whereby a text message is sent the second they send an inquiry and we hope to have something that will change the way Agents handle leads. You don't have to reply by text, just go to the web site and reply to the request.

My partner sent out 3 inquiries on the #1 web site in Omaha. Two never got back to her and the one that did took a week to reply. Does that contribute to the statistic that says 93% of all leads are worthless? I am betting YES!

So, as Agents, would you want to get all 4 "Requests for a Private Showing" from the same person in a 15 minutes time-frame, or would you rather be one of the 4 getting that lead and compete to be the first to respond, winning that lead? We have a HUGE discussion on which way to go with this.

Help!

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