Online real estate advertising

By
Managing Real Estate Broker with Brad MacKenzie
http://actvra.in/ZTG

Online real estate advertising

I'm actively investigating the way online real estate advertising works, or doesn't, and whether it is worth it. This post is just a "get your feet wet" post about my first impressions. I've thought and worked at this a lot lately. Here's one aspect of the deal about which I'd really appreciate your feedback and further thoughts.

Sales lead funnel

I look forward to the day that someone cold-calls me with a pay-for-performance proposition, like getting a referral fee if I close a transaction with a lead the cold-caller sent me.

In the meantime, it seems to me that while some people are generating profits by advertising on sites like Zillow and Facebook, for example (since there are always winners in every game), online ads, in the aggregate, MUST cost more than they are worth because, otherwise, people WOULD be offering pay for performance! (If referral fees paid marketers more than pay-per-click, they'd sell that concept instead.)

Right now, we are bamboozled by the baffling chain of conversion ratios - and the wide variety of costs and promotional packages - that lead down the conversion funnel from impressions > clicks > page views > lead captures > contacts > prospects > customers > clients > sales. 

As long as you and I, as consumers, don't understand the average statistics and our personal conversion rates, we can't make an informed investment decision, and that works in favor of marketing companies and agents/brokers who are willing to spend heavily to dominate and test markets.

I'd really appreciate your feedback and further thoughts and experiences about online real estate advertising.

Thank you!

 


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Internet Lead Generation-How Best To Capture Your Audience
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Rainer
121,890
Tom Jansson
Acuity Home Inspections - Chicago, IL
Chicago Area Home Inspector - InterNACHI Certified

Hi, Brad-  This is really the biggest question for anyone involved in advertising and marketing.  I've heard it said that 90% of all advertising dollars are wasted.  The trouble is finding out which ones work!

I appreciate the fact that Active Rain has tools available to tell me how well my blogs are performing.  It doesn't give me much information on conversion rates, but at least I can tell which blogs are attracting the most eyeballs and the most interactions.  Armed with that information, I know which blogs to leverage.

Thanks again for posting; I'm looking forward to other comments and blogs about this topic.

Aug 19, 2013 02:11 AM #1
Rainmaker
2,423,190
Kathleen Daniels
KD Realty - 408.972.1822 - San Jose, CA
San Jose Homes for Sale - Probate Broker

Brad, That's never going to happen. Those folks selling leads would need to be licensed in order to be paid a referral fee. And, we all know that is NOT what they are selling. No one is selling performance. 

They are selling a concept with no service level or guarantee. The general public knows what ads are too so they are not fooled. When they fill out an online form they are doing so to get the information they want. They may not even be qualified to buy a home.  

I stick to organic in what I eat and how I run my business. I blog and my phone rings. I'm not even big on FB or other social media sites.  It works for me.  I'm not big box and don't want to be. That is why I went out on my own.  I love being an independent broker. 

Aug 19, 2013 02:26 AM #2
Ambassador
3,323,094
Debbie Reynolds
Platinum Properties - Clarksville, TN
Your Dedicated Clarksville TN Real Estate Agent
Brad, I have done it through Homes.com, my newspaper, specialty real estate sites, etc. and never did I feel like it brought in enough leads or the leads that were genuine and viable. The cost far outweighed any income. They would try to impress with the stats about views, clicks, etc. But what I found is that many of these type leads are barely warm. The consumer fills out multiple questionnaires and may even already be under contract and still looking. I will not be going in that direction again anytime soon. I would rather donate to a good charity.
Aug 19, 2013 02:32 AM #3
Rainer
323,822
Scott Larson
BHHS/Utah Properties - Park City, UT
Park City, Utah Real Estate News

Brad, my experience in this market is that zillow and trulia at least are excellent ways for me to allocate my advertising dollars.  I have already closed 1 deal that will pay for all of my advertising at my current level of commitment for the next 4 years with several more in the pipeline.  I have a Trulia lead that placed an offer last week, but we did not get it, I am still looking for him.  We are a low volume/high dollar market so that may have something to do with it.  I also noticed in looking at who the zillow premier agents are in Park City, it is mostly a subset of some of the best, highest producing agents in town.  So far I would say that about 25-35% of my leads through these sources are good leads.  Communicating back and forth with a real interest in buying.

Aug 19, 2013 02:58 AM #4
Rainmaker
920,703
Richard and Beth Witt
Long Island Cash Home Buyer - Massapequa, NY
Long Island Cash Home Buyer 516-330-6940

A few of our agents are using Zillow and are very pleased with the results.

We provide Boomtown for our agents and we do get a return on the investment... small... but a return and it keeps the agents happy...

Nothing else has paid off for us and we have tried many avenues...

I too am anxious to read your other comments...

PS... to date I have not gotten one lead from AR however I use it to drive traffic to our site which it does do and I love the social interaction and have learned a lot so AR is a keeper for me... however not a good lead generator...

Beth

Aug 19, 2013 03:52 AM #5
Rainer
404,880
Brad MacKenzie
Brad MacKenzie - Duxbury, MA
Turning Houses into Homes on the South Shore

Yes, Tom, right on! I agree that AR's stats are somewhat helpful, and perhaps could be made more useful to us.

Kathleen, some of these folks are licensed. Otherwise, I agree with your first two paragraphs and applaud you for the third!

That's been my experience, too, Debbie. Cold, lukewarm and limp.

See now, Scott, THAT'S interesting. You and Beth both have had positive Zillow experiences. I know of one person who swears by Facebook $5 a shot boosts.

And Beth, I also have no direct clients from AR, but I have had a referral from an AR member.

Aug 19, 2013 06:29 AM #6
Rainmaker
675,239
Hella Mitschke Rothwell
(808) 226-1095 or (831) 626-4000 - Honolulu, HI
Hawaii & California Real Estate Broker

Brad: I have never purchased leads. Have gotten a few "free" ones, but everyone of them was not my type of client, if I could reach them at all. I would rather get a call like I did this afternoon out of the blue from all the marketing I put out there. When THEY call ME, that's what my business is all about. Like Kathleen, I am an independent broker and can't possibly call and nurture hundred's of leads (if that's what they are promising).

Aug 19, 2013 01:47 PM #7
Ambassador
2,547,597
Dick Greenberg
New Paradigm Partners LLC - Fort Collins, CO
Northern Colorado Residential Real Estate

Hi Brad - We don't purchase leads, and none of the agents I actually know who do or did are happy with the results. Usually, the issues were the quality of the leads. That said, there is some truth to the funnel concept - with the issue being how wide the top of the funnel has to be in relation to its cost. And there are some much lower-cost ways to generate leads than buying them. An example would be what Ben Kinney and his team do with CraigsList - I'm sure there are posts here describing that, as well as recordings of webinars at AR University where he talks about it. Personally, I feel a lot more comfortable generating my own leads with blogging and an IDX website - but that's just what works for us.

Aug 20, 2013 02:48 AM #8
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