Differences between real estate advertising and lead generation
– There’s a major difference between online real estate advertising and online real estate lead generation
– Advertising promises exposure whereas lead generation promises client opportunities
– Defining advertisement companies versus lead generation companies
It’s important to know that:
Expanding your real estate business via online means has drastically changed in the last 10 years. Today there are different styles of generating a larger client base for your business online.
So let’s clear the air: online real estate advertising is much different than real estate lead generation online.
Online Real Estate Advertising:
Typically when you think of real estate advertising online you think of Trulia, Zillow, and Realtor.com. Do you also think of lead generation? The fact of the matter is that the traffic driving model of those companies, by definition, does not qualify the big three lead as generation companies(although they will generate some leads, in the same fashion that television advertising does). The model that those companies use has a focus of generating a high volume of visitors, but not particularly delivering real estate professionals valid leads.
This is where the confusion sets in. Agents, a lot of times, equate high traffic to more leads, but that is a fallacy. At the same time that it is very important to be placed in front of a lot of eyes, it is more important that you are bringing in opportunities for yourself to expand your business (and your wallet).
So why all the hype about real estate advertising?
Traditionally you would advertise by placing signs, bus bench ads, billboards, newspaper ads, etc. Those tactics work to this day and they are not to be discounted. The same principles are implemented in advertising online by the big three and it makes sense because 42% of consumers are going online first before contacting an agent. Similar advertising techniques still work in the online realm and you will still find yourself getting opportunities if the circumstances fall in your favor. However, being a product of circumstance is no way to be successful. This is why agents would traditionally generate leads by knocking on doors, sending out letters, and talking to people.
Agents combine their marketing and apply both lead generation techniques and advertising techniques to put themselves in the best position to gain more inquiries for their services.
Let’s examine exactly what online real estate advertising entails:
• Your name and face gets placed next to a listing, along with other agents. (zillow states their business model here: http://www.zillow.com/agent-resources/trends-and-data/tips-and-advice/generate-real-estate-buyer-leads/)
• Much like television advertising, the big three bases their fees on impressions
• You pay based on the number of impressions the webpages accumulate
• The goal is to get exposure from people searching online
Lead generation online is a vastly different mechanism
At the same time that advertising online may generate a certain amount of leads, a lead generation company will make it their mission to hit a certain quota of leads for you. However, This is not a surefire way of success in opening up the door for more sales. Some business models will take leads from other areas and count them as a relevant lead for you even if you’re 20 or more miles away in order to hit that quota. Also, there is no guarantee that you will be receiving leads that actually contain a real living human being behind the inputted information. The variable that is not in the lead generation companies’ hands is the ability to close valid leads. The lead generation companies can only set up mechanisms of converting site traffic into valid opportunities for the agent. Then it is all up to the agents’ sales talent.
So now that we’ve established the clear difference, what should you look for when you’re searching for a good lead source?
The most important aspect will always be quality. Is it more effective to receive 5 valid leads per month vs 300 invalid leads per month? Absolutely.
Think about it this way: If you have 1 out of 5 leads that close each month from one source for the same cost as a source that you close 1 out of 300 each month, which would be the better investment? The first source obviously. It is much more time effective to only take action on 5 leads versus 300.
If your goal is to generate leads, then it is up to you to find the company that offers the best traffic conversion techniques. The number 1 mistake that agents are making when searching for a good online source of leads is getting the idea of high volume traffic confused with high volume and quality leads.
Here is the breakdown of what online real estate lead generation entails:
•Mechanisms that generate targeted traffic
•Mechanisms that convert traffic into leads
• Parameters that the home searcher enters/information that gets forwarded to agents
• Online real estate advertising promises that you will get exposure and that you will become a familiar face with your local market.
• Online real estate lead generation promises that you will be given opportunities to create relationships with potential customers
• Both promise that they are important to your business’s growth
Always remember your objective
If your objective is to get more exposure, then do your best to find the companies that best suit your marketing budget for the amount of impressions. Of course, one of the big three is a good place to start, but there are an abundance of other sources for advertising that might even have better targeting techniques. For example, we have our own version of advertising here at HouseHunt called HouseHunt Select
If your objective is to obtain new client opportunities then carefully research as many companies as you can, look for unbiased sources of reviews and ratings such as the Better Business Bureau or Rip Off Report. Even go as far as developing a list of what services a company offers that categorizes it as being advertisement based versus lead generation based. It is very important that you distinguish the two, otherwise you will be wondering why you aren’t getting what you paid for.Differences Between Real Estate Advertising and Lead Generation by HouseHunt