Real Estate Investing :The New Ultimate Listing Presentation (Part 4)

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So how do you capture a typical real estate customer? According to the National Association of REALTORS® 2009 Survey of Home Buyers and Sellers, 94% of all home buyers and sellers begin their quests on the Internet, and many of them begin by going to a search engine like Google or Yahoo, where they do a search for homes or listings.

Then they choose a link to a real estate website and visit that agent’s site hoping to find help in their search. The overwhelming majority of these real estate customers are looking for home searches. If they don’t find a good, easy-to-use home search, they will generally move on to another website.

That seems pretty easy, then — just get a website with an IDX home search. Heck, you probably have one already. But here’s where we come to the first problem. Most real estate websites do an amazingly poor job of capturing leads.

If that website is a “typical” real estate website, a very small number of customers will fill out a guest registration form and identify themselves — generally just under 1%. Last year’s numbers from the National Association of REALTORS® pin that number at an astoundingly poor 0.87% capture rate.

What this means is that, out of every thousand visitors, you, the website owner, will actually capture only about nine leads. Sound familiar? The capture is very inefficient because real estate websites are not designed around capture, but rather around giving out information.

So here’s the problem: Internet traffic costs money. Either through pay-per-click (PPC) advertising or through search engine optimization (SEO), the website owner is able to have his website listed on the search engines in such a way as to be displayed whenever a customer does a real estate search.

Pay-per-click advertising costs from under a dollar to several dollars per visitor, while search engine optimization costs several thousand dollars up front and needs to be continually managed in order to keep the site ranking high. So again, Internet traffic costs a lot of money.

Now, when you take that high cost of traffic and combine it with the low capture rate (0.87%) of real estate websites, the actual cost per lead becomes extremely high, usually well over 0 per lead. This is the reason that many agents, even those with websites, choose to purchase Internet leads from vendors rather than making their own.

Lead generation companies often charge and up for leads, and many times they sell the same lead to multiple agents. Some vendors charge as much as 30% of the closed transaction, resulting in lead costs of over 00. To make matters even worse, not only are those leads expensive, but often the lead quality is poor as well.

This is the very problem that caused me to begin to look for a solution. When I couldn’t find either an efficient website — a website that was designed specifically to maximize lead capture — I decided to build one. Several generations later, we ultimately developed a technology we called an LCM Gateway. LCM stands for “Lead Capture Module”.

Instead of having the inefficiencies inherent in even the best real estate websites, which are designed around delivering information, this LCM Gateway was designed to do only one thing: to capture Internet traffic.

Rather than having a capture rate of less than 1% like typical websites, the LCM Gateway captures between 30% and 40% of all its visitors, bringing the cost per lead down to as little as . More importantly, the quality of the lead is much higher than the quality of the leads supplied by lead vendors.

I can still remember those days of buying leads from companies like HouseValues (now called Market Leader), HomeGain, and Service Magic. I remember getting the same lead that had been sold to three other agents, and I remember getting some “leads” that had only a name and an email address!

I still remember spending lots of money and getting a high number of bogus leads. It was very frustrating, but I was desperate. So I decided to learn how to make my own leads. Now we generate all our own leads using our technology — tens of thousands of leads every single month! Is it any wonder that we’ve grown so fast?

And there’s no reason you can’t grow this fast as well. What it comes down to is having the customers. Let me give you an example. In Eagle, Idaho, we have an agent named Kyle Wilson. A relatively new agent, Kyle worked for Silverhawk Realty and had closed a very respectable 25 transactions in his second year. Not too bad for a new agent, I think you’ll agree.

He began using our LCM Gateway technology and soon he grew to a team of thirty agents and started looking at expanding to other markets. Kyle went on to do hundreds of real estate transactions that year, and became one of the biggest producers in Idaho. He listed homes at 8%, and the only thing slowing his growth was his ability to recruit and train more agents. What a success story!

So let me ask you a couple of questions. Did Kyle suddenly get smarter? Did he start working twice as hard? No. The fact is that Kyle is a very sharp and very talented guy. We simply helped point him in the right direction and gave him a few tools to make the process easier. He created the success.

And the truth is that it could just as easily be you. Why not? Do you work hard? Are you smart? If you answered yes to those questions, not only could it be you, it should be you! Why shouldn’t it be you?!

But I’m getting ahead of myself. I’ve told you how we ditched the typical real estate website design and developed something much better — our LCM Gateway technology. If you’re following along and feel like doing something simple to produce the leads you’ll need to use this approach, you’ll need to know how the LCM Gateway works.

That way whether you ultimately decide to license the technology from our company or you decide to build it for yourself, you’ll understand it. And that’s what I’ll cover in depth in the next part. If you don’t get anything else from this entire approach, learning how to produce lots of your own inbound leads will change your practice forever, so don’t miss it!

Matt Jones is the founder and CEO of FavoriteAgent.com and nationally syndicated author of LCM: The Secret to Success in the New Age of Real Estate, The Ultimate Listing Presentation, Traffic: How to Sell Fast and Net More, Becoming a Mega-Producer, and 20 Questions: Everything You Always Wanted to Know about Real Estate but Were Afraid to Ask. Jones’ North Carolina-based company has been profiled by major media outlets as an innovator and a pioneer in the industry, and CNN’s Pulse on America claimed FavoriteAgent.com is “changing the way real estate is being done in America.” This content is cross-posted in the following locations: BlogMattBlog.com, RealBlogging.com, NewsGeni.us, TheCommissionCheck.com, and now Amazon Kindle.

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