Lead Generation Paradigm Shift
The lead generation paradigm is changing dramatically. Web 1.0 was about buying leads sourced from sites that collected contact info, usually as a toll for the consumer to see additional information. Web 2.0 promotes the free exchange of information with the presumption that the good will of such exchange would lead to a business relationship. The newest paradigm is just beginning to appear. Web 2.x will promote the free distribution of data as currency to attract leads. User generated content, whether from blogs or video, will soon be distributable across sites with consumer traffic - MLS sites, IDX broker sites, Trulia, Zillow, Realtor.com. It's a kind of content network and in order to participate, an agent needs a blog or another venue to display their user generated content.
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Old Paradigm - Pay $$$ for leads |
Impact |
Client impression |
|
Buy leads from Homegain |
Leads don't expect contact from Realtor |
Client often offended by contact |
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Buy premium ad placement from Realtor.com by zipcode or locale |
Advertising, pure and simple |
Client understands it's an ad, thus poor clickthrough rate |
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Buy Google Adword for keywords appropriate to farming area |
Pay per click ensures consumer will be directed to site |
Although client visits website, no reason to stay or bookmark |
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Drip e-mail marketing |
Haranguing consumer with weekly emails, usually with canned content |
Client eventually becomes bothered enough to unsubscribe |
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New Paradigm - Nurture leads for free. Build a non-pressure relationship with the client and let client make first move |
Impact |
Client impression |
|
Blogging |
Engages customer without the dreaded sales pitch |
Clients interested in content bookmark or subscribe to blog. When it
comes time to decide on an agent, they make the first move. |
| Blog networks like Active Rain |
Agents don't want to pay splits with their brokers for leads |
Client receives service from a more enthusiastic agent who hasn't given away a big broker referral fee. |
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Future paradigm - Trade user generated content and blog traffic as
currency to attract leads with sites that garner consumer traffic |
Impact |
Client impression |
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Trulia Voices, Zillow Q&A (among the first Web 2.0 products that connect the agent with consumer) |
Agents actively develop potential relationships answering consumer questions about local markets. Answers are in essence user generated
content. |
Potential consumer client must make decision to contact agent answering question |
| Social networking - Active Rain, Linkedin, Facebook |
Networks send traffic (and leads) to agent blog or site. This isn't a
common occurrence because social networking sites haven't reached the
critical mass. |
Client reaches agents depending upon the network they are subscribed to. |
| MLS, broker websites (not yet seen) | MLS and broker websites need to create the interactive agent/client interfaces for lead generation. They should add value to agent's business development rather than subtract value by dinging them with referral fees. Creating value enhances recruitment. | Consumers
need a way to find agent blogs as easily as they can find home
listings. Clients want to initially communicate with agents anonymously
or without pressure. |
|
New lead generation products that connect agents with clients by leveraging user generated content (not yet seen) |
Sites wanting to display user generated content for their consumer
audience (i.e., Trulia, Zillow, and others, maybe even Realtor.com)
will provide services that allow bloggers to post hyperlocal, video and
other content on site. By providing venues to connect blogging agents
with their consumer traffic, the site will begin to "own the bloggers"
- and gain their loyalty and respect. Owning the bloggers is a first step to owning the real estate agents. |
Consumers want to be connected to bloggers - they just don't know it
yet. It behooves real estate sites that attract consumers to deliver
them to the best destinations - this will in effect make those sites
more trustworthy, credible and powerful. Take a lesson from Google,
which delivers its users to the best citations. |
Evolution of Lead Generation Websites
Technorati Tags: lead generation, web 2.0, real estate marketing, blogging, real estate technology, content network
Good article, but it does not address an obvious method of lead generation - one that produces 2 to 5 leads a day for us - actively using the online classifieds for lead generation.
We are still fine tuning the process, but it works well enough that we turned down two listings last month because the buyers were unreasonable in their pricing demands.
Having a steady stream of leads can change your business model - did I mention that none of these leads cost us any money?
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Online classifieds is a great method... these applications are developed for those purposes. You should be writing a blog post at The Harper Team on how you're developing these leads by online classifieds.
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Social networking, blogging, websites, these are all three of several ways to "generate Leads". There is nothing wrong with lead generation, the flaw is in purchasing leads from sources you have not thoroughly researched where the consumer has no choice.
Rebecca D. Levinson-Connect2Agent
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Exactly - the leads you pay for generally do not want you to call them
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Very nice article, Patrick. Interesting to see where the Social Media networks intertwine with real estate. I created Facebook groups a few weeks ago on my market areas (Charlotte Real Estate and Lake Norman Real Estate) and just got the idea of posting some news and information there...
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Temptation seems to be the potential evil that lurks in the future paradigms, Pat.
What if the advertising models were not profitable? The companies in the future paradigm would be forced to revert to Web 1.0 models to remain going concerns.
I think the future paradigms will be successful if they generate eyeballs but the only way they can truly get committed industry participants is to charge a user fee. That preserves the integrity of the system and defines the relationship between the platform and the professional beyond the dubious quid pro quo that exists today.
I know I sound paranoid but I've seen too many technology platforms fail and revert to the "leadgen" model. There MUST be a defining agreement between the content providers and the content users.
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I've been thinking that the old pay for leads paradigm is going by the wayside... every real estate pro I meet these days lambast these lead - why would anything with such a bad reputation continue to exist? Lead gen is shifting towards making the consumer comfortable, and what better way than with free, no-obligation user gen content? More on Homescopes and the new local Blog Networks .
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I question how much business real estate professionals actually get from blogs. One of the top guys on Active Rain with 166,000+ points wrote on his blog that he had been blogging like crazy to get to the top. However, he only had three loans in the hopper as a result of his work. He would have done better cold calling.
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In principle, outsourcing lead generation to a company that works collaboratively with the real estate agent can make for efficiencies and increase Realtor time with actual prospects. If the lead generation firm engages the agent in a conversation in which the Realtors needs and preferences are consistently considered and reconsidered in light of the lead results (matching the appropriate prospect to the agent in a way that creates a possibility for rapport at the outset between prospect and agent, that matches up the prospective buyer's needs with the Realtor's skills and resources, and that distributes the lead to the agent in a seamless manner)lead generation can be remarkably fruitful. To be effective, this matching process must be calibrated and re-calibrated by the lead generation firm so that the "hand off" of the lead to the agent appears to the prospect as inevitable and fitting as ripe fruit dropping from the tree branch. The lead gathering process must itself be meaningfully specific -- that is, the prospect must find the website (the access) to the lead generation firm in as direct a manner as possible. If the lead path from the agent back to the prospect is accurately traced (or reverse engineered), the lead distribution to the agent will seem inevitable, the default sequence, "the path of least resistance." Such a task calls for ingenuity, testing and retesting, and confirmation among responses and feedback leads and agents.
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Quality of leads depends a lot on where the white papers (or trial, or webinar registration, or other incentive) are promoted. In general, the more narrowly targeted the site, the more qualified respondents will be, regardless of the incentive used. But white papers are the most common tool because they are cost-effective and generate high response rates.
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