For today’s real estate teams, it’s not enough to just generate leads. They must generate qualified leads to stay competitive.
Great teams and brokerages build successful businesses for their agents through branding and lead gen. But just any lead won’t do.
To stay competitive, teams and brokerages must provide their agents with a steady stream of solid qualified leads — that is, data-backed leads ensuring the buyer or seller is motivated and the right match.
Ask yourself these 5 questions to see if your team has what it takes to thrive in a low-inventory housing market.
In a recent Inman Connect session, Josh Harley, Founder and CEO, Fathom Realty, Plano, TX, pointed out that while agents often begrudge the fact that they may be giving up 50% commission to be on a team, it’s important to remind that a good supportive team will be handling 70% of the work.
“You have to show agents that they’re going to get more than they give,” Harley says.
Teams typically go one of two directions: They either subscribe to the mentorship model, which focuses on training and coaching agents’ personal growth, or a leads model. The problem with the first system, Harley says, is many agents leave once they’ve absorbed everything they need from the team and break off to go their separate ways. “It becomes a revolving door,” Harley says.
The leads model, on the other hand, provides immediate gratification to both the team lead or broker and agent. “Agents close business quickly and see a significant increase in income,” he says. “If I had the choice, this is the model I would choose, even if it meant hiring just one agent for the first year or two and then building from there.”
In Golden, Colorado, where there’s currently about six days of inventory and fierce competition for even a showing slot, Stacie Staub, Founder and CEO of West + Main Homes, offers two strategies for generating leads.
First, look for “pain and change” events, including births, deaths, divorces and other life changes that create movement. Social channels offer a great source, as people typically share their life-change moments on Facebook, Instagram and similar channels.
Teams can help by supporting agents with social marketing campaigns targeting prospective clients who are downsizing, upsizing and thinking about making a move.
Second, become an expert on what’s going on in your market. “Let neighbors know there’s a house for sale and what that does for their home value,” says Staub. “Be the source of that information.”
Dig in with data and target metrics like “homeowners most likely to move within the next five years” or “those with X amount of equity.” A good CRM integration can help (see below for more on this).
Business referral groups, such as BNI, offer a great way for likeminded professionals to grow their respective businesses. Set up a Zoom meeting and invite title professionals, lenders, plumbers, contractors and others in the housing and real estate industry to connect. After establishing a relationship with these peer professionals, request introductions to more potential leads.
“Tie these connections into private Facebook groups for regular chats,” says Staub. “You might ask your BNI group to get a referral for a plumber, then ask the plumber for their electrician. The more people you’re connecting with on a regular basis, it’s statistically proven that will lead to listings.”
Top real estate teams have one thing in common: strong leadership with a clear division of responsibilities and support.
A smooth-running sales team starts at the top with strong centralized KPIs, clearly defined tactics, and the systems and processes to carry out those goals. Every TC, buyer’s agent, seller’s agent, inside sales agent and marketing specialist has a specific role, which, when running on all cylinders, creates the ultimate streamlined operation.
Consulting firm T3Sixty found companies with strong lead gen and high conversion often have a 5-to-1 agent to staff ratio. At these companies, it’s typically the staff who writes the offer, manages the documents and markets the property, allowing the agent to focus on building relationships.
T3Sixty’s research found a correlation between conversion rates and the level of management. Organizations that merely sent leads to individual agents converted at around 1% or less, whereas those which held weekly accountable meetings and had complete systems in support converted around 4-5%. Agents fully managed with inside sales staff and supported by brand marketing activities converted as high as 20%.
Top teams continuously market their brand to help drive customers to the site and make the name easily recognizable. These efforts give the agent credibility by building trust with the community. As trust and credibility build, customers are more likely to engage with these agents. The cost of lead acquisition diminishes too.
Jeff Cohn, host of The Team Building Podcast and owner of kwELITE Keller Williams, says that while nationally the lead conversion rate is less than half of 1%, he has led teams converting six times more by implementing a number of touchpoints, including text messaging, email, listing updates and e-alerts. This creates “a plethora of direct contact” with incoming leads, he says.
Staub agrees, noting customers need to see agents on Facebook, Instagram, events and even printed collateral in their mailbox. “If you’re showing up in all those places, then you’re never a second thought,” she says.
When used correctly, a CRM can offer a powerful tool in building lead gen. Dotloop integrates with a number of CRMs, including Cloze which uses artificial intelligence (AI) to capture contact information from calls and emails in a contextual way that can detect urgency to inform client motivation.
BoomTown offers a feature that enables agents to create Facebook and Instagram ads with client behavior informing the ad audience, allowing agents to reach their target audience faster.
CINC users can gate their content with popups requesting buyers to provide their name, address time frame and whether they’re preapproved. This CRM also offers an Open Houses app that collects visitors’ personal info and flows it into the CRM, while its core mobile features let agents track buyers’ property searches.
Market Leader offers an IDX feature that monitors client search and view navigation on an agent’s site then streams the lead into the database. The CRM also offers Leads Direct, which includes advertising experts to help manage SEO marketing campaigns for agents, and HouseValues, providing potential sellers a personalized home valuation and comparative market analysis then passes the contact to the agent.
Follow Up Boss’s Pixel tracks customer site activity and gives agents the contact info upfront to personalize the followup. Pixel improves ROI by tracking which Facebook or Google ad converts into closed deals.
CRMs can also help encourage a little friendly team competition. For instance, Follow Up Boss’s Leaderboard displays competitive standings with the names of agents who log the most calls, emails, texts, closings or specific time frame data, such as calls lasting more than 20 minutes, with the real-time data standings displayed on a TV screen or online.
BoomTown’s Vitals Report provides team leads and brokers with an overall agent score based on their rankings, such as 50th percentile for followup or closing leads.
Top teams are constantly tagging, tracking and adjusting their agents’ lead sources to optimize the mix. Some metrics they measure include speed to lead, lead/client acquisition, client conversion and profit margin by advertising channels.
Well-organized internal sales support agents by providing consistent lead tracking and coaching. They’re constantly adjusting and fine-tuning lead strategies until they find the optimal mix.
Once your leads have been tagged, track them by assigning a profitability score to each lead source. Here’s a helpful formula:
The resulting number is a multiple of the return the investment produces with 1 = 100%. An ROI of less than 1 means the investment lost money. For example:
An agent spends $1,200 per year on lead source A, which can be tracked to $4,000 in commissions. She’s spending $9,600 per year on lead source B, which tracks to $50,000 in commissions. While A is cheaper than B, lead source B has a significantly higher ROI.
A common mistake team leads make is not charging high enough splits, says Harley.
“The team has to close five sales for the same income earned as a single agent closing one home. But you also have to pay for marketing, support and training,” he says. “That’s why properly explaining the value prop to agents is so important to justify the split.”
While agents may need to give up a portion of their commission to a team paying for leads, it’s important to remember that they’re not just receiving a one-time lead, but rather, the beginning of a lifelong relationship.