Leads in real estate are pivotal to the success and growth of both real estate agents and their businesses. Having a healthy stream of leads flowing in at a constant rate ensures that there are always more deals happening, keeping revenue coming in.
However, generating leads organically can become tough sometimes if marketing strategies are not panning out, which is why agents and real estate businesses often buy leads online.
This article will delve into the pros and cons of buying real estate leads online, and what that could mean for a real estate business.
What are Real Estate Leads?
Before getting into the pros and cons of buying real estate leads online, we first need to figure out what real estate leads are. The best way to do this is by establishing marketing campaigns and differentiating the types of marketing campaigns. Some of the best CRM systems for real estate allow this to be made easier in the modern day.
Real estate leads refer to potential clients who have contacted a real estate business in some way. This can be a direct connection or an indirect connection. For example, real estate businesses often run marketing campaigns of direct mail, cold-calling, emails, and texts. The real estate agents provide an introduction to themselves alongside an enticing message to encourage people to contact them for their real estate needs. Any leads that come through this form of marketing is referred to as a direct lead connection.
However, sometimes marketing campaigns for real estate businesses can be done through TV commercials, billboards, or bus signs. These advertisements are out there for everyone to see and do not require a real estate agent to reach out to specific people. Any leads that are generated through these methods are indirect leads.
Types of Leads
Leads themselves can be of three types:
- Hot Lead: Leads that have showcased a strong inclination to buy or sell something, and want a real estate agent or business’ help.
- Warm Lead: Warm leads refer to leads that have shown some interest in engaging in real estate business, but need some time and convincing to get there.
- Cold Lead: Cold leads showcase a minimal amount of engagement in the idea of buying or selling properties at the time, but can be more inclined in the future.
Knowing what type of leads a real estate business is getting can help them understand whether buying real estate leads is necessary. Agents and their businesses require a steady flow of hot leads consistently to help them grow their business and keep revenue coming in.
Buying Real Estate Leads
Benefits of Buying Real Estate Leads
There are significant benefits to buying real estate leads when times get tough in the real estate market, and businesses are known to do that from time to time.
Quality of Purchased Leads
Generating your own leads will often return a mix of hot, warm, and cold leads without any fixed number for the respective qualities. However, when purchasing leads online, you are paying for a specific type of lead, which ensures you are getting high-quality leads for your real estate business.
Paid leads also come with the benefit of providing all the important details for a deal; contact details, property details, and preferences that people have. This lends the real estate agent strategies on how to strategize the deal moving forward.
Chance of Higher Sales
Paying for real estate leads ensures that there will be a higher amount of sales in the business. The more deals, the better growth for the business. If a real estate agent is worth their salt, they will be able to make use of the increased number of hot leads and convert more of them into sales.
On top of that, by relying on a fixed cost for qualified leads, the additional cost of marketing is reduced, ensuring cost is made on leads that have a chance of panning out.
Convenience for The Agent and Business
Having mentioned saving spend on the marketing budget and rather putting it into buying real estate leads, the same can be said for all the time and resources that do not have to be put into marketing as well.
The lead generation process of any real estate business requires meticulous thinking and strategizing based on several factors, alongside the cost. Not to mention, they have to be run consistently for a long period to ensure an area is properly exhausted for leads. Purchasing them on the other hand, frees up the real estate agent’s time to focus on the deals he is getting and creating pitches to convert to sales.
Disadvantages of Buying Real Estate Leads
While they can be good for real estate businesses, purchasing leads can also harm them.
Added Cost
While real estate businesses can save up on marketing costs by purchasing leads instead, the build-up of costs over time can become extensively high as the process keeps getting repeated. The choice ultimately boils down to whether or not the return on investment is worth it in the long run.
Depending on the Lead Supply
If an agent is heavily reliant on leads being supplied to them consistently, they are relying on these leads being high quality and for to be constantly coming in. If the supply of leads stops because the company has gone out of business or changed strategies to something less effective, it will directly impact the real estate agent’s business. Thus, always maintaining their own marketing strategy for leads is also a good idea.
Conclusion
Overall, there are good sides and bad sides to purchasing leads for a real estate business. However, it depends on the real estate agent and their business to weigh both these pros and cons to see if it would pan out well for them. While nothing is guaranteed, having a diversified portfolio of lead-generation strategies is key.
