#242 Mail-Right Show We Talk About All Things Connected To Getting Real Estate Leads in 2020
What is a real lead in 2020? This might sound like a really strange question but this simple question courses more confusion and frustration then everything else in the real estate industry.
You the agent or broker might have a definite idea in your mind what a real real estate lead is but in truth you might completely deluding you-self. We discuss this in this particular episode of the Mail-Right Show.
Full Transcript of This Weeks Show
Jonathon: Welcome back folks to the Mail-Rights show. This is episode 242. This is going to be a discussion between me and Robert, my great co-host. And we’re going to be talking about what is in 2020. I think this is going to be a fascinating conversation. It causes a lot of confusion for real estate agents. And we’re going to try and really clarify the differences between personal face-to-face lead generation and what you get online. Robert, can you quickly introduce yourself to the new listeners and viewers?
Robert: Hey, for those that don’t know me, I’m a real estate SEO specialist that has been doing residential real estate SEO for 13 years. I’ve started my own technology company as has Jon. And this podcast is all about marketing. And if you want to learn more about me and marketing in the sense of generating leads and other forms of marketing that are maybe branding related. But if you want to find out more about me, go to inboundrem.com and Jon over to you so you can introduce yourself.
Jonathon: Yeah, I’ve been a front-end WordPress developer for over 15 years, also an internet marketer for over 10 years. I started Mail-Right four years ago; been running the podcast for about two and a half years, and Robert’s been my cohost for over a year. And we’re just here. We supply information for you about online marketing technology in general; anything that can help you be a more successful real estate agent. So Robert, we going to start this and I think you came up with the subject and I think is a fascinating subject and it causes so much confusion in the industry, also when you’re having one to one discussions with real estate agent, what is a lead? So how are we going to start the conversation off Robert?
Robert: Well, we’re going to start it off by explaining. So first of all, there’s a lot of confusion about how you even define, okay. Everybody understands that they need to get them. And there’s the traditional source of real estate leads, which is how over 60% of the business still operates. And many of you on the show are going to be familiar with this. So when you get into real estate, most people are telling you to work your warm network; friends, family, so on, and so forth. And those kinds of leads are what would be called personal referrals, personal contacts. And if you’re really, really good at working in-network, you can literally build like a starting real estate business, just of doing that. Those are all leads. They’re warm leads, you get a name and a number from a friend, and when you call that person and say, “Hey, Mary Jones gave me your name. I’ve known Mary for five or 10 years. And she thought that maybe you might want to have a name in your Rolodex for a real estate agent.” And here’s the thing, those types of leads get what may be a 70, 80% response rate probably Jon, is my guess.
Jonathon: Just add a little bit to what you’re just saying, as you were saying it, Robert, agents say to you, “What do you need the most” and they almost, I would say almost a hundred percent will say to you, “leads, I need more leads.” But I don’t think what they’re really saying– what they’re really saying to you is I need more commission checks.
Jonathon: That’s what they’re really saying to you; I need more commission checks, Jonathon. But when they say leads, they quantify a lead directly with a commission check, which in some ways is understandable, but in some ways causes all this confusion really, doesn’t it Robert?
Robert: Well, it causes confusion. And what you’re expressing is both the pain of our typical client and also our pain as providers. Because what we’re saying that we’re going to give them is a name and a number, which is why we’re doing this podcast, is because all names and numbers are absolutely positively not created equal. And what we’re going to teach you today the subject of this podcast, everybody. So this is the part where you start taking notes is we’re going to talk about the different sources. We’re going to cover all the big ones that we typically talk about on this show. So internet social leads and the different types of social, such as YouTube versus Facebook versus Twitter versus, you know Instagram. And we’re going to give you some facts or as we understand them about those different types of lead sources and what you can expect from each one, which may or may not. So for those of you– so this show is designed for what Michael Hollenbeck, one of our previous guests would call like a tier one and tier two agents.
Somebody who’s probably making like under $120,000 a year in commissions as a real estate agent, anybody that’s got a team or is already making 500,000 to a million dollars a year; you probably already know everything that we’re going to cover in this particular show. So maybe it’s not the best show for you. And if you’re not making that much money and you’re thinking of getting into lead generation or you’ve just started lead-generation through digital sources then absolutely positively you should bookmark this show, listen to this show. This show is for you guys; this is why we’re doing this. So just to kick us off, Jon, if you don’t mind, I’m going to continue on the thread. Let’s talk about lead types, and I’m going to make this personal so everybody understands. So Jon owns a marketing company and so do I, and we do lead generation through two different ways, which is confusing because they’re both digital leads.
Jon does his lead generation, mostly through Facebook marketing. I do most of my leads either through what’s called organic marketing or paid Google advertising. And so in that single breath, I’ve now covered three different types of digital leads that you can get. And the expectation for these leads is different. The conversion rate which is language that you hear guys like me and Jon use all the time is different. And it’s something that you absolutely need to walk into as a first-time buyer and understand it’s– like, you can’t ignore this. You can keep tuning it out and saying it sounds confusing, but it’s really a simple principle. How many of this particular type of name and number do you need before you can reasonably expect a commission check, which is what Jon opened up the show with ‘how many’.
Here’s, what my experience says, and then Jon, I’m sure will have some things that he’d like to add because he and I do different types of marketing, we both want to talk about what we do. So my experience says that a social lead generated off Facebook using a number of landing pages. And here are the companies that you could be talking to that would generate this kind of lead; Commissions Inc, KV Core, YLOPO, Bold leads. All of those companies use social marketing, so does Real Geeks to get a name and number off of the Facebook lead. And right now, according to all the clients I have doing that kind of marketing, which is about 60 or 70 of them, it seems like the average closing ratio with somebody not doing great follow-up, not doing amazing calling it’s about one in 60. So you buy right now a cost of acquisition, so YLOPO, for instance, which is the best in the industry, will generate you a name and number for three to $6. So you’ll need 60 of those to get into a sale, which sounds good on paper.; sounds good. That sounds great. Woo, I get an ROI for a couple of hundred dollars, but that’s not the true cost to the lead, to get into WLOPO at all, you need three or $4,000 to even start with their system.
And then you have a high monthly; two or three thousand because they’re one of the highest in terms of your monthly spend $800 of that goes straight to YLOPO without you doing any marketing at all. That’s just their licensing fee to license their technology. So you have to factor that into their costs, to their lead type, which is what makes guys like Jon, maybe a little more appealing for people starting off because he does not have super high licensing fees. He also doesn’t have the AI and the other things that– forgive me, Jon, I’m talking a little bit for you, but I’ll let you an add-in, he doesn’t have the AI. He doesn’t have eight guys in the development partner department that you’re paying for. But what he does have–
Jonathon: Can I just mention because I want to get your feedback is, I’m pretty sure you know of this university, and it’s got two purposes. A lot of the people you just named and we might be changing the model of Mail-Right because I’ve been thinking about this for months and months and months. Is that by offering a do it yourself products element so the product, which a lot of these do, not all of them, but is you end up paying for a lot of training that they provide for you to actually use their interfaces to actually understand every part of the problem? Because I had a couple of friends that have gone on these not– well, one of them, and another one. Definitely, one in the industry and the training was really good, but it went on for about six, seven weeks, a couple of hours every week, just to learn how the interface works and the internal systems. And you’re paying for that. That’s part of the monthly fee is that they didn’t have to hire somebody, train them to train you.
Robert: Right, I agree. So that’s one kind of lead, one kind of lead type, and I just gave you like a reasonably average expectation, now that’s a social lead. Now, some companies generate leads off Google and they do it off paid. Now that means that somebody does a search and they see a paid ad, like for homes for sale in your city name. Like, let’s just say, Los Angeles. That’s where I’m at, so LA. And the, in theory, the numbers are higher. And I have found that to be true, even off paid Google leads. Okay, they cost more to generate. That cost of acquisition is probably going to be four times what I just told you for YLOPO. It’s not going to be three to $6 a name it’s probably going to be, even though YLOPO says that they’ve got their average cost acquisition off Google down to about six to $7. Most of the time, I think it’s like, you’re not really going to get a marketing company that’s refined their system, nor are all of the leads that YLOPO is generating are high intent leads.
So they’re not targeting just major keywords with like a lot of intent. And this is where the lead type becomes so important. If you have a lead that did a search, that’s called, let’s say homes for sale Los Angeles, that person might be deeper down the buying funnel closer to buying a home or selling a home. Then let’s say a person doing a search for what is the property tax in LA. And both of those are key words that we could target a paid advertising campaign. And both of them are targeted at paid advertising campaigns. So that lead type; that lead quality it’s going to be different. And these are questions that you, as a purchaser of marketing services should be asking your provider, which is why we’re covering it is what kind of lead exactly is it that you’re going to generate? How do you generate the lead and what is the average rate of conversion?
And keep in mind, you’re talking to a salesperson. So if their numbers different than what my numbers do, keep in mind, I’m not talking to salespeople. I’m talking to end-users who are actually using these systems in real life. And a salesperson is likely to give you the client that he knows that is doing the very best on the system. And for all we know, that guy or gal has, you know, an assistant calling every lead or a whole telemarketing team calling every lead it’s nuts. And those people will get an 80% better response rate than you. So they’ll close way more business than you will if you’re not calling every single lead two or three times. Right, Jon, do you agree with that?
Jonathon: Well, yeah, that’s the bit that you can control. You know, if they don’t find– my system sends a text message and an email when a lead comes in to the agent. And then it sends a series of emails and text messages over six month periods, which is the average period where somebody is thinking on selling or buying a house. But you still got, you know, it’s a person to person business; that’s why real estate agents still exist, and why I think in 10 years’ time they will still exist because it’s a person to person face-to-face, belly to belly, which I don’t quite like, industry. That’s great, and if it wasn’t like that, real estate agents– that would be a big problem with it. We need to go for our break. We’ll be back in a few moments where we’ll delve in a lot more into the nitty-gritty of what is an internet lead. We’ll you be back in a few moments folks.
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Jonathon: We’re coming back. Like I say it’s a face-to-face business, human-to-human. We can’t change that, and it’s really fantastic news to you the agent that we can’t. Nobody else can. That’s great news for you, but there’s a problem. We can send you somebody that’s interested that shown interest. I would agree with Robert that using Google, that interest–because of the platform, because they’ve actually did a search that shows more interest than a social media, Facebook campaign. I totally agree with him, but there’s a cost difference. If you can’t be bothered to get on the phone about three to four times after we’ve flag that up for you, that’s the bit we can’t do for you. Isn’t it, Robert?
Robert: Yeah, and that’s why to add to the confusion about lead generation, there’s always a lot of conversation about follow-up. And the reason there’s so much conversation about follow-up is that internet leads tend to be low quality. The highest quality internet leads that I know of; there are two of them. The highest number one lead generation in terms of quality right now is YouTube. If you’re doing high-quality YouTube videos, you won’t get very many leads, but the ones that you get will almost always be incredibly high intent. And what I mean by that is right now, talking to our last week’s guest, Malcolm, and talking to some other people that use YouTube as a lead generation, the closing ratio on YouTube leads is like one in three. That is incredible. You just won’t get very many of them, which is for some real estate agents and brokers very exciting. Because now we don’t– like if all you were doing is YouTube, which is what Malcolm does. Like the guy is always producing YouTube content. Everybody’s like, how do we have the time? And the answer is easy.
If you’re not spending like two to four hours a day, making phone calls all the damn time to leads, you could be spending that two to four hours doing something else, such as creating really high-value YouTube content. And if one out of three people that is reaching out to you through YouTube is literally like, you’re my guy, like I’m ready to go. What’s there to do? You set an appointment, you show some homes, you list some homes and you just do your job. So, YouTube is the number one highest quality lead source that I know of today inside any internet marketing space by far; no comparison. There are challenges to getting those leads. Like, Malcolm worked at his system for a couple of years before he finally got into a place where he’s probably going to do 18 to 20 sales this year off YouTube alone.
So that’s actually what he did last year, so this year, if he has grown, he’ll do 20, 30 sales off YouTube. So that’s YouTube, and last but not least there is organic marketing, which is what my specialty is. Jon does social. I do SEO. Besides YouTube, SEO is the highest quality lead that you’ll get. My closing ratio at the boom, which is by the way, diminished, it used to be one in 10, and now it’s one in 15 because we’re at the end of a booming market because of COVID-19 because of all this different stuff, but still, instead of one in 60 it’s one in 15. So you’re still talking about doing a lot less work with SEO generated leads then you are any other kind of marketing. And the reason is that people trust organic search results. And two, if you’ve done your job, right, in terms of building a destination site; you can go with one of two things.
You can either make a very usable website that people come back to over and over again. And because they’re using it, they develop some brand recognition and eventually they register and they might even talk to you. That’s something that Sierra Interactive does very, very well. Or you go with a whole experience that combines video, Google maps, usability, high valuable content, all on the site at the same time. That’s what I do. And when you have all of that stuff, combined, my clients using my current websites are getting incredible results; phone calls lead registrations, people picking up the phone when the lead has registered, so the chase is less. And this is why Jon and I are talking to you about different lead types because you’re going to spend different amounts of money to get these leads. My system is much, much more expensive than Jon’s, like hundreds of percentiles, more. And you can get into the social systems that are going to generate leads for you very quickly for a lot less money, but you’re generating a lower quality lead.
Jonathon: Whatever platform we’ve been talking about, I personally, and as I said, you know, I have a vested interest in saying this, but hopefully the listeners and viewers, if you’ve been listening over the weeks and months, hopefully, you come to a judgment about me that I wouldn’t say something just because I didn’t believe in it, but it helped me commercially. Is that whatever system you use; Bold Leads, Mail-Right, Real Geek. I see Bold Leads, Real Geeks as my main competitors. Whichever one you use, you’re going to be better off using me or those two, then buying leads off Zillow in the long term because at least you’re getting a crack. They’re not being sent to 12 agents at the same time, and it’s the first one that gets to that possible lead the quickest or have a chance of bagging it. And you feel the poor bugger that’s bringing that person up for the 12th, you’re at the bottom and you manage to get hold of them somehow; it can be a very brutal exercise, can’t I’m Robert? And I personally believe that you’re better off investing that kind of money with Real Geeks, Bold Leads or Mail-Right, then investing that 500 to $600 with Zillow.
Robert: I couldn’t agree with that more. So we’ve talked about different lead types and Jon and I– I have to agree because to be fair, we use this podcast and I use writing content on my website, even though I’m giving out the information for free and I don’t pitch my company to you, there is this subtle message of I think I know what the best system is. And then the subtlety is you can always contact me and ask me about that if you wanted to. And Jon has built a different kind of system and for the costs equation, he feels like he has one of the best value propositions out there as well, so it doesn’t–
Jonathon: My problem is I’m running another business and there’s only so much, well maybe it’s an excuse because it’s a bit linked to our last week’s guest is it’s also the main tool. We’re really getting there now and I’ve invested another chunk of money and I’ve cracked the whip with the people that are helping me, and we’re going to get this. But I think in the totality system like the Mail-Right, and I’m not knocking the other systems is it’s just that I feel for the money you’re getting the most complete solution in one package that a value proposition that really outshines the other competitors.
Robert: Yeah. And I haven’t really reviewed it guys and Jon and I will have some meetings and eventually, I’ll start to talk with a little bit of authority on what Mail-Right is doing. But for the moment, what we want you the listeners to understand is that we are two marketers talking about something that we’re passionate about, which is the systems that we built. And that’s what the show is about really is getting in touch with you and saying, Hey, if there’s a small piece of your marketing that you think is going to be fit by either thing that we’re talking about, then you should contact us. Because we each feel like with those types of leads that we’re generating that we’re offering an equivalent or better value proposition, then two other people that are in the same space as us. Now, that’s subjective. It really is. If you talk to the companies themselves, they probably have a different opinion about it, and you have to decide what you feel. But what I want you to know, and Jon has agreed with me on is we definitely want you to understand that regardless of where you go or who you buy your stuff from, that there is going to be a difference in quality.
Jonathon: I think– because we’ve got another three to four minutes, probably five minutes. One area that I definitely want us to cover Robert before we finished the podcast is, there’s only so many houses, so many sales per year in North America, but the amount of leads over the past five years that is generated has just exploded. And that’s another factor that your average real estate agent has to understand. Don’t they, Robert?
Robert: Absolutely. I’m so glad that you reminded me about that. So here’s a weird thing, all of those guys out there like Jon and I, we’re getting better and better at capturing names and numbers for you. We are, and not just us, there are other companies out there that if I’m honest about it and Jon doesn’t have to agree with me, but they’re way better than we are. I think YLOPO is one of the best companies out there in terms of capturing a name and a number at anywhere in the cycle. But guess what guys, that doesn’t mean as much as it used to because four or five other guys have also captured the name and number of the same person. So even though we’re in the same business with maybe like, and without that many new homes hit the market, it’s like three to 6% new homes and the lead proliferation is 20 or 30% more.
And guess what? There are 20 to 30% more buyers, there’s the same number of buyers. It’s that marketing companies like ours; we’ve gotten better at capturing that information. The person that registered with realtor.com has almost for sure, registered with YLOPO and probably two or three other marketing companies as well, and hell, maybe even a small local real estate agents website. And every single place they registered their name and number, whether it’s to do a search or to get a home value, everybody that’s got that information, considers them to be a lead. And what does that mean? That means that that person, depending on the system– if it’s YLOPO; Jesus Christ, they’re getting advertisements following them around on every social network that they go to. They’re getting messages sent to them in Facebook. They’re getting text messages, probably from every single person they registered with.
So they may be getting as many as five text messages a day from different providers. They’re getting emails probably from everybody they’re registered with almost assuredly. They’re getting a property drips, maybe three or four. That whole situation that Jon just mentioned is why I advocate strongly for a lot, like, if you can afford it to add a high-value destination website that contains massive amounts of information so that they’re coming back to you, as opposed to you trying to chase them. Because you are one voice out of many, and you either have to be more persistent by far than next guy or gal, which probably means you’re calling them over and over and over again in order to get a different result than your competitors are, or you have to figure out a different way to make an impression.
Jonathon: That’s the only thing I’ll slightly disagree with you is that the good news is that most agents do not make follow-through calls. When you look at the statistics, in all honesty, Robert, the majority of our agents do not make, after the– I would say over 50% of agents after the first call do not make a second call.
Robert: I don’t disagree with you. I wasn’t saying that people do that. I was saying they should, or that they would have to in order to make an impression. I’m in a great agreement with you that the number of my clients that don’t call once is staggering, staggering. I have a team that I do business with who shall go unnamed and they do $10 million in business, but they’re buying leads from five sources. And they’re so good at purchasing leads they don’t call anybody ever. So they’re literally just waiting for their automated systems to generate them a result, which they’ve got so many names and numbers coming through the door. They actually do. It’s a team of two when they’re getting over a hundred names and numbers every single month. And they generate massive business doing it that way. But I would say they’re overspending by 50% if you asked me. Like, they’re getting way too many names and numbers and the organic stuff accounts for 50% of the results out of five different lead sources. So they could easily eliminate one or two of these sources, which by the way, Jon, one of those sources is realtor.com, and you know how expensive they are.
So like I know, and I don’t think that if they ever sat down and took a breath and tracked their stuff, which they have tracked for them because they’re using followup boss. If they just looked at the numbers, which I’ve looked at in their own system and they haven’t. That’s the crazy thing, I went in and looked and was like, why are you still buying leads from XYZ company; you’re not selling them? Are you even making a profit on the contract? I don’t know. That’s what most real estate agents– they’re so busy doing the business of real estate, they don’t even stop and take a breath, and that’s why we’re doing the show today. Guys, if this is you, if you’re listening and going, Oh, I recognize that you know what? You could probably save yourself 20 grand in marketing expenses, just by doing a good–
Jonathon: I’m not laughing at real estate, but we all know, beloved listeners and viewers that the real estate business is a crazy business. That’s partially on of the factors I like about it. I’ve got to be totally honest. I’m used to it anyway because the web development, WordPress industries is a pretty crazy place as well. It’s a bit of the wild West really? We’re going to wrap it up there, Robert. We’re probably can have another internal discussion next week and I’m going to rustle up some great guests for the following week. I like a couple of internal discussions because we covered some really interesting subjects, me and Robert. So Robert, what’s the best way of finding more about you, your thoughts, and what you’re up to?
Robert: All right, I’m going to do something different this show, Jon, just a fucking for shits and giggles. So guys, here we go. I’m giving out my phone number this show. I usually give out my URL. Here’s my phone number? 818-274-9245, that’s my real-life phone number. Call me. Do you want a free consult? You want to talk about lead generation types. You want to do something. I’m going to try something different. I’m going to say, just call me or text me. If you’re too busy to call me, then text me and I will have a dialogue with you about your lead generation types of some changes that you should make. If you got confused, I’ll help. That’s it.
Jonathon: We’ve almost finished off this Mail-Right university. I’ve got my copywriter trying to sort out all my mistakes and grammar through the extensive lessons. We’re actually going to cut down the lessons because I think it would intimidate you. And we’re going to split it up into a free section and a paid section, which we’re going to offer later on in the year. Hopefully, we’re going to be launching that pretty soon. I know I’ve been saying that for the past couple of weeks, but I’ve just been finishing it off and then handing it over to my poor copywriter. Bless her heart, and we soon be offering that. But if you go to the Mail-Right website now, there’s all the interviews, the internal discussions between me and Robert; it’s just a wealth of free information on the Mail-Right website. If you just choose the topic and watch some of our shows experts, you basically we’ll learn an enormous amount anyway. We’ll be back next week probably with internal discussion or with a great guest. See you soon, bye.