No, Actually, Lead Follow-Up Beats Lead Generation

January 7, 2016

Steven Trice

I’m going to introduce a new idea. There are more business opportunities sitting in your database than there are from typical lead generation. Now, let me tell you why. 73% of real estate leads are not sales-ready when first generated. This means only 27% of your lead generation is immediately going to act. The rest need to be nurtured, or as real estate professionals say: “followed-up with.”

The bigger question, though, is: Which have you been spending more time on – newly generated leads or prospects who are sitting in your CRM? Natural instinct is to call for “more leads” when you’re aren’t closing enough business. But, the solution is actually with lead follow-up (a.k.a. lead nurturing).

So, I’m going to make a statement that I think is worth heavy consideration: Your number one priority should be nurturing your leads; not lead generation. Here’s some evidence to back it up:

The Math: Lead Generation vs Lead Nurturing

According to Forrester Research, businesses that excel at lead nurturing generate 50% more “sales-ready” leads … and at 33% lower cost. To show you the cost difference in leads you have nurtured and those you haven’t, let’s look at Marketo, a company specializing in marketing automation. They found these results when sending leads to their sales reps:

Real Estate Lead Nurture vs Lead Generation

Leads that were nurtured before being sent to their sales team (i.e. real estate agents) cost $68.50 less. That’s a pretty penny when you’re generating thousands of leads a month. And it’s even more critical to smaller businesses whose profit-margins are slimmer. Talk about a game-changer!

Remember, Email Drip Campaigns are NOT Lead Nurturing

Set to a specific cadence, drip campaigns regularly send out email communication to captured leads. However, they are programs. They don’t account for a user’s activity and behavior. Lead nurturing is the process of building strong relationships with prospects … i.e. homebuyers and sellers. You have to assess their needs, wants, and timeframe.

From there, you begin to guide them to action — which is either selling their house with you or buying a real estate property. Your drip campaigns should be supplemental to your nurturing efforts, such as an email sequence for returning website visitors.

Real Estate Email Drip Campaigns

Anyone looking at homes on your website again can easily be put on a drip, saying something like “Hey, I noticed you were looking at a few properties last night. Did you see one that might be of interest; or did you have any questions about the homes?”

Based on their actions, you are nurturing them to a decision. You are not just cold-emailing them and leaving them alone if there’s no response.

What a Lead Follow-Up Plan Looks Like

Every business will have a different lead follow-up plan, and you should customize your own to the clientele you serve, but here’s an example of what one might look like:

*Lead Registers on Website

Send a text message introducing yourself and inquiring if they’d be up for a call.
Schedule a call (use their web activity as conversation starters)
Take notes on what the lead is looking for and what timeframe they have.
Bucket them into a category that correlates with your business (like “6 Months Out” or “Looking for >$300k Homes in Charleston”).
Set them up with e-Alerts and place them on an email drip campaign that resonates with your category.
Assign reminders and to-do’s for yourself — to check back with them.

Again, this is a broad example. Lots of real estate businesses have very detailed follow-up plans, especially if the lead doesn’t answer their emails or phone calls. To break it down, it simply means you need a game plan for when a person becomes a lead. Without a plan, you’re going to see higher costs for converting leads into clients (and closing transactions).

If There’s a Lead In Your Database, Your Job Isn’t Done

Let’s say you generated 100 leads today. You got 10 appointments from them and closed 1 deal. A lot of real estate professionals move on after the first contact, but those 90 leads are still sitting in there. Some of them are probably re-visiting your website. Others could be paying very close attention to one property in particular. All of them are opportunities, but because they didn’t engage you on the first contact, you’ve begun to ignore them. You’re paying attention to the new leads coming in.

The easiest way to re-engage older leads is to have a follow-up plan, set to-do’s for regular check-ups, and have a technology to filter them in the database. Segmenting your leads helps you identify which people are still interested and find lost opportunities — which means dollars back in your pocket.