Thought for the day...

Tuesday again, and here is a thought for the day.

The question is "why is there such a wide range of opinions on buying leads in the real estate industry?"

Whether it is an agent buying Zillow leads or a lender buying leads, if you post something on social media the war starts. "Buying leads is a waste of money" or "stop buying leads from companies that want to put us out of business" to "I convert a lot of leads into closings" or "these leads are really good if you work them" are common statements. Why the disagreement?

I asked a friend who coaches and trains agents, and his response was...

"The reality is that there are some really low quality lead sources out there, and the return on investment from these is low. But the biggest disconnect is the agents themselves, the work they put into the leads. Remember that most of these leads are coming from internet / social media adds, and they have a very low closing and quality rate. But...

• If you only call once or twice they have almost a zero closing rate
• Some take 2-3 years of follow up before they turn into a deal
• It can take up to 18 tries to make contact, and up to 36 tries to start a relationship (according to studies)
• Most agents don't make more than one or two calls, a couple texts, and they give up
• Internet leads for realtors can see a 3-4% closing rate from some sources, up to 15% from others, so it is a numbers
• Many agents see a higher closing rate, but those are the ones that follow up and work the leads
• So it is not the leads that fail, it is the follow up that usually fail

The reality is, these leads are just a way of starting a conversation, adding contacts to our data bases, and some will lead to closings or referrals. But if the follow up is not there, then buying leads will fail. So when the conversations start, the naysayers will usually be the ones who did not do the work necessary to be successful."

I have to agree. The reality is most failures in the real estate industry result from lack of effort, lack of training, and lack of commitment, so of course buying leads fails if those are not applied. But it is a fact that their are many agents that close a lot of business from bought leads. So it does work.

Instead of fighting over it, just accept that some agents do well and others don't when they buy leads. Just a different business model, not a right or wrong.