Everyone says that agents should focus on lead generation. The real issue for most agents is not how many leads they generate but how many they totally ignore.
Former realtor.com President and CEO Allan Dalton once said that the real estate industry has no problem generating leads — the real issue is converting those leads into signed business. Once you have generated a lead, the first step in improving your lead conversion ratio is to identify which leads are worth your time and effort.
Sifting and sorting leads — ?the right now business? filter
One of the oldest sifting and sorting lead strategies focuses on what is known as ?right now? business.
This system uses a letter grading system (?A,? ?B? or ?C?) to categorize which leads are most likely to transact. ?A+? leads will transact in the next seven to 14 days. An ?A? lead will transaction in 15-30 days, ?B? leads in 31-60 days and ?C? leads in 61-90 days.
The critical question to ask here is, ?Who is closest to the money?? Focus on working with these clients. For example, if you have an ?A+? listing lead who wants an appointment at the same time as a ?C? buyer, you would opt for the ?A+? lead.
Sifting and sorting your referral database
The letter grading system also works for your referral database. In this case, ?A? stands for ?angels? or raving fans that send you at least one to two referral leads per year. Seth Godin describes them as ?sneezers? who rave about your services whenever possible.
The classification of ?B? goes to those people in your referral database who will transact with you or refer to you when the opportunity occurs.
The classification of ?C? goes to people who will not make referrals but will transact with you when they are ready to buy or sell.
A quick way to sift and sort this group is to ask, ?If you enjoyed an exceptional evening at a restaurant, would you tell your friends and family about it?? If they say ?yes,? chances are they will refer you as well.
The final category is for those people will not refer to you, will not purchase from you, and may say detrimental things about you. Give them a ?D? for ?delete them from your database.?
Your ultimate goal is to keep prospecting for ?angels? who will refer at least one to two deals per year.
Using technology to sift and sort
Real estate coach Craig Proctor has created a powerful approach for using technology to sift and sort leads. Proctor has been a longtime advocate of the 1-800 call capture systems.
In case you?re unfamiliar with this technology, the older versions employed an 800 number where a potential client could receive a ?free recorded message.? People calling on ads or yard signs found this attractive since they normally didn?t want to talk to an agent anyway.
Because agents paid for the 800 number call, they were entitled to the caller?s phone number and other available contact information. The system typically took less than a minute to notify the agent of the incoming call. This allowed the agents to call leads back immediately, often while the lead was still sitting in front of the property.
Today these systems are coupled with QR codes and/or text messaging. Consumers can immediately download the property brochure, photos, videos, plus any other information that the listing agent posts. Agents receive the contact lead?s contact information in seconds.
A key part of Proctor?s system is to use generic ads. The challenge with advertising a specific home is that it is easy for potential leads to eliminate it. Rather than advertising 234 Elm Street, Proctor?s system relies on a more general list. Here is an example of his approach:
?New-on-market homes — free list with pictures and recorded message. NewOnMarketHomesList.com.?
You can substitute almost any type of property list, such as foreclosure bargains, luxury homes, best buys, etc. Here?s another example:
?Free computerized list of available homes, recorded message, visit GlenwayEstatesList.com.?
Where Proctor?s system really shines, however, is his strategy for sorting the leads as they come in. He recommends offering a free report on how buyers can save money on their next mortgage or some other topic they would find to be useful.
When the calls come in, he uses the following strategy for sifting and sorting the leads:
- ?If you are a buyer with a combined income of at least $75,000 and you have good credit, press the number 1 to order Report No. 1.?
- ?If you are a buyer with poor credit and/or you earn less than $75,000 per year, press the number 2 to order Report No. 2.?
In terms of sellers, he uses a similar approach:
- ?If you are a seller who needs to move in six months or less, press the number 1 to order Report No. 1.?
- ?If you are a seller who will be selling over six months from now, press the number 2 to order Report No. 2.?
The people who fall into the first group are much more likely to transact than those in the second group. He still sends a valuable report to group two, but he focuses his energy on the leads from group one.
If you aren?t sifting and sorting your leads, you?re probably wasting time and money marketing to people who really aren?t qualified. With all the new technology tools, sifting and sorting is easier than ever. It is also one of the simplest ways to increase your income.
Bernice Ross, CEO of RealEstateCoach.com, is a national speaker, author and trainer with over 1,000 published articles and two best-selling real estate books. Discover why leading Realtor associations and companies have chosen Bernice?s new and experienced real estate sales training for their agents at www.RealEstateCoach.com/AgentTraining and www.RealEstateCoach.com/newagent.