Sacramento Software Development

Should You Pay For Real Estate Leads? You Already Do.

Posted by John Lockwood on December 31st, 2007

A lot of Realtors® complain about lead generating services, many of which have aggressive and misleading sales tactics. For example, you haven’t been in business very long if you haven’t fielded a call offering you a unique opportunity to lock in your exclusive territory before someone else does. For only $400 per month, let’s say, you can own the zip code 95682 on the world famous SellMeAHouseNowPrettyPlease.com. Of course, it may turn out that SellMeAHouseNowPrettyPlease.com generates a lead for 95682 every 174 years, in which case you’ve paid $835,200 for the opportunity to generate a $25,000 commission by the year 2181.

Most of us would agree that there are more effective ad buys one could make.

In addition to the bad feeling left by scam operators like this, many Realtors® object to the idea of such big-budget “real estate interlopers” charging them for the privilege of doing transactions that would otherwise be “theirs”. Of course, embedded in that objection is the naive idea that if Realtor.com and Yahoo Real Estate weren’t around, you’d be at the top of the search engine enjoying the well deserved fruits of your license. Enter scam artist #2, who’ll “guarantee” to put you there. Again, for a very modest fee.

My Early Revelation

When I’d been in the business maybe four months or so, I was working my broker’s “floor time” one day when this short, old, bald guy who worked in my office came in and offered to sell me some leads “from his web site” — 30% referral fee on the first one and 25% thereafter. Now at the time I was failing in real estate after about ten years of (for the most part) succeeding in professional software development. Though I hadn’t yet seriously begun marketing to consumers online at this point, it took me about a minute and twenty-three seconds to figure out that if the short old bald guy could generate enough leads from the Internet to sell them off, Johnnie software developer could figure out how to the same thing, being younger, taller, still in possession of my hair, etc.

For the next several months, and for many, many hours over the five intervening years, I worked on surpassing this fellow’s business model, beating him first at his own search engine positions and later acquiring more valuable ones which into which he hadn’t even made inroads. SEO plus IDX was the basic formula, then as now.

It took a lot of time.

I don’t think I could replicate a lot of what I did today, but fortunately, as in the military, it’s significantly easier to defend an entrenched position than it is to attack one.

A Balanced Model

As much as I have swung from the extreme of potential lead consumer to “interloper” (which is another word for broker, by the way), I admit that there are two limitations to my own marketing strategy.

The first is that it is extremely time and labor intensive, and it hasn’t gotten any easier to do. I don’t think I could replicate a lot of what I did today, but fortunately, as in the military, it’s significantly easier to defend an entrenched position than it is to attack one. On the flip side, this means potential growth is harder to achieve.

The second limitation is that there’s no guarantee that major search engines will continue to rank me as they do now.

I believe that the problem with paying for leads is not that the big bad interlopers make us do it. We’re always doing it, one way or another — even when we buy yard signs or business cards. What’s truly at issue is how much do we have to pay, and what’s the return on what we pay?

I admit, I don’t have the specific numbers to tell tell you what the “right answer” here is. All I can suggest is keeping an open mind to the different ways to generate business online. I have used both pay-per-click and SEO to good effect, and I would definitely add pay-per-click into the mix if you need to start getting leads in right away. I also wouldn’t discount well known lead resellers like HomeGain, though I need to learn more about this aspect of the business. If you’ve used these firms successfully, please let me know.

Real Estate Internet Marketing Matrix
High Cost / Low EffortPotential instant results Medium to High Cost / Low EffortPotential instant results High Effort / Low Cost
(or Extremely High Cost, Low Effort)Potential instant results
Lead resale companies like HomeGain Good IDX web site with Pay Per Click traffic Good IDX web site optimized for search engine traffic.

Posted in Miscellaneous | 5 Comments »

The Week In Review – Focus on Lead Generating Companies

Posted by John Lockwood on December 28th, 2007

Recently I announced a new guest author series entitled "What’s Your Internet Real Estate Marketing Strategy?"  The point of that series is to hear from Realtors® who are successful in their online marketing efforts but who have a view of Internet marketing that’s different from mine.

One of the ways it’s possible to be successful online that’s about as different as it can be from the way I do it is to use online lead reseller companies like HomeGain.com.  On Monday I’ll have an article that talks about how my own Internet marketing evolution is a response against a "lead reseller" agent in my office, and how I swung to the other extreme to become highly focused on Search Engine Optimization and content development.

With this in mind, this week I started looking into information about these companies and looking for Realtors® with an opinion on them one way or another.  Minnesota’s Josyln Panka sparked an excellent discussion, the comments of which serve as a sort of introduction to Realtor® opinions about HomeGain.  One commenter there, Nevada Broker, Sue Nelson, had some very positive things to say about her HomeGain results, so I stopped by and invited her to talk about her marketing strategy in our forthcoming series. Another person weighing in on this thread was Louis Cammarosano, HomeGain’s general manager.  Googling his name will bring you to all sorts of other interesting links about HomeGain versus Zillow.

Former HomeGain Sales Director Chris Hendricks defended HomeGain’s switch to a monthly-subscription model for its AgentEvaulator product by discussing an absolutely crucial element to successful online marketing — successful follow-up

Perhaps the best single source for discussion of HomeGain and other lead generation companies that I found was on Realtown.com’s Lead Generation Blog.  An excellent guide to who the players are is the "View by Vendor" blogroll on the left hand side, and the articles here are a good mix of criticisms of the Lead Generation companies and success stories.

Posted in Miscellaneous | 1 Comment »

What Was the Social Internet Before It Was Social?

Posted by John Lockwood on December 27th, 2007

Do you remember the anti-social Internet, where nothing was connected to anything and no one communicated using it?

Neither do I.

From its outset, the Internet has been about people sharing and communicating information and ideas. In the late 1980s, Tim Berners-Lee first conceived of a hypertext project at CERN as a means for researchers information. In August of 1991 the first web site was put online at CERN, and we’ve been all typing up a storm ever since. In addition to web sites and the tools to browse them, the first killer app of the Internet was e-mail.

In addition to email and web sites, electronic bulletin board systems (BBSs) like the ones I frequented on Fidonet in the eighties were, as the Wikipedia article correctly points out, a precursor to the World Wide Web. You could say that we had a social Internet before we had an Internet, and the latter was just a bunch of protocols to run it on.

Enter The Web 2.0 Now Here’s Something We Hope You’ll Really Like Social Internet

For the last few years a lot of people have been spending a great deal of time on various social networking sites. In 2006, Myspace allegedly reached the 100 million user mark — a number that at least one geek has debunked. The popular real estate social networking site, ActiveRain, also launched in 2006, and many agents and brokers including me have invested (squandered?) a great deal of time there. More recently, I’ve been amazed by how many messages I have whenever I log in at Facebook or Cre8Buzz or one of the other social networks I’ve participated in — and I’m not really that popular a guy. Ann Cummings invites me to use FunWall. David Smith pokes me. Oliver Muoto received a can of Whoop Ass.

Poor guy.

For awhile there I was getting email daily updates from Facebook, telling me the most inane things

I turned that off eventually.

Seven Criticisms of the Social Internet

  1. It’s Amateur, in the sense that you don’t get paid for it.
    Andrew Keen has probably written more about this criticism than anyone. As a corollary, I agree with this argument, insofar as I’ve made a decent living off of several web sites I’ve created and maintained, but no money at all off of ActiveRain. Even the referrals I’ve received have not come from ActiveRain, but from people finding my own web sites.
  2. Someone’s might be getting paid for it, but it won’t be you.
    One of the most amusing incidents in Move.com’s failed acquisition of ActiveRain was this ActiveRain apologia about who owns the content on ActiveRain. Still, I don’t recall any discussion about how the thirty-million would have been shared if the transaction went through. Oh. See also, this article about remodeling the kitchen in a house you rent.
  3. It’s Amateur, in the sense of incompetent or unskilled
    Think: Myspace web pages. Pink on purple, anyone?
  4. It’s Amateur, in the sense of trivial or unimportant
    OK, this one’s almost built in. In order to socialize, human beings have to lighten up a bit on their seriousness. Still, it does seem to me that one can base an adult friendship on banter a bit more sophisticated than throwing sheep at one another.
  5. You Can’t Optimize for Every Web Site There Is
    Every web site has its own rules for getting to a top ranked listing. I prefer to shoot for the top of Google, Yahoo, and MSN in that order. These are sites that buyers and sellers use when they’re buying and selling, not socializing. Yes, this means I’ve had to give up my coveted #2 spot on ActiveRain. So far I haven’t noticed a difference.
  6. It’s Anonymous
    Having their cake and eating it too, social Internet socialites believing in the absolute sanctity of open information (thou shalt not ever censor me), even if they don’t sign their names or take responsibility for their actions. Human-Powered Search Engine Mahalo goes a step further and recommends that instead of a photo of your human self, you “Be Cool” and use a Wee-Me Avatar instead. Apparently being Human-Powered wasn’t cool enough in its own right.
  7. It Confuses Grouchiness with Erudition
    With a hat tip to Quote of the Day and the Vicomte de Chateaubriand (famous consumer of steak), “You Are Not superior just because you see the world in an odious light”. And yes, I do apply that criticism to myself as well, and see this as one of my less useful posts. I can never get enough of the Internet Commenter Business Meeting. To be sure, that’s not new, either. We had the same sort of thing going on in Fidonet. To puree a metaphor, there’s something about sitting behind a keyboard without a real face in front of you that makes it harder to wag your tail.

Posted in Miscellaneous | Add a comment »

Real Estate Internet Marketing Week in Review

Posted by John Lockwood on December 21st, 2007

This week I finally published the video Windows Live Writer Tutorial that I’ve been meaning to do for some time. This tutorial goes through getting up and running, but I didn’t yet get into some of the really neat Live Writer features that would make you want to get up and running. As a supplement to my tutorial in the meantime you might check out some of the other reviews and articles out there. Phil Waineright’s Writer is Microsoft’s first Live Killer App has an older (but still good) overview of the features — and Live Writer now supports tags, which was missing when he wrote that post. Paul Stamatiou also wrote an excellent Live Writer Review with several screen shots based on the beta. Paul also mentions a few of the drawbacks of the software that I hadn’t noticed. Finally, Michael Pick has produced an excellent Windows Live Writer Video Review — which shows among other things that I need to work on my Camtasia to Youtube skills (no, I don’t think I will link to my Youtube video — that’s the point).

Aside from Live Writer goodies, the other news is that it is almost Christmas, which means it’s also almost New Years, so it’s time to start thinking about things like business planning and goal setting. There are only about two shopping days left to participate in DailyBlogTips’s Group Writing Project, 2008 Blogging Goals.

Finally, I installed a new theme for this site earlier this week, ParticleWave_01, a custom theme I designed recently. One of the items on what’s getting to be a rather long ParticleWave “to do list” is to make a version of that theme available.

Posted in Miscellaneous | Add a comment »

Windows Live Writer Tutorial

Posted by John Lockwood on December 20th, 2007

Here is a tutorial about getting started with Windows Live Writer. It takes you through the process of downloading and installing the software and configuring it for your Wordpress Blog. Enjoy!

Posted in Miscellaneous | 3 Comments »

Has Your Copyright Been Violated?

Posted by John Lockwood on December 19th, 2007

One of the certainties of the Internet is that if you write long enough, some idiot will eventually try to steal your material.

Remember grade school, where the world was divided into people who did their homework so they’d be able to pass the test, and those who tried to copy the answers? Well sure enough, the world is still divided that way.

This morning when I logged into my Sacramento Real Estate Blog I found an incoming link to one of my posts, and the title of the link was a jumbled title based on the original title of the post. Sure enough, when I went over to check out the post, everything except the title had been copied verbatim from the original post. Not only had this moron copied my post — they copied what I consider to have been one of the worst posts I’ve written in several weeks.

Fortunately, Google has a relatively easy way to respond to copyright violations on that you find on Blogger blogs (typically with a URL like ImAnIdiotCopyingYourWork.blogspot.com). I’ve read other bloggers complain that the process takes some time because you have to submit the request by mail or fax, but I just submitted a complaint following the instructions there, and it took no more than about twenty minutes.

Posted in Miscellaneous | 2 Comments »