As a real estate agent, you have to decide how you are going to get leads. After all, leads are the lifeblood of your business! There are several different lead generation methods available to the modern travel agent that can help you build your business, but one question you may be toying with is whether or not to buy leads. If you do choose to buy them, you might be wondering how much you should be, and if it’s the best business decision for you. We’ll start by looking at businesses that choose to purchase their leads.
How Much Should You Be Paying For Leads?
The actual amount you should be paying for leads varies, but several websites and blogs we looked at averaged out to approximately $20 per qualified lead. That is the key phrase - qualified. A qualified lead is one that actually stands a chance of resulting in a booking or sale.
If you decide to run ads yourself, you can expect to pay upwards of $100 per qualified lead, if not more. However, there are monthly services that offer leads at monthly rates between $100 and $400 that can yield several promising prospects. There are also companies that sell lead lists, but they sell them to several agents at a time so there’s no telling how many agents will attempt to contact these leads before you get to their name on the list.
Regardless of whether you’re paying for a service, buying lead lists, or buying ads that result in leads, it’s important to remember that there are no guarantees for a sale or booking. All a lead gives you is the chance to communicate with an individual who may need your services. Still, you can use purchased leads as a way to start building relationships and grow your business through referrals and repeat business. Purchasing leads works best if you have a plan in place for nurturing your lead list, and you are prepared to provide excellent service.
Whether or not you should be paying for leads is simply a matter of your business strategy and budget. You have to consider how much money you are willing to invest, what return you expect on that investment, and whether or not the leads will help grow your little black book of business long-term.
Benefits of Buying Leads
Let's take a look at the benefits of this lead generation method:
- You can set your price point to what you want to spend on leads each month.
- Your lead cost per lead is typically negotiable. If you have the ability to purchase a larger list of leads, or multiple lead lists over time, you may be able to negotiate for discounted prices.
- You can choose to purchase leads that are both qualified and highly targeted to meet your criteria. Taking this added step will yield people that are more likely to become your client.
- You have control over which leads you want, whether by zip code or specializing in one area of real estate (i.e. commercial or residential).
All of the aforementioned benefits are generally associated with outbound marketing methods such as running ads, buying lists, and paying to get in front of your target audience.
Disadvantages of Buying Leads
Although there are many benefits to buying leads, there are some potential disadvantages as well. These include, but aren’t limited to:
- You have no control over the actual quality of leads you receive. This can be a big problem if you get an entire list of “tire-kickers” and individuals who aren't ready to buy or sell just yet.
- Quality leads take time to develop. It may take several months to establish a viable list of people you want to work with from the large list of leads you acquire.
- You have to pay your lead provider whether you use the leads or not. This can be expensive if you don't have much business at certain times of the year.
- If your lead provider goes out of business, you may lose all access to potential clients. And, if you’re on a monthly retainer, you could lose the ability to get a refund if the payment goes through before delivery of the lead list transpires.
Alternatives To Buying Leads
Hustle - One of the most popular alternatives to buying leads is simply to get out there and market your agency or business directly to prospects. You can use direct mail campaigns, postcards, advertising, social media marketing, or whatever you think will work best for your market. This way, you have more control over your lead pipeline, and how much money you want to spend on acquisition and nurturing.
Network with other agents - The funny thing about business is we sometimes get more leads than we can handle. That’s where networking with other agents comes in handy. You might be able to trade leads, or work out commission deals for leads they give you that end in a sale.
Using these two methods will give you the opportunity to build relationships with your leads and work towards repeat business. You can provide them with outstanding service, so they are likely to refer others in their network to you.
Referrals - Regardless of how you acquire your leads, you may get lucky enough for some of your clients to refer people who are ready to buy or sell immediately. The leads referred to you from past clients are worth their weight in gold because happy clients have already sung your praises giving you social proof. It’s always easier to convert a warm lead than a cold one!
Is it a Good Idea to Pay For Real Estate Leads?
In the end, it has to be your decision. You might not feel comfortable putting yourself out there, and buying leads does eliminate some of the acquisition work. Then again, buying leads might not work well for you, and it can be expensive to boot.
If you decide to purchase leads, be sure to do your research and find out as much information as possible about the companies offering real estate leads. For example, determine how long they have been in business and their reputation within the industry.
Should you opt to hustle and network, you’ll need to research the best marketing methods for how to get real estate leads. There may be a learning curve and a lot of trial and error as you work to find where your ideal clients are.
Whatever you decide, make sure it works for your business and your comfort level. After all, the leads you buy or acquire should benefit your bottom line, and help you become a more successful real estate agent.
And, when you’re ready to do something with all of those leads you procure, make sure you manage them with Agent Legend. Our software simplifies real estate management. Click here to see how we help real estate agents go from busy to legendary!
