Online Lead Conversion Rates: Maximize Your Results

From Blair Kuhnen, VP of Marketing at Builder Homesite

Several builders have asked me "What should my online lead conversion rate be?" and it is a perennial favorite when I speak about online sales counselor (OSC) programs. This month I share with you a few guideposts you can use when setting up your initial goals and expectations.

There is not a specific lead conversion rate target for a best practice OSC program. Every builder operates with a different set of variables. Some of the factors that affect your conversion rate include:

1. The strength of your market - hot markets get better, more complete leads
2. Your calls-to-action - a good offer gets consumers clicking
3. The usability of your website - if they can't find the button, don't expect them to use it
4. The quality of leads - leads from your own website are always your best leads
5. The effectiveness of your lead handling process and your on-site sales force.

Does this mean, there is no answer? Let me share with you a starting point.

Toll Brothers Earnings: Weathering the Storm

Despite a third-quarter profit that fell 85 percent, Toll Brothers managed to stay profitable and actually beat analyst forecasts. Toll Brothers stock was trading higher in early morning action. 

CEO Robert Toll stated that a surplus of homes is curbing demand. He also said that ``Our buyers generally should be able to continue to secure mortgages, due to their typically lower loan-to-value ratios and attractive credit profiles,''

But, analysts predict that these buyers will likely begin to have trouble securing mortages, despite their favorable credit and financial status. This could mean that Toll and other luxury builders may be exposed to more writedowns of land holdings in future quarters.

Search Engine Marketing Strategies - PPC vs. SEO - Part 1

Part 1 of our Search Engine Marketing Series will focus on the basics of PPC.

Search Engine Marketing, or SEM, is a form of Internet marketing that seeks to promote a website by increasing it’s visibility in the Search Engine Results Pages (SERPs) when someone enters a keyword phrase that is relevant to that website or business. There are 2 main types of results on a SERP – Sponsored Listings (PPC) and Organic (Natural) Listings (SEO).

The Sponsored Listings are Pay Per Click Advertisements that are created by an Internet Marketer or firm that wants to present an advertisement to those users searching for specific keyword phrases. These Sponsored Listings will show up at the very top of the Search Results Page or on the right hand sidebar. The Internet Marketer responsible for creating the Pay Per Click Advertising Campaigns will assign a maximum bid to each keyword or group of keywords and establish an overall monthly budget that they are willing to spend on those designated keywords.

With each search performed on Google, the ad will post what is called an impression in the Sponsored Listing section. They will only need to pay for that advertisement if someone clicks on the displayed text ad and the user is then redirected to their website. This is referred to as Pay Per Click (PPC) Advertising. Initiating a PPC Campaign is rather simple to get started (you can see your advertisements posted within minutes of setting them up) but maximizing the amount of clicks you get for your money is a daunting process that deserves continuous attention and improvement by a PPC Expert.

Check back next week to learn about SEO - Search Engine Optimization.  Yes, it is different than PPC...

The Importance of Visualization: Real $3.1M Mansion Causes Big Virtual Stir

Be sure to read this article on cnn.com about a $3.1M mansion in Washington State that has been re-created in the 3-D online world, Second Life. This is a fascinating and innovative way to market real estate for prospective buyers online. This first attempt has attracted a lot of interest in the virtual community:

"In real life, a house like this might normally attract the attention of 50 to 100 people, but since Wednesday 3,500 people have toured the home in Second Life, according to its broker, Suzanne Lane. Not all of them are prospective buyers of course -- in a virtual world it's easy for anyone who's curious to just stop by.

"I feel comfortable that it will sell within the next couple of months," she said, despite the fact that the Seattle real-estate market has cooled recently."

This gives food for thought on the impact 3-D visualizations have on buyers, and the increasing importance of utilizing advanced visualization tools to attract interest in real estate properties. Consumers will soon expect to see 3-D walkthroughs and video tours of homes they are researching. Pictures and traditional virtual tours are becoming more and more obsolete by the day. As an industry we need to start creating interactive content, such as video and 3-D walkthroughs, that will excite consumers for years to come.

Thanks to Crystal Christopherson from Envision for this post.

Meritage CEO Fires The First Salvo In The PR War!

Well, 'New vs Used'--with all the current negative press and market conditions...we all talk about this stuff and think we should do something, but Meritage has actually taken action in combating the current market malaise/negative press, by hitting it head on via PR outreach.  It is not only about 'buy now' but also about 'new as superior'.  (You can link to the interview from Newhomesource.com.)  An interviewer from the local media interviewed Steve Hilton (CEO--Meritage) in a news format, resulting in a great scripted interview that can be posted in a variety of places online. 

What if the top 50 builders all created video interviews of key execs focusing on these important topics placing this content not only on their own websites but also on 3rd party aggregator sites? The effect is that wherever the consumer goes, he will see a myriad of influential and trusted sources espousing the benefits of new and combating the negative publicity in the current market. 

This poses an interesting question for the consortium, both as individual builders as well as a unified body...Can we provide draft scripts, should we help facilitate production, post on our sites, etc...?   What are your thoughts?  Please post your thoughts and comments. If we want to craft the environment we live in, we need to take action...the question is 'what action'?   Meritage has taken a first great step, which I would challenge all builders to follow!  (Posted by Melissa for Tim Costello!)

How to Capture AND Convert More Leads

To paraphrase the cartoon on the left, The greatest technology in the world won't guarantee you better lead conversion. You need to leverage the latest technologies alongside tried and true lead generation techniques to truly maximize conversion. This post is the first in a series that will help you generate and convert more leads. This post comes from Blair Kuhnen, VP of Marketing at BHI.

Simmons Homes is the leading builder in Tulsa. Tulsa, Oklahoma is a small, but good, homebuilding market. Being a smaller market, with limited relocation and easy commutes, lead volume for builders tends to be low. Many home shoppers are reluctant to give up their contact information and prefer to just visit communities without ever becoming a lead. Simmons has no problem generating lots of leads and converting a great many of them into sales. Here's how they do it.

First a little background. Simmons created an OSC program in October of 2005. When Simmons started their OSC program they were generating well under 100 leads per month. Since that time, they have added NewHomeSource.com, Move.com, NewHomeguides.com, and pay-per-click campaigns to drive up their website leads and third party leads. They have improved their monthly lead volume by 491%, plenty for an effective OSC program.

Simmons sees 20-25% of their total sales coming from their Internet leads. I spent some time this month with Mike Lyon, OSC for Simmons Homes, about techniques for converting more of these leads into sales. Mike is a master of online sales. His strength is in setting appointments. You can order his book on the subject here. After reading it, I would consider buying it just for his phone scripts. Continue reading this post. Click on the link to see the rest.

Consumers Striking Back: Business Week Feature on Consumer Complaint Sites

Business Week has a feature article about new home consumer complaint web sites that everyone in the Home Building Industry should read. The article talks about some of the most popular web sites, and tells the stories of the consumers behind them. These are angry consumers that have had serious problems with their new homes, and have decided to strike back. As the Home Building Industry struggles, these sites are getting more and more traffic and mainstream media attention. Take a few minutes to read the article and then, return to BHI Insights and leave you comments on the article.

The Fed Holds Rates Steady at 5.25 percent

The Fed held steady a key short-term rate at 5.25 percent. Ben Bernanke and The Fed calmed financial market  fears about a credit crunch and inflation. In its statement, the Fed noted that "financial markets have been volatile in recent weeks, credit conditions have become tighter for some households and businesses, and the housing correction is ongoing."

Fears of a credit crunch have caused stock market volatility in recent weeks as investors appear to be betting that the merger boom may be over.

Many economists and market watchers believe the Fed should not cut rates anytime soon since inflation is still a real threat. Those economists cite near record high oil prices and surging wheat and milk commodity prices.

The Fed also noted that "although the downside risks to growth have increased somewhat, the Committee's predominant policy concern remains the risk that inflation will fail to moderate as expected." and it expects the economy "to continue to expand at a moderate pace over coming quarters, supported by solid growth in employment and incomes and a robust global economy."

Fulton Homes Realizing Great Results Through Envision!

Jason Knott, editor of Techhomebuilder Mag, visited Dennis Webb (VP, Ops) at Fulton Homes to talk about their unique approach to their buyers through the use of technology.  Fulton has taken an interesting approach to the downturn in the market, as they are investing in technology/systems to ensure they are poised for the new buyer mentality.  And you gotta love that ‘box o nails’ comment regarding ROI on Envision!  Dennis also has some great advice for his competition—make sure you stay through to the end of the video.

Live from Inman Real Estate Connect 2007: Part 7

BHI Insights is at SFO heading back to Austin TX. It's been a great week at Inman Real Estate Connect 2007. The Inman conferences attract CEO-level decision makers across the industry, and feature a lot great content. We'll be at the next Real Estate Connect in New York January 9 –11, 2008. To check out all the other bloggers that were covering the conference, go to the feed blog . This blog is automatically updated with blog posts that are about the conference. Very cool use of blogging and feed technology. To see all of our posts in one place, go to the conference page on our blog. BHI Insights thanks all the bloggers out there that participated, and have supported us this week. See you in New York!