Now that the holidays are over and the market is picking up steam again, we decided to take a few days and explore Inman Connect 2020 so you don’t have to.
Every year, industry pros gather in the Big Apple to share their latest insights, make predictions, and engage in heated debates over the most pressing topics in real estate. As always, The Close was there to listen, engage, and test out the new tech that will impact your business.
Here are our 10 big takeaways from the week:
1. Since 2012, Online Real Estate Lead Quality Has Dropped Dramatically
Don’t worry, it’s not just you. There’s been a significant drop in the quality of online leads in the real estate industry in the last eight years.
Here’s how we know: The last era of innovation in real estate technology has centered around lead generation, and in many ways, very successfully so.
Between 2012 and 2019, the number of online leads has grown by more than 510%; people are raising their hands and requesting more information about property, services, and agents more than ever.
But, this isn’t necessarily good news, because the number of home sales during that same period has only risen by a slim margin, less than 10%. So, with the number of leads exploding but the sales volume remaining relatively flat, it’s clear that many of the leads this new tech is generating are of low quality.
Here at The Close, we’ve been paying close attention to internet lead generation in the last five years. The price for internet leads has risen by a lot; mostly due to the competition amongst real estate agents for them. Lower quality and higher price isn’t a good formula for success.
Our Advice: Just because the initial quality of a lead is decreasing doesn’t mean that your leads are not worth your time. The big takeaway for you is that nurturing your leads is more important than ever, creating communication plans that start with leads higher up the funnel, and resetting expectations as far as conversion rates and times.
If you’re paying for leads, take a good hard look at how those leads are performing. If you aren’t getting out of them what you’re putting in, you may not be nurturing them well or long enough. Get a plan in place to nurture your leads using a top-notch real estate CRM.
2. In Real Estate, Relationships Are King, But Content Is Queen
Unsurprisingly, there was a huge emphasis on the importance of building good relationships with your clients, especially from marketing experts in the real estate space like Katie Lance.
Equally unsurprising was the repeated mention of the importance of creating quality content in order to represent yourself, your listings, and your business to the world. In fact, Lance even called out the Inman audience early with this challenge:
“Every listing, every photo, every single letter of every single word of every single sentence is a representation of your brand. What sort of content are you making to create opportunities for incredible client experiences?”
The moral of this story was how interrelated these two tasks are. Great content; content that engages your audience, tells your story, and provides people with a step to take after hearing your message makes building relationships that much easier.
Likewise, a well-maintained relationship, one with regular, genuine, and authentic communication makes your audience much more likely to consume your content and act upon your message.
Our Advice: Make sure you’ve got an effective communication plan in place for every single contact in your database, and execute that plan. Once that plan is in place, develop a content strategy that builds on the trust you’ve created through your relationship building, and make sure that content strategy has a well-defined goal that can be achieved by your audience responding to your messages.
If you need help with your marketing plan, start here with this free marketing plan template.
3. The Traditional Mortgage is FINALLY Getting Disrupted
For as long as I’ve been in the real estate industry, homebuyers have had three options when it comes to purchasing a home: paying with cash, getting a mortgage, or doing a land contract.
Land contracts aren’t realistic for most sellers, so they are few and far between. If you’ve got enough cash in the bank to pay for your home outright, you’re breathing rarefied air. That leaves the vast majority of homebuyers dealing with a financial instrument that hasn’t had much of an update since the 1930s: the mortgage.
That is, until now.
There are now companies like Divvy, Flyhomes, and Orchard that are disrupting the home financing sector and giving buyers new ways to buy real estate that are faster, simpler, and less annoying than the traditional mortgage.
For instance, if your buyers want to purchase a home but don’t quite have the down payment you need, Divvy will actually purchase the home for them, then lease it back to them with a portion of your lease going towards a down payment savings program. When you’ve got enough saved up, Divvy will then sell the home to you.
Mortgages are harder than ever to qualify for and they often require more of a down payment than is realistic for many buyers. The traditional mortgage doesn’t meet the needs of many new home purchasers. This disruption is welcome and needed to keep this end of the industry on its toes.
Our Advice: Real estate agents, especially buyer’s agents, have a major opportunity to expand their client base by learning how these companies are disrupting the traditional mortgage market. The more financing options you’re aware of, the more potential buyers you can market to.
Learn how these companies do business and start marketing your services more aggressively to the rental communities in your hometown using our free real estate farming guide.
4. Much of the Innovation in Real Estate has Centered Around Lead Generation, & That’s Been Bad for Our Clients
The past five years have been an exciting time for innovation and technology in the real estate space. Exciting, that is, if you’re a real estate agent. Your clients? Not so much. They’ve had to deal with being targeted by agents almost everywhere they go online or off.
Don’t get me wrong, I think the advancements in lead generation strategies have been exciting and have lead to a lot more opportunity for agents willing to embrace them. But, we haven’t matched those lead generation advances with equal advancements in the realm of client experience.
Our customers haven’t felt a radical shift in the ease or enjoyment of their real estate experience, and feedback from clients on a large scale is starting to show a growing frustration with this.
Nick Bailey, Chief Customer Officer at REMAX summed up this concern this way:
“You think the consumer is there waiting to do business with you again? They’re not. Work and protect your database, transform the way people see real estate through their interactions with you.”
As an industry, we’re going to lose the trust of our clientele if we don’t start turning our attention towards innovating on the consumer experience.
Our Advice: Keeping informed about the latest developments in blockchain and crypto currencies os also a smart move as both technologies are poised to transform real estate transactions. If you still need to learn the basics, check out our guide to bitcoin for real estate agents here.
5. More People are Consuming Real Estate Content for Entertainment
It took all of three minutes into his presentation on day one for Joe Hyrkin, CEO of Issuu, to remind us that video is still the dominant media on the internet. The message was clear;
“If you’re not using video to market yourself, your business, and your listings, you’re missing out.”
This fact was hammered home with the startling statistic that viewership of HGTV has now surpassed viewership of CNN.
Home and homeownership media is now squarely on the entertainment spectrum, which put real estate agents in an interesting position; either get with the trend and start creating content that entertains as well as informs, or get out of the way for those who do. If you choose the latter, be prepared to surrender many of your leads and much of your business to those who do decide to jump in with both feet.
Our advice: It’s time to put together your video strategy. You can get started by setting aside three hours this week.
The first hour should be spent watching real estate video content online (watch your competitors, watch the big name agents who are doing it right, take notes).
The second hour should be spent thinking about your own capabilities. Do you have any experience doing video? What sort of gear do you have? What sort of time do you have to devote to video each week?
The third hour should be spent making a plan. Choose a time every week to spend making video, block it off on the calendar, create a list of the videos you want to shoot and how you want to use them. This process takes time to get right, but you have to start first, so start this week.
If you need some inspiration, check out this Ryan Serhant vlog of a tour of a $279 million ranch.
6. The Highest Performing Agents are Spending the Majority of Their Marketing Budget on Branding
According to Malte Kramer, CEO of Luxury Presence, the top 20% of real estate agents in major markets are spending upwards of 60% of their marketing budget on branding and awareness.
These top producers understand that a large part of success in real estate marketing is staying top of mind for everyone in your lead funnel, and in order to do that, you’ve got to be working to create a consistent presence for your brand in the marketplace. This budget is spent on things like a lead-producing website, social media marketing campaigns, event sponsorship, and more.
Our Advice: Examine your marketing budget and determine where your dollars are being spent. Your marketing generally falls into three categories; property marketing, lead generation, and branding. All three are important, but branding is where we have the hardest time spending our money because it’s challenging to see a direct return on that investment.
But, we know that a well-branded agent sees better results on their property marketing and lead generation efforts, so if you’re not spending enough on branding and awareness, it’s time to start.
If your branding game isn’t on point, check out our Real Estate Branding Guide + Tips From the Pros.
7. Tailor Your Presentation to the Platform, Not Your Brand
If your branding and messaging are changing based on the platform you’re on, you’re doing your overall marketing efforts more harm than good. This is the message we heard from Issuu CEO Joe Hyrkin.
“As real estate agents, you can definitely leverage your assets across all the different platforms you’re active on, but don’t let that erode what your message is. Of course, you’re going to use different ways to communicate if you’re on Facebook vs LinkedIn vs a video for your blog. But, that doesn’t change your overall brand guidelines or goals.”
Our Advice: First, make sure you have a marketing plan that includes branding and stick to it. What are the messages you want people to walk away with about you and your business?
Second, ask yourself, “How am I using the various platforms that I’m active on to tell that story? Do I know the strengths and weaknesses of each platform? How am I using these platforms to tell my story?”
8. Stop Thinking About Vanity Metrics
Ironically, some of the most interesting presenters at Inman Connect turn out to be people outside of the real estate industry. One of those presenters this year was Grace Ouma-Cabezas, Vice President of Marketing for food and home website, Food52. She had a great reminder for us about how we’re measuring our success, and what pitfalls to avoid.
“I am always asking my team: ‘How are we measuring success for this campaign? What counts as a win?’ It may be that success is measured by an email conversion, or a product sale, or by lowering our website’s bounce rate. It’s easy to get caught up in metrics like video views or web traffic, but if these statistics don’t actually translate into wins for your business, they don’t mean anything.”
Grace’s strategy is very much in line with what Eric Ries, author of The Lean Startup says about measuring success. Ries advises being wary of vanity metrics; meaning metrics that make us feel good, but don’t actually make us money.
Our Advice: Ouma-Cabezas challenged agents to think about what micro-conversions happen as our clients move down our funnel. What are the metrics that move your prospects closer to becoming leads, closer to becoming clients, closer to the closing table?
Start by identifying those conversion points (Facebook follows, Instagram engagements, email link clicks, etc.) and building your metrics around them. Email marketing is a great place to do this because it’s easy to measure your performance through clicks, opens, and conversions. Check out 17 Best Real Estate Email Templates to get started.
9. Marketing Investments Take Time to Show a Return
If you came to Inman Connect (or to this article) hoping for the magic marketing bullet that would immediately get you listings and buyers, sorry, it ain’t happening. One of the unofficial themes we heard all conference long was that the top producers in our industry have a long view when it comes to measuring their marketing success.
We heard a version of this message from top producers like Ryan Serhant, Josh Team, and best summed up by Coldwell Banker CEO Ryan Gorman:
“Your real estate marketing efforts’ success needs to be measured in years. Pick a strategy and stick to it for 18 months before you declare yourself a success or a failure. This doesn’t mean that you don’t adjust midcourse when you learn along the way, but don’t give up before really giving something a chance to work.”
Our Advice: Set a lead capture goal for your overall marketing efforts, divide that goal up across your different marketing platforms, and start measuring your success incrementally. What small battles do you need to win to eventually win the war? Make a plan for measuring, adjusting, repeating for 18 months.
10. Housing Discrimination is Real and is Still Happening on a Broad Scale
Newsday came to the main stage to talk with Inman Connect Founder Brad Inman about their incredible investigative exposé uncovering just how common housing discrimination still is in the Long Island housing market.
The results were hard to ignore: 49% of African Americans, 39% of Hispanics, and 19% of Asian who participated in the study reported facing some form of housing discrimination. Though this was a study done in a geographically small part of the country, experts (like those at the Urban Institute) agree that the results of this study reflect broader trends nationwide.
Our Advice: Get active in your local real estate community to combat this bias. Point it out where it exists, learn how unconcious some bias can be, and be a leader on your local board to make sure that policies, training, and education exist so that everyone feels welcome in your city. Start by familiarizing yourself with the full study by Newsday.
Did you go to Inman Connect New York 2020? What were your favorite sessions? If you didn’t make it to the conference this year, what are your favorite real estate conferences? Tell us in the comments below; let’s keep the conversation going.