In the current competitive environment, real estate agents and brokerages have to deal with many difficulties concerning lead response time and qualifying prospects. With more and more clients using digital channels to get property information, it’s essential for these businesses to stay ahead of the curve and start adapting to the changing landscape.
Innovative solutions are making a splash, managing sales and marketing tasks with ease, and letting real estate agents focus on what their job actually is. In this article, we will explore what SwaS is and its significance in revolutionizing the way real estate agents and agencies manage their digital transformation.
What Is Digital Transformation In Real Estate?
Digital transformation in the real estate industry is essentially the adoption of digital technologies into all facets of the business – from sales to marketing to operations and customer service. The whole point of this shift is to bolster performance, increase the bottom line, and improve the customer experience.
The National Association of Realtors has reported that digital transformation is revolutionizing the way real estate agents and organizations function, resulting in improved competitiveness and better results for customers.
The report further states, “digital technologies have the capability to upend established business models and open up new prospects for growth and success in the real estate industry”. However, let us not forget how things used to be before this change.
Today we will focus on sales and marketing and look at how the digitalization of the real estate industry took place and what is coming in 2023.
Real estate sales and marketing before the internet
Let’s take a walk down memory lane and remember that before the internet became widespread. In the past, real estate sales and marketing relied heavily on traditional methods such as print media, direct mail, and open houses. Realtors would also network to find clients, other agents, and their brokerage. These efforts were usually targeted at the local area, making it difficult for agents to showcase their listings to a wider audience.
To summarize, the entire process of real estate sales and marketing was long-winded, pricey, and mainly depended on personal ties and face-to-face meetings. But things became easier when the internet first arrived.
How the real estate industry adapted to the first internet
Real estate professionals were one of the first to realize the potential of the World Wide Web when it began to become more widely available in the ’90s and 2000s. They saw it as a great way to reach a greater number of people and promote their listings and services.
The initial websites created by these professionals were basic. They had limited details about the properties and agents, yet this was a major leap forward for the industry. As technology progressed, real estate websites became more sophisticated, featuring virtual tours, multiple images, and comprehensive information about the properties.
This enabled agents to promote their listings in a more immersive way, making it easier for potential buyers to get a better idea of what they were looking at.
The availability of data and the convenience of digital property searches have revolutionized the real estate industry, giving agents more options to connect with customers and boost their sales.
Real estate statistics on internet leads, sales and marketing
At the start of the internet era, real estate agents heavily depended on online promotions to get leads. Initially, these promotions were plain banner ads that were placed on prominent websites.
As the technology surrounding online promotions advanced and with the introduction of social media, agents started using more sophisticated tactics. These tactics included activities such as SEO and PPC advertising. These allowed them to get their message to a bigger audience and target potential customers correctly.
At the start of internet marketing, the conversion rates were quite low with only a small fraction of leads produced through online ads resulting in sales. Thereafter, as technology improved and more people got comfortable with the internet and the concept of buying a home online, conversion rates began to rise.
By 2015, studies showed that real estate leads generated through online advertising were increasingly likely to result in actual sales, with conversion rates reaching as high as 20-30%. This demonstrated the increasing effectiveness of online advertising for real estate agents and the growing importance of digital marketing in the industry.
The year when it all went downhill
After 2015 however, the conversion rates of real estate ads started to decline. The industry became saturated with digital advertising. As more and more real estate agents adopted digital marketing, competition for online real estate leads increased, leading to declining conversion rates.
This was due, in part, to ad fatigue or “banner blindness,” where internet users became immune to the constant barrage of online advertisements. Additionally, many real estate agents struggled to effectively reach and engage their target audience through digital advertising, resulting in low conversion rates.
This was especially true for social media advertising, where algorithms and constantly changing platforms made it difficult for real estate agents to maintain a consistent and effective online presence.
According to recent studies, the average conversion rate for real estate ads hovers around 1-2%, with only a small percentage of leads generated through online ads resulting in actual sales. This low conversion rate highlights the ongoing challenge real estate agents face in effectively reaching and engaging their target audience through digital advertising.
Despite this, however, digital marketing continues to be an essential component of real estate sales and marketing, as the internet remains the primary source of information for home buyers and sellers.
Example of digital transformation of sales and marketing in real estate
An example of early digital transformation in the real estate industry is the widespread adoption of Customer Relationship Management (CRM) software in combination with many other digital transformation tools. That allowed real estate agents and agencies to manage their sales and marketing activities in multiple platforms, including lead generation, email marketing, and follow-up. By automating many manual tasks, CRM and automation software helps real estate agents save time and increase their productivity.
One of the key benefits of CRM software is its ability to provide real-time insights into the sales and marketing activities of an agent or agency. With real-time reporting and analytics, agents can track their progress and make data-driven decisions to improve their performance. This can result in a higher return on investment for their marketing spend, as well as a better overall customer experience.
By embracing digital transformation and implementing these technologies, real estate agents and agencies can remain competitive in an ever-changing industry and continue to grow their businesses.
How Is The Real Estate Industry Being Transformed In 2023
The real estate sector is witnessing a revolution, with a strong emphasis on automation and artificial intelligence. The usage of CRMs is now the norm. Equally important, the key to success in the realm of housing sales and marketing is making the most of smart automation to create more efficient and productive workflows.
The principal idea behind this change is to enable real estate professionals to connect with potential clients in less than 5 minutes, and to have an automated appointment scheduler. Curious to find out what’s driving this transformation?
Agents and firms are utilizing a multitude of advanced technologies, such as AI-driven lead generation, chatbots, and marketing automation, that allow them to automate mundane activities such as follow-ups, appointment scheduling, and lead nurturing, thus leaving them with more time to concentrate on other parts of their business.
Furthermore, these tools assist agents to become more aware of their clients, including their shopping inclinations and activities, enabling them to customize their sales and marketing strategies to better suit the requirements of their potential customers.
To sum up, the digital revolution in the real estate business is leading to more proficient and successful sales and marketing operations, greater productivity, and improved customer experiences.
As technology persists to progress and becomes more available, it’s likely that we will observe even more progress in the real estate market and the way that agents and agencies carry out their sales and marketing activities.
Digital transformation: agent perspective
The Digital Revolution is making a huge difference in the real estate business and all its stakeholders, notably agents and agencies. They’re able to use technology to:
- Extend their influence
- Streamline operations
- Open up doors to a much larger pool of potential customers
- This leads to greater productivity
- Better customer experience
- Higher conversion rates
- It’s a win-win situation!
Digital transformation: customer perspective
With the help of technology, real estate agents are able to serve their clients a more special and customized experience for their clients including:
- Custom approach to locating the perfect property for the client
- Transforming the way that customers and agents interrelate
- Efficient and smooth client journey from lead to close
Recommended ➜ Read about the drivers of digital transformation.
Key Elements Of Digital Transformation
The real estate sector is undergoing a tremendous shift due to digitalization, which is completely changing the landscape of how real estate transactions and promotions are transacted. According to an article from integrio.net, key elements of this transformation include:
- Improved customer journey
- Personalized client experiences
- Creation of complex sales and marketing ecosystems
- Informed choices
- Use of Software-as-a-Service (SaaS) models
- Business process automation
By having these components in place, real estate companies and brokers can make their operations more smooth and more productive, while providing clients with a tailored and top-notch service. This has generated a more interconnected and educated industry where customers can make better decisions and agents can offer quick and quality service.
Digital Transformation Challenges
Embracing the digital age in real estate can be a tricky process. Agents and agencies may come across a few difficulties while making the shift, including:
- Adoption of new technology: Agents and agencies may find it challenging to embrace the latest technology, including modern CRM applications, automated processes, and digital systems.
- Integration of systems: Ensuring that new technology integrates seamlessly with existing systems is a challenge for many agents and agencies.
- Data privacy and security: As the real estate industry is inundated with digital technology, it’s essential that agents and agencies take steps to guarantee the safety and confidentiality of customer data.
- Cost: Making the switch to more modern digital systems can be a costly endeavor for agents and agencies, particularly for smaller companies.
- Staff training: Ensuring that staff is trained on new technology and systems can be a challenge for agents and agencies.
- Resistance to change: Some agents and agencies may resist the move toward digital transformation due to a lack of understanding or a fear of change.
If the right steps are taken these difficulties can be tackled. Dedicated planning, quality instruction, and a willingness to accept change are all needed. By dealing with these obstacles, agents, and agencies can gain the advantages of digital transformation.
Recommended ➜ Read about the challenges of digital transformation.
Why Is Real Estate Digital Transformation So Important
In the coming years, the real estate sector needs to embrace digital transformation to remain competitive. Clients are looking for rapid responses and access to all the information they need, and the digital transformation of this industry can help agents and agencies offer a more efficient experience.
Keeping up with the latest technological advancements will create a competitive edge and help real estate professionals stay at the top of their game. So why is it so important to get on board with digital transformation by 2023?
You have 5 minutes to get in touch with a prospect
The speed at which real estate agents respond to leads is a key factor in securing potential clients. Today, the standard within the industry is to contact leads within five minutes. Can your agent do that? For every lead that comes in? What if they send a request at 10:30 PM?
Those who are slow to respond run the risk of losing clients to their competitors who will have already made contact. Roy Harmon, owner of Advertoscope, emphasizes the importance of being the first to reach out, as waiting longer than five minutes could lead to missing out on opportunities.
78% of prospects buy from the first agent that responds
Aspiring real estate professionals should be quick to reach out to potential leads. Responding within 5 minutes is the benchmark, as research has revealed that 78% of customers will go with the business that responds first.
If you don’t act fast enough, you might miss out on the chance of signing up a new customer as your competitors may be quicker in reaching out to them. That very first communication between your agent and the prospect can have a significant impact on how reliable they think you are, as well as how they will perceive any possibilities.
By being the first to reach out, an agency can differentiate itself, highlight its unique features and benefits, and create a lasting impression. As noted by Leif Peters, a Senior Account Executive at IntelliChief, the first vendor to engage a prospect has a golden opportunity to mold their opinions and create a memorable experience.
In the first minute sales conversions skyrocketed to 391%
Lead Connect has shown that if you respond to inbound leads within a minute, your sales conversion rate will soar by 391%. It isn’t just about scheduling property viewings, but actual conversions. If you can do this, you’ll join the elite 1% of B2B selling organizations and reap the benefits of their hard work.
As noted by Karl Norman, Business Development Director at Lead Connect, the ideal time to contact a potential customer is when they have just entered their phone number into the form, as they are available and thinking about the seller’s services. If the response time is slow, the prospect is likely to find another supplier.
80% decrease in lead qualification if you respond later than 5 minutes
If you take longer than 5-10 minutes to contact a lead, the likelihood of making a successful connection drops dramatically – a decrease of 80%. This clearly emphasizes the need to be quick in reaching out to prospects.
Given that there are so many elements in the B2B world that you cannot regulate, it is essential to capitalize on the ones you can. Otherwise, your company may experience severe opportunity loss.
Today about 55% of real estate agents take up to 5 days to respond
A study revealed that 55% of the organizations in the survey took more than 5 days to answer leads and an astonishing 12% never replied. This is especially worrying taking into account that these leads could have been produced through paid promotion, which is now fairly costly.
It is shocking that organizations would let these leads go without a response for an entire business week or even be lost totally. To remain competitive, companies should quicken their lead reaction time and make sure they don’t let these important leads escape.
Where is the industry going to achieve this?
The real estate industry is adopting new business processes which are aimed at addressing the issues of lead response time and prospect qualification. This involves the integration of new revolutionary SaaS CRM platforms powered by three key components:
- All top sales and marketing tools in one place
- Battle-tested industry snapshots and assets. All are branded to your business.
- Account manager with industry and tech knowledge.
Let’s not kid ourselves, there are plenty of SaaS platforms out there that can get the job done, but wouldn’t it be nice if you didn’t have to dwell into tech and marketing at all?
With SaaS solutions, there’s no one assigned to your business specifically with tech and industry expertise. This third component is what actually makes it Software-with-a-Service (SwaS).
With SwaS, the problems of slow lead response time and poor prospect qualification are solved. Freeing up agents and agencies to focus on their job, while the platform takes care of the sales and marketing aspects with proper follow-up automation. This new model is set to revolutionize the way the real estate industry operates and improve the overall experience for both agents and customers.
SaaS vs SwaS
To better understand SwaS let’s make a quick comparison to what we already know. SaaS, or Software-as-a-Service, is a model where software is hosted and managed by a third-party provider and accessed over the internet by the end-user, i.e. agent or agency. This allows companies to leverage software solutions without the upfront costs and ongoing maintenance of traditional software models.
Whereas, SwaS, or Software-with-a-Service, takes this concept a step further by incorporating the human element relevant to the industry, in this case real estate. With SwaS, the provider takes care of all the sales and marketing processes, including creating a complex lead response and qualification system.
This removes the need for companies to worry about setting up technology, automation, and other technical aspects, enabling them to focus solely on their business goals.
Is Your Business Ready For Digital Transformation?
There’s no doubt – as a result of the introduction of SwaS, the real estate industry is undergoing a digital transformation. It solves the problem of lead response time and prospect qualification by taking care of sales and marketing, leaving agents and agencies free to focus on what they do best.
By combining the convenience of SaaS with the personal touch of human interaction, SwaS offers a comprehensive solution to the challenges faced by the real estate industry.
As a leading digital transformation agency, Lumen Spei is committed to helping real estate agents and agencies with their future digitalization. We invite all those who are looking to enhance their sales and marketing efforts to reach out to us and experience the benefits of our SwaS solution.
With our team of experts, we are confident in our ability to help you achieve your goals and grow your business.