The Cost of Internet Success

Posted by: Mitch Ribak on November 21st, 2008

 

I know that there are so many of you out there who read this blog and are excited about taking your business to the ‚Äúnext level‚ÄĚ by using the Internet.¬†

Lately, at The eHomes Realty Network, I have been getting a lot of inquiries about the cost to get your Internet business off the ground.  Below are your basic costs to get going.  The marketing program you choose will vary from area to area. 

Website

I’m a big believer in using ‚Äútemplate websites‚ÄĚ.¬† There are many choices in custom websites also, but I prefer to put my money into marketing and generating business.¬† Most template websites are 90% customizable, affordable and already have a ton of generic content.¬† You can easily spend $10,000 – $20,000 on a custom site.¬†

IDX

Over 90% of the real estate leads we capture at Tropical Realty of Suntree are from people registering to view home listings on our website.¬† I highly recommend an IDX vendor versus your free MLS providers IDX.¬†¬† There are multiple IDX companies available.¬† HomeGain offers an IDX website with their AIMS product. We will be launching our 100MPH Marketing Software in about a month for the state of Florida.¬† However, it won’t be available nationwide for some time.¬† I also recommend iHomefinder.com. Their tool is very easy to use, reliable and has a good capture mechanism.¬†

Pay Per Click

Using pay per click can be very costly if you don’t know what you are doing.¬† If you are using Google and/or Yahoo!,¬†try to get to the third position.¬† This will allow you to get good results at the best possible price.¬† As most of you know, I use HomeGain’s BuyerLink¬†exclusively for my PPC program.¬† With BuyerLink, the cost is usually less than Google and Yahoo!, the conversion rate from click to lead is almost double and the best part of all is you don’t have to spend a second of your time managing your keywords.

Keep in mind when deciding on your marketing budget that you will receive anywhere from an 8% Р12% click to lead conversion.  For this example, we are going to use $1 as your cost per click and a 10% click to lead conversion rate.  To figure out how much you need to spend on pay per click, figure you need to generate 1-2 leads per agent per day.  Your goal should be 50-60 leads per month per real estate agent.

If you spend $500 on your pay per click, you should receive 50 – 75 leads.¬† Once you get good at conversion, you should be converting approximately 1 sale out of 35-40 leads.¬† Our 100MPH Marketing system will help you convert 1 out of 25 leads or better.¬† Before you start any pay per click program be sure you have an excellent follow up and conversion program.¬† It’s imperative or you could be throwing your money away.

Database, CRM and Drip Campaigns

It’s important to start from the beginning with a database and CRM.¬† There are several programs you can buy to keep track of your leads and send emails.¬† If you are on a budget, which most of you are, you can simply use Outlook to keep your leads, organize them and email them.¬† You can even use it as your follow up reminder system.¬† I will be launching the 100MPH Marketing CRM after the first of the year to assist agents in this area.

 

Those are the tools you will need to have a successful Internet program.  You can easily add more tools but there is no reason to do this when you are first starting out. 

Let’s take a look at the pricing for these products on a monthly basis.¬† Remember, you have to plan at least 4 – 6 months in getting up and running with your Internet business model. ¬† Most real estate agents will start earning revenue much quicker than that, but it’s always good to prepare for this amount of time.¬†

You are starting a business ‚Äď this isn’t a get rich quick scheme.¬† It’s a solid business building plan.

 

  • Websites – $50 per month
  • IDX – $50 per month
  • Pay Per Click – $500 Per Agent (of course if you are excellent at lead capture you could spend less)
  • Database, CRM and Drip – Free if you use Outlook or $35 per month if you purchase¬†a basic CRM system.

As you can see it’s really not a huge investment to get yourself up and running to succeed in real estate.¬† Your pay per click can be done for $250 per month, but plan on it taking a little longer to get the momentum going.¬† Once you do, you can cut down the cost.¬† Currently I spend around $300-$400 per month per agent.¬†

Another way to look at the costs is to look how much you would pay for a referral or how much you pay for print marketing currently.¬† We have dropped all our print marketing and only spend our money on the Internet.¬† Since we generate so much monthly traffic (55,000 per month with 6,000-12,000 of these unique visitors) we don’t have any need to place home listings in magazines or newspapers.¬† Our listings receive much more exposure than those media outlets. ¬†

The key is to look at your cost per sale.¬† If you are spending $500 for leads and you create 50 leads, you are spending $10 per lead.¬† If it takes you 35 leads, your cost per sale is $350.¬† I don’t know about you, but I would gladly pay $350 for a $2,500 or more commission.

I hope this helps you with your decision to start your Internet program.¬† As always, I’m here to help if you have any questions about how to get started.¬†

Good luck!  

Mitch Ribak, Broker
Tropical Realty of Suntree, Inc
Mitch@MitchRealty.com

www.MelbourneHomeSearch.com
www.MitchRealty.com
www.eHomesRealtyNetwork.com
Office: (321) 259-9115

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Comments

4 Comments on “The Cost of Internet Success”

Todd Covington

Great post. I’ve now spent around $14,000 on a custom job. I think long term it will be worth it but it sure has hurt my wallet. Thanks for the super ideas in your post, Todd.

Listwise-Triangle Real Estate

For anyone looking for a custom look for a generic template cost, they should go by Dakno Marketing and look at their SwiftSites and SwiftBlogs. They did mine, and for the $549 I paid, I got a custom look and setup along with the use of their Agent Back Door, making updating super easy. Anyways, they worked great for me.

Bob Wuest

I like template sites too for Realtor websites. However, when you’re looking at a template site, make sure they don’t do dynamic content. When they do, Google spiders cannot access any of your content that you add to the template.

Laurent

Bob, this is simply not true. Real estate websites will always have dynamic content. There’s no way around it because the properties you have for sale are always changing. Google and other search engines have no issue crawling dynamic websites.

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