Exploring the ins and outs of how much a valuation lead is truly worth, in this article we touch upon how much they cost and how much your agency can be expected to pay for one.
Dive into the latest episode of the ‘Starberry Vlog’ series bringing Ben & Nitten together again to guide estate agents in answering the one big question: How much would you pay for a valuation lead?
As an estate agent understanding the inner workings of valuations leads is of high importance. Uncovering the honest figures regarding how much a valuation lead truly costs your estate agency, will reveal not only better lead targeting strategies but also marketing and best budgeting practices.
Revealing this information however is dependent on your agency's commitment to ‘tracking’. Tracking allows you to spot high-lead converting web pages or identify the success - or failure - in individual marketing strategies.
Calculating Cost Per Valuation Lead (CPL)
We all know that to calculate cost per lead, involves taking the total amount spent on marketing and dividing it by the number of leads acquired, to reveal the Cost per Lead (CPL). However there are some things to consider:
Simply to start you need to sit down and be honest, asking the question: how much are you willing to pay? What is the value of a valuation lead to you and your team, how many of these leads do you need to win an instruction. Moreover how many of those instructions actually convert into a sale.
A typical conversation with our estate agent clients reveals that they tend to get an instruction for every two web leads and that every instruction would convert into a sale. The average property sale prices can vary dramatically, but most estate agents tend to pay somewhere between £100-£200 a lead.
When calculating CPL, it is best to keep in mind that not every investment is to achieve the final instruction and property sale. Realising that sometimes paying for a lead for the chance at bigger and better potential business down the line, we believe is beneficial.
You might also want to consider segmenting leads. Finding out how much a landlord vs a vendor is to you will allow you to make better budgeting choices.
How The Cost Per Valuation Lead Can Differ For Every Estate Agent
Please be aware that what works for one agency may not work for another. There are many variables when considering the cost per valuation lead, including:
- Location: Depending on the location of your properties or even your office can have a major influence on the cost per lead. For example estate agents based in Central London tend to see higher figures as opposed to those out of the city.
- Property Type: The type of property that your agency offers can also impact costing. Those offering accommodation in bungalows and 1-bedroom apartments as opposed to those selling 6-bed detached homes.
The cost can also differ depending on your agency's main lead types - Sales vs Letting leads. When segmenting leads you'll discover that different budgeting is required, so for an agency that mainly secures landlords you may want to reconsider budgeting as they tend to be the more costly leads to pursue as opposed to vendor leads.
How We Can Help Achieve And Improve The Cost Per Lead
At Starberry we can help you identify the correct problem in order to correctly identify what a lead is worth to your agency. Essentially we start to build a campaign around what our client is willing to pay and we highly consider how they are performing already. For example some clients may have a higher cost, not due to their marketing but to an underperforming website.
We understand that a lot goes into the overhead of the business, so when working on costs we tend to work around marketing costs, finding the best solution for the best value. For example we may decide to run what we call an “easy entry” campaign, not committing too many channels but in turn allowing you to perform more accurate tracking on your best performing channels.
To be clear, none of this is simply an overnight process, we suggest staying committed for 3 to 6 months to witness some serious marketing ROI. Bearing in mind that it is also a two-way street and that the final conversion for sale is on the agent side; however we can help with this also.
Our goal when working with estate agent clients, is to ensure the most efficient forms of lead capture are in place to lower all costs. Making sure the website is in order with improvements such as strategic CTA’s and open forms that actually convert. Providing accurate tracking solutions to discover what works best and the main things we can recommend further.
All of these well-thought out and strategic recommendations are a part of the digital marketing campaign we can offer clients. If you're interested in learning more about how to take your agency to the next level when securing leads, book a meeting with us right now.