Release the Pressure with Pay Per Lead

Nicholas Marr is CEO and founder of Marr International, the company behind UK based overseas property website homesgofast.com, which has been running since 2003. Nicholas is also a lifetime property investor who has a passion for international real estate, and appears on Television show ‘Ask the Property Expert’ on Overseas Property TV.

Here, Nicholas Marr shares with propertyportalwatch.com some of his ideas about the best business models for portals:

I run an overseas property portal and like many website businesses have tried and tested various businesses models. The aim was clear, to find the best method for agents to pay for our services that also kept them happy.

The Commission Share experience
We started with property agents listing their real estate with us on a commission share basis, the system worked by agents signing an agreement and then promising that they would inform us the progress of each lead. They also promised to inform us of a sale and forward our commission cheques. A year went by and, as you guessed it, we saw a handful of commission cheques from a handful of agents – the rest disappeared without trace. The system relies on a portal being able to trust the other party.

We then thought of a system that involved us giving away £300.00 to any buyer who bought from our site. This system was well publicised and used as a threat to unscrupulous agents. The theory went that we would be informed by each buyer of a purchase as they would want their £300 reward. Rather than making the commission share option a success it brought to light the extent of the dishonest agents. We had buyers coming out of the woodwork quoting us sales that would have amounted to tens of thousands of pounds. I was not going to rely purely on this system.

Monthly subscriptions: as straightforward as it comes
Paying a monthly marketing fee to list on our website was a straightforward as it comes – our clients were used to the model and happy to pay. To be effective pricing needed to be competitive portals that run this system need to produce real leads that can turn into sales. I remember in 2007 the Bulgarian property market had taken off and we had more enquiries than you could imagine. We varied our monthly subscriptions to match the amounts of property listed and things ran fine.

Then came the slow down – we did not produce the amount of leads agents were used to. This led to unhappy customers and us being forced into making price reductions and other concessions. Agents began to leave and it seemed the bigger sites were the places they ran to. Our staff began getting more calls regarding lack of leads than any other subject. Something had to change…

To the rescue: pay per lead
The pay per enquiry business model means agents only pay when we produce an enquiry that meets set criteria. It means that if we do not perform we do not get paid. It certainly got our businesses highly focused on driving buyers to our agent’s properties.

We now work with our clients advising on wording and SEO for their adverts. We refund immediately any leads that are spam or not contactable – the integrity of each lead is paramount. Our clients feel we are working together with them to find buyers for their real estate. The pressure is on but it’s not from complaints regarding lack of leads, it’s to increase our performance on behalf of our agents. We are recruiting agents that are seeking value for money and leaving the big companies whose fees are becoming to hard to swallow.

Today we allow agents to select between subscription and pay per lead. Established developers who provide an initial deposit can also work with us on a commission share basis.

In all, each model has its good and bad points, but I would recommended any portal struggling in today’s market test the pay per lead system. After all, what have you got to lose – it won’t be your clients.

By Nicholas Marr
CEO of Marr International the company behind overseas property website homesgofast.com

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