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In today's rapidly evolving digital landscape, the way businesses approach sales and lead nurturing has undergone significant transformations. Industries across the board are adapting to changing customer behaviors and seeking innovative solutions to boost lead conversion rates and sales.
However, we believe the industry where these changes have the potential to make the greatest impact is within the real estate brokerage model. With its unique dynamics and challenges, the real estate industry stands to gain tremendously from the future of sales, lead nurturing, and customer service — AI chatbots.
In this guide, we’re covering the following topics:
We can’t cover how AI can revolutionize the brokerage model without first tackling the real estate industry’s elephant in the room—awful lead conversion rates.
The raw truth is—traditional methods of sales and lead nurturing are no longer sufficient to keep up with the demands of today's tech-savvy (and impatient) consumers. And let’s be honest—the old tactics weren’t working well for brokerages and real estate agents either, with the industry’s lead conversion rate averaging around 1%.
If that isn’t enough to get you looking for a better way to do business, your prospects and clients certainly are. Prospective buyers and sellers now expect prompt responses, personalized interactions, and seamless experiences throughout their customer journey. This shift in customer behavior necessitates a paradigm shift in how real estate professionals engage with their audience—and it’s already happening.
Like we mentioned, real estate brokerages have been historically plagued by low lead conversion rates. But now the real estate industry is embracing AI chatbots as a game-changing solution. Advanced conversational AI is revolutionizing the way agents interact with leads by enhancing customer experiences and streamlining sales processes—all leading to more sales, and at a much lower marketing cost. AI chatbots have become indispensable tools for forward thinking real estate professionals seeking to deliver superior customer service, improve lead conversion rates, and gain a competitive edge in a crowded marketplace.
During this in depth guide on how AI chatbots are shaping the future of lead nurturing in real estate, we will explore the transformative impact of AI chatbots on brokerage sales and operations, and why it is a critical shift. We will delve into the significant changes in customer behavior and expectations that have propelled the adoption of AI chatbots, as well as discuss the specific benefits and applications of AI chatbots and how they solve for low lead conversion rates that have plagued the industry for too long. We’re also sharing research and case studies about AI in real estate sales and lead nurturing as we uncover its potential to revolutionize the industry and drive unparalleled growth for real estate brokerage owners.
In an era where customer expectations are constantly evolving, businesses across industries are realizing the critical role that superior customer service plays in driving sales. Real estate brokerages, in particular, face unique challenges in meeting these expectations due to the complex nature of property transactions.
You’ve likely heard that your easiest sale is a repeat customer. Well, that’s true—but only if that customer had an exceptional customer experience. And while short sighted businesses in other industries might get away with focusing solely on first time customers, completely ignoring the potential in repeat business, real estate does not have this (pretty awful) option. Unlike software or ecommerce, for example, where customer service mostly likely comes into play after the sale, real estate professionals only make a sale after providing exceptional customer service upfront—often for months. This is one of the unique challenges of the real estate industry—juggling a mind-numbing number of relationships at once, all ever before getting paid.
With the rise of AI chatbots, the real estate industry has found a powerful ally in providing exceptional customer service at scale—minus the headaches. In this first part of our guide, we will cover exactly how consumer expectations are changing, and how AI chatbots enable real estate professionals to meet and exceed them in a more efficient manner than ever before.
So what are your potential clients looking for? According to recent studies, the modern consumer landscape is shaped by three key pillars in terms of expectations: the need for speed, the need for availability, and the need for guidance. Fortunately, AI chatbots excel in meeting all three of these expectations, at a fraction of the cost of other options. Let’s take a look at how real estate AI serves consumer demands below.
Perhaps unsurprisingly, 75% of consumers claim the most important aspect of customer experience is prompt responses, according to this study. Gone are the days when consumers were content with waiting for days to receive a response to their inquiries. Given the popularity of messaging apps, social media platforms, and on-demand services, people have become accustomed to instant communication in all aspects of their lives.
To further drive home the point, another study found that consumers are 2.4 times more likely to stay with your business if you can solve their problems quickly. Whether it's seeking information, resolving issues, or making purchase decisions, consumers now seek immediate interactions and seamless experiences, and this doesn’t just apply to online retail and software services. The real estate industry is no exception to this trend. Prospective buyers and sellers expect instant communication when dealing with real estate professionals. Failure to meet these consumer expectations can lead to frustration, loss of interest, and ultimately, the loss of potential clients.
In a world where global connectivity is the norm, the need for 24/7 customer support has become a vital expectation for consumers. Providing round-the-clock customer support is now a crucial factor in delivering exceptional service and staying ahead in the competitive landscape. More and more consumer reports are pointing out the same trends—not only is the expectation for 24/7 customer service growing, but tolerance for waiting is dropping fast.
Normal business hours aren’t going to cut it for the modern customer. They may have questions about property listings, inquiries about the home buying or selling process, or urgent concerns that require timely resolution, and full schedules and fast paced lifestyles don’t always accommodate 9-5 Monday-Friday communication. Failing to meet these needs with 24/7 responses will result in missed opportunities and dissatisfied customers.
Providing a personalized and high-touch experience that is genuinely helpful to clients is crucial to stand out from the competition. 60% of consumers admit to becoming repeat customers after a personalized experience with a brand—that’s because today's buyers and sellers are seeking more than just transactional interactions—they desire an experience of real connection and guidance that goes above and beyond their expectations. A personalized approach caters to their unique needs, preferences, and aspirations throughout their home buying or selling journey.
Offering a real estate concierge experience involves understanding clients on a deeper level, anticipating their needs, and providing tailored recommendations and solutions. It requires going beyond the basic transactional aspects and offering a comprehensive and seamless experience that addresses every aspect of the client's real estate journey. While most brokerages excel at this type of personalized service for their clients, they often fail to do it at scale—for both prospects as well as clients—due to resource restraints. This is where AI chatbots can come in to fill in the gaps.
Read More: Your Brokerage’s Customer Service is the #1 Thing in The Way of More Sales
As you probably guessed, AI chatbots can meet customer demands at scale in a way humans have never been able to. By addressing the need for speed, availability, and guidance, AI chatbots emerge as an invaluable solution in meeting modern consumer expectations and enhancing the overall customer experience in the real estate industry.
Yet, there’s more to the adoption of AI chatbots for lead nurturing than consumer expectations. Brokerages stand to both save money on their marketing efforts as well as drive more sales volume. In the next section, we’re discussing how brokers can increase ROI with lead nurturing AI chatbots.
We know the lead conversion rate in real estate is extremely low—no need to beat a dead horse—and we also know that a brokerage’s lead conversion rate is a huge factor in determining the ROI a brokerage gets from their marketing and sales efforts. In the second part of our AI chatbot sales guide for brokerages, we’re going to take a look into what factors cause the real estate industry’s lead conversion rate to be so poor, and how AI chatbots can help solve it.
Read More: Experts Agree Lead Nurturing is Critical—Here are 3 Ways To Dominate It
3 major factors contribute to the real estate industry's historically low lead conversion rates—the limited scale of marketing operations, the time involved in closing a real estate transaction, and the depth of the relationship and commitment required to make a sale.
The first factor—scale—is the sheer volume of leads generated, which can overwhelm brokerage teams and make it difficult to provide timely and personalized responses to each potential client. It’s a constant struggle between needing a greater number of leads to make a sale, and not being able to provide a high enough level of service to so many leads at once, which leads to none of them converting. Manual lead follow-ups are often time-consuming and prone to human error, leading to missed opportunities and lost conversions, especially when considering the amount of communication and relationship building required across the tremendous length of time it takes to successfully pull off a property sale.
That brings us into the next factor which is time—compared to other industries, the time it takes to arrive at a completed real estate sale could be months. If there are delays, complications, or difficulty coming to a decision, the result could be a sales cycle that is a year or even longer. As you know, the longer it takes to complete a sale, the less likely it is to be completed. With more time comes more resistance—more opportunity to explore other options (other brokerages), and even the opportunity to change one’s mind about buying or selling property completely.
The last factor comes down to the extraordinary commitment that buying or selling a property is. Compared against transactions in other industries, real estate transactions are one of the biggest life decisions a person can make. Therefore, there needs to be a high level of commitment from the prospect as well as a strong mutual trust built between the client and agent in order to pull it off. And unfortunately, one of these two things is missing for many prospects, hence the low conversion rate in real estate.
Essentially, the complexity of real estate transactions, the need for extensive information, and the depth of trust between agent and client can all make the lead nurturing process challenging—especially when it comes to repeating this at scale. And while we can’t change certain things, such as the length of time it takes to buy or sell a home, we can mitigate the risks of prospects losing interest or looking elsewhere by better managing communication and the client experience.
Cue AI chatbots—the solution to real estate’s low lead conversion rates. AI chatbots have been shown to increase sales by up to 67%—and there are several reasons for this staggering figure.
The most important aspect of increasing conversion rates is the relationship with the lead (or client). How early is this being built? How proactively and effectively are your agents engaging in relationship building? Often brokers face 2 types of agents: those who focus more on sales than relationships, and those who focus on relationships so much they get sucked into assisting leads that will never convert. And we’re here to tell you that the second scenario is actually a lot more common.
Unfortunately it’s entirely impossible to ensure 100% commitment in all of the leads you generate, but it is completely reasonable to weed out those without intention to actually close. This is one of the primary functions of AI chatbots—to qualify leads heavily before they move on to speaking with agents. And in terms of building trust, AI chatbots are also designed with natural language processing capabilities, which means they can understand what prospects need and genuinely connect with them. Though the interaction may lack the emotional depth a human can provide, AI is capable of building the early-stage foundations of a lasting relationship—good listening skills, dependability, and helpfulness. In essence, a person having just finished conversing with AI should feel heard, validated, and supported. These positive feelings and relationship “merit,” if you will, naturally translate into how leads feel about your brokerage.
As you can imagine, having agents focused on building relationships exclusively with leads that are committed to transacting and have a positive pre-existing connection with your brand leads to a significantly higher ROI than letting agents send occasional messages to a random assortment of cold leads.
The second aspect of AI chatbots’ success in driving sales is the same factor that drives success in real estate: Location. You’ve probably heard the phrase “meeting consumers where they’re at,” which is great advice—but have you considered meeting consumers where they want to be met? And how they’d like to be approached?
Yes, nearly everyone relies on their smartphones—even older generations, whether you believe it or not. According to AARP, 9 in 10 adults over 50 use smartphones to send texts and instant messages as of 2018, with the trend being an increase in usage. Studies show that the average American uses their phone 96 times per day, for a total of over 5 hours. Yet just because your customer base is on their phones, doesn’t mean they want phone calls from your brokerage. Bank My Cell reports that 75% of Millennials—the largest group of home buyers today—avoid phone calls, and 81% experience phone-call-induced anxiety.
Statistically speaking, your conversion rates should improve from about 1% to 15% by switching from phone calls to AI powered text nurturing. 90% of people respond to texts within 30 minutes, and 50% respond within 3 minutes. To drive the point home further, even if leads don’t respond every time an AI chatbot reaches out on your behalf, text messages have a 98% open rate, essentially guaranteeing your brand is being seen.
All of that being said, it’s a no brainer to remove or—at the very least—limit phone calls, and replace them with AI chatbot texting in your lead nurturing strategy if you’re looking to drive the highest conversion rates possible.
Lead conversion is one metric to improve when looking to increase ROI, but it’s not the only one. AI chatbots allow brokerages to lower their cost of lead generation as well as lower their cost of customer acquisition—here’s how.
We typically think of lead nurturing as something that happens after we generate a lead, but in reality, lead nurturing starts well before a lead is a lead. Every person your brand interacts with is a potential customer, meaning they are all being nurtured in some way. Especially when it comes to real estate—everyone will either buy, sell, or rent a home in their lifetime, at least once.
Using AI chatbots as a means for lead generation is simple. AI interacts with people who may have shown some interest in real estate. At this point, they’re likely not a true, hot real estate lead, which is why agents shouldn’t be wasting their time on these contacts, even though the contact is still extremely valuable. Because at some point, they will transact—and if you can nurture them and build a relationship, when the time comes, there’s a high degree of likelihood that they’ll choose your brokerage.
Read More: 9 Stats About Generating Real Estate Leads With AI Every Broker Needs To Know
Think about it—who would you rather do business with? Someone who calls the week you got serious about buying and started submitting your information into real estate websites in order to look at properties? Or the brand that’s been sending you market updates, information on the home buying process, home valuation reports, and listings tailored to your preferences for over a year while you got your finances sorted to buy? What if that same brand that supported you for a year also pointed you in the right direction to fix your credit score, and then set you up with a mortgage officer so you could get prequalified? And imagine that, before they connected you with the mortgage broker, they educated you on how the process works so you didn’t feel underprepared or silly for not knowing. And finally, that all of this value creation happened in a low pressure environment, through the most convenient means possible, at your own self-directed pace.
This is what the best real estate brands are trying to do for their customers, and many do it through high touch, charismatic agents who are on the ball. But no matter how amazing your agents are, they won’t be able to meet every person that comes their way with this level of service. And they certainly won’t be able to take on a large number of clients this way either.
That’s why brokerages are switching to AI chatbots for lead generation. AI can nurture a nearly infinite number of contacts indefinitely and assist in all of the tasks stated above. And given that brokerages are prone to buying expensive “hot” leads from sites like Zillow or Realtor.com, costs can be reduced dramatically by opting for less expensive leads or focusing on raw contact data and using software to warm them into hot leads.
This is one of the many things we do for our clients—generate extremely low cost, high quality leads using our AI chatbot technology. Check out the case study below from United Real Estate, which explains how we saved them 75% on lead generation.
Where most brokerages spend an unfortunate amount of capital—after buying leads—is lead conversion. This is the beginning of what most consider “lead nurturing,” and when humans are involved, it gets pricey. You’re either looking at paying an agency or call center a hefty monthly fee to outsource the labor, or you’re investing in hiring and training in-house staff and paying their wages. And those costs increase heavily as your business grows.
Not to mention that paying internal sales agents to make follow up calls with leads generally involves borderline harassment—we’re joking of course, but also not. Remember those stats on consumer preferences regarding phone calls? Most people are busy—they’re not going to answer a phone call during their work day, and by 5pm, they’re either driving kids around, putting dinner on the table, or hitting the gym, and they don’t want to be bothered. The truth is, almost no one appreciates an ISA’s attempts to get through, no matter how well intentioned the call is, which significantly reduces the effectiveness of traditional lead nurturing methods.
Contrary to popular opinion, ISAs are not the only reliable lead nurturing solution for brokerages. Using AI chatbots as a lead nurturing solution means reduced costs across the board. There’s no lost time (and therefore money) due to training staff, nor are you stuck paying salaries. For the cost of 1 employee, you can scale your lead nurturing efforts indefinitely, and at will, all while providing an experience that your potential clients prefer.
You can see another case study below from Nations Info, which explains how they were able to save 81% on their lead nurturing efforts by switching to our AI.
AI chatbots not only revolutionize customer interactions and lead conversion rates, but they also bring significant additional benefits to real estate brokerages. In this section, we will explore three key areas where AI chatbots provide advantages: recruitment, employee productivity, and employee retention.
In the competitive world of real estate, agent recruitment is paramount to the success of any brokerage. By leveraging AI chatbots to generate and convert leads, brokerages can offer a unique value proposition that entices agents to join their ranks.
Technology stack is one of the top areas agents look for in a brokerage, and NAR reports that the average agent spends $2,000 per year out of pocket on software—a significant cost you can eliminate for potential recruits. Having real estate AI as an integral part of your brokerage not only brings agents more business but also saves them valuable time, streamlines their workflows, and reduces marketing costs—all attractive and competitive agent recruitment strategies.
Read More: Agent Recruitment is Getting Competitive—Here’s How To Win
For every broker, right behind the stress of agent recruitment comes the pain of ensuring they are actually producing income for your business. With all of their capabilities, AI chatbots essentially act as virtual assistants for agents, enabling them to work more productively and effectively by handling routine tasks such as real estate appointment setting, sending follow-up messages, and collecting client information, freeing up sales professionals' time to focus on higher-value activities, allowing them to take on more clients. Through automating tasks, AI chatbots help optimize sales teams' workflows, increase efficiency, and maximize their overall productivity. All of this means more transactions closing, more happy clients, and more money in you and your agents’ pockets.
We are adding all of this productivity data into our clients’ dashboards so they can easily see which agents are on top of their game, and who needs additional support and training. After all—we have the data, and aggregating it for our brokers is a tremendously valuable capability that’s a major part of our company’s roadmap.
The last major area of benefit of integrating AI chatbots for real estate brokerages lies in one of the toughest business challenges every broker faces—employee retention. Retaining top-performing agents is essential for the long-term success of a brokerage. By incorporating AI technologies—such as AI chatbots—into your tech stack, you can provide agents with a powerful toolset that keeps them engaged, motivated, and continuously achieving outstanding results.
Offering superior AI systems, particularly those that generate high-quality leads at a low cost, can become a compelling reason for agents to remain loyal to your brokerage. When you’re driving the majority of their business opportunities and they become dependent on your automated processes to run their business, it takes even considering leaving your company off the table.
Read More: The Employee Retention Crisis Solved—Why Agents Leave & How To Make Them Stay
At this point, it’s clear that harnessing the power of AI chatbots for sales and lead nurturing is no longer a mere luxury—it has become a necessity for real estate brokerages. Throughout this comprehensive guide, we have explored the numerous benefits and advantages that AI chatbots bring to the sales process.
From lead generation and qualification to personalized, automated customer interactions, increased conversion rates, and super-charged agent recruitment and retention, AI chatbots are revolutionizing the way real estate brokerages operate.
If you are a brokerage owner looking for a cost effective lead nurturing solution that will increase your sales volume in 2023, we invite you to book a free, no obligation AI chatbot demo with our team. We would love to walk you through the platform and share how our clients have achieved incredible results.
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