Cost of a lead Vs The Value of Life Time Customer
You do not want to leave anything to chance with your business, and this doubly true when considering the cost of acquiring new business. If you put an ad in the newspaper, you would want to know how many calls it generated, how many calls became real customers and how much each customer was worth (in terms of revenue for the business). Knowing this information allows you to determine whether or not it was worth investing in the ad in the first place, and whether you would do it again! By having a good appreciation and understanding of the potential value of a customer, we can keep perspective as to whether lead is actually good value or not. ( click here to read this previous article which takes a closer look at the true value of a lead
Let’s say you provide Conveyancing and Legal services within the real estate industry. Due to the competitive nature of this industry, it is not unusual for Google campaigns to cost upwards of $100 a click when advertising for conveyancing and legal services. This is a considerable cost especially when not all of those clicks will actually result in conversations on your websites i.e. people who will actually call you and eventually become clients.
How much is a customer worth?
It is easy to think that the amount quoted reflects the potential future value of a new customer, as this is the cost of service they have asked for. However, a better way to look at it is as if it is the beginning of a longer term business relationship - because it is! Always remember that every customer has the potential to be a repeat customer, and that repeat customers are the best value you can get! How do we do this?
1. By always offering exceptional service and customer care
2. By providing and offering additional services.
Many first home buyers may need to consider creating or updating their will following a home purchase. This is an essential additional service that you can also easily provide at a time when it is highly relevant. In the longer term, provide a great user experience and memorable service, and in future they may return to you again for other matters and additional properties, or refer their friends to you! (everyone wants to be able to say “you should speak to my lawyer”. This way, you can easily see the value of a customer goes up over time. Eventually, this can dwarf the initial cost of acquiring the lead.
Pre Purchase Building Services
When providing Pest and Building Inspections, you also have the opportunity not only to provide the service, but should there be any issues with the property that need addressing, you can quote and provide for these repairs too. If the new buyers plan to renovate and extend, you are in prime position to be contacted. Like a great mechanic, every homeowner needs a great builder!
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