There are many ways agents can spend their money on the Internet, and debate is evolving on whether some of those ways are smart or not. There are lead generation companies that sell leads, sell exclusive advertising rights to neighborhoods or zip codes, and sell closed leads for referral fees.

For example, the high cost of working with referral fee-based third parties that use your listings to increase their traffic without paying you or your MLS, submerge your brand to their "network," charge up to one-third of your earnings for a closed lead, and encourage consumers to ask you to compete against other agents by lowering your fees is only beginning to dawn on some agents and brokers. As these agents realize how much they are truly paying, which is way beyond the referral fee, they are calling these companies "interlopers."

"The reason why the whole referral fee debate is a concern," says Most Home Corp. Glenn Davies, vice president of sales and marketing, is that "we aren't a referral fee company, but we get lumped in with the interlopers."

"Getting between brokers and their listings are using them to skim customers," clarifies Davies, "we think that is reprehensible."

Most Home, says Davies, doesn't divert leads -- it helps agents manage their own. The company has been in business about five years and generates approximately 3000 leads per day between about 5,800 agents.

"We'll put up a website," says Davies, "but we know the agent is busy and not tech-inclined and they have no time to manage leads, so we'll bet on you. We'll qualify the client, put our licensed agents in-house to phone and contact your Internet leads for you and those we pass on to you. Forty percent of agents pay us a referral fee to do that. Another 25 percent are paying us a fixed fee for volume of leads, and they are getting two-to-three completions a year. And others are self-managing their own websites using our software to filter leads."

Davies says, "We see ourselves as personal assistants. You can license our technology, or we'll do it and you pay a referral fee or you pay a flat fee. We don't aggregate leads and sell them to agents."

He turns up his nose at the user agreements that most virtual office websites require consumers to click through before they can see homes.

"What we use on agents' websites is VOW-like," says Davies. "About 40 percent fill out the data, but the problem we have is asking the client to engage in a buyer's agreement. That is far too forward and not consumer-friendly. You are agreeing to a buyer's agreement, but they aren't binding, and that is deliberately cumbersome, which is at the center of the whole VOW debate."

According to Davies, consumers don't like VOWs. "We talk to 400 consumers a day, and we put them through a full 15-minute interview to ask them for more information. When we are finished with them, we tell them we will ask their agent to call them. One of the things we ask is 'How did you find the agent's Website?' There are three things these consumers tell us they want: a Realtor they can trust, more information about the market, and more information on MLS data they can find on the Internet."

Consumers want the data that the MLS was never intended to address -- like whether or not there are cats in the house, or dogs in the backyard. They want more pictures, he says.

After software and personnel filtering, Davies says that 3.68 percent of one million leads are good enough to pass on to agents. Most consumers, says Davies, want "an idea" of what is available and to do some basic research before engaging the services of a Realtor.

Consequently, a lot of Internet leads aren't really leads, and finding out which ones are is a valuable service.

Published: December 16, 2003

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Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. For more articles by Blanche, click here.