House Money: Coldwell Banker’s ROI System Offers Channel Analysis

If you eavesdrop on calls to an average Manhattan real estate office for an hour or two, you'll notice a pattern. When brokers ask home seekers where they found a given listing, the callers will say “The New York Times. The New York Times. Through an online ad. From a billboard. The New York Times. From a listing in a real estate magazine.”

This will be typical of what brokers hear. It also will be misleading — expensively so.

The return on investment between ads placed in newspapers and the Web is “off by an order of magnitude,” says Philip Kiracofe, chief technologist at Coldwell Banker Previews International, a high-end New York real estate firm. A carefully chosen online source yields inquiries that cost $1 per call. The same lead generated through some print media runs anywhere from $100 to $200.

So why is the Times so frequently cited? The paper of record has branded itself as the premier real estate listing outlet in Manhattan, and has become a default answer. In truth, 92% of Coldwell Banker Preview's inquiries come from the Web, and Kiracofe has the numbers to prove it — 3,000 of them, in fact.

That's how many telephone numbers this particular Coldwell Banker franchise leases from M5 Networks Inc. M5 also provides an inbound-call campaign-management system which allows Previews to assign unique phone numbers not just to each listing, but to each medium every listing appears in.

“The tracking numbers act like a cookie would on a Web site,” Kiracofe says. M5's system captures the number a caller is dialing from, the property that generated the inquiry, and which medium generated the call. “We can now determine all that with no effort on Joe Agent's or the consumer's part,” he adds.

When M5's inbound-call data is coupled with Ad Tracker, a proprietary system developed by Coldwell Banker, Kiracofe gets a view of how specific media outlets are performing across all properties.

There's another benefit: the ability to automatically aggregate inquiries. An individual who makes several calls about listed properties is likely to be a serious buyer, and the realtor can flag that person as a target for special attention, or perhaps as a candidate for ancillary services.

Data from Ad Tracker also reassures clients who list properties that reduced ad spending doesn't hinder Coldwell Banker from generating leads.

“[Other firms] say, ‘We're not cheap like those guys. We're going to do everything necessary to sell your property.’ For us to say we have a better way, we need demonstrable proof.” The M5 system, along with Ad Tracker, offers that proof.

Real estate ads are paid for out of the brokers' pre-set commissions, and don't have a direct bearing on the cost of a property. “The seller doesn't care about cost, but the seller does care about maximum exposure,” Kiracofe says. Sellers would be quite happy to have brokers display their properties on the sides of blimps, or on the scoreboard at the end of the Super Bowl, he adds. It doesn't cost the homeowner anything.

The Coldwell Banker Previews franchise has cut $600,000 from what had been a $1.5 million advertising budget, with no loss in results.

M5 provides more than just the inbound telephone analytics platform; it furnishes phone service for its customers as well. Because M5's clients aren't relying on local phone companies, they have much greater flexibility in adjusting how calls are routed.

“If a client runs an infomercial, it might get 60% of the calls it's going to get within the first five minutes,” says M5 CEO Dan Hoffman. “I might need 20 people to answer those phones within those five minutes. We can adjust the way calls flow based on real-time information.”

M5 also is able to quickly reassign numbers based on a medium's life span. A newspaper real-estate ad might have a “shelf life” of only a few days, while a spot in a glossy, high-end regional magazine could last a few months. And if a given source is generating a lot of ads, the telephone number assigned to it can be extended with little fuss.

For Coldwell Banker Previews, the next step involves even more system transparency. An upcoming iteration of Ad Tracker will give sellers listing properties immediate access to customized dashboards which offer sales campaign updates that previously were sent to them monthly.

For more on ROI, subscribe to the MarketingROI newsletter by Richard H. Levey at http://subscribe.chiefmarketer.com/subscribe.cfm.