Channels and Social Media ROI Question

Benn Rosales (@agentgenius) is one of the smartest guys working in real estate and social media today, and as the proprietor (?? – maybe czar? emperor?) of AgentGenius, one of the best real-estate industry sites out there, he brings a great deal of credibility to everything he says.

A few months ago, he and I had a tremendously exciting and stimulating debate on the telephone about measuring ROI from social media.  I think we ended up disagreeing on some points, but the whole conversation was so enriching and so enlightening that I have been looking forward to the next chapter.

That next chapter has been opened:

I’ve had this conversation with many people over the past 6 months about tracking ROI and at the time, no study, nor documentation really existed, however, in recent months this all changed with Dell, when they bragged about their $1 Million in sales from Twitter.

Interestingly enough, it was done through channels with channel specific deals which leads me to Trulia, Zillow, and local MLS Boards, as well as FSBO, REO, and other property aggregates and large Brokers themselves as a means to move volume inventory.

Benn goes on to hypothesize that “real-estate channels” may be

the beginning of the answer to real estate and social media above and beyond the agent but allow the agent the opportunity to participate with their particular social spheres.

All in all an interesting opening, and one well-positioned to move the discussion forward.

Channeling Twitter

The first premise I want to take a look at is Dell’s use of Twitter to generate $1m in sales.  Because one of the things I’m most leery of is applying what works in other industries to real estate without taking some of the peculiar fundamental facts about real estate into account.  (God knows, I do it often enough….)

The first thing I noted is actually addressed by TechCrunch — that this sort of usage of Twitter is not much different from just opting in for email offers:

Signing up for what is essentially a marketing email on Twitter perhaps gives some consumers the feeling of being part of an exclusive club. (It’s so exclusive, anyone can join). Or maybe they simply don’t want this junk filling up their inbox, and can choose to pay attention only when they are in the market for Dell products.

I’m not sure that this qualifies as social media in any meaningful sense of the term.  In fact, this sort of “channelization” of Twitter takes the whole “social” out of social media.  It’s a giant corporation broadcasting offers to the masses.  What’s social about that?

The second thing I noted is more of a question than a note.  What sort of person would actually follow @delloutlet?  Obviously, someone who buys or wants to buy a Dell.  Furthermore, someone who is probably looking for deals.  Third — and this is strictly a guess — someone who is tech-savvy enough and shops for computers often enough to know what they want, and what constitutes a good deal or not.

I mean, in theory, someone like my wife who is willfully ignorant of computers and things technological (“That’s your department, Rob”) could find some computer she likes on Dell.com, then go looking for deals on that computer via @delloutlet.  Especially since such coupons and deals are Twitter Exclusives.  I just can’t see it.  I can’t even imagine such a thing happening.  She’s far more likely to just hit “Buy” (well, she’d never shop for a computer in the first place, preferring to make me do it instead, but leave that aside for now).  At most, she’d do a Google search for “Dell coupons” or some such.

You cant see it, but this is me drooling.

You can't see it, but this is me drooling.

On the flipside, some hardcore gamers interested only in highest FPS (frames per second) performance for the latest video-card-murdering shooters are not likely to be looking for deals on Dell computers.  Like the Aspirational shopper, that guy is interested in saving money, but not at the expense of performance or “quality”.  He’s your Falcon Northwest shopper, for example, or more likely, a custom rig-builder addicted to Newegg.

(<gamergeek>And yes, I am one of those people who is addicted to Newegg, but lacking time, I’d love to get a custom Mach V with a custom paintjob, and so on and so forth…. </gamergeek>)

Real Estate Channel

So keeping the above in mind, consider what a “real estate channel” in social media might look like.

The immediate problem I run into is that quite unlike Dell, real estate brokers and agents (and even developers really) do not have “products”.  Dell can sell 50,000 laptops over Twitter, because they’re all more or less the same.  (Options like larger hard drives, etc. are just options.)  Real estate on the other hand is perhaps the ultimate non-commoditizable good.  Two identical homes right next to each other can be dramatically different in value, simply because one house might be sitting on top of contaminated water tables, or less dramatically, because the view out of the back porch is different.

Well... it is a Real Estate Channel...

Well... it is a Real Estate Channel...

Even if Twitter (or any other Channel) is used to sell a house, everyone except the buyer who was interested in that house is out of luck once it sells.

Plus, the model that Dell used to “channelize” Twitter is no different than any broadcast email, or even a TV ad: one-to-many broadcast of an offer.  This model is already in place in real estate, and it isn’t clear that taking that model and moving it to a “social media channel” changes it in any real significant way.

The second problem I run into is the another “fundamental fact” about real estate: the consumer buying cycle.  Companies like Dell can have concepts like “frequent customers” because the same person might buy a Dell for himself, then another for work, then one for his wife, and then another one for work… and so on.

In contrast, normal consumers (i.e., not investors) are not buying a home here, then another one there.  Nor are they shopping frequently — the average time between transactions is seven years.  A transaction might be three months from start to finish on average.

What that suggests then is that someone who is “following” (using Twitter as the example, but you can think about friending on Facebook, or reading a real estate blog) the real estate channel is doing so for perhaps 6 out of 84 months, and those six coming at the front and the back.  For 78 months, then, the “follower” has to derive something of value out of the channel for it to have any value to her.

That there is a tall order and then some to fill.

So using social media as a “channel” to move volume inventory might happen, but strikes me as something of an unlikely scenario.

What About Services?

However, I think one can argue that real estate uses social media not to move houses, but to promote services.  The agent isn’t really selling a whole bunch of houses; rather, she is  selling her brokerage services to a buyer or a seller.  The broker isn’t selling a bunch of houses; she’s selling the services of her legion of agents.  The franchise brand isn’t selling houses; it is selling the services of its network of brokers who have legions of agents.  And so on.

Consumers could reasonably expect to receive roughly the same level of service from the same service provider (at agent, broker, franchise, brand, and so on) and social media real estate channels might support that sort of claim.  (By the way, that this expectation of receiving consistent level of service is not borne out by experience is a quality control problem that the industry must resolve.)

Even if social media is to be used to sell services rather than products, we are still left with the Seven Year Cycle issue.  Why should a consumer “follow” an agent (or broker or franchise) if she is not in the market?

Not your typical Realtor personality...

Not your typical Realtor personality...

Furthermore, selling services raises another issue while it disposes of the “non-commoditizable products” issue: personality.  I do not believe that someone following @delloutlet cares all that much about what the person behind that handle is like.  It would be nice if the human being behind the moniker was a nice person, but since my interest is in the Dell product, and what kind of deal I can get, I don’t particularly care.  It is exactly the opposite with professional services.  Since what I am purchasing is not a product, but services, the personality, qualifications, experience, knowledge, and the humanity of the person providing the services matter a great deal.

Putting all of those personal traits ‘out there’ on the web is, to put it mildly, a delicate affair.  How much sharing is too much sharing?  Just how do you convey your voice to total strangers through a medium where anonymity is one of its greatest benefits?

The answer to these questions is precisely what hundreds of social media experts and marketers are trying to provide.  At the same time, I do think one thing might be clear: if your personality is mostly conveyed by products you are pushing, then your personality will be defined as the pusher of products.

And then… ROI

As Benn’s original post suggests, all of this is in service to understanding the ROI of social media marketing.  Dell’s $1m from Twitter factoid notwithstanding, I maintain that figuring this out is one of the greatest challenges of social media marketers.  This ROI thing is really, really hard.  Here’s why.

Oh baby! I got ROI!

Oh baby! I got ROI!

First, to compute ROI, you have to have a return.  Without dollars, it’s impossible to compute a return on anything.  And in real estate brokerage, that return thing is a squirrelly little concept.

Second, to compute ROI, you have to have an investment.  ROI is, after all, return on investment.  Well, how do you compute that investment?  If it’s tallying up the cost of FaceBook, Twitter, WordPress, and LinkedIn… the investment is zero.  So even a dollar is infinite ROI.

The real investment, of course, is in the time that the agent (or brokerage marketer, or social media guru at some brand, etc.) spends on social media channels.  But time has different value for each individual, even on a strictly financial sense.

A SVP of Marketing for a major national brand getting paid $250K a year costs her company $125 per hour.  A new agent who is doing three transactions a year costs significantly less on a per-hour basis.  And that’s just the straight financials.

The real cost, I believe, is opportunity cost.  What else could the person engaging in social media marketing have done with those 10 hours a week?  Would that alternative activity have generated more or less dollars of revenues?

I do not see that “channelization” changes this question much at all.  Either social media marketing activities generate greater revenues per minute spent than alternative activities the person doing the activities could have, or it does not. That measuring this efficiency is difficult or impossible does not change the logic of the statement.  Nor does the fact that it is difficult to measure such ROI make it any less imperative for marketers to think about how to at least tell a story about it, and how to let non-marketing decisionmakers know enough to keep investing in Activity X or to move the investment to Activity Y.

In Conclusion… There Is No Conclusion…

This got long.  [ED: Yeah, what else is news?]  The topic, however, is interesting and important.

I think right now, the conclusion to be drawn is that there is no conclusion to the debate and discussion.  We all have far more questions and unknowns than answers and facts.  I think that Dell made $1m from Twitter is sorta amazing… but also sorta ho-hum.  And more importantly, what a product manufacturing and sales company does or does not do with a “social media channel” is of rather low relevance to real estate companies.

But we end with the same question we had at start: How to compute ROI for social media?  We end there because the logic is unassailable.  ROI requires return on investment.  Without the ability to define either “return” or “investment”, any talk of ROI is not even fiction — it’s science fiction.

Marketers… we got work to do.

-rsh

  • http://sandiegohomeblog.com/ Kris Berg

    First of all, I read every word, so I think some sort of prize should be coming my way. :)

    It is too early on a Saturday morning to get my head around this, but you have (at least between the lines) hit on something I have been struggling with. As an agent, my customer is a transient. Once the moving truck backs out, real estate is no longer a hobby or a passion for him. And my customer is the world really, not some “group” that is easily targeted.

    Now, if I am selling a lead generator or a web site platform or a widget, targeting my audience is quite simple. I follow all the agents. We are out there in a tidy little box. They have figured this out; the vast majority of my own new followers are companies with something to sell me.

    If I am playing the broker role, the agents are my customers as well, and a full-out twitter blitz will create exposure. The ROI may be abstract, but it is there. I am building a brand.

    The problem is for the individual agent to use Twitter for anything but a fun, agent water cooler. Yes, we learn stuff there. Yes, we help each other out. But, where does the business development part come in (aside from the smattering of referrals which may result)?

    I have a dismal (by Twitter standards) 853 followers this morning. Only five are “civilians,” non-agents, including two daughters (who aren’t buying a home any time soon) and three clients. The clients started following me only after they were clients and later friends.

    I’m not saying there is not value, of course. It is just my belief that the value for the individual agent cannot, will not, be quantified in terms of increased business and increased dollars, at least not directly. If I learn something that makes me a better agent and am able to take it to the streets, that may result in a return on my investment. If I have a problem with my IDX product and I can DM the provider, that makes me more efficient. Beyond that, the ROI opportunities are for those higher up the food chain. For the individual agent, I think it is largely a myth.

    • http://www.archcityhomes.com Karen Goodman

      I think that Rob and Kris raise good points. Without pondering the issue too much, I had a couple of immediate thoughts.

      Rob – I agree that being a real estate agent on Twitter is very different than someone selling a product. I use Twitter to network with people in my community. They are getting to know me as someone with ethics, market knowledge and can be trusted. I’ve been on Twitter for 5 months and received my first referral last week from a non-agent to a friend that isn’t on Twitter. When you think about the 7 year cycle, you need to remember that much of an agent’s business comes from referrals. By getting to know local Twitterers, I hope to become a trusted friend/resource. When they stumble on someone moving, I think at least some of them will pass on my name.

      I also really like your point about examining what an agent would have done with those 10 hours had they not been on Twitter. Would they have called former clients? Walked a neighborhood with door hangers? Written more blog posts? Prepared a snail mail mailing? Would any of these activities given them a direct return? I don’t think so. All agents need to find a way to prospect for business. I don’t want to call on FSBO/expireds, send out mailings or join a BNI group. Twitter and my blog ARE my prospecting tools.

      Kris – I agree with you completely that Twitter is all about fun and not an ROI activity if you are only interacting with agents. I bet you would find Twitter a different experience if you did a search on San Diego and started following regular people. I use Tweetdeck on my computer and have groups set up for St. Louis (#stl and #stlouis). I also periodically use one of the apps to search on location and add anyone in my town that sends @replies…I’m looking for people who will interact with me.

      In every community, there are some agents that are the most well known to the general public. On the blogosphere, there is a small club of agents that have made a name for themselves. As an agent doing about 20-30 deals a year and not paying for Google #1 search engine placement, most of the people in my city won’t have heard of me. As someone that focuses on providing solid, local blog content and doesn’t post on controversial RE industry topics, I’m not going to make it into the blogger inner circle. But, by using Twitter effectively and attending local Tweetups, I’ve been told by several people that I’m one of the top local twitterers…and everyone knows my handle when I introduce myself at a Tweetup.

      One last point. As a very non-techie real estate agent, Twitter has saved me money and time by providing me with helpful followers ready to immediately answer my questions when I am having a computer problem. I found a new real estate photographer by simply putting out a tweet asking if anyone knew a good inexpensive one. When I upgraded a slideshow plugin on my WordPress blog, and it immediately disappeared, a Twitter friend spent 30 minutes on the phone with me getting it back up. For free.

      No, I can’t measure my ROI. But I’m a more effective small biz owner because of Twitter.

  • http://sandiegohomeblog.com Kris Berg

    First of all, I read every word, so I think some sort of prize should be coming my way. :)

    It is too early on a Saturday morning to get my head around this, but you have (at least between the lines) hit on something I have been struggling with. As an agent, my customer is a transient. Once the moving truck backs out, real estate is no longer a hobby or a passion for him. And my customer is the world really, not some “group” that is easily targeted.

    Now, if I am selling a lead generator or a web site platform or a widget, targeting my audience is quite simple. I follow all the agents. We are out there in a tidy little box. They have figured this out; the vast majority of my own new followers are companies with something to sell me.

    If I am playing the broker role, the agents are my customers as well, and a full-out twitter blitz will create exposure. The ROI may be abstract, but it is there. I am building a brand.

    The problem is for the individual agent to use Twitter for anything but a fun, agent water cooler. Yes, we learn stuff there. Yes, we help each other out. But, where does the business development part come in (aside from the smattering of referrals which may result)?

    I have a dismal (by Twitter standards) 853 followers this morning. Only five are “civilians,” non-agents, including two daughters (who aren’t buying a home any time soon) and three clients. The clients started following me only after they were clients and later friends.

    I’m not saying there is not value, of course. It is just my belief that the value for the individual agent cannot, will not, be quantified in terms of increased business and increased dollars, at least not directly. If I learn something that makes me a better agent and am able to take it to the streets, that may result in a return on my investment. If I have a problem with my IDX product and I can DM the provider, that makes me more efficient. Beyond that, the ROI opportunities are for those higher up the food chain. For the individual agent, I think it is largely a myth.

    • http://www.archcityhomes.com Karen Goodman

      I think that Rob and Kris raise good points. Without pondering the issue too much, I had a couple of immediate thoughts.

      Rob – I agree that being a real estate agent on Twitter is very different than someone selling a product. I use Twitter to network with people in my community. They are getting to know me as someone with ethics, market knowledge and can be trusted. I’ve been on Twitter for 5 months and received my first referral last week from a non-agent to a friend that isn’t on Twitter. When you think about the 7 year cycle, you need to remember that much of an agent’s business comes from referrals. By getting to know local Twitterers, I hope to become a trusted friend/resource. When they stumble on someone moving, I think at least some of them will pass on my name.

      I also really like your point about examining what an agent would have done with those 10 hours had they not been on Twitter. Would they have called former clients? Walked a neighborhood with door hangers? Written more blog posts? Prepared a snail mail mailing? Would any of these activities given them a direct return? I don’t think so. All agents need to find a way to prospect for business. I don’t want to call on FSBO/expireds, send out mailings or join a BNI group. Twitter and my blog ARE my prospecting tools.

      Kris – I agree with you completely that Twitter is all about fun and not an ROI activity if you are only interacting with agents. I bet you would find Twitter a different experience if you did a search on San Diego and started following regular people. I use Tweetdeck on my computer and have groups set up for St. Louis (#stl and #stlouis). I also periodically use one of the apps to search on location and add anyone in my town that sends @replies…I’m looking for people who will interact with me.

      In every community, there are some agents that are the most well known to the general public. On the blogosphere, there is a small club of agents that have made a name for themselves. As an agent doing about 20-30 deals a year and not paying for Google #1 search engine placement, most of the people in my city won’t have heard of me. As someone that focuses on providing solid, local blog content and doesn’t post on controversial RE industry topics, I’m not going to make it into the blogger inner circle. But, by using Twitter effectively and attending local Tweetups, I’ve been told by several people that I’m one of the top local twitterers…and everyone knows my handle when I introduce myself at a Tweetup.

      One last point. As a very non-techie real estate agent, Twitter has saved me money and time by providing me with helpful followers ready to immediately answer my questions when I am having a computer problem. I found a new real estate photographer by simply putting out a tweet asking if anyone knew a good inexpensive one. When I upgraded a slideshow plugin on my WordPress blog, and it immediately disappeared, a Twitter friend spent 30 minutes on the phone with me getting it back up. For free.

      No, I can’t measure my ROI. But I’m a more effective small biz owner because of Twitter.

  • http://www.threefourteendesign.com/blog Jason

    Rob,

    I on the other hand couldn’t make it all the way through without getting off on multiple tangents. Maybe when I have more time I can come back to appreciate the awesomeness that is this blog post, but right now there is just too much to digest- making more questions than answers which is the obvious point to this post anyway right? You might not get alot of comments, but you will get alot of questions and hopefully trigger many more blog posts on related topics from others who will link back to this thought provoking post.

  • http://www.threefourteendesign.com/blog Jason

    Rob,

    I on the other hand couldn’t make it all the way through without getting off on multiple tangents. Maybe when I have more time I can come back to appreciate the awesomeness that is this blog post, but right now there is just too much to digest- making more questions than answers which is the obvious point to this post anyway right? You might not get alot of comments, but you will get alot of questions and hopefully trigger many more blog posts on related topics from others who will link back to this thought provoking post.

  • http://www.threefourteendesign.com/blog Jason

    Coming from a non-agent. My guess is that traditionally ROI for a selling agent could be calculated by listing sale minus the number of ads run, time spent in open houses, time spent with the seller, time spent in transaction, so on… how often did you market the actual business that didn’t directly correspond to having a listing tied to it? Where you active in your community? Did you put out newsletters? Did you network prior to social networking sites and organized events? All of those things are similar to what you are doing on Twitter and other similar sites. The more people know you from those outlets and can relate to you as a person, the more likely they are to use you as a Realtor. Here is my view. Residential Real Estate agents need a niche. Do you only do expensive listings? Do you market affordable homes for first time homebuyers? Each of these has its own special rules and hints that go with it. The thought is that you dont do both right? Well, even still do you market a particular area of your community? It seems to me that the best social media a Realtor could use is a hyperlocal news blog that concentrates on that one community. Where people can go for information about where they live as well as info about buying homes in the area. Maybe this is out of line, but if I were selling my home you would bet that I will seek out someone who specializes in homes similar to mine or at least the area that I am in. This has nothing to do with Social Media, but if I found someone via Social Media that fit this profile I would be more apt to use them than someone else, primarily because I would hopefully be able to tell if they are tech savvy because they would also have a blog and a great online resource for their listings. OH- and they would also use floor plans and interactive tours :)

  • http://www.threefourteendesign.com/blog Jason

    Coming from a non-agent. My guess is that traditionally ROI for a selling agent could be calculated by listing sale minus the number of ads run, time spent in open houses, time spent with the seller, time spent in transaction, so on… how often did you market the actual business that didn’t directly correspond to having a listing tied to it? Where you active in your community? Did you put out newsletters? Did you network prior to social networking sites and organized events? All of those things are similar to what you are doing on Twitter and other similar sites. The more people know you from those outlets and can relate to you as a person, the more likely they are to use you as a Realtor. Here is my view. Residential Real Estate agents need a niche. Do you only do expensive listings? Do you market affordable homes for first time homebuyers? Each of these has its own special rules and hints that go with it. The thought is that you dont do both right? Well, even still do you market a particular area of your community? It seems to me that the best social media a Realtor could use is a hyperlocal news blog that concentrates on that one community. Where people can go for information about where they live as well as info about buying homes in the area. Maybe this is out of line, but if I were selling my home you would bet that I will seek out someone who specializes in homes similar to mine or at least the area that I am in. This has nothing to do with Social Media, but if I found someone via Social Media that fit this profile I would be more apt to use them than someone else, primarily because I would hopefully be able to tell if they are tech savvy because they would also have a blog and a great online resource for their listings. OH- and they would also use floor plans and interactive tours :)

  • http://www.notorious-rob.com/ Rob Hahn

    Some great, great points made here in the comments so far. Let me see if I can take them one at a time. :)

    @Kris – I think you’ve hit it on the head with respect to your observations about folks who sell to the RE.net generating ROI from Twitter/social media. That is the channel. Look at Mike Simonsen at Altos Research and how he’s marketed his company and services brilliantly through SM channels.

    But even for them, if someone wanted to track ROI from social media activities, the key issue is still going to be efficiency: desired outcome vs. investment (time = money). And once you have that metric, you still need to think about alternative uses of that time=money.

    So to a large extent, the value of social media activities so far (may change in the future) does come down to some inchoate “brand value”. This is the specific point that Benn and I have discussed in the past. It’s a fascinating discussion for marketing-heads like me. I don’t know that Dell’s experience, or GaryVee’s experience, are particularly cogent to the experience of real estate brokers/agents, and that’s where further thought and investigation need to focus.

    @Karen – I think the best point you’ve raised is something I’ve overlooked entirely: that social media is an amazing education/informational channel for professional networks. There is no doubt that I personally have gained from being on social web — just last night, I got advice on dealing with a feed & Google Analytics issue that would have taken many more painful hours of research for me to figure out, thanks to Twitter. That is an amazing usage, and it does have some sort of financial/business impact. Question is, how do we measure it?

    On the other major point, that by leveraging social media in your local community, you’ve gained referral business, I think you touch on the issue there — which is alternative usage of that time (which =money) — but do not directly address it. If I were a coach advising you on your business, and we learned that with your 10 hours of Twitter/SM per week, you generated 1 referral per month on average, then I surely would want to compare that to what 10 hours per week spent doing XYZ other activity would have generated.

    If, as in one of your examples, spending 10 hours per week calling and having lunch with former clients led to 2 referrals per month on average, then I would have to advise you to stop with the Twitter/SM and start hitting the phones and restaurants. Wouldn’t you?

    The issue today is that no one knows. No one has actually collected any data, or conducted any sort of reliable study on the effectiveness of social media activities in generating revenues (direct or indirect). That remains a challenge for marketers in the real estate space to continue to think about.

    @Jason –

    I also think that the most effective channel might be (I have no evidence) is a hyperlocal news site. I’ve written about that before. Trouble is, it is not at all obvious to me that anyone’s figured out hyperlocal sites yet… and doubly unobvious that real estate agents are the best folks to run such sites. There is a clear conflict of interest going on when someone who makes a living selling properties in a particular neighborhood also purports to report on news, character, happenings, and issues with that same neighborhood. That’s a different topic, but it’s an important point you raised.

    Whew – again, thanks, and looking forward to further conversations on this.

    -rsh

  • http://www.notorious-rob.com Rob Hahn

    Some great, great points made here in the comments so far. Let me see if I can take them one at a time. :)

    @Kris – I think you’ve hit it on the head with respect to your observations about folks who sell to the RE.net generating ROI from Twitter/social media. That is the channel. Look at Mike Simonsen at Altos Research and how he’s marketed his company and services brilliantly through SM channels.

    But even for them, if someone wanted to track ROI from social media activities, the key issue is still going to be efficiency: desired outcome vs. investment (time = money). And once you have that metric, you still need to think about alternative uses of that time=money.

    So to a large extent, the value of social media activities so far (may change in the future) does come down to some inchoate “brand value”. This is the specific point that Benn and I have discussed in the past. It’s a fascinating discussion for marketing-heads like me. I don’t know that Dell’s experience, or GaryVee’s experience, are particularly cogent to the experience of real estate brokers/agents, and that’s where further thought and investigation need to focus.

    @Karen – I think the best point you’ve raised is something I’ve overlooked entirely: that social media is an amazing education/informational channel for professional networks. There is no doubt that I personally have gained from being on social web — just last night, I got advice on dealing with a feed & Google Analytics issue that would have taken many more painful hours of research for me to figure out, thanks to Twitter. That is an amazing usage, and it does have some sort of financial/business impact. Question is, how do we measure it?

    On the other major point, that by leveraging social media in your local community, you’ve gained referral business, I think you touch on the issue there — which is alternative usage of that time (which =money) — but do not directly address it. If I were a coach advising you on your business, and we learned that with your 10 hours of Twitter/SM per week, you generated 1 referral per month on average, then I surely would want to compare that to what 10 hours per week spent doing XYZ other activity would have generated.

    If, as in one of your examples, spending 10 hours per week calling and having lunch with former clients led to 2 referrals per month on average, then I would have to advise you to stop with the Twitter/SM and start hitting the phones and restaurants. Wouldn’t you?

    The issue today is that no one knows. No one has actually collected any data, or conducted any sort of reliable study on the effectiveness of social media activities in generating revenues (direct or indirect). That remains a challenge for marketers in the real estate space to continue to think about.

    @Jason –

    I also think that the most effective channel might be (I have no evidence) is a hyperlocal news site. I’ve written about that before. Trouble is, it is not at all obvious to me that anyone’s figured out hyperlocal sites yet… and doubly unobvious that real estate agents are the best folks to run such sites. There is a clear conflict of interest going on when someone who makes a living selling properties in a particular neighborhood also purports to report on news, character, happenings, and issues with that same neighborhood. That’s a different topic, but it’s an important point you raised.

    Whew – again, thanks, and looking forward to further conversations on this.

    -rsh