Lead generation
What is conversion rate?
Conversion rate is the proportion of leads that progress to a defined outcome — a viewing, an offer, or a completed transaction — and is the main measure of whether a lead source or process is working.
It is only meaningful with the stages named. 'Ten percent conversion' means nothing without knowing conversion from what to what. Lead-to-appointment, appointment-to-offer and offer-to-close behave very differently and have different fixes.
Compared across sources, conversion rate is what makes cost per lead interpretable: an expensive source converting well can be far cheaper per transaction than a cheap source that does not.
Low conversion at the first stage is usually a speed or qualification problem. Low conversion later is usually a pricing or matching problem.
Related terms
Lead scoring is the practice of assigning each prospective buyer or seller a numeric value that estimates how likely they are to transact, so an agent can work the list in order of probability rather than in the order enquiries arrived.
Speed to lead is the elapsed time between a prospect submitting an enquiry and an agent making genuine contact. It is one of the strongest predictors of whether an internet lead ever converts.
A pipeline is the set of active opportunities an agent is working, organised by the stage each has reached — from new enquiry through viewing, offer and under contract to closed.
Gross commission income is the total commission an agent or brokerage earns before any splits, fees or expenses are deducted. It is the standard headline measure of production volume.