With the start of the new year, we saw leads increase along with sales for most builders in most markets compared to Q4. We’ve also seen record-high traffic to builder websites, but that hasn’t translated into record-high leads. However, those who do end up becoming a lead are higher quality. Compared to the previous quarter, most reported a steady increase in leads and appointments, and many builders are meeting or exceeding their sales goals. Q4 2022 was challenging, to say the least, so it is refreshing to see the first part of 2023 recover from that dip.

As we look at the first quarter of this year, some metrics jumped out and surprised us. We’ll highlight those below. Our goal is to keep you informed on benchmarks and the latest metrics and make sure you are setting your program up for success. 

Takeaways: 

• First things first, understand the comparisons. If we compare Q1 of 2023 to Q1 of 2022, we saw a 49% decrease in lead volume. However, compared to Q4, it was a 45% increase. That is a drastic swing in just one year. Again, the leads coming in are higher quality, and we saw a 40% conversion of lead to appointment. 
• Compared to 2022 averages, appointment conversions are up 3%, conversion to sales is steady, and contribution is down 7%. 
• That contribution is the lowest we have seen since 2019, but also not super surprising. The increase in inventory and exposure of completed homes on the MLS has boosted traditional walk-in traffic. With less resale inventory on the market by 25% or more in some cases, Realtors are gravitating toward new homes. These sources would bypass an Online Sales Program unless you have the funnel locked down. 
• We also have noticed some skills gaps in Online Sales Specialists hired in the hot market. Established, high-performing Online Sales Programs are averaging a 51% lead to appointment and 49% contribution. So there is a need to reset expectations on the job function and behaviors needed to hit the goals. 

Overall, home builders are fortunate that inventory levels of resale homes remain low. That has given us the lift needed to make it through a higher interest rate environment. We encourage Online Sales Teams everywhere to focus on the foundational activities that produce the results. In addition, the last half of 2022 into this year looks and feels more like 2019 as it relates to conversion rates. 2019 averaged a 39% contribution rate. We anticipate as we reach more of an equilibrium that 50% contribution continues to be a healthy goal to target.