The First Question Every Realtor Asks Me
n over five years as a real estate marketer, the most common question I have been asked by realtors is this: which real estate marketing strategy has the highest ROI?
It’s a simple question, and yet you will likely get very different answers depending on whom you ask. I have compiled the biggest mistakes realtors make and an overview of the marketing strategies which typically yield the best returns…
Mistake #1: Not Knowing Your Numbers
Real estate is a highly competitive game. Those that are able to yield the best return on their marketing budgets are the ones that survive the tighter times and thrive the most when the market is strong. The better your ROI, the more you can build up your war chest, the more you can dominate your niche, and the more you can seize on opportunities to grow your market share. Unfortunately, most real estate agents have no idea what their real marketing costs and returns are. If you don’t know, how can you invest in the best strategies?
Some just fail to do the math. Know your cost per action, cost per lead, cost per closed deal, and your true net after labor, materials, commission splits, etc. One of the biggest hazards in this industry is the masses of marketers that hammer agents with their one marketing product or software tool. They claim that “if you just close one deal it pays for itself.” That might be true. But there are many forms of real estate marketing which can produce a result. Email marketing, yard signs, open houses, billboards, and direct mail are just a few examples. But, are they really delivering the highest return? Remember 80% of your results are likely coming from just 20% of your efforts. What’s that top 20% today?
Demand the max. We all know that internet marketing is a must have today. Yet, that still leaves a lot of options. So is social, pay-per-click, or SEO? What should you be focused on?
Social Media Marketing for Real Estate
We all want to ‘go viral’ right? Yet, NAR’s 2016 Member Profile reveals that only 70% of Realtors are using social media. We know many of those on it are doing a pretty cringe-worthy job of it. And it can be hard to track results if you aren’t paying attention. That has caused many to abandon these efforts or put them on the back burner. If you have someone tracking actions for you, you can tell precisely how many visitors click through to your website, contact you, and become deals. You can even break it down to the exact cents you get back.
The ROI on social media marketing for real estate can vary widely. You might put up a hit post which cost you nothing to create and reap a windfall of leads. In that case, your ROI is literally infinite. Of course, these moments can be unpredictable and elusive for 99% of agents. Or you can systematically publish great content and use social ads to generate predictable actions. YouTube, Twitter, LinkedIn, and Facebook all offer these features.
What is really important with social today is:
- To own your online real estate – own all the custom URLs related to your brand
- Focus your efforts and spend on the one or two platforms which are the best match
You don’t want the competition piggybacking off of your spending and name because you didn’t bother to grab the Instagram handle that matches your name and brand name. At the same time; you can go broke trying to dominate every social platform in existence. There are hundreds of them. Instead, know your ideal clients, and focus on connecting where they are at. For some agents, it might be Facebook. For others, it will be LinkedIn. For others, it may be Twitter or Google+ or Instagram. Finally, kick the old mentality of rushing to large numbers of likes and fans to the curb. Focus on quality connections instead.
Pay-per-click advertising is often misunderstood and overlooked by real estate professionals. Some say “I don’t want to pay for advertising when I can do social or blog for free.” Let me tell you – nothing is really free. Not if you want consistent and reliable results. Not Facebook and not real estate blogging. After all; who is going to design your social media profiles and post for you? Who is going to write your blog every day and maintain it? That shouldn’t be you. You should be closing deals. PPC is hands down the most predictable way to generate results and to be able to measure your ROI. Period.
With PPC you only pay for results. You can scale up lead generation when you need to fill your pipeline, and scale back on-demand when you are overloaded or are headed on vacation. You can set your own budget and change it on a daily basis.
According to a survey by Search Engine Land, the average conversion rate for Google Adwords is 2.7%. Real estate is actually in the top 4 performing industries for Google PPC ads!
Remember you can also use pay-per-click advertising on Facebook, LinkedIn, and Twitter too. However, Facebook has often proven to be a little more affordable than the others.
Your exact ROI will depend on your call to action, ads, and closing skills.
Search engine optimization is a big category. Everyone wants great SEO so that they are at the top of Google, right? Few understand what’s involved in that. Most agents get mugged by unscrupulous and out of touch internet marketers who promise top rankings for a few hundred dollars. And they get terrible results. SEO actually incorporates and is influenced by many factors on your website, your social media, and even your PPC campaigns. On your website, this means the right keywords each month, good inbound and outbound links, and how fast and mobile friendly your website is.
However, the real core of most SEO is the real estate blog. Yet, according to NAR Realtors are spending less now than in 2014 to maintain their websites, and only 11% report they are blogging.
Blogging well requires an investment. But it can deliver great returns if you focus on quality, stay consistent, and maximize your ROI through the channels above. You see one blog post can touch thousands and thousands of prime prospects. Drive traffic to your blog with PPC and you can get a lot more out of both strategies. Repurpose that content on social media, and use your blog to kick start conversations on social and you compound those results again. What is really great about blogging is that it keeps working for you indefinitely. You might just get one deal from that Google Adwords click, or a handful of deals from a viral Facebook post. But a good blog post can both create immediate results, and attract leads and build your SEO for years.
Mistake #2: Trying a Little Bit of Everything
The most successful realtors are those that show urgency and consistency. If you are like most agents, constantly switching between marketing strategies after a couple weeks or months you’ll never get the most out of any strategy. You’ll never get the best ROI. You’ll always be a month away from broke. The best agents I have worked with cultivate a handful of high-performing marketing strategies, and stick with them. They might weight their budget a little more over here one month, and a little more over there the next month, but they understand the importance of consistency.
Social media done poorly is about as profitable as playing the lottery. Done well; based on best practices, the data, with good tracking, and incorporating paid social ads it can deliver the same types of conversion rates as Google Ads. Let’s say you spend $1 per click, and you get a 1% conversion rate to leads from visitors landing on your site. For $1,000 you get 1,000 site visitors and perhaps 1% become leads of some type. That’s 10 leads. If you can close 20% of those, that’s 2 deals. What’s your average commission?
Of course, results can vary widely. And they can only be amplified by good SEO. Your SEO and blog on its own may yield very substantial results too. If you paid the industry average of around $250 for a great piece of content and you get one single deal from it ever – what’s your ROI on that? Insanely high. If you only get one a year from it for the next ten years?
The bottom line is that SEO, PPC, and Social all work. But they have to be done right, and they should be used together to elevate conversion rates at every step. The most successful realtors are those who show consistency in their marketing efforts and delegate the technical work while they focus on closing deals.
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