What does your real estate marketing strategy look like? If you are an agent engaged in passive marketing campaigns, placing your picture on bus stop benches, or buying leads, rethink this strategy. Qualified real estate leads don’t come from buying lists or sending out volumes of cold emails. The better method is to take the time mining your own network and nurturing your contacts to find qualified leads. The time you will take to build relationships in order to generate leads will be worth it.
Are listing system subscriptions and “old school” advertising methods worth it?
Subscribing to listing systems accessing specific zip codes means spending hundreds of dollars per month. Add up your “qualified” leads and figure out what the cost per lead actually was. Let’s say you spent $2,100 in the past year and you ended up with three listings. That amounts to $700 per lead. Did you sell all three? What were your ultimate commissions? Was it worth it?
Think of the “old school” methods like advertising on bus stops, or mailing brochures to prospective clients. Even your email newsletter is now “old school.” These are expensive ways to market your services and difficult to track their effectiveness. What was your Return On Investment (ROI) with these marketing methods?
Building and nurturing your network
You are a professional, offering personal services requiring excellent personal relationships with your clients. This requires building up relationships by networking. It will take time and is not easy, but the more successful real estate agents have an awesome network. I am not suggesting that you suck your contacts dry and shamelessly use them. However, ask yourself, “If I reach out to my contacts today for client referrals, will they comply?” If your answer is, “I don’t know” or “No,” now is the time to begin nurturing your network by adding value to your relationships. Over time, when you ask for client referrals, they will be more likely to comply.
The National Association of REALTORS® Home Buyer and Seller Generational Trends Report 2015 reported that a full 40% of all home buyers located their agent through a referral from someone they knew. This was the same for 38% of the home sellers. These were by far the highest numbers compared with all other forms of locating real estate agents. This report also revealed that the most important characteristics in choosing a real estate agent were honesty and integrity for both buyers and sellers. This is why spending time building your network is so important. Buyers and sellers are most likely to find you through recommendations from people they trust rather than from your advertisements.
Three elements to consider when trying to generate real estate leads
Now let’s look at three important elements related to mining real estate leads and helping you land more listings:
The old saying “The more money spent, the more money made” does not work for the real estate brokerage industry. Throwing money into advertising and blind marketing campaigns will usually not result in a decent ROI. This is a business where success depends on your good reputation of being an honest and knowledgeable real estate professional. Integrity, reliability, personality, knowing every detail of your listings and their neighborhoods—all of these things help to build your reputation. People who see that you have these qualities will have confidence in your professionalism and won’t hesitate to recommend you to friends and relatives. And the best part? Building your network costs a lot less than traditional advertising.
The second element is time. The more time spent building your relationships and network, the better quality your real estate leads become. This is by far a better ROI than advertising.
Finally, the results we all strive for are excellent quality real estate leads. It’s all about the additional time you spend on relationships and not the money spent creating important referrals from your network. You will find that as your relationship marketing time increases, the money spent eventually goes down.
How to start mining leads for listings
Tomorrow, start joining clubs, associations, organizations, groups, blogs, forums, etc. These may charge initial membership fees, but over time the ROI on those fees will far outweigh their costs. Joining groups where foreigners are members will put you in contact with people who recently moved here or who know people thinking about moving. Business networks will involve companies that are growing and hiring employees who will all need new housing. Companies considering opening a branch in your city will be a great source for new buyers and renters.
Don’t forget about social media. Set up accounts with as many as you have time for, like Facebook, Twitter, Instagram, Pinterest, YouTube, and LinkedIn. Join their specialized groups related to real estate and relocating, and contribute numerous posts.
If you are not getting a good ROI on your real estate advertising efforts, follow these recommendations to build networks at less cost with a higher ROI. Everyone knows someone who needs a real estate agent, and you need a bunch of them to recommend you.
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About the author
Steven Rich, MBA has over three years of experience as a successful real estate agent. He was awarded the Top Condo Salesperson for two of those years by his real estate company. Steven has served as Associate Editor for a real estate magazine and is the author of a 104-page e-book on How to Buy, Develop, Lease, and Sell Real Estate.