My business is a little different from that of most Realtors. We are a marketing company that also happens to be a real estate company, so we are working not only with real estate agents on a regular basis but also with builders and developers. The one thing that both builders and Realtors are talking with us about is how they have curtailed their marketing efforts is an attempt to reduce expenses.
This concerns me. I have a hard time thinking of anything that promotes and increases my business as an expense. Marketing is a necessity. Without it, no one would know what service or product we are offering. Today, more than ever, with so many others competing for the same dollar of revenue, it truly is out of sight, out of mind. If you are a Realtor, how many times has someone said to you, "I forgot you were in real estate". This is usually delivered mere days after they have just listed and bought from someone else. If you are builder, I'll bet you've heard "I didn't know you were building in that price range" more than you care. Unless you are a secret agent or are the keeper of the secret formula to Coke or Bush's Baked Beans, it's unlikely that you want your product or service to be top secret.
Often, the marketing budget is one of the first things that gets slashed in tough times, and sometimes the marketing budget is cut the hardest and deepest. In the scheme of things, should you really be slashing the one thing that is going to generate new business for you? After all, don't you really, really need to generate new business and income?
A marketing budget is an investment. The purpose of an investment is to create a return, and like any investment, marketing dollars need to be invested wisely in order to produce income. I've always thought of myself as being fiscally responsible. If I don't need to spend money on marketing, I won't, but when you need to make something happen, you need to spend the money. To be an effective "marketeer" you need to develop a sense of when to ramp up marketing and when to pull back. There is a knack to balancing the mix.
How you invest your marketing dollars is another post, but let me say this: look at what is working for you, and cut the things that aren't swiftly and reallocate that money to new ideas. Reinvent your marketing by taking another look at your target markets to come up with fresh ideas on how to get your message in front of them. If you must cut your budget, you need to totally overhaul your marketing strategy so that you can make the money you have work more effectively than before. Ah the joys of marketing: doing more with less!
I firmly believe that there are two serious mistakes currently being made in marketing:
1. Failing to make something happen by doing nothing while waiting for the perfect marketing plan. This is an serious marketing mistake. Roll out a good plan, monitor it carefully, and refine your good plan into a perfect plan.
2. Waiting for the market to recover before doing any marketing. You need to find ways to make something happen NOW! What's it going to take to get your business going again and how are you going to let everyone know what you are offering/doing?
Don't be a follower. Be the one that everyone watches to try to figure out what you are doing and why it's working. Learn to be creative. If you are meant to be a marketeer, you should be able to come up with exciting and inventive ways to attract an audience. Refine good ideas from others and make them great. If marketing isn't one of your strengths, seek advice. Doing things right will cost less than expensive marketing errors.
The most flattering thing to be told is that other people are waiting to see what you are doing to market your service or product so that they can follow suit. It feels really, really cool. Trust me. With a little creativity, a little ingenuity, you could be the one that gets your company back on the fast track to success, so keep honing those marketing skills!
As a marketing company, you'll probably agree with me on this - all market needs to be accountable for production. If it's not, refine it, if it's still not, CUT IT.
Studies show time and time again that for resales, the best source is online advertising and advertising through other agents. But, agents have always advertised for other reasons, too:
(1) Branding - they just want you to think of them when you think of real estate. (i.e. Xerox, Kleenex, these are BRANDS, not product types, but people use them interchangeably). However, a single agent can not get to this level, nor should they try - they wouldn't be able to handle that level of business.
(2) Keeping sellers happy - but now more and more sellers are banks, and they are not buying into the smoke and mirrors. If their property is not in the local newspaper they don't care. They get it. They know what sells, PRICE.
(3) Ego - In times past, REALTORS would place an ad to see their own face in the paper, on a bus, or wherever.
I know an agent team who spent $35K to have a brochure designed. The brochure looks like a menu at a high end Bistro. When I look at it, I get hungry. It's got a picture of scallops on the front. Yum. It will not sell real estate, it is not likely to get them business. And, it cost $35K. It was for their own egos.
So, now you are seeing ad cutbacks from agents because they are starting to "get it" themselves. The smoke and mirror drill does not pay their mortgage. But, had they not been doing silly advertising and had they been holding their ads accountable for productivity, they'd probably have stockpiles of money to pay the bills now. But, it's too late. They can only do what they can do. I commend them for hunkering down and focusing on the advertising that is working and cutting the rest. Hopefully, when the market recovers, they'll remember what they're learning now.
Thanks for your comments. Certainly quality is important in marketing, and ego needs to be left out of the equation. Design your marketing materials to do their job: drive qualified traffic.
1. I don't believe that we can rely only upon the internet to drive traffic, although certainly internet marketing should be an important part of the budget.
2. Branding is important but running an ad just for branding purposes in a soft market is not, in my opinion, the highest and best use of dollars. In this market, we need to focus on driving qualified traffic, not sustaining image or market position. However, that being said, brand yourself with a consistent message, for example through the use of a good tag line, and keep your marketing message to one point at a time.
If you could market yourself in a smaller, more targeted area, such as a neighborhood or specific area expert, your name will be synonymous with real estate in that area or neighborhood. As you grow your business and take off, you may be able to hire a licensed assistant to assist you so that you can go on and cultivate another targeted area. Now that's branding!
3. I think there was a time when sellers expected Realtors to hold open houses and run ads in papers. Sometimes things are done to make a seller happy, but if you go in to the listing appointment and explain to sellers who their target market is and how you are going to reach them, you should be able to show them that newspaper isn't generally where buyers are looking for a home today.
4. I concur about the ego ads. Someone needs to tell some of these people how tacky their ads are.
Good luck with your career, Vicky. You seem to be on the right track and I wish you the best of success this year!