by William Bronchick & Frank Pulley
Marketing is the lifeblood of a business. It doesn’t matter how much knowledge you have, without marketing in one way, shape or form you will have little or no business. It’s a fact that marketing is one of the most underused and overlooked ingredients in many businesses. It’s also a fact that there is no silver bullet for marketing, and methods that worked six months ago may not be as effective now. Finally, you normally have to utilize several methods of marketing, in order to maintain enough leads to run your business at a higher level. So we will say it once again, if you have no leads then you will likely have little or no business!
Although marketing is the most important ingredient in getting a business off the ground, it can be expensive and some of the marketing methods go beyond the initial financial means of the investor. So let’s talk about some marketing ideas that can be effective AND low cost.
Before we get to how you will market, let’s address some of the preliminary information you should garner before we start our marketing campaign:
- What Will Be Your Primary Real Estate Strategies? A new investor should be familiar with several types of investing strategies. (e.g., Lease Options, Wholesales, Fix n Flip, etc.) It’s a good idea to focus on 2 to 3 or so strategies initially so you don’t get too diluted in your efforts.
- Who is Your Target Customer? What is their situation? What is their pain and motivation? An example might be a landlord that has a tenant that isn’t paying. How can you provide a solution that works for them, but also for your business?
- What is Your Farm Area? Once you have identified who your target customer is, then you need to try to figure out where they own properties that match your investing goals. If you were looking for inexpensive $150-$200k properties to fix up and sell, you wouldn’t look in an area that had brand new $500k homes, would you? Usually, you will want to choose 2 to 3 zip codes and then select neighborhoods within those zip codes that match the types of properties the best line up with your investing strategies.
- What is Your USP? USP stands for “Unique Selling Proposition”. This is something about you and your business that is somewhat unique and makes you stand out from everyone else. A good example is a “Retired Military”, “Teacher”, “Retired Cop”, or “Single Mom” to mention a few. You can then use this USP to make your marketing different, unique and to hopefully get your target customer to remember you and maybe even build a connection. It can also be what you do in your business, for example, it might be that you work with sellers in foreclosure or some other specialty.
Now that we have put some thought into laying the foundation of what strategies our business will pursue and the sellers and properties that will best match those strategies, it’s time to pick some ways to successfully reach out to those targets. Here are a few ways to market on a shoestring:
1. Business Cards. Business cards are very effective and pretty inexpensive. Just make sure you don’t get the “free ones” from some website that look like everyone else’s cards. Spend a few buck for a glossy finish. Have your pertinent information on the card like name, business name, tagline or motto, all of your contact info and most of all, include a decent picture of yourself on the card. People will remember it much better. While you are at it, use the reverse side to indicate what types of properties you are seeking.
2. Networking. Getting out a few times a month and handing out your business cards is paramount. Real estate is a business of who you know and who knows you. Let other investors know what you are looking for and find out their need also. There are normally several investor organizations in your area that hold regular meetings. Title companies and real estate brokers that work with investors also hold classes. Get signed up for all of their emailing lists and attend as many events as you can. You will not only increase your knowledge, you will also increase your chances of possibly getting a referral from one of your constituents. Referrals are the best type of lead!
3. Phone Calls. Calling on a variety of types of targets can be an effective way of capturing a lead. Call on Newspaper ads, Call on FSBOs (for sale by owner) and FRBO (for rent by owner) ads on Craigslist, rentals.com, and other sites. It’s a numbers game, so be prepared for some rejection. Don’t negotiate over the phone and most importantly- use a script in order to gather sufficient information in order to see if it will be a deal for you or not. The purpose of a phone call is to establish seller motivation and get an appointment to meet them in person at the subject property. Negotiating begins only after you meet them face to face, build rapport and have had an opportunity to evaluate the property condition.
4. Door Knocking. Door knocking can be a very effective way of capturing new business because most investors are either afraid or unwilling to do it. Folks that are in foreclosure can be a good possibility. In some localities, you can get a list of foreclosures from your county for free or at a low cost. There are also subscription sites one can join for a reasonable monthly fee. You need to rehearse what you are going to say and practice it before you venture out. Door knocking in pairs makes sense from a safety aspect. Make sure you door knock when folks are likely to be at home, such as evenings, weekends and inclement weather.
5. Mailers. Mailers can be pricey but they can also be very effective. A couple ways to save money is to obtain a targeted mailing list such as foreclosures or non-owner occupied properties. By targeting your marketing, you can save money and increase the effectiveness of your mailers. Lists can be expensive, but in some states, one can obtain some free or low-cost lists from a local realtor, a title company, your county assessor or county treasurer. Postcards are cheaper to mail than letters but in this day and age aren’t always quite as effective as some sort of letter. When it comes to letters, either typed or handwritten can be used. Although results can vary, our experience is that handwritten seems to produce the best results. You can write them yourself, which takes a lot of time or you can take a list and go to one of the many yellow letter types of websites and have them done for $1.00- $150 each.
The final step in marketing success is following up. If someone contacts you, try to talk to them then and there. If that isn’t possible, then arrange a time to call them back and call them back when promised. If you get a call and someone leaves a message, call back as soon as you can- preferably within 24 hours. If the seller seems unmotivated but it seems like a possible deal, ask them if you can call them back in a couple of weeks.
That’s it. It’s time to market effectively in order to move your real estate business ahead to success. Best of luck!!