by In any business advertising is looked at as a key component to generate new business. When someone starts an ad campaign (whether it be TV, Online, or Print) you might hear them say “I have to get the word out”. The striking part about that statement is it doesn’t imply any direct result in sales. This could be because of the definition of “advertising”. Consider the following definition:
Advertising (noun): The activity of attracting public attention to a product or business, as by paid announcements in the print, broadcast, or electronic media.
With this definition of advertising in place, it’s no wonder so many real estate professionals spend money on advertising and get absolutely no business! In the above most simple definition there isn’t any consideration for what that advertising shall do other than to bring “public attention”. In real estate we have very few funds to invest, so every dollar we spend on advertising must result in sales.
I invite you to consider a different definition of Advertising:
Advertising (noun) : The activity of attracting public attention to a product or business, as by paid announcements in the print, broadcast, or electronic media that shall result in leads and closed business.
With this definition in place you can allow yourself to make very different on which forms of advertising you choose for your real estate business. Every form of advertising needs to not just pay for itself*, it needs to generate business for you!
Now, let’s look at some common forms of advertising and how you can determine if you should be using it for your business.
- Magazine Ads – Magazine ads can be very effective. Before placing an ad, ask the advertiser how many calls the average agent receives from an ad. The entire point of launching a magazine ad is to get calls that you can turn into business. You don’t care about the circulation, the readership, etc., just how many calls should you expect!
- Online Paid Advertising – Online advertising takes many forms from PPC (pay per click), display ads, social media ads, video ads, and more.. When you are examining pay per click ads take into consideration the following. How many clicks will it take to get a lead? When you know this number then you can quickly calculate what your cost per lead is and determine if you want to start with online advertising.
- Postcards – Before sending out thousands of postcards take the time to understand what response rate you should expect. Your real estate coach might already be able to tell you what to expect, but if you don’t have a coach, send out just a few hundred postcards and track the number of calls you receive. When you don’t receive any calls, it means your advertising didn’t work, so you may need to change your marketing message, where you are mailing etc., but don’t send that postcard out again if you didn’t see any results!
*Maybe Some Ads Don’t Have to Pay for Themselves?
The concept of having ads pay for themselves is largely what direct response marketing is all about. You put in $X into your marketing and you get 5-10X that money back. When you think of advertising in this manner then there is no limit to the amount we can spend because it keeps bringing in revenue, but what if we stopped getting those returns?
In some instances you might need to launch an awareness campaign to drive more people to your direct response marketing efforts. This can occur when you launch a new product or in the case of real estate; maybe there is a new real estate development or even a new loan program that you need people to be aware of. Awareness campaigns can be very helpful but it is important to put tracking and target metrics on these types of campaigns to ensure they are truly worthy of your hard earned dollars.
Regardless of what form of advertising you choose, it is important to hold that advertising accountable for results. Every piece of real estate advertising that you launch should help you to close more business.
