By Frank Pulley and Bill Bronchick
Marketing to find motivated sellers is the lifeblood of your business. Marketing can be compared to oxygen to the human body-it’s essential for your body’s life, and marketing is essential for the life of your business. It doesn’t matter how much knowledge you have, without marketing in one shape or form, you will have no business. Unfortunately, marketing is one of the most underused and overlooked ingredients in many businesses. It is the single most important ingredient in determining your business success.
Before you determine what type and methods of marketing you’re going to utilize, it’s important to ask yourself a few essential questions about your business.
- What is it specifically is it that my business does?
- Who specifically is my customer both on the buy and sell sides?
- Exactly where are the areas that I plan to conduct my business?
When you first considered getting into real estate you probably didn’t have much of a plan in place as to what type of real estate investing strategies you would use in your business. You also probably considered doing business in your locality and somewhere near where you live. You might even have heard about certain areas that seemed better to invest in than others. However, that’s probably as far as it went.
It starts with a good business plan, which gives you an idea of the direction(s) you will be going in business and the strategies you will employ to get there. You then have to take that basic information and figure out a way to successfully market to those areas for potential buyers and sellers that are consistent with the specific investment strategies that you have chosen. Then you need to determine the areas or areas you plan on investing in. In marketing, we refer to these as “farm areas”.
In determining a farm area, the first thing you need to do to become familiar with the overall state of the real estate market in your local area and if there are properties there that fit within your investing strategies. An investor can make money and successfully invest in any market, but you have to use the correct strategies. Having a trusted advisor or mentor can be invaluable at this point in steering you in the right direction.
There are literally dozens of ways to market and it’s not uncommon to use more than one method for a particular area. In addition, you many times have to repeat your marketing more than once such as sending out mailers. The fact is- you absolutely, positively have to market on a continuous basis!! You should spend time with your team members, mentor and mastermind group on the types of marketing that will yield the best results for you.
Let’s look at some free or at least low-cost ways of marketing:
- Driving farm areas. Get to know your area thoroughly.
- Looking for other investor signs. Call the investors and find out what they are looking for and let them know what you are looking for.
- Networking and business cards. Have a respectable business card, then give them to past and present business associates, friends, family, neighbors, etc.
- Calling on Craigslist ads, FSBOs, and Newspaper Ads. Practice what you are going to say and use a script for your phone calls.
- Door Knocking. This is not for the faint-hearted but can be very effective!
Here are some other ways of marketing. They aren’t free but they work!
- Mailers. We could write an entire book on just mailers. What your list is and what your mailer will be will depend on your target and what seems to be working at that time in your farm area. Before you mail anything, it’s important to acquire some sort of list of motivated sellers to mail to. Track your responses and look for a least a 2 to 3% response rate with a mailing.
- Signs can be very useful in capturing leads. In real estate, we refer to them as “bandit signs” as they were designed to be set up and quickly removed in order to avoid the local ordinances. Consistency is the key to a sign campaign. If you plan to implement a sign campaign, plan on doing it for a minimum of 6 to 8 weeks.
- Bird Dogs or Scouts. Some investors have had great success in using people we will refer to as bird dogs or scouts by using these folks to do some of the legwork for them.
- Social Media and Other options. Other options available would be advertising on social media such as Facebook, Twitter or LinkedIn. In addition, some investors use removable magnetic signs on their vehicles. This advertises for your business as you drive around town to find motivated sellers.
Follow-up. It always amazes me that people will spend literally a few hundred dollars and quite a few hours in order to get a marketing piece designed and mailed out. Soon they start to get calls and often they take days or weeks to call the potential motivated back.
It always amazes me that people will spend literally a few hundred dollars and quite a few hours in order to get a marketing piece designed and mailed out. Soon they start to get calls and often they take days or weeks to call the potential motivated seller back. Personally, I like to try to take my calls live but your situation may be different. No matter what – your goal should be to call every potential seller back the same day or at least within 24 hours! If you think that you’re the only person these people may be talking to, you are probably wrong.
A consistent marketing plan for finding motivated sellers is a very important factor as to whether your business will be successful, average or even unsuccessful. Unfortunately marketing, just like other business maintenance aspects such as bookkeeping and networking, tends to get swept under the rug for many of us, especially when we get busy.
“Stopping marketing to save money is like stopping your watch to save time.” – Henry Ford