If you struggle whenever the time comes to put together a marketing plan for your business or you’re not sure where to start and what exactly to include, the following pages will help clarify this. In this article, we will break down the process of drafting a marketing plan for real estate investors, with the intent to help every investor out there.
We will cover goal setting, the elements of marketing plans, and how to improve your ROI with marketing. Also, we share an outline of a marketing plan that can serve as an example – a resource that is particularly useful to novice investors.
Join us, as we go through the basics.
It goes without saying – marketing is important for success in any industry. When it comes to real estate investing, though, marketing is crucial, because it differentiates investors who merely survive in the market (if at all) from those who thrive.
Marketing enjoys this special status among investors because the business model of real estate investing companies rests on buying properties at below market price. This is where the profit is made, so the success depends on securing a stream of motivated house seller leads. And these kinds of leads are best acquired through marketing.
Can you close contracts on houses without marketing? Of course you can. But this would mean that you depend on referrals from people who already sold their houses to you. There are a number of issues with referrals:
So, if you are trying to jump-start a real estate investing business from scratch, and you don’t have previous experience in the field, you can’t afford to rely on referrals alone. Especially if you intend to become a real estate entrepreneur who works full time in the industry.
This is where marketing to motivated sellers comes into play.
First things first, you have to add some structure to your marketing efforts. If you fail to do this, you risk overspending on marketing or getting more leads than your company can handle. In both cases, you are throwing money down the drain.
Real estate investors develop marketing plans to make their marketing more efficient. In essence, marketing plans are a written outline of
A nicely executed marketing plan directly addresses the goals that are laid out in your real estate investing business plan. It should include specifics and benchmarks – the objectives should be both measurable and realistic.
In real estate investing, goal setting goes along the following lines: our goal is to generate an X amount of revenue in the next year, coming from Z amount of closed deals, sourced through Y amount of leads, acquired by investing a Q amount in marketing.
Now, this is the underlying logic of goal setting, but the variables aren’t set in stone. You all know that fixed returns from investment properties simply don’t exist (one deal brings $10,000, another brings $25,000 in profits). Also, maintenance of the properties that are already in your investment portfolio will make dents in the returns as well.
Still, you should have a rough sketch regarding desired outcomes. For example, cash on cash returns between $150,000 and $180,000, by closing 20-25 properties under contract, from 100-120 leads, by investing $24,000-$30,000 in marketing.
We will delve deeper into marketing budgets below, however, this is to show how marketing plans should relate to business plans. Before we do that, let’s take a look at other essential elements of marketing plans.
The marketing budget is important, but to make the best use of the ad spend, first you need to
Once you set the budget, you should
We will review each of these elements below.
You don’t need to describe an elaborate seller persona, as it’s required in retail, but you should determine your target audience based on property location, type of deal, and selected demographics about its owner.
Note that we didn’t specify the motivated seller’s place of residence, rather we referred to property location (as in – real estate market). If you limit your marketing campaigns to people who live in the target neighborhood, you will miss out on absentee owners and out of state owners. So, make sure you include all homeowners – online marketing channels are great for this.
Investors pursue different types of deals – foreclosures, tax delinquencies, code violation, probate, etc. Pinpoint the exact type of leads (and eventually deals) you want to get through your marketing, and this will ease decision making for specific marketing channels or campaigns.
When it comes to demographics, you need some general input about motivated sellers. Things like age, income level, home-ownership status, and similar data. Basically you want to have a clear answer to the questions: Where are these homeowners likely to search for a solution when they need to sell a house fast?
We get it, audience profiling may seem too basic and unnecessary, however, having a clear idea about the people you want to target has profound implications about your marketing plan (and campaigns). Suppose you go for PPC. If you target houses in probate that are located in Owensboro, KY, owned by people who work a 9-5 job, you will bid on keyword like “how to sell a house in probate in Owensboro, KY” and you’ll run the Google Ad from 6 PM until 1 AM
Or if house owners in your market are mature, you should discard Instagram as a marketing channel because many of these homeowners don’t use that platform and focus on Facebook instead.
Property owners are exposed to marketing campaigns from other real estate investors in your market, whether through direct mail, Facebook ads, or any other channel. If you want to stand out, you will need to find one unique feature that sets you apart from the rest.
This is also known as “your unique selling proposition” and can concern any aspect of your real estate investing business – your professional experience, the streamlined selling process, the fast service, etc. If your forte is experience, you can use something like “We’ve bought 140 houses in probate in the last 3 years.” If you provide fast service your message can be “We’ll give you an offer in 48 hours and we can close contract in 7 days or less.”
The unique selling proposition should dominate your campaigns across all channels. You should have it in mind:
It’s your marketing message.
Speaking of competing with other real estate investors, you should also include a section on marketing practices of other investors in your marketing plan. These days it’s easy to check what others are doing. For instance, Facebook business users need to disclose active marketing campaigns in the name of page transparency. Same goes for offline campaigns, just pay close attention to the mailbox when you go driving for dollars or door knocking.
Also, analyze your competition in terms of their market share, their strengths, and their shortcomings. If you can match or outperform them on any count – there’s an input for your marketing message.
We already discussed annual business goals and how the marketing budget helps you achieve them. Once you have the total marketing budget, you need to distribute it down to channels and then determine metrics like cost per click, or similar.
Let’s explain this.
It’s recommended to use more than one marketing channel. In fact, this distribution comes naturally since real estate investors can’t really get an uninterrupted stream of seller leads from one channel. So, you set aside segments – one for SEO, one for PPC, one for direct mail, etc (we will share an example on managing multiple marketing channels in the next section).
Each segment gets a budget and has its own deliverables and expectations. And as you run the numbers, you come to a specific amount of money you are willing to invest to get a lead from the channel. In pay-per-click campaigns (Google Adwords, Facebook ads) for motivated sellers leads, this is expressed through the metric cost per click (or CPC = total cost / number of clicks). Having such metric in mind will prevent you from overspending by engaging in bidding wars.
These type of metrics can be calculated for each channel, and it’s particularly easy to calculate them in online marketing, where it’s easy to track campaign performance.
There is more than one way to allocate your marketing budget, this is just one of them.
You can also get leads from so called “free marketing” on platforms like Craigslist, however, you have to consider the trade offs as well. In terms of money, Craigslist ads are free or extremely cheap to set up, and you might even get a lead. But you have to ask yourself whether the time spent in posting classified ad listing on Craigslist is worth it. Don’t underestimate time as a resource. You should be spending all that time to improve your business processes, build a converting website, and close deals.
Translate your long term business goals into actionable items. This is a widely used productivity hack that helps you keep track of progress toward the objective. It serves as a checkpoint and it improves motivation.
Let’s say you intend to retire within 5 years. What needs to be accomplished this year for you to remain on track? In specific terms: how much revenue, how many deals, how many leads? This is very important for your marketing plan. When you end up getting your first 10 leads from the marketing campaign, and you manage to close two of them, you can feel a sense of success about the long term process, even though you’ve only closed your first two deals.
And if you are not on track, the benchmarks in your marketing plan will alert you – maybe it’s time to consider changing an aspect of the campaign. Alternatively, maybe your expectations of the real estate market weren’t realistic, so you need to adjust your marketing plan.
It all boils down to the indicators you get from your marketing campaigns.
“Everyone has a plan until they get punched in the face” – that’s what Mike Tyson said. Wait a minute, no one is actually throwing punches at real estate investors. Well, yes, and..no. Let’s discuss the Facebook retargeting pixel to illustrate this point.
Up until the first half of 2021, the Facebook retargeting pixel was included in real estate investor marketing plans. In a nutshell, it’s a piece of code that registers website visitors so you can remarket to homeowners on Facebook if they are Facebook users. Most marketers used this resource, across industries. Then, as governments are losing their patience with Big Tech (especially the EU), new law was introduced and the retargeting pixel was retired due to concerns about violation of privacy. Tons and tons of marketing campaign (and plans) were affected by this change.
You can’t run marketing campaign on autopilot. In PPC, you need to check keywords every six months or so, for SEO it’s similar, and this applies to every other marketing channel out there. Keep track of metrics about particular campaigns, but also about the overall marketing plan. Chances are, at some point you will need to tweak the plan you drafted last year.
No matter how resilient your initial marketing plan was, sometimes aspects that are out of your control affect it’s completion.
Enough about elements of marketing plans. Let’s check out a specific outline of marketing plan (with actionable steps).
Let’s assume you are starting out as a real estate investor and you’ve never bought a house before. You’ve registered a company and you’ve written a business plan. How do you develop a step-by-step marketing plan for getting motivated seller leads?
The short answer is: by marking milestones for your marketing within a set timeline.
1) Website design – it all starts with your online presence. You build a real estate investing website, and you design a landing page that converts. It’s recommended to make the website mobile-friendly (almost half of the leads come from mobile traffic), and to start publishing original content about your unique selling proposition. At this stage, your “about” page and a couple of other posts are enough.
Timeline: This step can be completed in a couple of business days, especially if you use a ready-make real estate investing website template (like those offered by Carrot). Just cover the basics and you’ll improve the website as you go along.
2) Pay-per-click Campaign – it’s the best way to expose your business to motivated sellers when you start out. You can start slow by bidding on a broad match keyword (“sell my house fast in X”), as you are yet to build website authority. At the beginning, the goal is to have website visitors and to note their interaction with the landing page. Soon, some of these visitors will convert and you’ll get your first online leads.
Timeline: Complete this step in the first month. As you gather metrics about the campaign (click through rate, cost per click, conversion rate, etc.) you can further tweak your Google Ads. You’ll decide what to do with your PPC on an ongoing basis.
3) SEO – this is the step where you establish your authority as an expert. It involves tasks such as on-site and off-site optimization, content creation, and the uphill struggle typical for real estate investor SEO – link building.
Timeline: It takes months to see results from SEO. You can complete some simple tasks right away (like on-site SEO), but posting original content is a long-term endeavor. You’ll need at least six months (maybe more) to rank high for your target keywords.
4) Social Media – to build relationship with wide audience (not just motivated sellers) by posting relevant content. Select the platforms you’ll use – Facebook, YouTube, Instagram, LinkedIn, Pinterest, etc. – and put your message across. Most social media platforms allow you to get paid traffic as well. Place lead capture forms strategically and you’ll get leads from these channels.
Timeline: launch them in the first month, and keep them current as you move along. Volume depends on the platform, but you have to be active on a regular basis to remain relevant.
5) Direct Mail – get your campaign straight into the homeowners mailbox. Direct mail can support your online marketing efforts, especially as the warm months (and the increased real estate market dynamics) draw near. You can send three yellow letters per property in six months.
Timeline: do it occasionally, particularly as winter comes to an end.
There you have it folks – the first five steps as you start to put your marketing plan into practice. Of course, none of the steps in the template are set in stone, and you’ll need to adjust the outline to fit your unique circumstances. However, this template can provide the backbone of your plan. As you gather feedback about your active marketing campaigns, you can make decisions as you see fit. For instance, double the PPC budget if you get high quality leads that are easy to close.
But what if closing on your leads doesn’t come easy? We will explore this in the next section.
We can’t discuss marketing plans without addressing optimal closing rates. Let us disclose an industry secret to you: some real estate investors struggle to close deals. It’s not because of an issue in the lead stream and it’s not because of faulty marketing plans. Give the same amount of leads to two different investors and their close rate will differ.
This is where customer relationship systems come into play. Solid CRM system is crucial for success because it allows real estate investors to track leads. You need to have info on every interaction with a potential lead – from a website visitor, to lead conversion and, eventually, closed contract. Fortunately, online marketing can provide all sort of metrics and data points, including:
and all sorts of metadata like number of visits, time of visit, website heatmap, etc.
Take this data to optimize your follow up process and to improve your closing rate. If you use the CRM system properly, you’ll get a higher ROI, since you are closing more deals from the same amount of leads – those that are already in your system. This will effectively change your perspective on ROI and marketing plans in general.
Every real estate investor out there faces unique challenges. Conditions vary – whether it’s due to real estate market characteristics, the level of experience in their REI team, or simply because motivated sellers prefer a certain marketing channel. So, you’ll have to tailor the marketing plan according to the type of seller leads you need.
We’ve done our best to present the essential elements of good real estate investor marketing plans. Now it’s your job to draft your plan and to tweak it based on the feedback you get from house sellers.
One thing is certain: decision-making is much easier when you have a marketing plan to come back to, even if you come back to it just to revise what you originally drafted in the document.
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