Traditionally, the costs for marketing in the real estate industry were prohibitive. The ability to reach a large number of people was reserved only to those who can afford to produce a TV commercial. This didn’t apply to real estate investing in particular, though, because there were a few workarounds.
Real estate investors were able to pick up leads for free from a popular property listing. The issue with the house sellers on these listings? They are outbound leads, i.e. you are calling them to gauge their motivation and these leads are not as hot. Also, since listings are free marketing, many other real estate investors will contact the house sellers, which means that often, you won’t be the first to get to them.
The gold standard in marketing for real estate investors are inbound leads, or when motivated house sellers are calling you. It’s what you should be after, because if the sellers are motivated enough to pick up the phone and talk to you, then the likelihood of closing the deal is much higher. So to get as close as possible to house sellers, real estate investors turned to direct mail – and it worked.
New leads are important for every business, but in real estate investing, leads are a critical part of making it past the one-year mark.
That’s because obtaining hot leads is the most difficult part of real estate investing. Raising capital is easy if you have the leads. You go to a lender and tell them that if they give you an X amount of money, after one year the project will get them the X amount + profit. Lenders will perk up when you present such an offer, especially in real estate, where the property itself is a collateral for the risks.
As a result of that, marketing is what makes or breaks your real estate investing business. The only lead stream that performs better than the leads you got through marketing are referrals, but you need to work hard and to have a good track record to get those.
Today the bar in marketing is low. Digital marketing is way cheaper, and almost anyone can do it, if they set aside some time for it. You’d think that this is great for real estate investors. It’s actually not.
Since marketing is more accessible, the competition in real estate investing is tougher than ever. Also, the average internet user is exposed to much more ads (to the point of saturation), so it’s harder to get your specific message across. This affects offline marketing as well, and a lot of glossy mailers which were delivered to a mailbox end up in the trash.
You’re not only competing against more real estate investors, but your audience is exposed to more marketing than ever before. So, you need to excel in marketing if you want to secure a consistent flow of leads.
We are going to examine all marketing channels that are available to real estate investors. The list isn’t exhaustive and includes: online marketing (PPC, SEO, social), traditional marketing (direct mail, bandit signs, door knocking, cold calling) and word of mouth marketing (referrals, networking, apparel marketing). The information is structured so that even those who already have an active ad campaign on one of these channels can learn of ways to improve their reach by adding a new channel.
What’s the end goal? To help you develop an integrated multichannel marketing strategy for getting real estate investors seller leads.
We’ll start with the digital channels that are the most relevant at the moment.
Back in the day, investors may have spent more time and effort to find motivated house sellers. Today, everything we do is connected to the internet, whether that’s through social media, by typing a query in a search engine, or checking the latest email in our inbox. You don’t even need to check statistics on internet use, just note what you (and those around you) do on the internet during the day. Motivated sellers are doing these things, too.
Online marketing for real estate investors revolves around ad campaigns (PPC), SEO, and social media.
PPC is the number-one method for getting motivated house seller leads. It stands for pay-per-click, and it means that you pay only when someone clicks on your ad. PPC campaigns can be launched on many different platforms (including social media like Facebook), however, when real estate investors talk about PPC, they usually refer to Google Ads (formerly Google Adwords).
Google Ads are text-based ads that are shown above the search results when search engine users type a keyword relevant for your real estate market (for example, ‘how to sell my house in x fast’). Setting up a PPC campaign for motivated house sellers is a process. It involves research on motivated seller keywords, choosing a bidding strategy, and a host of other intricacies.
We will review the pros and cons of PPC for real estate investors.
SEO is not a marketing method, it is what you do to make your real estate investing website appear in the top search results for your keywords (for example, ‘how to sell a house without a realtor’). You optimize the content that is available on your website and the website structure itself, so that search engines rank you higher than your competitors.
To get house seller leads through organic traffic, you need to work on all aspects of SEO including: keyword research, content creation and optimization, link building, website accessibility and site navigation. It is content marketing at its best: you use keywords in posts that are helpful to motivated sellers, while making it easy for search engine crawlers to pick up your high quality content.
People spend a lot of time on social media. Checking social media has become almost second nature as users are comfortable enough to use their social media profiles in the decision making process. This also applies to decisions like home buying or selling.
If your real estate investing business is active on the right social media platform, you will not only tap into a stream of seller leads, but you can also connect with other professionals (investors, lenders, contractors, property managers) in the industry.
Facebook is great for targeting motivated sellers in your real estate market, LinkedIn is used for networking with colleagues and investors, Instagram is popular for listing properties, Pinterest can put your business in front of potential house buyers, and YouTube can enhance your SEO efforts because it doubles as a search engine (consulted by Google).
In a way, social media marketing is a mixture of PPC and SEO because it allows real estate investors to get organic traffic through regular posts, but it also offers paid traffic through ads.
The posts on social media are typical content marketing: it’s free traffic that inspires engagement from a wide audience of social media users interested in real estate. You’ll have to use lead magnets to further qualify this audience and to separate the motivated house sellers from those who simply want to consume content about real estate. On social media, these lead magnets are usually free guides (property market analysis), free services (property appraisal), or webinars (how to stop foreclosure).
Real estate investors use Facebook paid ads almost exclusively. While each social network has its form of ads – sponsored content or direct message on LinkedIn, promoted pins on Pinterest, or in-video YouTube ads, etc. – only Facebook Ads are cost-effective. These ads are not always lead conversion forms – investors can also increase attendance of an event (open house, virtual house tour, a webinar), boost a popular post, or promote their page.
Even though email marketing is not as big with real estate investors as the other marketing channels, almost everyone has an email, and they check it on a regular basis. Determining which portion of these users consists of motivated sellers is key to a successful email campaign.
Newsletters are the most typical format for email marketing in real estate, however, you can also create an automated sequence of messages to guide your leads through your in-house process. And, of course, you can use emails to keep in touch with those who’ve closed a deal with you – we all know how important referrals are in real estate investing.
Direct mail marketing, bandit signs, and driving for dollars were the go-to methods when the real estate investing industry was established. Don’t worry, we don’t dis traditional methods for obtaining motivated seller leads even though we are a digital marketing agency. Most of these marketing channels remain relevant to this day.
Let’s review their value for real estate investor marketing.
This one’s straightforward – you send mail to homeowners to present your real estate investing business. It can be a letter, a postcard, or a mailer. Handwritten letters on yellow paper (known as yellow letters) usually have a higher response rate.
Direct mail for real estate investing seller leads is not sent randomly to a whole neighborhood, though you can do that too. The addresses of the properties are obtained from motivated seller lists, which are sourced through the county (code violation properties list, tax delinquent property list, etc.) or a data service.
If you launch a direct mail campaign on your own, you need to sort out envelope design, to write a copy, to print out letters, to choose a sending frequency, and to manage delivery. Alternatively, you can hire a brick and mortar agency to do direct mail for you.
Property owners and home buyers check real estate listings, so it’s natural for real estate investors to try marketing through listings ads. Now, there are many property listings out there – some are professional like Multiple Listing Service Listings (or MLS) and some are available on real estate platforms like Zillow, Trulia, and Redfin. Craigslists has a classified ads section that is available for free.
Signposts, posters, banners, and stickers, or bandit signs, are still used as a guerrilla marketing technique by real estate investors. They typically contain the bare minimum: copy that says ‘we buy houses cash’ and a contact number.
Bandit signs can be made from all sorts of materials (plastic, metal, woodboard) and they end up distributed on traffic signs, lawns, and parks.
Door-to-door real estate prospecting is nothing new. In fact, it’s how “real” real estate investors closed deals back in the day.
Sometimes, investors try to find new properties to add to their motivated seller list by driving for dollars. It’s simply walking or driving through a neighborhood and looking for signs of distressed properties, like a pile of mail at the door, code violation notice, or foreclosure notice.
Door knocking is like taking driving for dollars up a notch. Instead of adding the property (or their owner) to your list for a direct mail campaign, Facebook Ads, or some other marketing channel, you are walking up straight to the door to talk to the owners.
Real estate investors can find leads by talking to people. There is such a thing as off-market deals, and they are usually found by keeping in touch with someone who knows someone else… in the industry.
To get these deals, you don’t just hand your business card and walk away, rather you need to engage in proper real estate networking and build a relationship with the professionals in your real estate market.
We’ll take a closer look at referrals and apparel marketing.
Nothing beats referral marketing in real estate. We are used to getting social proof for day-to-day purchases, and if someone vouches for you when it comes to a big transaction like buying or selling a home – it’s hard not to close the deal.
Referral marketing for real estate investors is straightforward – you ask those who worked with you in the past to send a deal your way. You offer an incentive in the form of a finder’s fee, a commission, or cash back offers, and you never screw someone over by withholding their share of the deal.
Requests for referral can be added to most marketing campaigns, including direct mail, social media, on your website, or on your business card.
The clothes you wear or the vehicle you drive can serve as a mobile banner for your real estate investing business. If you wear something like ‘looking for an investor?,’ or ‘I buy houses cash,’ sooner or later, someone will ask you what that sign means.
And no, you don’t have to walk around wearing these types of shirts all the time. Some investors are strategic about apparel marketing, i.e. they wear the shirt when they know they’ll meet a potential investor, like at a dentist appointment or a meeting with a lawyer, because they know that this person has expressed an interest in investing. Of course, you can’t really know when you’ll come across a seller or an investor, this is just an example.
Word of mouth can get you motivated seller leads. You can’t bank on them though, because they depend on the actions of others. You can put in all the hard work, but you never know whether that will result in a referral or whether the next chance meeting will bring you a deal.
Also, you can’t track word of mouth marketing, except maybe the referrals where you know the exact finder’s fees you paid for a deal. How do you rate your performance in networking? It’s not even close to what digital marketing offers in terms of ROI analysis.
You shouldn’t base the success of your business on a single source of leads. That’s why we advocate a multichannel marketing strategy, or having more than one lead stream – this is the best way to mitigate the risk of having no leads in the pipeline.
We covered all these different marketing channels and you can see that each channel has downsides. PPC is great for reaching motivated house sellers, but the leads dry up when you stop the campaign. SEO is slow to pick up and you’ll struggle to get real estate investing backlinks. Social media is popular, but it can’t provide hot leads consistently.
It takes time to see results from direct mail, so which deals are you going to close while you’re waiting for property owners to respond to your letters? Listings, email campaigns, door knocking, networking – they are all time consuming, and no one can guarantee results. You get the point.
What it comes down to is that none of the marketing channels operate in isolation. You can’t have a campaign on only one of these channels and expect a consistent flow of high-quality leads. When you run Google Ads (PPC) in your real estate market, you better optimize your website and rank in organic search results to boost your credibility. You have to have a good website because that’s where most conversions happen. You have to be on social media platforms (at least one) because that’s where motivated sellers spend their time.
Real estate markets have cyclical dynamics with summer generally being the most active period. It’s recommended to use more than one marketing channel to get through the months when you are in the valley.
As you implement a multichannel marketing strategy to get motivated seller leads, you’ll need to excel at conversion tracking if you want to calculate ROI. It’s not as complicated as it sounds – you need a CRM (client relationship management) system that allows you to track the journey of each lead through your funnel. We are talking about a system that notes:
Online marketing allows real estate investors to split test different lead forms (designs, copies, placement) to improve the performance of the campaign in real time.
And, of course, you need to set up robust lead nurture processes in your CRM system to maximize return on ad spend. Once a lead enters your CRM, it’s a shame to leave a deal on the table just because you don’t have a closing strategy or an effective follow-up process.
Marketing is the most important lead generation stream for real estate investors. It all boils down to return on investment in marketing. If you employ a multichannel marketing strategy, you’ll increase the chances of securing a consistent flow of new leads.
There are many channels to choose from. We did our best to provide a breakdown, including benefits and drawbacks, of the typical marketing channels real estate investors utilize. Hopefully, this will help you to select the channels that work best for you.
To improve the performance of ad campaigns, you must do split testing and track performance data. These are all processes that increase the ROI you’ve made in marketing to reach motivated house sellers, so that the effort to improve and optimize them is well worth it.
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