Successful
marketing produces leads at a cost that is acceptable and is within
established advertising cost ratios. Within the real estate industry
the commonly accepted advertising cost ratio is 10% to 15%. For the
individual Realtor this is a percentage of the commissions earned.
As a Realtor develops an annual sales goal the plan should include a
budget for advertising. Once a Realtor has a successful marketing
program in place the budget can often be reduced to below 10%
To develop a
successful marketing program it is necessary to invest funds to
"fill the pipeline". Once a marketing program is productive it will
pay for itself. In real estate, with the lead time from first
contact to
closing, it can take three to six months to reach a point where the
commission income is paying the marketing costs.
Unlike the
typical Internet marketing programs, that may take six months to
produce significant results, our marketing campaigns produce
immediate activity. It is not unusual for our Realtor clients to close three
to five million dollars in sales the first year.
What's the Cost?
The cost
should be based upon the sales goal (and the related commission
total) you establish. Using a $100,000 figure you would have to
budget $10,000 to $15,000 for the first year. In this first year you
will be paying an initial set up fee so the cost can run a little
higher.
If you are
just starting out without an existing website you need to plan on
developing a primary website and then also plan for developing site
visitor traffic. You can create a minimal primary website to start
out and this can be accomplished for $300 to $500. This site can use
your name as the domain name as in www.johndoe.com. Then you also
need to create a lead generator site which should have a domain name
like www.yourtownmls.com or www.yourtownhomesearch.com. A lead
generator website with an IDX program will cost $1,500. to $2,500.
With these sites created you then need to budget for visitor traffic
generation. The pay per click search engines will produce
visitor traffic on day one resulting in immediate lead production so plan on
spending $300 to $800 monthly for traffic. The more you budget for
the pay per click traffic, the more leads you will generate. There
will also be a monthly fee for hosting and maintenance which would
run between $50 and $150.
At a minimum
one can start out with just the lead generator site so the set up
cost would be around $2,000. Then the monthly budget might run $500
with the monthly hosting and maintenance. So, the first three
months would cost $3,500. At that point you should have several
sales in escrow and see the light at the end of the tunnel.
Based upon
these figures you can see that you must be prepared to invest $3,500
to $5,000 at a minimum and you could spend more for a more
aggressive start up. If you extrapolate the figures you will be
spending $8,000 to $10,000 in the first year. This would position
you to earn the $100,000. If you are a good salesperson and really
work at it you will do better than $100,000. If you spend more for
traffic generation you will have a greater sales potential. Our most
successful clients have achieved over 15 million dollars in sales
during their first
twelve months on the Net. These individuals are extraordinary
salespeople who have worked very hard.
