3 Reasons Why Real Estate Professionals Should Not Cut Their Marketing Budget During COVID-19 — RISMedia |
Since the “Stay-at-Home” regulation came into force due to the coronavirus pandemic, the vast majority of industries worldwide, including real estate, have seen massive budget cuts.
Although the government has declared the real estate profession to be an “essential” business in most states, activity across the country has slowed noticeably, resulting in thousands of real estate companies severely curtailing their marketing and even completely freezing budgets.
But is that really a good idea? Or maybe the current situation offers real estate professionals an incredible opportunity to grow their business despite the odds.
Whether you’re an individual agent, team leader, broker, or investor, in this article I’m going to shed some light on how our clients and partners have crushed it since the real estate outbreak began.
I will also introduce three reasons why you should not lower your marketing budget, but instead increase it.
Reason # 1: Take advantage of heavily discounted engagements
It is no secret that numerous mass media and advertising companies are suffering huge losses as a result of the abrupt budget cuts resulting from the COVID-19 outbreak.
For example, according to the Wall Street Journal, in March alone the cost of running an ad on Facebook in front of 1,000 users fell by 15 to 20 percent compared to February. A similar drop in costs per 1,000 impressions, in particular a 22 percent drop, was registered for Instagram.
The world’s largest video search engine, YouTube, saw its advertising costs fall by 15 to 20 percent over the same period. There are many other major digital media and advertising platforms that are having a similar impact on their advertising revenues.
In the last 30 days we have received numerous discounted parking spaces from various media and advertising space sales agencies. Some of the offers were very attractive indeed.
For example, we received a pitch from a well-known regional homeowners magazine that reaches around 1.5 million readers through its physical and digital version of the journal.
The release offered us a heavily discounted package that we used to pay twice more for. For us and our strategic real estate investment partner, a national iBuyer, HouseCashin, from whom we have been buying advertising space for some time, this was a breeze.
The ROI was particularly high in connection with this unfortunate situation due to the favorable conditions for large home buyers like HouseCashin.com.
That being said, it doesn’t matter what type of real estate company you run. What is important is that you can currently achieve enormous engagement in front of your target group at greatly reduced prices than ever before.
The economy will soon recover and you will no longer have this amazing opportunity as it is now. Take advantage of it while everyone else is cutting their marketing costs.
Reason # 2: gain market share when everyone else is stopped
As more and more real estate professionals are leaving the marketing and advertising field, many lucrative opportunities open up that would otherwise not have been available. One of the many ways is to gain larger market share as the majority of your competitors join forces.
To demonstrate this strategy, I’d like to use one of our latest examples. I apologize in advance to those who are strongly opposed to using Zillow’s Premier Agent advertising platform, but this section is about using the platform to your own advantage.
For those of you who know how the Premier Agent program works, you know very well the scarcity that surrounds certain zip codes.
In other words, there are some very desirable zip codes in every city in the United States that are completely sold out to a handful of local real estate agents and teams. Before the coronavirus pandemic, these zip codes didn’t open often due to the very high demand.
At this point, however, when real estate professionals cut their marketing budgets, you can see that the most desirable zip codes are starting to win. In response to this increasingly worrisome situation, Rich Barton, the founder and CEO of the Zillow Group, announced that Zillow will assume 50 percent of advertising costs from March 23rd.
We advised our strategic real estate partner Kristina Morales, a licensed REALTOR®, not only not to leave the postcodes currently occupied, but also to secure the new ones.
Kristina reported: “When COVID-19 first happened and the fear arose that the real estate market might decline, I immediately thought of reducing my marketing budget with the Zillow program. After speaking to my Real Estate Bees digital marketing strategist, I realized that reducing my marketing budget wasn’t the answer. The answer was to grow and expand into markets that weren’t available to me before. What’s even better than entering new zip codes is that the quality of the leads has improved significantly. Think about it, only serious buyers are looking because it is not worth the risk for others. My activity has skyrocketed over the past four weeks and my pipeline is still full. I attribute this directly to my commitment to maintain and / or increase my marketing budget. “
If Kristina had reduced her marketing budget, she would never be able to fill her pipeline within 30 days by the end of the year. Also, once the pandemic is over, she has secured her new, highly lucrative zip codes that she probably wouldn’t get in the regular hours.
Reason # 3: Leverage downtime to build your pipeline
It’s been almost a month since the U.S. government hired non-essential businesses to close their doors to customers. Guess what? There are many people; People who have either already been or would be in the real estate services market.
But because of the outbreak, all of these people, as well as those who weren’t officially declared non-essential businesses, are now stuck at home around the clock. And what exactly are they all doing at home?
You guessed it right, these people spend a lot of time in front of the television and their computer. As I mentioned earlier, these people were either already in the market or about to be launched. According to the data we continue to receive from our nationwide network of strategic real estate partners, 70 to 80 percent of those who were already in the market have not withdrawn.
In a recent interview by the Washington Post, Lawrence Yun, Chief Economist of the National Association of REALTORS® said, “If the virus shutdown takes less than three months, there will be a fast, robust recovery and possibly no change in annual home sales. “
Based on current developments, the government appears to be planning to lift the economic blockade by the end of April. Therefore, if Mr. Lawrence is right, the economy will recover quickly. So this is the perfect time to use various promotional tools to start building your pipeline in front of your target audience.
Despite the current situation, people are still buying and selling houses, but not many real estate professionals seem interested in attracting new customers. Right now there is a great opportunity to fill your pipeline with underserved customers.
Oleg Donets is a serial entrepreneur, technology, and digital marketing strategist with a solid track record. Since 2013, he has successfully supported numerous startups and established companies from a wide variety of industries in establishing, growing and scaling their businesses by using his innovative technology solutions and advanced marketing strategies. Oleg is the founder of Real Estate Bees, a cutting-edge technology and marketing platform for the real estate industry. Oleg is also a proud business mentor at SCORE, the largest nonprofit in the country and resource partner to the US Small Business Administration. You can find Oleg on LinkedIn.