No leads, no business, right? True as that might be, it’s hard to put numbers to the value in seeking leads. How much of your time should you dedicate to prospecting marketing each week? And how much of your overall real estate budget? This is our quick guide to making those decisions.
How to think about prospecting as a piece of your advertising budget.
First, a reminder if you’re asking yourself, “What is prospecting?” Prospecting is a tactic that real estate agents use to identify and reach out to individual people who they think are primed to buy or sell a home. Check out our comprehensive guide to prospecting to get all you need to know.
Unlike inbound marketing where real estate agents put content out and wait for prospects to make outreach, prospecting involves agents going out and making first contact in a very hyper-targeted way.
The amount of time and money you need to invest in prospecting marketing depends on your market and your target demographic.
Do your research before parting with your hard-earned cash. Take a look around: What’s working for the agents you know?
Reflect on the successful sales you’ve had: How did you find those leads? How much did those steps cost – and what would it take on a monthly basis to keep those channels robust?
Some of the old classic prospecting strategies are still the ones agents swear by – and they cost only time.
Making phone calls to client referrals and going door-to-door are still extremely advantageous. But don’t forget to calculate the time you spend making call lists, compiling addresses, and preparing scripts for those conversations.
It’s always a give and take – and your time is valuable. If you have existing clients who need your attention but you’re spending six hours a day prospecting, there will be a real cost to that for your bottom-line.
Flyers and postcards can be expensive, but after the up-front investment in a nice, glossy stack, you can use those to support your conversations for a while. And if those are too much right now, get yourself some professional-looking business cards, and start putting them in as many hands as possible. You never know when a friendly chat in line at the grocery store could turn into a lead opportunity!
A recent study on real estate marketing budgets found that 51% of agents spend $5,000 or less on marketing each year. A good rule of thumb is to dedicate somewhere around 10-15% of your GCI (gross commission income) on all your marketing – including both prospecting and digital marketing.
Here, Hoole outlines what different marketing investments in your real estate budget can get you.
Another consideration in your marketing budget is the time you spend on prospecting.
Whatever prospecting marketing route you take, the biggest time investment will come up front. You’ll need to compile contact info for your network, plan scripts for phone calls and door-knocking, and scope out events where you can meet prospects directly.
After that big push, you’re not finished. Consistent upkeep is key. The real estate life can be feast or famine – and you don’t want your slow periods to come as a result of an unhealthy pipeline of leads. You should be dedicating at least an hour a day to prospecting – and up to half your time during slower months.
Try to set aside specific times of day for prospecting throughout the week. Your leads live their lives on different schedules, but there are a few rules of thumb that work for most agents.
Data from InsideSales shows that reaching out on either end of the standard workday – either about 8 a.m. or 4 or 5 p.m – tends to be fruitful. Avoid prospecting between 1 and 2 p.m – that post-lunchtime lull doesn’t drive results.
The important thing to learn is what works for the people you want to reach. If your main demographic is working millennials, you’re going to want to reach out at a different time than when you’re connecting with retirees.
Experiment with your calling and emailing schedule to see what gets results – and keep notes so you can switch things up according to what works.
Try not to push all your prospecting to one day of the week. When something unexpected comes up, you’ll end up pushing the prospecting aside first. As busy as you may feel right now, guard that prospecting time… or you won’t stay busy long.