By Robert Sharoff, REALTOR® Magazine
Due to the consolidation of the industry and increased competition, “real estate has evolved from a sales business to a marketing business,” says Dan Gooder Richard in his book Real Estate Rainmaker (John Wiley & Sons, Inc.; New York; 2000). “Marketing’s job, he adds, is “to make the phone ring, to generate the lead, to get prospects through the door and compel them to ask for an appointment,” he says.
The way to do this, he believes, is with a targeted marketing campaign, the foundation of which is what he calls a trophy database. “Armed with a computer database program or contact management software, today’s rainmaker can easily maintain a huge collection of past customers and active prospects.”
How huge? “No longer will 50 or 100 or 200 or 400 contacts support a practice. In today’s market, rainmakers need a prospect ratio of about 25 to 1. If you want 50 deals, you need about 1,250 [names] in your database.”
A good way to amass such a database is with an extensive cross-media direct response advertising campaign. Direct response ads are those that require interested customers to contact you to receive more information or some type of premium or prize. For example, if you’re trying to sell vacation homes, ask customers to write in for a free report on how to buy second homes.
“Everything a rainmaker sends out or advertises must contain a response offer,” says Gooder. And, when possible, make it a limited offer. “If you don’t have a cutoff, prospects can put it off. A deadline creates urgency.”
The next step, says Gooder, is follow-up. “Follow-up is where rainmakers make their money,” he says.
Gooder believes in hanging in there until a prospect “buys or dies” and provides a number of sample letters and telephone scripts to make the job easier. “Flood prospects with an abundance of information,” he says. “Once your mailing system becomes automatic, it can run virtually hands-free. Even when you get busy, the mail still goes out to everyone in your pipeline.”
There’s also a useful chapter on how advertising can be used to raise a company’s or a salesperson’s profile in the market. Among his suggestions: create a catchy slogan and find a prop or symbol that will stick in the public’s mind and distinguish you from the competition.
Finally, there’s an excellent chapter on marketing budgets. Gooder recommends spending a minimum of 10 percent of your gross income on marketing and up to 20 percent if you are looking for strong growth. “What these figures do is sharpen your focus,” he says. But remember: “Marketing results and budgets are always a moving target. Don’t expect to be perfect.