15 Sep 2017

How Much Do You Really Need To Spend On Property Marketing?

In this day of sophisticated digital marketing, we are constantly being inundated with messages, images and sounds across so many platforms; television, whilst browsing the internet and of course on social media sites such as Facebook. 

When it comes to property marketing, the analytics from the back end of the property portals e.g. realestate.com.au show that a property has mere seconds to grab a potential buyer's attention and get them to take action in the form of clicking through to the property for more information, photos etc. Without attracting a click, it's unlikely that the property will earn an enquiry, inspection or an offer to purchase. 

However marketing is very expensive, at least it can be. So, how much marketing is enough? How much is not enough? And, is it being properly targeted? What are the 'Marketing Must Haves' and which ones are nice to have but either not essential for attracting your buyer, or not about the property at all?

 

5 Marketing Must Haves:

1. Good quality professional photography - this used to be quite expensive but you can now have a package of 10-15 photos, some elevated drone shots and a short video for around $600 and for the number of clicks and enquiries they attract - it is worth every cent. Video has become a great attraction tool and property listings with videos certainly receive more enquiries.

2. Floor plans - some photographers use very wide angle lenses which make houses look much larger than they really are. A floor plan with the layout and dimensions is one item which buyers click into to make sure the property will work for them and they have a true picture of the size of the property. Floor plans can start from $35.

3. A sign - this depends on the type of property. A photo sign is good if there is a pool or some stunning feature you can highlight. But even a solid professional agent signboard is great, its surprising how many people aren't actively looking for a property but they drive past something in an area they like and it prompts them to pick up the phone. The professional signboards look much nicer, are not expensive and don't get displaced or crooked in bad weather. Huge signboards are not essential, it's just our opinion but if the sign is more about the agent getting their face seen than it is about the property, let them pay for it. That opinion will probably get me some negative comments from agents but its true! A professional signboard can cost as little at $60.

4. A Quality Property Fact Sheet or Brochure - A professionally printed A4 brochure with all the attributes of the property on the front and the Floor Plan on the Back is great. If a buyer is looking at multiple properties and they have a nice heavy card brochure from your property, they are more likely to remember it and retain the brochure rather than having it end up straight in the bin. A brochure and open home invitation pack costs from $55.

5. Online marketing on the real estate portals - Figures vary but it is estimated that 85-90% of buyer enquiries come directly from the real estate portals.  There are a large number of them but here on the Sunshine Coast realestate.com.au is by far the best performer. Domain can be too, but mainly in the areas where southern buyers are shopping for high end properties.  We've not found it particularly effective in our experience. This is one of the big ticket items, and the bigger the advert, the bigger the price tag. But how big does the ad need to be, to be effective and do you really need to spend top dollar? We will come back to this one. Prices range from free to $4000.

It used to be suggested a seller invest 1% of the property value in marketing but it's really not necessary. Plan for around $1500-2000 and you will have a very presentable marketing campaign.

The Negotiables:

Newspaper and Print Advertising - This is far less impactful than it used to be and effectively priced itself out of its own market. Incidentally, it's the same companies which own the real estate portals so they aren't exactly missing out on your marketing dollar. There is an argument for using print for the very high-end properties, but again it's just our opinion.  Much of the print marketing is more about the agent or agency profile than it is about finding a buyer. We've been tracking the source of buyer enquiry for years and this one just doesn't deliver a good ROI or return on investment. Prices in the local newspapers start at around $575 for 1/4 page per week and magazine style productions can vary.

Property Styling - This can be a really good move for some properties which are vacant or just need a little finessing on the presentation front. It's not cheap; a starter package for 6 weeks is generally around $4000 but it can well and truly be recouped in a better sale price. Not essential but worth considering for some properties in some markets. A cheaper alternative can be virtual furniture, but if done poorly it can look worse than a vacant property.

Display Presence in the Agent's Window - Where we once would meet sellers on a real estate window enquiring on a particular property, nowadays, that's almost redundant and this method has ultimately been replaced by  realestate.com.au. So much so that many successful agencies don't have a physical street presence at all, some of the larger capital city and international agencies aren't even on street level while others operate from fully virtual offices.

So those are the main marketing types for consideration - or if you like - what to invest your marketing dollar into for a good result. Now onto how much to spend.

I'm not going to win any friends among agents here but - Let's Talk About Supersize Advertising Campaigns

In a previous blog, I wrote about the way buyers filter properties on the real estate portals e.g. price range, property type, land size, number of bedrooms, land size etc. Here is the article. Our example buyer filtered down from close to 6000 listings to a possible 8, the biggest ad didn’t actually impact the buyer in developing their shortlist whatsoever! 

There is no disputing that the full page ad in the paper is hard to miss, as is the Premiere (largest) advert on realestate.com.au or domain.com.au. If you look at all the listings in a particular suburb without applying filters which most buyers will apply, you will see the large premiere adverts at the top of the page. In reality buyers filter properties by location, price, size and attributes such as the number of bedrooms, bathrooms etc and end up with a short list, irrespective of the size of the advertising format. Whether in print or online, it makes for very impressive profile advertising for the agent or the agency, something to think about right? You’ll notice the same offices always using this method for every listing large or small, hard to sell or easy. Why?

There are 2 things at play here, and it's not all self-serving. Firstly, the real estate portals are selling something too – advertising space. Who are they selling to? Real estate agents right; and bigger advertisements mean more revenue for the portals. The largest format advertising is cheaper when purchased by the agency in a package on an annual contract. Whilst this does mean a saving on the cost of the larger format advertising, it generally means that all properties have to have the same size and cost of ad irrespective of whether they are worth $2M or $200,000, a cost which is almost always passed on to the seller.

Secondly, how do they justify the biggest advertising spaces to the agents? Well, they do add a few bells and whistles to the functionality of the advert. But as you saw in the filtering example, that has little impact on the buyer finding the property; people in research mode may look at the entire list of properties from first to last, whereas the buyer who is ready to act filters down to a shorter list.  But check out the reasoning the portals give to agents for the bigger ad, highlighted in orange. 

 

 

 

You read that correctly. The bigger advert is about the agent’s profile and perception of being a market leader in the area. Why is that important to the agent? Because that often forms part of attracting their next listing, not the one that has just been advertised. They are there to impress the next client, but at the expense of the current one. It is absolutely no different in print advertising, which is becoming less and less utilised; for good reason.

I'm not for a minute disputing that bigger adverts get more attention and they have their place in some markets e.g. where there are more sellers than buyers, which is not currently the case. But a lot of the time they are simply not necessary, so who is getting the benefit?

The smallest free adverts are probably not enough as they do tend to disappear down the bottom of the page but the next level up or feature property is big enough to get the job done and costs $400-500 rather than up to $4000 in some areas for a Premiere listing. I haven't had a buyer come from print advertising in years so I'm out on that one as being a waste of your money.

So, why spend the extra money? You really don’t need to. Now, not all agents are just trying to get you to pay for their personal profiling. They are genuinely trying to get the cost down for their clients by signing up for a package where every property is promoted to the largest ad size at a discounted price, but they are being sold an idea and just haven’t really dug into where your buyer comes from.

But lets be perfectly transparent here. From our experience having worked previously in the large national franchise groups, agents are under an enormous amount of pressure from the franchise group and their principals to sell not only the larger online advertising but also print advertising to boost the office and agents profile in order to attract their next listing. The thing that irked us the most, and prompted us to open an independent office, was that the profile advertising to attract their next seller was being done at the expense of the current seller. And that just plain doesn't sit right!  We feel the same about huge property boards plastered with the agents head shot. What's being advertised and who should pay for it?

Do you really need a full page advertisement for your specific property, with your current market demand? I liken it to Goldilocks working out which of the 3 bears' porridge she preferred, not too little, not too much, not too hot, not too cold - just right. It's all about how many $$ are left in your pocket at the completion of the sale.

 

If you've been thinking about buying or selling your home, feel free to contact us for more information at fgregory@sunshinestateagents.com.au or call us on 0431 366 364.


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