Writing a real estate marketing plan can be one of the most important things you do for your real estate business if you don’t want to fly blindly.
It can give you direction and help you reach your revenue and profit goals.
But how do you write one?
A real estate marketing plan describes your advertising strategy to reach your business goals, generate leads, and reach your target market and potential customers.
You need to determine your business goals, value proposition, and unique selling proposition, which, in turn, inform the marketing channels you will use.
Using a practical example, I will discuss how this is done in this article and further clarify what a real estate marketing plan is.
What is a Real Estate Marketing Plan?
The term ‘marketing plan is a synonym for ‘marketing strategy.
This is because it is based on the marketing strategies you plan to apply.
So, a real estate marketing plan is a document that describes what kind of advertising strategy you, as a real estate professional or real estate business, will use to reach your business goals, generate leads, and reach your target market with your respective customers.
It also outlines which campaigns will be carried out over a certain period. But that’s not all.
It defines how those campaigns will be measured to determine if your real estate marketing activities are successful and what your USP (unique selling proposition) and value proposition are.
Then, it also determines which marketing activities you will carry out weekly, monthly, quarterly, and/or annually.
Essential questions to ask for your real estate marketing plan are:
- What are your business goals?
- What results did you get from your market research, and who are your target customers and ideal clients?
- What is your value proposition?
- What is your unique selling proposition (USP)?
- How will you reach your target audience and potential customers depending on geographics and demographics (regarding real estate demographics, this article could be interesting to read too)?
- Which marketing channels are you going to use to reach your potential customers?
- With which metrics will you measure your advertising results?
Why Would You Want a Real Estate Marketing Plan in the First Place?
After having defined what a real estate marketing plan is, many reasons for creating one may already be obvious.
The question of why you might want to create one is best answered by describing what happens when you don’t have one.
Without a real estate marketing plan, you will be flying blind or shooting a target with closed eyes and hoping that you will generate buyer or seller leads for some miraculous reason.
You won’t know your target market and, thus, not know who your target customers are.
This will lead to you not knowing your value proposition and unique selling proposition.
By the way, the value proposition outlines what benefits you can deliver to your customers as a real estate business.
The unique selling proposition (USP) is how you do this differently than your competitors.
So you see, both are based on knowing your target market with your target customers.
This is defined and outlined in your real estate marketing plan; without it, it’s more like gambling.
Your odds of success with your marketing campaigns will be reduced significantly.
How to Write a Real Estate Marketing Plan
Now that you know what a real estate marketing plan is and why it’s better to have one, you can write one.
Let’s use some numbers with an example real estate business to make it more concrete.
What Are Your Real Estate Business Goals?
Suppose you want to generate a profit of $150,000 per year for your real estate business. To get this profit, we also need to consider the taxes you must pay.
Assuming the corporate tax rate of 21% in the U.S., you need to generate revenue of $189,873 ($150,000 divided by 0.79).
So, your revenue goal per year is $189, 873 which means $15,822 per month and roughly $4,000 per week.
If you are a realtor, we can assume a commission of 3% per sale on a median home price of $320,000, which is $9,600, meaning that you would need to sell 1.6 homes ($15,822 divided by $9,600) per month.
To not overcomplicate this, I rounded the number to 2 homes per month.
Next, you would need to determine how many leads you will need to generate to sell two homes per month.
As stated by the National Association of Realtors, a buyer visits, on average, ten houses before making a decision.
We can convert that into a showing-to-sales ratio of 10%.
If this is correct, you would need ten buyer leads that tour the home you are trying to sell before you have a sale.
In my opinion, this number also strongly depends on the type of market that there is.
It might get closer to 10% in a buyers’ market, while in a sellers’ market, it is closer to 33%.
Let’s make an average and settle with a 21.5% showing-to-sales ratio to not complicate our lives.
If you want to stay conservative, you can apply the 10% from above later.
So, to sell two homes per month, you would need nine qualified buyer leads per month who want to do a property tour with you.
But that’s still not the final number we need to help with real estate marketing campaign activities.
We also need to know how many leads generated by your marketing campaigns are necessary to get these nine qualified buyer leads.
Your Target Customers, Value Proposition, and Selling Proposition
This is when we have to answer the question of who your target market and customer is for your real estate marketing plan.
What we will do next in our calculation depends on the answer to this question.
Suppose you decided to specialize in first-time home buyers by researching your local area and on the Internet.
And now, your value proposition to this customer segment is to offer only homes slightly below the average market price with a lot of hand-holding and facilitating mortgages.
Your unique selling proposition is that you have contacts and a special system giving you a much higher success rate with loan approvals of almost 95% for first-time home buyers.
Now that we have established your target market, target customers, value proposition, and unique selling proposition, we can move on to the next step in our marketing calculation.
I already discussed how to market to first-time home buyers in this article.
How You Will Reach Your Target Customers
One of the quickest ways to reach them is by using Facebook Ads with ad placements on mobile devices, where you include interests regarding weddings.
Using first-time home buyers in the targeting section is also a good idea.
Back To the Numbers
For Facebook Ads, we know that this marketing channel has a conversion rate of 10.68%. (source)
But that doesn’t mean that 100% of this 10.68% will want to schedule a showing appointment with you, which would be too optimistic.
The better your sales skills and follow-up systems (you can read about following up in this article, the higher the next number (lead to appointment conversion rate) will be.
We assume that 10% (you can substitute this percentage with your numbers according to your experience) of the generated leads can be converted into appointments.
For obvious reasons, I couldn’t find reliable statistics because, understandably, not many real estate businesses like to share their internal sales performance data.
And the last number we need is the typical cost per click for Facebook ads for the real estate industry in the U.S., which is $1.81.
This number is also highly dependent on the click-through rate you achieve. The latter, in turn, depends on the effectiveness of your Facebook campaign and your ad creatives, as outlined in my last article.
Let’s summarize the numbers for our real estate marketing plan calculation to reach the goal of 9 qualified buyer leads per month to get to your revenue goal:
- Showing to-sales ratio: 33%
- Facebook Ads Conversion Rate: 10.68%
- Lead to appointment conversion rate (assumed): 10%
- Facebook Ads cost per click for the real estate industry: $1.81
To get nine qualified buyer leads that make an appointment with you, you will need to generate 90 leads per month (9 divided by 10% lead to appointment conversion rate) via the Facebook advertising campaign.
To convert these 90 monthly leads on Facebook, you need 536 clicks from your ads (90 divided by 10.68% Facebook Ads conversion rate).
Since one click costs $1.81, you would need a monthly marketing budget of $969.
This also means your costs per closed deal would be $485 ($969 divided by your goal of 2 home sales per month).
Which Metrics Would You Need to Measure for Your Advertising Results?
In the case of the above example, you would need to keep track of the leads you generate per week, which is roughly 23 (90 divided by 4 equals 22.5).
Another one would be the showing appointments you can convert from these leads.
These numbers will help you see if you have an advertising or sales performance problem.
You could include all the above elements of a real estate marketing plan in a document for your internal use and the numbers in an Excel sheet.
And the same principle applied could also be used for other marketing channels.
In the example in this article, I chose Facebook since this would be one of the marketing channels most suitable for reaching first-time home buyers.
This article has been reviewed by our editorial team. It has been approved for publication in accordance with our editorial policy.