Since real estate marketing and lead generation are competitive, you must often stand out.
With the latter real estate influencer marketing can help, a tactic that combines native advertising and referral marketing to promote your real estate services via trusted sources.
So you may wonder whether influencer marketing really works for real estate.
Influencer marketing can work for real estate, provided you know your target audience and can find an influencer aligning with it as well as possible. Hence, you reach the ideal message-market fit.
If you want to learn how I came to this conclusion, keep reading. In today’s article, I will cover…
- What influencer marketing is
- How influencer marketing performs, including general statistics and KPIs
- The pros and cons of real estate influencer marketing
- How you can increase your success rate with real estate influencer marketing (7 tips)
- Success and failure stories
- Finding influencers for real estate
What Is Influencer Marketing
If native ads and referral marketing had a child, it would be influencer marketing.
On the one hand, you have native advertising, which typically blends into a particular marketing channel or media format so it feels natural and integrates well into the content.
On the other hand, you have referral marketing relying on word-of-mouth recommendations from trusted sources, including the promoter or influencer being convinced about the product’s or service’s value.
So here you have the partnership element essential in (real estate) referral marketing.
The individuals (influencers) you want to partner with should have a minimum amount of following on social media, the usual marketing and communication channels used.
So when using the term “influencer,” you usually refer to “social media influencer.”
The whole principle is actually nothing new.
Breaking it down it’s just getting someone with a following. This individual needs to mention a product or service in their communication channels in passing, and voila, you have influencer marketing.
Before social media, this could be a “famous” person interviewed somewhere (TV, radio, print media, etc.). In passing, they mention product/ service X.
Today’s influencer marketing can come in many shapes and forms: product reviews, sponsored social media posts, or collaborations.
I will discuss the pros and cons below. Still, one advantage of this advertising tactic is targeting a specific niche audience with particular interests.
It is also perceived as more authentic and less obvious “in your face” advertising.
These advantages don’t mean that success is guaranteed, as you will later see when I analyze the performance of this marketing channel.
How Does Influencer Marketing Perform (General Statistics & KPIs)?
Before applying influencer marketing to real estate, let’s look at statistics and key performance indicators.
Social media followers took in 87% of the cases a specific action after seeing posts with product information.
By no means were these sales (some yes). These were actions such as visiting a brand’s retail store, following a brand or making a purchase (source).
Because of better audience targeting (my article) micro-influencers are often preferred in influencer marketing campaigns. It’s because their audience is more likely to take action (source).
A micro-influencer usually has between 10,000 and 50,000 followers.
When you later maybe select an influencer, you want to keep in mind that consumers prefer following influencers who look and act like normal people, so you may want to avoid celebrities (source).
Regarding best practices, you may want to consider using the same influencers across different campaigns.
At least 56% of brands use this approach to build long-term relationships with their respective influencers (source).
As I discussed in my article about real estate marketing challenges, when I mentioned that many don’t measure their ROI regarding their marketing campaigns, the same phenomenon exists in the field of influencer marketing.
Almost a third (30%) of companies don’t measure their influencer marketing ROI (source).
This is a side note so you can avoid falling prey and start doing influencer marketing for real estate just because many are doing it. Still, no one knows how well they actually do.
Not measuring the ROI may not be because the marketers don’t want to. 28.1% of brands find measuring the ROI of their influencer marketing campaigns challenging.
And the second biggest challenge is finding the proper influencer for their campaigns (in 27.4% of the cases) (source).
However, when marketers correctly measured their ROI from their influencer marketing campaigns, a majority (89%) stated that they believed their ROI from influencer marketing was better than other marketing channels (source).
In addition, according to this statistic, businesses make $5.20 for every $1 spent on influencer marketing on average (source).
Influencer marketing also seems to positively affect lead quality since 51% of marketers state it helps them acquire better customers (source).
Chances are this is true since, when you use micro-influencers, you can narrow your audience targeting better.
By the way, I already analyzed the positive effect of the right targeting on lead quality (my article).
According to this source, you can get a significantly better ROI (11x better) with influencer marketing than with banner ads (source).
Crunching Some Additional Marketing Numbers (A Case Study)
The above statistics make a promising first impression.
But let’s crunch some additional marketing numbers so we can compare using influencer marketing in real estate with just running your own social ad campaigns.
As a case study, let’s use the most popular marketing channel for influencer marketing, according to the statistics, which is Instagram.
I aim to estimate the cost per lead for influencer marketing on this channel and then compare it to the cost per lead you pay when running your own PPC campaigns.
In both cases, I will assume the worst case regarding marketing performance.
1) Crunching Marketing Numbers With a Micro-Influencer On Instagram
Let’s start with the costs of influencers, micro-influencers specifically since campaigns likely perform better with them.
According to this source, you pay between $100 and $500 for a sponsored post from a micro-influencer (source).
We also assume the lowest number of followers for an influencer like that: 10,000.
You will be disappointed if you think all of these 10,000 would see your sponsored post when published.
According to this source, it’s only 10%. And this is a statistic from 2018. So this percentage is likely lower since organic reach on social media platforms decreases over time. But let’s stay positive and go with the 10%.
It means that 1,000 followers would see your sponsored post you pay $500 for.
From the statistics above, we also know that 87% of followers take a specific action after seeing posts with product information.
In 87% of cases, this can be a specific action after seeing posts with product information.
So this action can be visiting your real estate website, following your Instagram account (if you have one), or making a purchase (in the case of real estate, let’s say this would be a lead conversion (appointment or email subscription).
So it gets further diluted, and we need to assume that from this 87%, only a portion will translate into a lead conversion.
Since in the statistics three action types are mentioned, let’s go with a third part of the 87% will be lead conversion.
So from the 1000 followers seeing your sponsored post for $500, 29% likely convert into leads. That’s 290 leads and a cost per lead of $1.72 ($500 divided by 290).
Despite all the dilution (not all followers see the post, and only a percentage of the percentage is taking a lead conversion action), that’s not bad at all.
However, remember this is all provided that organic reach since 2018 has stayed the same, and you selected the right micro-influencer targeting the ideal audience for your real estate business.
The moment you go with larger influencers, the whole equation changes.
Also, I didn’t factor in the time cost to find the proper influencer and build a relationship.
If you use tools, as you can find at the end of this article, you would also need to factor in the monthly costs of using such tools.
So the actual cost per lead factoring all this in is higher.
2) Crunching Marketing Numbers With Instagram Ads
According to this source, you pay between $0.20 and $2.00, and according to this source, $0.50 to $0.95 per click for Instagram ads.
Let’s use the average CPC from both sources: $0.91.
According to this source, the average Instagram ads lead conversion rate for real estate is 3.4% (source).
This means you need 29 clicks to convert one lead. And 29 clicks at $0.91 per click cost $26.39, and the cost per lead would be $26.39.
Even if you manage to half these costs because you have great skills regarding ad copy, the right targeting, etc., or the lead cost data from this source is correct, chances are you don’t beat the cost per lead for influencer marketing of $1.72.
These results would also confirm the statistics from above, where marketers state their ROI is significantly better than in other marketing channels.
The Pros and Cons of Real Estate Influencer Marketing
|You can reach a targeted audience||You may have limited control over the influencer’s messaging and content.|
|Can help to increase brand awareness and recognition||If you go with large influencers the costs and costs per lead may skyrocket.|
|Working with influencers can increase your brand's credibility in the eyes of potential customers||In contrast to a PPC ad campaign on social media, you can't scale it if it brings results since the influencer has only so many followers.|
|Likely more cost-effective than other marketing channels (provided you work with the right one) due to lower costs per lead.||Difficulty to measure the ROI of your real estate influencer marketing campaign.|
|Influencer marketing often feels more authentic and less like a sales pitch.||Building relationships with influencers and developing a campaign strategy can be time-consuming (should be factored into the cost per lead).|
|Likely better quality-leads (again provided you work with an influencer with the proper target audience)||If an influencer associated with a real estate professional receives negative publicity, it can reflect poorly on the real estate professional as well.|
|A potential long-term effect since influencers can continue to promote your brand even after the campaign has ended.||It’s possible for influencers to post content that doesn’t align with a real estate professional’s brand values or messaging.|
How to Increase Your Success Rate With Real Estate Influencer Marketing (6 Tips)
Use preferably micro-influencers for your campaign to better target a more narrow audience and have lower costs.
2) The Right Influencer:
Choose the right influencer so their audience aligns as best as possible with yours (this is provided you know your target audience (my article)).
3) Your Goals:
Before you start running the campaign, get clear on your goals and objectives for the campaign (e.g., lead generation or brand awareness)
4) Performance Tracking:
Track and analyze performance (e.g., dedicated landing pages or phone numbers), making measuring your ROI easier.
5) Long-Term Relationships:
Aim to create a long-term relationship with the influencer so you may work together frequently, provided the campaign brings the desired results.
6) A Multi-Channel Approach:
Try a multi-channel influencer approach, relying on social media and channels such as blogs, podcasts, etc.
7) Influencer Event Marketing:
Try influencer event marketing. It is organizing events to invite various influencers to share this event with their followers.
This is something where you could kill two birds with one shot. You get exposure to generate leads but may also find the ideal influencer for future campaigns.
However, the main challenge will be organizing the performance tracking if various influencers share your product or service information on their channels (you will need several dedicated landing pages, phone numbers, email addresses, etc. simultaneously).
Success & Failure Stories of Real Estate Influencer Marketing
While researching, I didn’t find large lists of success and failure stories of real estate influencer marketing.
The most predominant ones I found were one success and one failure story.
This success story published on Entrepreneur.com involved the founder and CEO of Super Luxury Group Alvaro Nuñez Alfaro selling high-end properties.
He successfully built a team of 100 global influencers by organizing an influencer marketing event inviting them to stay at his luxury properties in exchange for content/promotion.
The second story I found was a failure story, at least a first-time failure story of influencer event marketing, published on the NAR website.
It is also an excellent resource for learning what can go wrong when doing them.
Finding Influencers for Real Estate: (An Overview)
Before you start finding influencers for real estate, I want to remind you that it’s crucial to be clear about your target audience or your ideal real estate client (my article).
You want to use the tools I collected below based on what you defined for yourself.
Most of these tools will inform you about the influencers’ type of audience and the number of followers.
Suppose you are a real estate agent or real estate professional. In that case, you also want to ensure the influencer’s audience doesn’t include other real estate professionals.
It’s because you may find “real estate influencers.” Still, these are usually individuals not targeting potential home sellers or owners but other real estate professionals.
Based on these metrics and how well they align with your target audience, you can make an educated guess about which influencer you want to approach for your campaign.
- Tribe Dynamics
- Tubular Labs
Does Influencer Marketing Work for Real Estate?
Influencer marketing can work for real estate, provided you know your target audience and find an influencer aligning as well as possible. Hence, you reach the ideal message-market fit.
Let’s say you don’t consider the time-consuming part of finding the proper influencer and building a long-term relationship, and the above ideal conditions are met.
In that case, it can often be more cost-effective, resulting in lower costs per lead and better quality leads than other marketing channels.
However, you want to consider the cons I discussed above. As always, you don’t want to bet your whole farm on just one real estate marketing channel.
This article has been reviewed by our editorial team. It has been approved for publication in accordance with our editorial policy.