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I’ll start of bluntly. Social Networking is a huge time sucker… because it’s about making “friends” (who are not really your friends). In order to forge real relationships with social networking sites you’ll need to devote massive energy to it.
A lot of real estate investors are using Twitter and Facebook. They’ll want to be “friends” with you to try to recruit you into their deals. As an investor yourself you’ll get a lot of other investors “friending” you in hopes of getting your friends for themselves and recruiting them into their own deals.
Now the question is not whether this is fun. It clearly is fun because a lot of real estate investors do it. The also spend all day on their blackberries and Iphones following people on Twitter and Tweeting about what they just ate.
Facebook – it’s new, it’s entertaining… but is it effective, measurable marketing?
In my opinion it’s not. You don’t have to agree with me. You can test it for yourself. I recommend tracking your time investment.
Why Social Networking is a Awkward Marketing Solution for Real-Estate Investors:
The Fake Friends Factor. You’re sharing your lists or “friends” with everybody else basically, and everybody’s got an agenda to sell everybody else their deal.
Sales Noise There is a huge quantity of “sales noise” on social networking media… even Linked-in, which is one of the better ones. In fairness, sales noise is present in all marketing media these days.
Challenges In Establishing Thought Leadership. Even on Linked-in there’s a big laddder of thought leadership to climb to establish yourself as an authority figure. One way to do it on Linked-In is answer questions… but when you see how prolific and entrenched some of your competition is you’ll wonder if it’s worth the trouble to populate Linked-in with 100s or 1000s of posts showing your authority… and remember, they have to be good posts because the competition is very, very sharp and prolific.
Sharp Competition on social networking sites is a big problem for all marketers. You have to be highly committed not only to making “friends” but also to following up with them with personal contact, which can be extremely time consuming. Basically, you’ll be competing with other “real estate investors” who spend their whole day on Facebook and Twitter.
Have You Got The Desire?
The real question is not whether you can enter the ranks of Facebook, Twitter, and Linked-in real estate mavens. The question is whether you have the time and the desire to do so.
Several months back – after a year of testing – marketing guru and direct-response testing freak Johnn Reese blogged that he was closing his Facebook account because it was sucking up his time and it was too hard to determine if Facebook networking was growing his business at all. Social relationships on sites like Facebook are not quantifiable in terms of dollars you can make for the friends you have. That’s the problem. Social networking is not measurable marketing, which is why guys like Dan Kennedy don’t do it. Period.
What Reese and Kennedy and others who “get” direct marketing do is focus on measurable R.O.I. (return on investment). That means developing ads, squeeze pages, email campaigns, sales letters, and hard-to-resist offers that get people to take action. When you spend X amount of dollars putting an offer together and buying advertising to get traffic to it, then you can look at what you spent (in dollars – and you can track you time too and factor in your own hours for work you did if you like) and look at the revenue you generated.
That’s direct response marketing. It’s testable. It’s proven to work to get leads and grow businesses that use it. And it’s measurable…. unlike the dollar value of your Facebook “friends”, your Twitter “followers” and your Linked-In “connections”.
Now I know you’ve looked around at what other real estate people are doing with the internet and you probably figure that because they are doing this Facebook stuff you should be too. The thing is, most people are almost totally clueless about effective, measurable marketing. When you imitate the clueless people, you re-enforce cluelessness in yourself.
I am not saying you shouldn’t have a presence in social networking. You probably should, but building your marketing around such an unmeasurable method is a house of cards.
For real-estate investors you’ve got two major target groups you’ll be looking at attracting:
- People who have money and want more of it
- People who haven’t got any money and want to get some by selling their house quick and cheap
- Additionally you’ll find people who’ve got hustle, but no money – they’re looking to put-together deals and recruit investors themselves. When you generate investor leads you’ll get some of these people just checking out your marketing, but with no interest in investing in your projects.
Now the people who have money and want more of it – and already trust the idea that real estate is a good investment, generally, which is a pretty common opinion. You won’t be swimming upstream to convince people investing in property is a good idea. Your challenge is to persuade them to invest their money with your instead of one of the 10s of 1000s of competitors trawling Facebook and Twitter for investors of the first category.
By the way – I believe a problem well stated is a problem half-solved, which is why I focus so much on what’s wrong with marketing with social media here. It’s not because I’m some jerk who naysays every new idea.
If you’re going to attract the people with the money, you’ll need to establish some kind of thought leadership in your field. The basic process I recommend is:
- Build an email list. This keeps the cows in the corral since it’s a private channel of communication.
- Run teleseminars
- Sell your own info-products
- Upgrade info-product buyers into investors.
To build that email list you’ll need to advertise… and actually Facebook advertising is worth looking at due to it’s geographic and demographic targetability. Myspace and Stumbleupon have similar targeted ad systems. These systems vary somewhat but the basic principle of how they work is the same.
You’ll want to run ads, get clicks, send those visitors to a “squeeze page” (not your main site), offer a “goodie” of some perceived real value, and get those names on that email list so you can offer them access to your free teleseminar. Then you sell ‘em stuff and get ‘em to invest with you because they like you, trust you, and believe you when you say “I know what I’m talking about”.
Of course there are other ways to attract people interested in making money as real estate investors. Viral software giveaways is one on the more interesting ones. Since I develop viral software so it’s a bit of a loose claim for me to say “oh, just make some software” – but truthfully a simple, useful software isn’t too costly to get made. Under $1000, easily. In some cases you could just get an existing software and re-brand it. I have resources in this area so ask me if you’d like to know more.
The cool thing about the software approach is your competition doesn’t even have it on their radar as a viable method, much less know how to create and promote it. Comparatively speaking, doing the stuff I’m talking about here is like bringing a firetruck to a water-balloon fight.
Yes, you are fighting your competitors – not just for customer dollars…
You’re locked in a battle for Attention. We are in the age of battling for”Mindshare”. It’s not enough to have a good offer, you need to capture imaginations and engage human emotions.
Now as far as the people looking to cash-out with a quickie sale of their houses, they won’t be looking for software. They’ll be looking for somebody they can trust not to screw them over. Assuming you’ll be doing most of your buy-deals locally to you to start, I’d focus on driving geographically targeted traffic to some sort of voice mail and/or squeeze page offering a free report on something like “How To Sell Your House Now For Fast Cash And Get Top Dollar”. You’ve got to offer the mouse some free cheese.
Again, I recommend issuing a free report – perhaps mailing it with a CD. This gives you the opportunity to follow-up by phone – and build trust. A script could go something like:
Simple Phone Script
Hi, I’m Mary. I’m calling for (your name) from (your business name). You requested our free mailing “How To Sell Your House Now For Fast Cash And Get Top Dollar”, and I wanted to (make sure we got your address right, see if you got that in the mail, see if you had any questions of feedback).
Oh, that’s great.
Would you mind if I asked you a few quick questions?”
… and so forth.
Then you establish some trust. You can invite these people to a teleseminar or even a local meeting about how to improve their situation with a quickie sale.
This game is all about winning trust. The mechanisms I’ve outlined here may seem a little elaborate, but the purpose is not only to bring in more revenue, it is also to create a barrier-to-entry to prevent your competition from rustling your cows.
It is my belief that the business you can reasonably get from social networking, blogging, and website tweaking will be disappointing compared with the results you can expect from developing the systems I have outlined here.
The post author, Loren Woirhaye writes sales copy and creates marketing systems for business clients who want to slash customer acquisition costs and position their businesses For 20%-30% sales growth in the next 12-18 months. He writes regularly about marketing and life at his Entrepreneur Blog.