How Much Should I Spend on Monthly Postcard Marketing?
Here is some valuable insight I have learned over the years from our real estate postcard marketers that is relevant for any small business. Realtors like to use postcard marketing for two reasons. The first is to drive inquiries and leads (short-term). The second is drive more business and referrals (long-term).
Short-Term Postcard Marketing
I often refer to this type of marketing as the lead acquisition work. In this prospecting phase Realtors use postcard marketing to announce their just listed properties, just sold successes and their upcoming open house events. They canvass the local community (and their personal contact lists) to drum up inquires and possible leads.
According to Patricia Sorce (Direct Marketing Researcher), realtors understand the value of deploying short-term postcard marketing because it “helps them build awareness within a specific geographic area so that when homeowners are ready to sell, they will remember these agents and call on them. In a way, these postcards are a pseudo-personal recommendation by the selling neighbor that says, ‘Use this agent as we are doing, and sell your home fast and for what it's worth.’”
Long-Term Postcard Marketing
Realtors also use postcard marketing to stay in touch (referred to as long-term follow-up or farming). I often refer to this marketing phase as customer retention and development. The top realtors like to stay in touch over the long haul to keep their name, brand and contact information in front of their past clients, sphere of influence contacts in an effort to stimulate new referrals and more business.
“Remember, memory starts to forge after 9 plus touches.” —Steve Morris, Exit Realty
“You need a minimum of 12 touches if you want to be number 1 or 2 top of mind. No one remembers number 3!” —Gary Keller, Keller Williams Realty
Basic Rule of Thumb
From our annual real estate market survey we did several years in a row, we found out that productive realtors tend to spend about 10% of their gross commission (income) on general marketing (print, mail, web etc.). Postcards, flyers, and other print communications were about 40 to 50% of that 10% spend. On average, that translated into about $150-$170 per month spent on monthly postcard marketing, which works out to be about 250 postcards each and every month.
Of the 250 postcards, about 150 (60%) were used for long-term follow-up or farming use. The other 100 (40%) were used for short-term lead prospecting.
The overall result was that productive agents created an annual 3,000 (12X250) positive brand impressions within their target communities.
What This Means To You
No doubt about it—funding marketing for a small business is tough and more often than not, it is an afterthought done on an adhoc basis. Here are five simple steps to help you create a very basic marketing plan that many top realtors use.
- Start with an overall marketing objective for your business. What do you want your marketing to do? Who do you want to communicate to? What do you want to say or offer? What would the ideal (revenue/sales) goal be for your business if your marketing was done correctly?
- Think of marketing in two simple categories—short-term (prospecting) and long-term (staying in touch).
- For each of the two categories, determine a simple marketing mix. To keep it simple at first, your marketing mix might have both web (online marketing, social media, adwords, etc.) and traditional (direct mail, print, flyers, etc.) elements. Pick a couple for each category that best fits your market.
- Take 5 to 10% of your annual revenue forecast and then split it or allocate across the marketing elements within the two categories. Much of this will be determined through testing and through trial and error.
- Finally, take your plan and break it out on a monthly basis to ensure you have systematic strategy to regularly promote and advertise your business.
If that sounds too hard, then my advice would simply be:
“Do what productive realtors do—simply send out 250 postcards each and every month. They know what works and how to stay top-of-mind in their local communities. There’s no need to overthink it.”