I’ve been in the luxury second home sales and marketing world for years. Consulting with some of the best resort developments in the world.
In 2016 I began working with luxury brokerages.
A common underlying issue with developers and brokers is how to reach the right audience. How to generate qualified leads without spending an arm and a leg with relatively low ROI.
Marketing expenses are always significant, often hundreds of thousands of dollars. Funds go to:
- Email lists
- Direct email campaigns
- Banner ads
- Retargeting and even
- Old school direct mail… to name a few
Covering those expenses with a faster sales pace is always the challenge, whether it’s a home or a developer’s inventory.
Is deploying a scatter shot marketing campaign always an absolute failure? Absolutely not, we sold a lot of real estate. But the resources (time, effort, expense) were too high and payoff (ROI) was never where we wanted it.
Insert the advertising axe.
To reach savvy buyers with enough disposable income to make an ultra discretionary purchase like a second home, your dollars should be spent in a more targeted fashion. Cut that budget in half and spend it more wisely.
And now we can do things unimaginable just two years ago.
Ultra. Targeted. Marketing.
Ultra Targeted Marketing Explained
Moving forward I recommend you divide up marketing expenses into three major compartments and focus all of your efforts on targeting, targeting, targeting.
Compartment #1: Intercept Marketing
We continue to hammer “intercept” marketing because it’s the most logical means of targeted advertising today. Make an impression on someone when they are already there, experiencing your property or your community.
Spend no more than one third of your marketing budget with local signage, or articles/ads in local magazines or newspapers… local only.
But here’s where most mistakes are made. The next two thirds should only be spent on other targeted marketing efforts.
Remember, the best properties in the world are sold to high net worth investors around the world.
$20M Penthouses in Manhattan are sold to investors from Los Angeles or Dubai just as $10M ski-in ski-out homes in Lake Tahoe are sold to buyers in San Francisco.
Advertising in global financial publications in an attempt to reach everyone, everywhere with a strong net worth is not targeted and can be ridiculously expensive.
Luxury second homes and developments can sit on the market for years and spend huge dollars in trying to attract wealthy consumers that are difficult to reach.
Don’t get me wrong, I like private jet magazines for branding, if you’re Cartier or Rolex then go for it, but for promoting real estate, stick with the next two compartments.
Compartment #2: Social Advertising
Spend roughly the next third of your cash on targeted social media advertising. Namely, paid advertising on Facebook and Instagram. There are others best addressed in another future post, but for now this is the best way to start.
And don’t try that “rich people aren’t on Facebook” excuse, not true.
— There are 2.1 million people in the U.S. over the age of 35 with more than $3,000,000 in liquid assets
— Of those 2.1 million people, 1.4 million are reading their Facebook news feeds every single day
I’m not referring to spending a full time salary for someone to write 5 blog posts per week to get more “Page Likes”. That doesn’t matter as much anymore.
Less than 2% of everyone who has “Liked” your Page will see any of the posts on it… really.
This is because Facebook wants you to spend money to promote your business. Totally logical. Because they’ve built one of the most powerful advertising platforms ever.
— There are 230,000 people over the age of 35 who live in New York, New Jersey, Connecticut and Massachusetts and have an interest in The Bahamas.
— Of those 230,000 people, 9,700 of them have more than $1M in liquid assets.
If you sell real estate in Nassau, you can promote your home or development in the Facebook news feeds of financially qualified consumers in key target markets that have already expressed an affinity for The Bahamas.
Yes, you read that correctly. Read that last line one more time before moving on.
Spend a very small daily budget (as low as $5 / ad) and do it consistently. Target those exact audiences you’re trying to reach. Logical starting points include feeder markets with direct flights, or drive-to markets.
Then narrow that down even further based on annual income, net worth or home value. You can target people who shop at Neiman Marcus, own a Bentley and/or like Peanut Butter and Jelly sandwiches… really.
This takes some experience to do right, (I’ve taken many courses on Facebook Advertising), but once you know how to build campaigns, create posts that convert and run test campaigns to gauge effectiveness, you’ll be building huge traffic with one of the most powerful advertising platforms ever built.
We have social advertising services. Use this form to raise your hand if you’re interested. I enjoy learning about different second home markets.
Compartment #3: Network Marketing
Start with the same feeder markets you target for your Facebook Advertising, and connect with super agents in those markets.
What’s a super agent? Those real estate professionals who dominate their own markets. They get the most luxury listings – typically $1M homes and up – and generally sell the most real estate.
Don’t waste your time asking every last agent in an office to sell your real estate for you.
This won’t work for two big reasons:
- Most agents in a real estate office don’t have the personal networks you need to reach
- Those super agents that do are too busy to “sell” your property
Instead, do a little research and hand pick your referral network. (We are a partner with Who’s Who in Luxury Real Estate, the world’s largest network of super agents. We can help you do this)
Set up a referral opportunity where super agents can simply “introduce” your offering to their databases in a professional way so they look good.
But! Understand who you’re dealing with. Super agents are super because they work the hardest. They don’t have the time to do what you want them to do.
So offer an attractive referral fee – say 3% of the sale price for a single family home and 5% for resort inventory – and deploy a system that does everything for them. (Here’s one)
Privacy is probably the biggest pressure point with super agents. If Brad Pitt is in their database they won’t be sharing that with anyone.
Transparency is the next really important point. Make sure you use a system that ensures total transparency, that your super agents are notified automatically of any inquiry from their database. I happen to know of a really good one.
To significantly reduce costly resources including time, money and headaches creating multiple advertisements, full page spreads and banner ads that follow people around the internet, build your networks through ultra targeted marketing and sell your inventory faster.
You really can’t afford not to, especially if you’re in a market like Sea Island, GA; Aspen, CO; Nantucket, MA; Napa, CA; Palm Desert, CA; New York, NY; Naples, FL; Lake Tahoe, CA; Caribbean, London, Dubai, Sydney, Cabo San Lucas, Playa Flamingo, Mendoza, The Bahamas…
You get the idea.
Clearview Elite is a digital marketing firm with solutions for purveyors of luxury real estate in any second home market. Clearview Elite is well connected as a partner with Who’s Who in Luxury Real Estate and builds bespoke referral programs with the world’s best super agents. Clearview Elite manages highly targeted social media advertising campaigns and deploys its proprietary software to sell the world’s best real estate.