3 Money Saving Mistakes That Hurt Your Real Estate Business During A Downturn
In an economic downturn, it’s common for real estate team leaders to take specific measures to save money. Consequently, these short-term “life rafts” they’re using to attempt to weather the storm could sink the entire ship!
Unfortunately, a lot of real estate agents fall into this pattern. While attempting to do something they think will help them save money, they only end up hurting their bottom line.
In this article, we’ll talk about the three most common costly mistakes real estate agents make when trying to save money.
Let’s dive into the first costly mistake.
Mistake #1: Cutting Your Marketing Spend
We can all agree that most, if not all, real estate businesses and companies in other industry sectors immediately turn down the dial on their marketing spending when times get tough.
Agents forget that their marketing provides them the fuel to generate consistent lead flow and sales for their business and keeps their pipeline well-fed.
It’s the vehicle that allows you to stay top of mind and establish consistent communication with your prospects and database. While the herd is going one way, you should go the other way (because when they cut marketing that means your leads are less expensive IF you keep your campaigns live).
The fact is, you can’t afford to pull back the lever on marketing completely. Instead, you can focus on ramping up the lead sources and marketing activities that generate the highest ROI for your business.
While most teams jump ship on their lead generation during a downturn, the 5% of real estate teams that stay the course and adapt are the ones who will succeed long-term.
An insightful marketing quote by Ryan Deiss, former CEO of Digital Marketer, one of the top digital marketing companies in the country, states, “He or she who can afford to spend the most to acquire a customer wins.”
So, how can this be applied reasonably to real estate when money is tight?
The agent who understands the concept of customer lifetime value is the one who spends the most to acquire, nurture, and convert their prospects into profitable relationships, building a memorable brand that stays relevant in the market 10, 20, and 30 years from now.
Your customers expect to hear from you every day, and you should be engaging in conversations with new leads early in the buyer journey through your IDX search site and Dynamic Lead Registration.
Top Agent, Scott Trembley, did a phenomenal webinar with Ylopo during the pandemic. Even though many agents had their best year ever during COVID, Scot has experienced tremendous and consistent growth before, during, and after COVID by sticking to his 4 S strategy.
In a nutshell, Scott Trembley committed to staying the course. He increased his call rate and heavily relied on his tech stack, specifically Ylopo’s RAIYA and Dynamic Remarketing tools, to help him nurture his database and keep his brand and listings in front of buyers and sellers consistently.
What’s The Logic Here?
A slow market is a prime moment to double down on marketing and social media while your competitors sit at home waiting for the storm to pass.
Most agents have heard that Facebook and Google award them the lowest cost per lead, but many have not been able to spend money on these platforms long-term while generating a measurable 3-5x ROI. Scott Trembley has been able to accomplish this sought-after goal with the help of Ylopo. Specifically, Scott spends money on Ylopo’s Dynamic Registration and more recently the cutting-edge Direct Connect leads.
During the pandemic, top agents like Scott Trembley saw a $1 or $2 cost per lead on Facebook!
A slow market is also the perfect time to optimize your search site, build brand awareness, and grow your database while you wean off the expensive portals.
Remember, to be a top agent: you should do what 99% of other agents are afraid to do.
You must be present and in front of your customers 24/7/365.
Luckily, we’ll talk about some tools that help you do that, which we’ll get into in a moment.
Before that, let’s dive into mistake number 2.
Mistake #2: You’re Waiting To Optimize Your Team
During an unfavorable market, Team Leaders must take a hard look at their team’s productivity and make efforts to optimize their team structure and assess what and who is holding them back from scaling their business to the next level.
Think about the team leader as the captain of a ship.
A captain must take control of the ship to pinpoint which team members are the highest performers and identify those that aren’t pulling their weight, compromising the effectiveness of the whole team.
However, as the captain, you are often faced with tough decisions.
Are you going to take the time to coach the agents who are struggling to keep up with the rest of the crew, or cut them loose?
It’s vital to keep a tight ship and monitor your “teamerage” regularly, making sure each crew member hits their KPIs accordingly.
To maximize team quality and performance, you can hire a few ISAs to replace the underperforming agents and help elevate the success of your top performers, or you can save money by leveraging a virtual AI ISA like RAIYA to help pick up the slack.
An AI-based ISA is a great way to increase productivity and elevate lead conversion without adding an extra person to manage.
Another strategy to improve your team’s effectiveness is to arm them with the highest converting scripts.
Ylopo offers free high-converting AI lead nurture scripts for 30,000+ agents who are getting incredible results.
Let’s take top agent and Ylopo client, Barry Jenkins as an example:
If you’d like to get these scripts for free, you can click here to download them now.
Let’s now dive into the 3rd and final mistake.
Mistake #3: You’re Eliminating Technology Your Business Relies On
Don’t do it!
You may not realize it, but your tech stack is part of the foundation of your business!
As an agent, you simply don’t have the time to spend 10-12 hours daily managing your lead generation, social media presence, and all the people in your CRM.
As a team leader, you should only focus on the activities that will generate sales and increase revenue so you can effectively expand your team and scale your brokerage. Isn’t that the goal?
Simply put, if agents cut down on technology for the sake of saving money, they will lose big time. Once the automation technology provides is gone, agents won’t have enough time in the day to do the actual money-making activities that keep their businesses afloat.
If you HAVE to eliminate some technology, at least keep the tools that hold up your business. That means you don’t want to cut your CRM, any tools that provide performance and accountability insights, and your digital marketing tools that fill your funnel with quality leads and keep your brand relevant.
So, What Should You Do To Make It Through A Downturn?
First, you should determine who on your team will most effectively help you and your business make it through these difficult times. If you’re not sure where to start when it comes to team building and recruiting or aren’t confident that you have the right people on your team, Real Estate Coach, Erik Hatch, shared his recruiting and team building process in a very insightful webinar last year. You can watch that webinar here.
Next, you need to focus your efforts on the money-making activities in your business. We’re talking prospecting, lead nurturing, setting and attending appointments, writing contracts, and closing deals. If you want further reading on what foundational money-making principles you should stay focused on, read this article about the 4 Foundational Real Estate Principles that Transcend Market Conditions.
Finally, rely on your technology to do its job. Make sure you have a top-of-the-line digital marketing tool that keeps your business and brand relevant so when real estate transactions need to take place (which they will), your business will be the first one that comes to the consumer’s mind.
More About Ylopo
30,000+ agents and teams leverage Ylopo’s digital marketing products to streamline their systems, generate more quality leads, and nurture those leads toward more appointments and transactions.
Because real estate agents depend on cutting-edge solutions to generate more quality leads and sales, Ylopo consistently invests millions of dollars a year in developing innovative tools to help agents..
Ylopo also provides AI ISA assistants like RAIYA to allow agents to save time while nurturing leads and seamlessly integrates with all the best industry CRMS, like Follow Up Boss, to help agents keep track of their prospects more effectively.
Ylopo’s tech stack empowers you to always stay in front of your consumers, grow your brand presence, and focus on your core money-making activities.
Because our team has been in the trenches, partnering with agents and teams for decades, we know that if you double down on marketing spending, optimize your team structure, and leverage technology in an economic downturn, you will come out on top.
Want to discover how our suite of products can work for you and help scale your business?
THE LCA BLOG
Weekly articles that cover every aspect of the real estate industry, growing your business, personal development & so much more.
Consistency is the foundation of any successful real estate business. Without it, you’re at risk of failing to capture leads and wasting money on ineffective marketing campaigns. To stay focused and achieve a steady stream of new prospects, you must develop a plan that allows for consistent lead generation efforts. But exactly how do you […]
Many real estate agents begin their careers on a part-time basis, juggling other jobs or commitments as they test the waters of the industry. But if you’re ready to dive in and make real estate your full-time profession, you’ll need to adopt the right strategies to make that transition successful. In this blog, we’ll outline […]
Understanding how to increase lead engagement and conversion goes hand-in-hand with getting leads. Getting leads today is much easier than before. Usually, all you have to do is to increase your budget for PPC to see an additional lead flow. However, lead engagement and conversion offer more opportunities to increase income than having more leads. […]