Hi Folks,
What are the start up costs associated with marketing?
I am trying to figure out my marketing budget. Where do I get leads? How much should I expect to pay?
Business cards - $60
News paper ads $250
Leads??
from source 1
from source 2
Thanks Folks.
I don’t think business cards are all that necessary at the very beginning unless you have a network to hand them out to.
I’m also not a big fan of advertising in the newspaper, especially in the classifieds. You can run a test, but don’t expect immediate results. Of course, your mileage may vary.
I started my business by using region-specific advertising on Google AdWords. You will probably need to budget at least $250 to run your test; $500 would be better.
I started this way and get a number of good leads each week. My first deal was a home-run which net me $32,000.
hey newbie,
did you use soft or hard money to do your first deal?? and what was the time frame from start to money in the bank for your first deal?
When you begin marketing it really depends on what methods you want to persue, i agree with newbie, that business cards aren’t the best idea in the begining unless you have a good sized network to hand them out to.
Hi realnew,
I guess it all depends on what kind of budget you have 
One of the things I would suggest is to start networking yourself within your local investor community by joining the local REI club. Getting involved locally will give you a good source of leads and potential partners.
Next, develop both online and real-world strategies. Online: develop a simple site… shouldn’t cost you too much. I believe I read someone here offers free or low-cost sites . Next look into running local campaigns on Google and/or Yahoo. Like I said in another post, you can call them directly and they can help you develop a budget and campaign. As a point of reference, I was testing a new brand locally and set a $5/day limit and ended up getting two deals that resulted in $40K total! For off-line stuff like postcards, signs, etc. you’ll have to search online and find the best prices. One strategy that I’ve used in the past is to find a postcard company that offers free postcards. That’s right, free. Some companies will give you 1000 or more postcards for free with your message on one side and their’s on the other. Door hangers are also good cheap ideas. As far as leads go, be very careful and do your research. What will your focus be? Foreclosures? Low-Income? Once you’ve decided who you’ll be targeting with your advertising, then you can pick the best (and most economical strategy) to reach them. Not all lead sources are created equal.
Realnew,
I think that your marketing budget depends on your goals. Bear with me, here.
You want to figure out what your goals for the month, 6 months, year, etc are first.
From there, find out how much it’ll cost you to get each lead. In the start up phase, some of this you’ll have to make educated guesses on and then tweak as you start getting hard numbers.
Figure out how many leads you need in order to get a deal. Once again, in the beginning you’ll need to estimate until you can get some hard facts. Err on the high side so that if you’re wrong, you can shave money off the budget instead of adding to it.
I wouldn’t feel right telling you that in order to create a marketing budget that you only need to figure out how much signs, business cards, and newspaper ads cost. It’s not that easy.
You really need to take the time to think about your budget and how it relates to your long and short term goals. If you haven’t established those yet, that’s a better place to start.
I agree with 800sellnow. Networking is a great way to get the information of other investors so that when that first deal comes across your desk, assuming you aren’t ready to start holding anything, you can wholesale it in a matter of hours or days without having to worry about holding costs right away because you’ve created a list of people to wholesale to.
I am going to go against the norm and suggest that you hold off on Google until you are more established. Concentrate on creating a great direct mail campaign where you are targeting specific sellers in specific situations. Direct mail is phenomenal in that you can write as many or as little as your budget allows.
Google is not as concentrated towards motivated sellers as direct mail is. With direct mail, you hit them at home, can specify how you can assist them with their current situation, and know that the very person who needs to see your letter has received it.
With Google, it’s hoping that they type in the keywords you selected. Hoping that they click on you versus everyone else on the page, and hoping that the click converts to them calling or emailing you. There’s too much left to chance there for me.
Don’t get me wrong…Google is a great tool to use when you’re more established and can start testing other marketing medias. But for right now, stick to something that you can track and get an accurate account of exactly how many responses you got from your direct mail campaign.
One more thing…I think business cards are absolutely vital to your marketing campaign when you’re just starting out. Leave them on the table at any restaurant you dine in, fast food joint you go through the drive thru on, and any and everywhere you can think to put them.
You should be leaving/handing out at least 10 business cards per day. They won’t make you any money sitting in a box at home. However, if people see on your card that you give a $500 referral gift for every house they send your way that you buy, your business cards will start generating leads all by themselves.
Big Cheese
Does anyone have any suggestions for software to use that implements both marketing (labels, scheduling for mailers) & database mgmt? I’m not sure what is best way to keep track of leads from lists & my efforts.
Thank you
Revest,
Download the trial versions of:
GoldMine – It does it all, but I really hate the interface and decided not to use it even though I own it. It also has a module for Real Estate you can download for free
ACT! 2006 – I just purchased the Premium for Real Estate. It doesn’t have all the fields I need but I intend to customize it and add more fields. For ACT! I am going to purchase an Add-on that allows me to do the marketing campain, also available in trial format from pinpoint tools
I heard about using Pinpoint Marketing w/ Act! Premium RE.
I hadn’t heard about GoldMine.
I’m also considering this one
www.realinvestorsoftware.com
If anyone has ever used any of these I’d like to know your comments.
I appreciate knowing that you didn’t like the interface.
Thanks!
I have not used them, but it looks good if it delivers. Contact them and see if they offer a trial version
Sajoc,
I couldn’t agree more! When my husband and I started investing, we were homeless and living in the 200 square foot basement room of a family friend’s house. We had $20 to spend each month and had to make each lead count.
If we didn’t get leads, we didn’t eat. And with 3 small children, it was vital that at least they ate, even if I didn’t always get to.
I tell a lot of folks that you can still incorporate at least 4 marketing techniques on $50 per month and that means that if one doesn’t work well, there are still 3 other lead-generators to fall back on while you fix the one broken one.
A small marketing budget never means that you cannot market, or that you are confined to one marketing strategy. Anyone on any budget can still effectively bring in enough leads to take their company to the next level, which allows them to up the budget a little bit, market more, buy more, then up the budget, market more, buy more, etc.
If I was able to do it on $20/mo, I know anyone can.
I couldn’t agree more with Sajoc about direct mail! At least 80% of your marketing budget should be direct mail! It’s the most effective marketing tool you can use to figure out exactly how much each lead is costing you. You can’t track how many people see your billboard or sign on the side of the road and decide to call or not. With direct mail, you can track exactly how much mail went out vs exactly how many calls you got back. And it fits any budget out there.
If you can only send out 12 letters per month, do that. If you can only send out 6 per month, do that! It works on any budget
Good luck to you, Sajoc and RealNew.
Big Cheese
To Big Cheese,
You are to be highly commended!!!
That’s a lot of pressure to make something happen when the kids are crying and hungry. You are to be respected for your hard work and diligence!
I’m in awe when I look at my pathetic lazy butt… next your example.
May God bless you and your family!
S
Sajoc,
Thank you for your kind words, but that’s not why I wrote them. I wanted everyone to see that anyone can market on a budget of any size, regardless of the situation.
One of the things that kept us going was the fact that going back was just as far as going forward. We didn’t want to go back to a 9-5, and knew that perseverance and determination (plus the education we’d gotten) would help us get there.
Never underestimate the power of the FREE library card! That helped a ton when I couldn’t afford to go buy the books I wanted. Success is only possible when you want it bad enough and have taken the necessary steps to make it happen (goal setting, marketing planning and budgeting, etc).
Again, thank you for your kind words. I appreciate it.
Big Cheese