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Where are Real Estate Buyers coming from?

Whether consulting with an owner as to the best way to sell their home or in casual conversation, the question is frequently asked, "Where are real estate buyers coming from?" Real estate professionals hear it all the time and yet an amazing number of different answers are brought forth. The National Association of Realtors has generated numerous reports detailing sources of buyers over the last several years. The data has been very interesting and very widely distributed. However, many real estate professionals seem to be unaware of the results. The results are not surprising and show that far and away the buyers are dependent on real estate agents and the Internet.[i] The results below show all sources that a buyer may use so there is overlap.

  • Real estate agent - 84%
  • Internet -84%
  • Yard sign - 59%
  • Open house - 48%
  • Home book/magazine - 31%
  • Builders - 24%
  • Television - 9%
  • Billboard - 7%
  • Relocation company - 5%

Frequently, though, in a small community, such as the Volusia and Flagler county real estate markets, agents will minimize the impact of online marketing. Because the State of Florida is heavily associated with second home and retirement homes, they feel that the Internet is less of a factor. One would assume that the presumption is that second home buyers are less research oriented and buy while they are on vacation. Perhaps retirees are in the wrong demographic to use a computer and the Internet to conduct research. These conjectures fail to stand up, however, when compared to the actual data.

The intent of this article is to examine the strategies most effectively used to find buyers. Ultimately, we'll attempt to explore how buyers are most effectively using the tools at their disposal today, and how an effective real estate marketer can reach out to connect those buyers to the appropriate sellers.

Commercial Marketing

While much of the content of this article will deal with residential tools and techniques, the basic tenants also apply to commercial properties. Commercial real estate tends to require a specific skill set with regards to an agent's knowledge. However, the strategy to market a commercial product (including land, office space, or business brokerage) is very similar. The commercial market does use different tools to accomplish the same end goal. Where there are specific differences in strategies, the author will strive to point them out and explain the differences.

Volusia and Flagler County Markets

Also noteworthy is the focus on the Volusia and Flagler County markets in Florida. While much of the article is generic in nature, the focus is on home buyers and sellers in the primary market of Adams, Cameron & Co. The market area is on the east coast of Florida about 60 miles south of Jacksonville and extending an additional 60 miles south along the coast. Below this area (known as the Fun Coast) is the Space Coast known for the Kennedy Space Center. The market area also extends westerly about 40 miles with the westernmost portion serving as a bedroom community to the Orlando market.

Within the two county area are four submarkets:

1.       Greater Daytona Beach Area - known for Motorsports, the home of the LPGA, multiple Bike Week events, and generally a popular tourist destination, Daytona Beach serves as a cornerstone for communities such as Ormond Beach, Holly Hill, South Daytona, Port Orange, Daytona Beach Shores, and Ponce Inlet.

2.       Flagler County was the fastest growing county in the United States for a number of years. Palm Coast, is the center point of Flagler County and has been a hotbed of activity for a number of years. Hammock Dunes is the newest community and boasts an annual PGA Champions Tour event along a fantastic oceanfront course. Bunnell is the county seat for Flagler County, and Flagler Beach is a surfer's paradise.

3.       The New Smyrna Beach Area is just south of the Greater Daytona Beach Area and includes Edgewater, Oak Hill, and New Smyrna Beach (another surfing and fisherman's dream).

4.       To the west, is the West Volusia Area which includes DeLand (the Volusia County seat), Deltona, Orange City, Lake Helen, and Debary along the I-4 corridor. In addition, the area includes more rural settings to the north such as Pierson, Astor, and Barberville.

Historical Real Estate Marketing Strategies

Looking back there are a wide variety of strategies that have been employed to market properties. Yard signs have been the staple of the industry for a number of years. In the very early years, it was not uncommon for a property owner to sign agreements with a number of different brokerages. The result would be a grouping of signs in the front yard. Further, there was an absolute lack of communication between brokerages. When one brokerage found an interested buyer, they would have to reach out to all other companies in order to determine if homes were available that represented a good match.[ii]

Luckily, things have improved. Over time the Multiple Listing Systems (MLS) evolved. Initially, the MLS systems were books that were printed regularly. Later they were contained on microfiche. For the last several years, fortunately, we have had computers to simplify the process. Today, not only do brokerages have access to the properties that are available but most buyers have ready access to the available properties as well. There are several exceptions, though. In many areas, certain property types are still not included in these systems:

1.       Commercial property is often not included. Some brokerages that specialize in commercial property prefer only to work with other commercial specialists and consider the MLS to be a residential outlet.

2.       Property listed with an out of area broker can be particularly difficult. A seller may choose to work with an agent who conducts their primary business in a different geographic region. In some cases the regions can be very large. In Florida there are three very large regions covering large sections of the state. However, there are countless smaller regions. Within the Volusia and Flagler County areas there are four different MLS systems in use. An agent belonging to one may or may not list in others. The vast majority of agents belong to only one of the four systems. Property at the borders can be difficult to find because of the uncertainty as to which system is in use.

3.       Manufactured housing is very popular throughout the country today. Various MLS systems have different rules with regards to what can or cannot be included. Some allow all manufactured homes, others allow none. Still others require that they be listed when the land is conveyed but forbid them being listed when the land is not conveyed. The rules do change from location to location.

4.       Confidential (or Pocket) listings refer to an older practice that is in limited use today. There are situations in which a seller would like to sell a house but, for one reason or another, doesn't want anyone to know. These situations are very difficult for a marketing broker because it is almost impossible to deploy the vast majority of the resources at hand. However, they do exist and are not typically listed in any MLS.

There are reasons, however, for the different rules. Certain areas have requirements that are different from others.[iii] To that end, when data is homogenized in order to be combined into a single system (such as in generalized sites), sacrifices must always be made.

Current Strategies

Today, there are more solutions available than ever. In addition to the items discussed above, marketers have countless other medium at their disposal. We can examine the various tools and techniques in order to determine the most effective overall marketing strategy and marketing mix.

Print

Long ago, print advertising became the natural progression to reach out to potential buyers. As the market areas grew and the likelihood that a particular buyer would drive past the perfect house diminished, real estate brokerages needed a better outlet. Print refers to several different types of advertising outlets, the most popular being Newspapers and Trade Magazines.

Newspapers

The first print outlet was newspapers. Locally, the primary newspaper, the News-Journal, was organized in 1925[iv] and is still in operation today. Typically, real estate advertising is conducted on Sundays, the day in which open houses are traditionally held. It also has the advantage of having higher readership than other days and most newspapers offer a larger Sunday paper and many provide a real estate section which is contextually targeted for potential buyers. An exception to the rule would be commercial real estate which is often included in the business section in a separate ad in order to reach business people who may be more interested in leasing or purchasing office space or investment property. The primary goal of advertising in the local newspaper is to generate awareness of the type of properties that are available rather than to highlight any one particular property as there is rarely enough space to describe a brokerage's complete inventory.

Many marketers have made the mistake of repeating the same property week in and week out with the intent of providing greater exposure. Because newspapers offer such a small slice of the overall inventory, a reader seeing the same property repeatedly will likely consider the property stale and be concerned that something is wrong with it due to the highly repetitive nature of the newspaper. Further, advertising the same home repeatedly reduces the likelihood that a buyer will find a property sufficiently compelling to generate a phone call. Best of class solutions to the challenge of determining which properties to advertise should focus on the best deals, selected across a wide price range, with repetitiveness taken into consideration.

Historically, the local paper represented one of the better advertising techniques for a few reasons. As distribution is daily, with a real estate section weekly, the marketer has the ability to provide timely information in a manner that is not available in some other mediums. In addition, the newspaper readership was traditionally very high among a local population meaning that an advertiser could reach a substantial percentage of the local target market.

Unfortunately, in recent years newspaper circulation has been declining steadily as evidenced from the chart below which reflects a local newspaper[v]. Results from advertising are closely aligned with these results.

In fact, results of transaction based information (such as real estate and stock information) are outpacing the declines of general readership. While most information is available in other mediums, such as television and Internet, transaction based data is more readily available and more timely on the Internet leading to a substantial decline in the effectiveness of newspaper advertising.

In addition to the local newspaper circulation, there are also local classified focused advertising mediums using the same quality print. In the Volusia/Flagler market the best example is the Pennysaver which provides a comprehensive list of products for sale from homes to cars to services. The classified genre is also most effective for generating calls from potential buyers by showing examples of the types of inventory that are available. In this case, featuring investment properties and affordable property tend to generate the most activity.

Industry publications

In the realm of print real estate marketing there are a number of industry specific publications. Typically, in the Volusia/Flagler market, these publications have distributions ranging from 10,000 to 15,000 per publication. Typical distribution locations are in hotels, restaurants, convenience stores, and other tourist friendly locations. Occasionally they are also available in waiting rooms such as doctors and dentists offices.

These publications feature a series of advertisements from a number of agents and/or brokerages. They tend to be full color and promote a limited number of listings. The goal of advertising in these publications is not necessarily to help a buyer find the perfect property for their unique situation but rather to stir interest. Like newspaper advertising, displaying the complete inventory of a brokerage would be cost prohibitive. Ideally, by spurring a reader's interest in a featured property, a brokerage can generate a conversation in which a much more comprehensive list of properties can be provided to a potential buyer.

Examples of this genre include national, franchise publications such as The Real Estate Book, and Homes and Land. These national advertisers also tend to publish the listings that are advertised in the print publications on their online counterparts. In addition to the national publications there are also regional and local publications such as the Digest of Homes, and Market Showcase. These have limited online exposure but tend to excel in local distribution.

Online

In recent years there is no question as to the increase in the number of potential buyers switching to the online realm in order to find property. The trend is not surprising when you consider the real time data that is available when compared to any other medium. New listings can be distributed more readily, changes to prices and availability are almost real time, and the ability to search for exactly the right property is greatly enhanced. While no website has as much data available as a Realtor, the accessibility by the end user is greatly enhanced by the timeliness and 24/7 retrieval opportunities.

Company Website

Most brokerage companies today offer comprehensive websites that allow users to search for available properties. ?The most effective of these are provided by localized companies rather than the national or international websites. Examples of these include the Volusia and Flagler County Area's Leading Real Estate Company or Long Island's Premier Website. These websites offer regionalized features for people who are moving to the area. Typically they help a buyer to identify specific aspects of a local community that aren't available on national or multinational sites. The primary users of these sites are local consumers or buyers who have identified a particular area in which they would like to purchase.

Many brokerage sites employ a technology known as Internet Data Exchange (IDX). While the technology provides a cheap and simple solution for implementation of a website, it falls well short of providing the type of service that most buyers require. Whether you are buying or selling, avoid brokerage websites that rely on the IDX interface as they simply don't provide the level of service that a custom interface can provide.

In the online world, studies have shown that the acceptable response time to an online user can be as little as fifteen minutes. In order to determine the best possible websites, try to indentify a brokerage that employs advanced technologies that allow an agent to be alerted when a buyer has interest in a property. For buyers, wouldn't you prefer a faster response time when you want more information? As a seller, do you want to lose that interested buyer in a prolonged response time? The best of class solutions provide:

1.       frequent updates to the listing information (at least daily)

2.       real time response on their own listings (preferably by e-mail and text message)

3.       integrated follow up system to remind agents to follow up with buyers

Another important aspect of a best of class brokerage website is the marketing effect. If the website is not heavily marketed in abundant locations throughout the Internet no one will find it. A website without sufficient advertising to drive users is akin to having a telephone without telling anyone the number.

Network Providers

In addition to the local brokerage websites that provide high quality local search capabilities, there are a number of national search providers. These companies aggregate data from brokerages around the United States or around the globe in order to provide comprehensive search functionality for buyers. Typically, these sites have the advantage of providing robust search engines along with a substantial number of properties. These tools are quite exceptional in providing information to those searching a particular area.

These national providers also have shortcomings. The sites tend to include limited data based on the number and quality of brokerages participating. Some larger brokerages choose not to participate in order to increase the effectiveness of their own sites. Smaller brokerages tend not to have the resources to support uploading and maintain the vast amounts of data necessary to promote themselves. In addition, many of these websites require monthly or annual fees to maintain the data on their sites. These fees can be expensive and even cost prohibitive for some brokerage companies or Realtors?.

Examples of these sites include: Realtor.com, LuxuryRealEstate.com, ReloHomeSearch.com, Front Door (by HGTV), Trulia.com, Zillow.com, Yahoo! Real Estate, Google Base, Oodle.com, Land Watch, Resort Escape, Point2NLS.com, ActiveRain.com, Craig's List, Hotpads.com, PropBot, and PropSmart

The best of class real estate brokerages will develop solutions that will automatically include all applicable listings to each of these sites. As listing information is updated, the information on all of the corresponding websites will also be updated meaning that buyers are finding recent and relevant information.

Agent Websites

In addition to brokerage websites, many agents also have their own websites. With the importance of the Internet in marketing today, the best brokerages will provide websites to the agents and maintain them to ensure that the most recent and relevant information is available for their customers. Like a top quality brokerage site, the agent sites should provide real time feedback to the agent when a potential buyer inquires.? They should also keep track of potential buyers so that agents can be sure to provide appropriate service to them.

Direct Marketing

Direct marketing is a tool to ensure that a marketer can reach out to the group which has the highest opportunity and propensity to buy. There are several methods that can be used to reach out to appropriate buyers. The goal of direct marketing is to reach out to the right people in order to maximize the number of interested parties per attempted connection.

Direct Mail

In the marketing industry, what the real estate industry calls a farm area, is called geo-targeted direct marketing. Simply put, the concept is a geographically targeted area which is particularly appropriate for a marketing message. There are several examples of how this works through a direct marketing method. One example is the direct neighborhood. In most cases, the immediate neighbors have a number of attributes that make them appropriate for our marketing messages. First, they likely have an interest in the local neighborhood and may know friends or co-workers who would like to live nearby. Second, they have the means to purchase a home in the area and likely know people who have the means to purchase a home in the area.

Another opportunity is to identify move-in areas. When targeting move-in areas, we identify neighboring communities who may be apt to move into a home that is to be marketed. For example, there may be a move-up area in a particular subdivision. Some areas contain single family attached homes (townhomes), single family homes, and high end single family homes in the same neighborhood. One strategy would be to develop a mail strategy to target owners of the townhomes in order to promote one of the single family homes that is available. By this method, the marketer could present a possible replacement home for an expanding family.

E-mail Marketing

The key to e-mail marketing is to ensure that we are using a permission based marketing strategy. Marketing through the use of unsolicited mail to a large group of people is not only counter-productive but is potentially spam, and illegal. That being said, we have techniques available to us to market directly to appropriate individuals who have requested information from local brokers and agents. Our systems provide the ability for our listings to be promoted to interested buyers who would be interested in particular properties. We have the ability to market directly to people based on the preferences that they have set as buyers. We can put only applicable properties in front of these buyers, increasing the value of each and every e-mail.

Relationship/Influence Marketing

The marketing world has been changed dramatically over the last several years as marketers try to take advantage of a number of new approaches to reaching consumers. There are several different names that have been used to mark a progression from 1:1 Marketing (made popular by Don Pepper and Martha Rogers in their landmark book), to Gorilla Marketing, to Viral Marketing. Each of these represent a new approach to reaching consumers. Ultimately, they have certain aspects in common. Specifically, rather than simply advertising a product with the intent that the consumers will respond to the advertisements, they are geared at reaching out to individuals on a personal basis. Each of these practices has its own flavor but they are all designed to influence the consumer in a way that is vastly different from the advertising approaches of the past.

The challenge, of course, is adapting these techniques to property sales. Whether selling homes, land, or businesses, these approaches become more difficult. There are several approaches that brokers can use to tackle that challenge. Some are old and others are newer. However, this aspect of marketing is vital to the effective sales strategy.

Internal

Each real estate agent has a sphere of influence. This sphere of influence includes people who they have worked with in the past, investors who are constantly looking for the right property, and friends and family or other contacts with whom they have business every day. In the simplest example, if each agent has a sphere of influence of just 200 people, the ability to market a given property to only ten more agents helps us to put the property in front of 2,000 potential buyers. This is a primary reason that the largest real estate brokerage companies tend to dominate a market for a very long time. The value of additional agents who are interested in selling in-house property is very difficult to overcome. Using the same conservative assumptions as above, an office with 300 associates would have 60,000 potential customers in the sphere of influence. A small local office with perhaps ten associates would be at 2,000.

One of the most effective strategies is to market the property within a local office. Depending on the strategy of the brokerage, they may or may not have regularly scheduled meetings. The best practice in the industry is to schedule weekly meetings to ensure that each sales associate is aware of all changes to the inventory. While they may also be getting the information in other formats, there is little substitute to hearing the listing agent describe the property.

In addition to hearing about the property, some offices also schedule time for the agents to visit the property and review it for themselves. Clearly, having a team of professionals review a home will provide for a more lasting impression in their minds when they are thinking about the right property for a particular buyer. These visits have another advantage as well. When a team of experienced agents visits a particular property, they can share marketing ideas as well as suggestions for improvement that would speed the sale of the home or generate the highest possible return. These suggestions can, in turn, be shared with the seller. The old saying "two minds are better than one" is true but twenty minds are better than two when it comes to quality feedback.

In addition to marketing within an office, there is also an advantage to reaching out to a brokerage's agents regionally. Most agents would prefer to sell a property that is listed with their company than to sell one that is listed with a different brokerage. Agents often prefer working with an agent that they know and trust. They would certainly prefer to work with an agent that they know is properly trained. In general, in-house sales tend to be smoother transactions which result in a faster sale, a goal of both the buyer and seller. Because of these advantages, it is very important to market to a brokerage's agents not only on a local basis but also on a regional basis. The industry best practice for sharing available property regionally is multi-faceted. First, an agent from one office can easily visit a sales meeting in another office and have their property toured by those agents if it is applicable. At the very least the agent can describe the property in order to determine if anyone has a potential buyer among their sphere of influence. In addition, every property listed for sale should be available to other agents. This can partly be achieved through the use of the MLS. However, if there are multiple systems, you can quickly lose the regional impact. A better system is to document every property newly for sale in the company and deliver it to the agents using both e-mail and physical log sheets so that they are aware of, at the very least, a property address, price, and the listing agent's contact information. That will allow an agent with an interested party to quickly inquire with regards to additional data. In addition to these strategies, a weekly newsletter sent to all of the agents and information published on an internal website can strengthen and reinforce messaging about particularly strong opportunities. An effective brokerage will leverage all of these strategies in order to ensure that all of their agents are aware of internal inventory.

Regional agents

In addition to marketing internally, it is also very important to reach out to other agents in the community. There are several strategies to pushing the information to them. The simplest of these tools is the MLS, which is available to all agents in a particular geographic community who pay to have access. In addition to the MLS, there are other tools that help to share information with other agents. In the State of Florida, a tool called MLS advantage was created by the Florida Association of Realtors. The tool receives data from most of the local MLS systems and aggregates it in such a way as to allow any licensed Realtor? in the state to access it. The advantage, obviously, is that even if an agent is 300 miles away, they can see the properties that are available in the local community. Use of this tool by listing agents greatly increases the exposure among real estate agents throughout the state.

In the commercial realm there are a number of other tools that are widely used to market properties. The most commonly used in our area is LoopNet which is a national service promoting particular properties. Over the last several years LoopNet has become the defacto MLS for commercial properties. However, it is not alone, other companies such as CoStar are also very important in the marketing strategy. The commercial aspect also has a number of groups that meet with the goal of economic development or promotion of commercial properties. Rather than using the electronic methods, these groups discuss available properties and share information in a face to face setting. They are sponsored by a number of different organizations, including the city and county economic development departments, the chambers of commerce, the associations of Realtors?, and in Central Florida there is also a special association of Realtors? called Central Florida Commercial Association of Realtors?. All of these organizations are very important links in the ability to market commercial property.

Of course with so many licensed real estate practitioners in the market place (over 5,000 in Volusia and Flagler Counties) it is very important to recognize the value of offering a full co-broke commission. In any agreement to sell property, the listing agreement will contract with the seller. A part of the contract will be an agreement to share a portion of the overall commission with an agent that brings a buyer. In recent years there has been a trend to reduce the percentage offered to the buyer's agent in an effort either to reduce overall commission and make the arrangement seem more compelling to the seller, or to bolster the commission earned by the listing agent. This has become one of the most common mistakes in the real estate marketplace. A seller who offers a reduced commission is drastically lowering the appeal and excitement associated with the property when compared to other properties on the market. Take for example, ten units in a condominium development who are all offering 3% co-broke commission, and that are all priced at $100,000. If an eleventh unit comes on the market at the same price offering 2.5% commission, the owner is, in effect, offering $500 less to a real estate licensee for procuring a buyer. That small savings may be the difference that makes it less exciting and appealing to the local real estate community. Clearly, this is an overly simplistic example. Also, I should note that all commissions are negotiable and that an honest real estate professional should find the right property for a buyer regardless of the commission that they earn. However, from a marketing perspective, I think it behooves the seller to provide a competitive offering.

National and International Networks

Of course, in these days of global markets we cannot depend solely on the local or regional market. Rather, it is important to reach out across the United States and, indeed, across the globe. It is very important to identify opportunities throughout the United States as the barriers to moving or relocation domestically are very low. In addition, there are a number of prospective buyers who may be interested in second homes or retirement homes in destination areas such as Volusia and Flagler Counties. Further, a property owner selling a home is typically looking for a replacement home. When the new home will be out of the area, an agent and brokerage need to know where to go to find a professional with the type of intimate knowledge of the new area. Brokerages work within networks to ensure that they have qualified, experienced agents working in the new area to provide the highest possible quality of service. To that end there are a number of networks which exist. Most people are familiar with the real estate franchise systems. There are a number of these solutions in existence and many are owned by a single company (Cendant Corporation). They provide a solution for the small, independent brokerages in a particular region to leverage some name recognition in the same way that a local restaurant owner may join a Burger King franchise. However, in each market, the most successful real estate brokerage tends to be an independent company that is not affiliated with a franchise. The result should not be too surprising considering the financial situation. A franchise typically requires between six and ten percent of top line revenue to be paid not only by the brokerage but also from each of the agents working for the franchise. That money is taken directly out of the marketing efforts of the local franchise and the agents associated with the franchise.

There is an alternative to the franchise solutions. Most of the leading independent brokerages work together through a network called Leading Real Estate Companies of the World (LeadingRE). In fact, over 30% of all transactions in the United States were conducted by an independent brokerage who is a member of LeadingRE[vi]. No franchise can begin to compete with that volume. In addition, of the top ten brokerages in the country last year, six were independents who are members of LeadingRE. Real estate brokerages within LeadingRE send buyers and sellers to member companies. The agents and brokerages appreciate the fact that they have certain assurances that their customer will have the highest level of service throughout both transactions.

In addition to the sizeable presence in the United States, LeadingRE also enjoys a substantial and growing position with brokerages across the globe. With the change between the value of the dollar and other currencies, including the Euro, the market opportunity internationally has grown substantially (more on that below). With nearly 700 companies (5,500 offices) spanning 38 countries and 170,000 sales associates, the LeadingRE network is a major part of the solution to finding international buyers[vii].

In addition to LeadingRE, Who's Who in Luxury Real Estate is a powerful global network that is focused on luxury properties. The network includes 1,500 brokerages around the world. In addition to offering referral services, the system also includes print, online, and other marketing resources targeted to reach out to potential buyers of luxury real estate. While the definition of luxury changes from market to market (typically the top 10% of property in terms of price), this is a fantastic resource to compare the various offerings across several areas. For an area such as Volusia and Flagler Counties, the comparisons are very positive. Consider waterfront property in the State of Florida, a property in Ormond Beach will likely cost a fraction of a similar property in West Palm, Naples, Miami, or other areas. These national advertising tools help buyers to see the value savings.

Open Houses/Showings

In addition to other relationship marketing strategies, one of the best solutions available is to hold open houses. A traditional tool for bringing properties to a buyer's attention, they can be drastically more effective when held by a trained real estate professional. There are a number of tools and techniques that help to increase the number of potential buyers who see a house and increase the likelihood that a prospect becomes a contract.

There are other tools as well. Some best of breed brokerages will hold periodic open house events. Properly done, these events will include hundreds of homes open in a given day generating a network effect among the homes that are being offered. Because several homes will be available, a potential buyer can build a much greater understanding of the inventory in a single day. In addition, the network effect generated by moving a potential buyer among several homes can be very fruitful for buyers and sellers alike.

In addition to open houses, it is very important have a licensed, trained professional provide input into the home before it is shown. A properly staged home can have a tremendous impact on the time it takes to sell and the total amount that it can bring at market. In addition to properly staging a home, a qualified agent can help to open the home before showings. By opening the home, the agent can make sure that the premises appear bright and airy.

International Buyers

Earlier we mentioned the growing importance of the international market when finding buyers. Certainly the decline in the value of the dollar is leading other countries to examine the United States as a bargain. Investing money here is safe but can also generate substantial returns for a foreign investor. When determining the best way to find international buyers, consider how you might go about purchasing property in Europe. If you were interested in a villa in France, what steps might you take to find that perfect location?

You've probably selected one of the following:

1.       Search the Internet

2.       Ask a local real estate agent that you know and trust to provide a reference

3.       Visit France and find a local real estate professional

4.       Call real estate publications for the appropriate areas and order books

Any of these solutions are applicable. These tend to be the same solutions that generate leads coming into the Volusia and Flagler County areas both internationally and from people who are out of the area. When searching the Internet there are a number of web site solutions to use. If a brokerage is properly promoting property through their own website and through the appropriate other sites, international buyers will find the home they are looking for.

When asking a local real estate agent for a referral, a buyer is typically going to be taking advantage of a referral network. Again, a brokerage that is properly established with a quality referral network will be able to service that buyer when they come in.

Visiting a destination and looking for property is also a frequently used solution. Typically when finding closer property it is easier but it is certainly a viable strategy. When visiting a location, finding the right real estate agent could be as simple as visiting an office, looking in a magazine, or calling a number from a sign. In order to capture these buyers, the best strategy is to work with the largest company.

The last strategy is also used from time to time. Publications such as the Real Estate Book and Homes and Land will provide numbers on the front of their publications. Anyone who is interested in a book from another area can simply call to request one. When they do, advertisers are provided with their name and number in order to facilitate following up with more information.

Effectiveness

Ultimately, the goal of marketing is always to find a buyer. Among the various solutions above there are a number of advantages and disadvantages to each. All of the tradeoffs must be weighed in order to determine which of the strategies should be employed in a given scenario. Each property is different and a strategy should be developed based on the relative merits and the appropriate target market.

Convergence

One of the keys to any successful marketing strategy is to use multiple strategy elements. Depending entirely on a single approach will almost always lead to failure. A proper marketing strategy requires a mix of print, online, relationship, and direct marketing. Trying to find the appropriate buyer without reaching out in all of the mediums is truly not effective. Without any one of these strategies you will miss a portion of the target market.

Often marketers make the mistake of looking to these strategy elements as alternatives. Instead, an effective marketer will view them as pieces to a puzzle. The puzzle doesn't work quite right without all of the pieces. When we bring them together we start to find the value. Another way to consider the impact of convergence is to realize that the value of cross strategy marketing is the product of the marketing tactics rather than the sum. Each time a different tactic is used it represents a greater overall impact on the strategy.

Analysis

That being said, the effectiveness of each strategy can change from time to time. It is absolutely vital that an agent and a brokerage closely monitor the effectiveness of each of the strategy elements and of each of the advertising mediums. The simplest way to review effectiveness is simply a cost per lead analysis. If an investment of $1,000 in the news paper generates 15 contacts and that same $1,000 investment in an online site generates 200 contacts, it probably behooves the marketer to shift some dollars. Of course, there will be a point of diminishing returns.

In addition to the quantity of leads it is also important to measure the effectiveness of the prospects. There may be sources of business that generate many leads but few closings. These are not only harmful but can be detrimental as they will consume time without generating results. There are a number of tools that can be used to track the lead quality. In the real estate industry, the most common tool is Top Producer but more generic tools such as Sales Force, UpShot, or ACT! can be used. The very best of real estate brokerages will have in-house versions of these programs that are provided to the real estate agents and that are customized to focus on a particular market and tied to the marketing strategies that are applicable in a given area.

Local Results

Of course, what really count are results in the local market. While there are countless discussions regarding the effectiveness of each of these, an examination of local numbers becomes very important. For the first half of this year, the results have been stunning. Within Adams, Cameron & Co.'s offices each phone call into the office is logged and a source is recorded. In addition, all inbound referrals through the referral department and all requests that are sourced via our websites are logged and recorded. The combined report shows where Adams, Cameron & Co. is generating buyers.

The most notable result is that the Internet is accountable for more inbound leads that any other source. The brokerage website and the various other websites have become the primary source of raw leads. Within those numbers are a combination of calls to the office which are sourced from individuals who are using the website and pick up a phone to call in and those who submit online. The online submissions represent approximately 80% of the category. Due to the quantity of leads, it has become crucial that agents are alerted immediately when a potential buyer inquires. The technology mentioned above to speed response time has become immeasurably valuable.

Relationship marketing is dominated by a combination of co-broke calls (meaning an agent from another company) and people who simply walk in the front door. There are also a large number of prospects coming from national and international networks as well as referrals from various Chambers of Commerce, etc.

Signs have always been an important part of real estate. The most important aspect of real estate signage is quantity. Yard signs are an excellent source to find prospects. However, only rarely is a prospect interested in the property advertised by the sign that generated the call. The true key to sign calls is the ability to promote the other properties that are available to the potential buyer.

Lastly, print media continues to play a role. While this was once the dominate method of finding buyers, the effectiveness has truly warn away. Regardless, it is still an important aspect of our overall marketing strategy. There are some buyers that cannot be reached any other way.

About Us

Helen Adams formed Helen Adams Realty, a general real estate office in 1963. Under her direction and keen foresight, the company quickly became recognized as the area's leading condominium marketing firm. Robert L. Adams became a partner and sales manager of the firm in 1974. Within four short years, Adams Realty became the dominant real estate company in the area with acquisitions of several smaller real estate companies and the merger with Cameron Realty in 1978. As President and Chief Executive Officer, Bob Adams expanded services to include Adams Cameron Title Services and Adams Cameron Auction Division.

Adams, Cameron & Co. is Volusia County's undisputed real estate leader with total sales far exceeding any other company in the Daytona Beach area. There is no other local real estate company that can offer more associates, more offices and more full service capabilities than Adams, Cameron & Co. can!

?The author, John Adams, is a native of the Daytona Beach Area and is a third generation real estate broker. His education includes a Bachelor's of Business Management degree from Florida State University and a Masters of Business Administration from The Kellogg School of Management at Northwestern University. His business experience includes several years with Arthur Andersen's Business Consulting organization during which he handled engagements domestically and internationally. He was a cofounder in a marketing company which he grew from startup to $40 million dollars in revenue.



[ii] Interview with Helen Adams, founder of Adams, Cameron & Co. the greater Daytona Beach Area's Leading Real Estate Company from the Daytona Beach News-Journal.

[iii] The most striking example may be with regards to the Florida Keys where property locations are searched according to their proximity to the nearest mile marker on US-1, the primary highway and only road that stretches the length of the Keys. While vital to operation there, the same strategy could never work in a large city.