Hey there! Caleb Luketic, owner of Steel Marketing here. I wanted to write this introduction to let you know who I am. I actually started out as an investor here in Nashville, TN, not as a marketer. I found success with online marketing in my own business, was asked by others in the industry to help them and created Steel Marketing to help real estate professionals generate more leads & turn bigger profits than ever before! Let’s dive in!
Crushing Your Competition
Real estate is the MOST competitive industry out there — I don’t care what people tell you. Whether you’re an agent or investor, you’re always trying to gain an edge on your competition by figuring out what marketing method will get you all the new, hot leads in your market. Zillow, Realtor.com, Home Advisor, Facebook, mailers, bandit signs, referrals, door knocking… the list is endless. But wouldn’t it be better if the leads found you without you putting in much effort & you made a great return on investment?
Most folks in real estate — whether an agent or investor — focus on outbound marketing to generate leads because it’s usually cheaper & generally creates a little quicker return, tapering off in a few weeks to a few months (I did that when I first started in real estate).
Why? Because we all love instant gratification, right?! I mean who doesn’t want to see their marketing efforts be rewarded with people needing to sell their house or buy a new one calling us right away?!?!
Sometimes we have to sit back, take a breather and know that things that take time usually will be beneficial to the growth of your business in the long run.
Dominating Your Market With Growth & Longevity In Mind
Let’s talk about the best inbound marketing method there is: Search Engine Optimization (SEO). Essentially, SEO is ranking your business website on Google, so when someone Googles, “best realtor in Nashville,” or “sell my house fast in Nashville,” your site pops up.
SEO is the best because no matter if it’s two o’clock in the morning or two o’clock in the afternoon, people can find you & call you. You did nothing right at that second to earn that call; they went to Google, clicked on your site and gave you a call. Does it take time to get ranked? Absolutely. Is it worth the wait? Heck yes!!
Most of the time, leads that come from Google searches are the juiciest because they sought you out. You didn’t have to scratch and claw your way to find them — they came calling.
You also aren’t going to get all the terrible, trash and maybe even fake leads — just using adjectives used by other agents I’ve talked to — that come from a Zillow or Realtor.com because it’s your website being ranked at the top. Of course you’re going to get your tire kickers every now and then, but for the most part, these are going to be real people going to Google & calling you directly… you eliminate the middle man entirely.
Think about it: when someone wants to sell their home — whether in a desperate need to sell to cash buyer or retail with an agent — what are they going to most likely do? Google it. People today want to do their own research, feel their own validation and educate themselves on making the right choices. They want the control. So give it to them! Let them browse your website and be blown away by how credible & professional you are… it’ll lead to them picking up the phone & giving you a call.
Money You’re Missing
In another article, we talk about how much money your business is LOSING by NOT being ranked on Google. It touches on a variety of industries and mentions potential profits for real estate agents.
We are going to talk about potential profits (aka money you’re losing out on & not making) right here, but I would highly suggest reading that article as well because I’ll only be giving highlights of definitions here — you’ll be able to get the full context of what we are talking about here by reading both articles.
In the aforementioned article, I show you the formula I made that gives you an idea of the potential profits based on your Search Engine Ranking Positions (SERPs), the percentage of clicks each spot (1-10) receives on page 1 and a general 10% conversion rate (which is lower than usual for ‘service based industries’ but we’re gonna roll with it) – all of these numbers are backed by studies, I didn’t pull ’em out of thin air.
(Total Number of Monthly Searches * SERP Percentages) * Conversion Rate * Average Profit Per Deal = Potential Profit
Below there are two different toggle menus, one for agents, realtors and brokers & one for investors and wholesalers. I’ll break down niche-specific numbers using this formula in there, but let’s talk big picture for a second.
How can you tap into that goldmine sitting out there on Google? Well, here’s essentially the quick overview: Build a credible website, build trust in Google’s eyes and rank at the top for keywords that people search, which will drive more traffic, help convert that traffic and result in you getting more leads (either listings or purchasing flips/investment properties) — I can help get all that done for you, too 😉
Price Point, Timeframe and Returns
What’s the price point to even get started? I’ll be honest: it’s not something you can throw a couple hundred bucks at and expect it to succeed. It takes time — anywhere from a couple weeks to a few months. But let’s look at the return on investment & keep a longevity mindset here — I’m about to use some crazy high numbers for start up costs, too, that aren’t what you’d actually pay (at least with Steel Marketing… I’m sure someone out there would try to rip you off with these prices).
Let’s say building a website is $5,000, your monthly SEO cost is $4,000 and you don’t generate a lead until month 6 that converts into a closed deal… that total adds up to a $29,000 investment upfront into your business’ longterm growth before you see a penny in returns. Like I said before, these numbers are highly exaggerated; even if these were the numbers, you’d still be making out like a bandit!!!!
Let’s take a closer look at both aspects of our industry — both retail and investment — to show you the profits you’re leaving on the table:
*** These numbers are based on a listing of you selling a $250,000 home & earning a 3% commission ***
(Total Number of Monthly Searches * SERP Percentages) * Conversion Rate * Average Profit Per Deal = Potential Profit
Murfreesboro, TN | 320 Monthly Searches | $7,500 Average Commission
#7 SERP = (320 * 3%) * 10% * $7,500 = $7,200/month
#5 SERP = (320 * 7%) * 10% * $7,500 = $16,800/month
#3 SERP = (320 * 13%) * 10% * $7,500 = $31,200/month
#1 SERP = (320 * 32%) * 10% * $7,500 = $76,800/month
Tampa, FL | 880 Monthly Searches | $7,500 Average Commission
#7 SERP = (880 * 3%) * 10% * $7,500 = $19,800/month
#5 SERP = (880 * 7%) * 10% * $7,500 = $46,200/month
#3 SERP = (880 * 13%) * 10% * $7,500 = $85,800/month
#1 SERP = (880 * 32%) * 10% * $7,500 = $211,200/month
Virginia Beach, VA | 700 Monthly Searches | $7,500 Average Commission
#7 SERP = (700 * 3%) * 10% * $7,500 = $15,750/month
#5 SERP = (700 * 7%) * 10% * $7,500 = $36,750/month
#3 SERP = (700 * 13%) * 10% * $7,500 = $68,250/month
#1 SERP = (700 * 32%) * 10% * $7,500 = $168,000/month
Dallas, TX | 1,120 Monthly Searches | $7,500 Average Commission
#7 SERP = (1,120 * 3%) * 10% * $7,500 = $25,200/month
#5 SERP = (1,120 * 7%) * 10% * $7,500 = $58,800/month
#3 SERP = (1,120 * 13%) * 10% * $7,500 = $109,200/month
#1 SERP = (1,120 * 32%) * 10% * $7,500 = $268,800/month
Phoenix, AZ | 750 Monthly Searches | $7,500 Average Commission
#7 SERP = (750 * 3%) * 10% * $7,500 = $16,875/month
#5 SERP = (750 * 7%) * 10% * $7,500 = $39,375/month
#3 SERP = (750 * 13%) * 10% * $7,500 = $73,125/month
#1 SERP = (750 * 32%) * 10% * $7,500 = $180,000/month
Now, going off our highly exaggerated numbers from before, you’re going to still be making bank if you had to invest $29,000 upfront before a deal closed & had to continue to pay $4,000/month for SEO. Because starting in month 7, if you’re ranking #1, you’re paying $4,000 to be making over $200k if you’re in Tampa… you’d become the top broker or agent in your area in NO TIME.
Now are these numbers guaranteed? Absolutely not. If you’re a bad salesman, people won’t sell their home through you or buy one through you… they’ll find someone else. But if you’ve got good systems in place to make good, timely follow ups to convert those in the ‘maybe’ category into the ‘yes’ category and you are good at sales, you’re going to do even better than these numbers.
Here’s something else to think about: these numbers are based on $250,000 home sales with only 3% commission. What about the big houses that sell for $500,000 that you get 6% or 9% commission on? Those will make your numbers skyrocket!
If you want to explore what it’d look like to begin your path to total domination of your market, schedule a consultation with us!
*** These numbers are based on a wholesale deal equaling $10,000 & a flip/rehab equaling $30,000. This also EXCLUDES rentals & creative financing deals (owner finance, subject to, etc.) ***
(Total Number of Monthly Searches * SERP Percentages) * Conversion Rate = Number Of Good, Solid Leads
If you’ll notice, this formula is just slightly different than what you’ll see above or even in the realtor section. Here’s why:
From what I’ve learned, the real estate investment industry is a whole different ball game when it comes to SEO & crunching numbers. The first formula I mention I believe works extremely well for all other industries but this one because during a given season, there may not be as many folks in dire urgency to sell their house. Whereas there’s more than likely always going to be someone looking to sell their perfectly fixed up house with an agent to a normal retail buyer.
Based on these numbers — wholesale deal equals $10,000 & rehab equals $30,000 — you should be able to find a nice return based on the amount of good, quality leads you’re going to get based on this formula. Some months your lead flow will be higher, others it’ll be lower. Generally speaking, April-October the number of leads are higher compared to November-March… just how it goes sometimes.
I personally have gotten huge deals during November-March, so it’s just the luck of the draw when it comes to when someone is in a situation where they need to sell quickly. But remember, it takes one big deal that strikes at any moment that will make it all worth it.
Now, the success & profit potential we’re about to discuss will be determined on the following things: how good of a salesman you are & how many exit strategies you have. If you only wholesale, you will NOT be as profitable as you could be if you bought rentals, did creative deals and flipped houses.
Nashville, TN | 280 Monthly Searches | $10,000 Wholesale; $30,000 Rehab
#7 SERP = (280 * 3%) * 10% = .84 leads/month
#5 SERP = (280 * 7%) * 10% = 1.96 leads/month
#3 SERP = (280 * 13%) * 10% = 3.64 leads/month
#1 SERP = (280 * 32%) * 10% = 8.96 leads/month
We’re just using Nashville as an example in this one, so we can break down numbers a little easier — I’d be happy to break down numbers for you in your area, just schedule a consultation!
So let’s go off of the #3 SERP… you’re getting essentially 3 good leads that could turn into deals. If you wholesaled 2 & flipped 1, you’d be walking away with $50,000 that month — that’s a pretty solid month right there!
If you invested $29,000 like we said before for the first 6 months to get this thing going & in month 7 you closed $50,000 worth of deals, you’d have almost a 2:1 ROI already, more than likely have a few follow ups that might convert later down the line and you’ll continue to spend $4,000/month on SEO to get this type of return.
Yes, some months you may only wholesale all your deals, others you might have a bunch of flips going on at once or you might buy and hold all the houses coming your way. But whatever strategy you’re going with that month, the leads will be flowing in & generating you revenue if you’re able to convert them 😉
And remember: these numbers are extremely high for your upfront cost!!!! You’ll be nowhere NEAR $29,000 initially invested into SEO before you start generating leads — unless you’re going after every city in every state across the US 😉
If you want to explore what it’d look like to begin your path to total domination of your market, schedule a consultation with us!