Analytics will buy you a BMW
Our culture celebrates multi-million dollar Super Bowl ads and the creative marketing campaigns (as well as the freewheeling culture) of Mad Men, which makes it one of the most acclaimed and popular television shows on television. In real estate, the prevailing marketing tactics reach back into the past with billboards, benches and print advertising – often featuring the signature smiling headshot. Agents embracing the present and future have flashy websites, blogs and iPad apps to dazzle their prospects and customers. On their own, these can all make an impact, and do often help win business, but the real money is made in the trenches.
What’s in the trenches? Data – lots of it about every single aspect of your business, customers and competitors. Behind each of the flashy ad campaigns mentioned above – be they old school or high tech – must be a sophisticated and effective analytics plan.
The most important part of the customer lifecycle
What is analytics? It is technically defined as “the science of logical analysis.” What does analytics mean in today’s business vernacular? I believe that every single aspect of your business should be measured, analyzed and optimized. This is most important in the customer lifecycle, and you’ll get the best and easiest tangible results starting with the customer lifecycle too. This effort can become very complex as you get more sophisticated, but you can gain a tremendous amount of lift from implementing a basic methodology.
Identifying each step in the customer lifecycle
I start by identifying each step in my customer lifecycle. In real estate this might mean: targeted marketing message – marketing campaign – lead – showing – closed sale.
Specific Marketing Message: Break down every marketing/advertising effort into the smallest measurable component. If you use Google AdWords, don’t just measure the overall campaign. You want to track each keyword. If you are running outdoor advertising, track each bench and billboard separately. If you are blogging, track where your traffic is coming from before it hits your blog as well as the specific content and links on your blog.
Marketing Campaigns: Roll up your targeted marketing into general categories. I like to call these mediums. Examples are: Print Advertising, Outdoor Advertising, Internet Advertising, Radio, TV and Social Media.
Lead: When you get a lead into your pipeline, you need to understand both the medium it came in from as well as the specific message that inspired the customer. If it came in from your blog, which article was it from and which link within that article?
Showing: Understand which of your leads turn into showings, and which just take up your time. You can have one medium that generates a ton of leads but very few showings while another is the opposite. You may or may not decide to cut back on the lead source that gives you a lot of leads that don’t convert, but whenever you get a lead from the high-converting medium you’ll want to prioritize that one.
Closed Sales: You want to do the same analysis here as for the showings (which leads really closely verses just browse), but you also want to dig deeper. Which leads turn into high priced sales? Which leads turn into repeat buyers? Which leads close quickly and easily? Which leads have a pattern of difficulty in securing financing?
Effective marketing is less sexy, more analytical
Popular culture portrays marketing as a sexy and creative field, and parts of it are and that creativity is still important. The truth is that outstanding marketing is more about data, analysis and hard work. This may not seem fun to a lot of you, but let me give you one more pitch.
If you set up a strong analytics plan, you measure the important aspects of your customer lifecycle and business, and you optimize your efforts according to your data, you’ll see clearly the positive impact you’ll have on your earnings. You will see how with the same amount of money and effort, you are increasing your sales every quarter. Call me a nerd if you like, but I believe THAT is a lot of fun. And so is driving a BMW.