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Is there really any point to having a marketing plan?

Having been around this see-saw industry for just a few years less than blogger extraordinaire, Lenn Harley, I have seen more failed attempts at developing a meaningful, achievable and profitable plan than not. New and experienced agents, with the encouragement of their broker, start each year with a laundry list of all the proactive steps, mailings, networking ideas, calls, web sites, lead generation contracts, farming and the myriad of other ways to generate business. Plan lengths I have seen have varied from one page, to, literally, more than 75 pages.

Too often, however, well-intentioned brokers and agents get so caught up in developing the plan and systems to implement, that they lose sight of what is most important – doing the actual business of real estate – working with buyers and sellers. In their technologically sophisticated, erudite projections, they move away from the basics, immerse themselves in tracking all the required plan steps, input hundreds and thousands of data items in expensive industry software and, oftentimes, just barely make ends meet - if they do meet - after staff, marketing and overhead expenses are factored in.

There are many reasons that more than 90% of the agents leave this business every four or five years, but mostly, it’s because they have more expenses than clients. It really is true that if you fail to plan, you plan to fail, but – there is a balance. Yes, you have to have a plan and, just as important, a budget that you will stick to. I will never forget a conversation I had with a high income earner and successful agent back in 1990. Every January, he would take his wife to their favorite restaurant to celebrate his success for the previous year. After dessert, he would pull out a small notepad and write down three things: the amount of money he wanted to earn, the number listings he needed to take and, the number of buyers he wanted to work with over the next year. Those were his goals.

He then took a second sheet of paper and wrote down the steps he would take – every day – to meet his goals. That was his business plan. To this day, he continues to average between $175,000 to $200,000 per year, has one part-time assistant to do the paperwork, no expensive software (just uses Excel to track his business and expenses), no buyer/seller lead generation contracts, no team or other significant overhead expenses and, is very content with his business and income generated.

There are truly as many different ways to do this business as there are Realtors. You have to decide what the nature of your business will be and what level of consistent daily effort you are willing to put into it to succeed. So, do you really need to have a marketing plan? I think if you have measureable goals, a budget, personal discipline and a commitment to consistently apply yourself daily - in prospecting and providing quality service - the rest will follow.

What do you do best that helps you to succeed? If you have a marketing plan, what are the three most important elements? What is the best advice you could give someone just starting the business?

Dave Rosenmarkle

Broker Owner

Highland Realty

Arlington, VA

703-538-2566

www.HighlandAgents.com

davidrose@mris.com

Posted by Dave Rosenmarkle on 01/20/2009 03:02 PM

Comments (41)

marketing, marketing plan, business development, business plan, real estate, new agent, setting goals

41 Comments on Is there really any point to having a marketing plan?

JAN

I would advise new agents to learn their market by reviewing the MLS reports of active and sold properties on a monthly basis.

You can't sell a market if you don't know it.

Then I would advise them to develop a regular structured routine of "working the Internet, including ActiveRain". Getting their name and identify out there on a weekly basis is essential.

Then I would advise them to focus on advertising themes and "work it". Don't get bogged down with activities that aren't working. Be nimble and ready to move energy and resources to new areas when the market changes.

First and most important is to "get up and go to work every morning". Even if "work" is just a few feet away.

Shucks. That four things.

Hi Dave, I am always amazed at the time and effort agents put into developing a business plan only to have abandoned it early on. I would rather see that effort put into sales training or other basic income producing activities. As I look back on the plans I've done it seems like they really were meant to please the broker.

Thanks Lenn, on-target suggestions. By the way, whatever happened to previewing???? Now that we have on-line photos, I have to think that previewing has dropped at least 50%.

Bill, I couldn't agree more. Some brokers have need to have something to show their district or regional manager. I had a visit from a prospective agent a few weeks ago who wanted to leaver her current firm. One of the reasons was "benign neglect". She gave her broker a business plan last January and, he never had time to review it until she informed him in December that she was looking for another firm.

Dave,

good job on this post - a business plan is nothing unless you put some action to it. Our BP is simple and only one page long. Maria and I get together once a week to put some legs into that plan, we make the call we need to make for the week, we check-off our list as we go and maintain consistency and guess what? It's worked for several years, and we're doing pretty good, staying above the crowd. It's a simple plan, but the richness is in the action we're taking.

I would tell a new agent to do what fits his/her style and don't spend yourself out of business the first year. Also, I would suggest a lot of previewing homes to get to know diff. areas, etc...

Yes, you need a marketing plan, and most agents who have one still manage to screw up because their marketing plans lack 2 things:

1. a USP or unique selling proposition, as in what makes you different from the others.

2. Simplicity. I can put my marketing plan on one yellow legal page with a crayon and 90 seconds of explanation. If you need a power point program on your laptop and 45 minutes of pitch, you lose people.

If I had to add a 3rd element it would be to find a niche, learn it well, and work it hard.

Also having done the postcards, the farming, the ads, and so forth, my marketing "plan" now consists of promoting my business through Internet exposure (preferably free), maintaining relationship with current and most importantly former customers as they are a great source for referrals, and developing and maintaining out-of-area agent-to-agent relationships again for referrals. It's working.

Hip, hip hooray! Well said and logical. Splanning made simple.

Hi Dave - Timely post for anyone who wants to stay in this business! What most real estate agents forget is that this is a for-profit enterprise. I don't mean to be patronizing but if your costs exceed your revenues, you're broke. Period, finito, end-of-story. Spending money on THE RIGHT MARKETING is valuable in any market. Unfortunately, most businesses never really sit down to calculate what marketing costs them, nor do they ever track the results. In good markets, our marketing dollars seem to work only because there's an intertia created by a gold-rush mentality. In today's market, it's clear that marketing dollars can be easily squandered. Here's a simple example: Why would you spend a lot of money on print advertising in papers (perhaps small local papers are an exception) when the newspapers themselves are loosing advertising to the internet? I'm just asking......

So here's a rule-of-thumb business plan:

1) Lead with revenue (figuring this out is the challenge)

2) Add one new person to your database every day. (in other words, get off your butt and meet people)

3) Preview, preview, preview the inventory (since no-one seems to be doing it these days, heck you may actually become an "specialist")

4) Blog (blogging should get you out meeting your community, blogging should allow you to market your business, and blogging makes you smarter!!!)

Good luck everyone!

FACE to FACE contact. I am having a review of our marketing plan for February. Our entire marketing philosophy is how do we get ourselves physically in front of our sphere each and every month. Last week, it was a "meet the manager" day at the country club. Next month is another event and then March through August is a madhouse of events after events. Why do we do it. It is dirt cheap relative to print advertising and being in front of you sphere physically is 100 times more effective than any postcards. We don't do post cards. We do sell over $50mm. It is all about the net.

It is all about the internet. I am in agreement with Tim.

Dave: Personally I love to market and have discovered that it has sustained my business. The key is to do it evey day and often. I believe a person whouldn't be afraid of trying different things. That's the key!

You made many good points here Dave. Tenacity is key, and so is knowing where you are going and how to get there.

The chicken or egg is for many agents: How do I get actual clients?

Most agents are very good at satisfying them once they obtain them, but finding them in the firstplace is where the confusion sets in.

Chris & Maria - I like lists, it's keeps me honest and focused.

Kristi - For a lot of new agents, the money is gone in the first six months; they keep hoping "someone" is going to buy through them. Then "someone" walks in and by an open house from another agent.

J. Phillip - With the thundering herd now all over the Internet, a USP is walking a farm and letting people get to know you. Simple is best.

Silvia, all good practices. Thanks.

Linda - Splanning says it all!

James - solid suggestions. Way too many newbees livin' off the significant other's income and not minding the revenue stream.

Tim - I think it's the only way to confirm and build a solid working relationship.

Woodland, I agree to a point. Part of my market area has a lot of elderly folks who could care less about the Internet and care more about when I'm stopping by.

Thanks Paul & Chris - Tenacity, consistency, going the distance. Whatever you want to call it, it works when you do.

Dave,

Great post, but a little clarification is needed. You said the high earner (1990 conversation) had a simple business plan. He wrote down the amount of money he wanted to earn, the number listings he needed to take and, the number of buyers he wanted to work with over the next year.

This is not a business plan. This was his goals. Goals are important, however, they aren't the plan. The plan would be HOW he intended to accomplish those goals. Now, with his experience he may not have to have a written business plan on how to accomplish them, but a newer agent definitely would.

Great point. Sometimes it is the simple things that seem to work the best. Thank you for the post

Roger - thanks for commenting. If you re-read the post, you will see that there is a 2nd step where he lists all of the things he plans to do to meet the goals. I agree that goals without plans are meaningless.

I was just talking about this with a friend this morning...I get way too caught up in planning that sometimes I forget to actually execute on the plans. I loved the story - simplicity is so important thanks for the post, Dave!

I did see it, Dave. Just felt it bore repeating, as this is where I see alot of agents drop the ball. They make the goals, but don't develop a way to get them done. Again, great post.

With Web 2.0, we don't really have to worry as much about marketing expenses anymore. The problem now is, even if we don't have to spend a penny, we don't have enough money coming in. The public expects us to provide the information, but if we don't make any money, you're right. The agents won't be around to give them what they want. It has to be a give and take agreement.

Andrew - you're in good company among many. Planning your day, week, etc is really essential. On the otherhand, I have seen agents sit at their desks for days, checking statistics, checking their prospective farms, checking their to-do lists and calendars - and never pick up the phone.

Dave, lots of good points, I start everyday with a plan and end everyday with the next days plan in tact with very few exceptions. I find making a plan before leaving the office and reviewing it right before bed really works.

A good business plan is essential, along with written goals. How are you gonna do it! "Failing to plan is planning to fail," and there's some truth to that.

"If you don't know where you are going you are never going to get there" I agree that goal setting is vital. Complicated marketing plans can overwhelm. Keep it simple and Talk to people everyday, maintain your client base and network.

Dave,

Good article - thanks! What a great reminder about the need to have a plan, yes, but to keep it simple. In this economy and market what better words of wisdom. If you have a great plan yet fail to work with the people (buyers and sellers) who can make it happen what good it is?!

Dave,

thanks for letting the secret out. I don't believe in the 75 page marketing plan.

Here is part of my plan since you were so thoughtful to share.

Find 5 things that you can focus on and be consistent, such as:

Expired Listings
Open Houses
Door Knocking
Contacting Sphere of Influence
Hand out a minimum of 20 Business Cards a day (I've actually obtained several clients pumping gas)

Keeping it simple and not too many ideas will keep you more focused when you start getting busy.

Happy Prospecting!

I hate planning. That's just the way it is. I'm a dreamer. It's hopeless...

Great post Dave, keeping it simple is really easier. I would have written all of the focus points that Dawn listed above as my advice and I would advise the new agent to lead with revenue as Jim said and then work backwards from the, divide revenue dollars into listings and sales units sold, from there you could figure out how many contacts you need to made each week in each of Dawn's categories. There is the action required, but the consistency is what will make or break the goal. I'm using a simple plan that assigns a point value to these activities and know how many points per day and per week I need to get to where I want, when I win, I reward myself, when it looks like I may fall short, I stay late or get up early or work the weekend, whatever it takes. The challenge in this is that the smarter you work, the faster you get to the goal, the reward, the free time, etc. There is a great book called Getting Things Done by David Allen that really simplifies all of the things we have to do and the system I'm using is based on it and available free online at The Printable CEO . I plan to post about it soon, it's on The List.

Isn't there a difference too between the marketing plan and the business plan? Business plans should be simple and straightforward. I like having a marketing plan at the start of a new listing that takes me through 2 months of marketing - and keeps bringing up new ideas.

Great post! For the first few years that I was in real estate, I had the elaborate plan that was about 15 pages long.... and just like a New Years Resolution, the "plan" is sometimes in the trash bin by March. My new strategy is simple -- I'm focusing on what I need to NET monthly and I know how many buyer leads and listing appointments I need to achieve that goal. Of course, I have a marketing budget, etc, but just keeping my eye on the price at all times is really working. I'm motivated, I'm happy and business is pretty good!

Great post and great comments...thanks everyone! Back to the basics with a little tech thrown it....

Regards

Rick

What do you do best that helps you to succeed? Focus on my "big rocks" and try to keep my experience on an even keel.

If you have a marketing plan, what are the three most important elements? (1) Accountability (2) Organization (3) Budget

What is the best advice you could give someone just starting the business? You are going to be the owner of a multi-million dollar business, act like it. Be prepared and plan ahead.

JAN

Great post the responses should help a lot of new agents undersatnd what it takes to be a successful agent.

Laura,

Here's my 3 most important things, as you asked:

1. An achievable goal.

2. A realistic action plan to reach it.

3. Willing to be flexible when needed.

Join my NEW group for professionals who work from their home office at http://activerain.com/groups/virtualoffice

Regina P. Brown

Dave, while I agree that it's important for an agent not to get caught up in the minutia, a marketing plan IS a must. You need to know HOW you are going to reach those goals and what it will COST.

... follow through and accountability are so key. And without a coach or mentor to keep you on track it is easy for many to just abandon business plans, kinda like they do for new years resolutions.

Great points Dave. All the best.

Cheers !

Sheldon

Business plans are a very important part of goal planning. Set up your yearly goals. Then determine how you are going to accomplish those goals, by breaking them down into daily and weekly goals. Then follow through. You don't have to have a 75 page plan. A simple one can do especially if you are just starting out. If you are going to pay for lead generation programs, you need to make sure that your money is being well spent and that you are making more money than what you are spending. Keeping track of what you are doing and what is successful for you can be one of your goals in your marketing plan.

Dave - Very well said. For me, it goes back to KISS - agents and brokers tend not to keep their business plan SIMPLE! Lenn also sums it up well - it all starts with going to work every day. Really doesn't get any more simple than that.

very insightful!

MAR

Hi Dave. I just sat down and revisited my lame marketing plan. I felt like I appeased the broker and wrote it up. Now being somewhat responsible for two buyers agents, I felt an obligation to being able to quanify what worked, what didn't and why. Without a focus on my plan, I wouldn't be able to guide and lead. That's a poor combination for a rainmaker. It's important to create the plan and keep your lifestyle, strengths and areas for improvement as considerations for the execution!

Thanks!

Diane Donnelly Keller Williams Annapolis

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