Question for Top Producers...if you're willing

It's relative isn't it? If an agent makes $50,000 per year and they invest $15,000 on marketing they're likely eating under a freeway. I think 30% is excessive. It tells me the referral base isn't as strong as it should be. I know a lot of huge producers that spend nowhere near 30% and they're killing it.

I know there were quite a few top agents spending buckets of money at the height of the market; many of them are either gone, or not spending that much. I agree with Greg: I don't think you "need" to spend an exorbitant amount, your service should generate referrals.

Caroline.... I have a very strong referral base.... but I also do direct mail marketing....it's expensive..... my income is ALL referral fees and I make a good profit after spending 30%.... the people I'm feeding are top producers in New England....I feed more than one agent..... their income amounts to hundreds of thousands each, not just a couple!!  most agents don't spend what they should be spending because they are not making enough money and are not secure enough with their ability to produce.... what is your definition of a top producer??  top in a small office...top in a state....top in many states or top in the country??  it's all relative.... making $200k today is not a top producer...it's making a living!!!

Caroline: I know a top producer from the haydays who advertised absolutely everywhere. She was the #1 listing agent in a small community, so ended up making quite a bit for her. But she also had to spend it to stay there. Then the market crashed. She tried to keep the advertising going for awhile, but is now much more careful. She still gets most of the high-end listings, BUT THEY DON'T SELL, or rarely. So what's the answer? Outspend others in advertising? Buy leads? Stay on the Internet and social media and Activerain? The latter is the one for me. I am not a "top producer" in my are. For now, that's fine with me. The one who is the "top producer", does mostly REOs and does no advertising beyond the Internet (that I can see). 

I think that is an interesting topic. I think that we calculate based on each sale. For example, for every listing we have a custom and practice of doing certain kinds of mailings. We send out certain mailers to the sphere and utilize email and social media and have many online memberships as a result. It's hard to put a percentage on it.

I think its a combination of things, but you have to spend money to stay before the public eye.  I went out of the real estate guide which never provides any sales but appeases my listing clients and I had friends ask me if I was still in the business!  I do some first class mail, a lot of work on my website to keep it interesting, send out a once a week e-blast, and I appreciate referrals very much.  But it's no "one thing" that I can put my finger on...it's a little bit of everything when it comes to real estate marketing.

I tend to spend no more than 10% of GCI on marketing and focus that on services and advertising instead of direct mail and other costly campaigns. 

I know one "Top Producer" in the area.  He went on the radio and probably spent a lot of money with the vanity of paying to hear himself talk.  

Bryan.... 10% of your income is equivalent to 60% of most high earning agent's income!!!!  you deal with the rich and famous.... every home is millions!!!

caroline....I don't mean to hijack your blog!!! so sorry but I had to respond.

We spent 11.9 percent of gross commissions in 2011 and 13.7 percent in 2012 on Advertising and Promotion of our business.

70 percent of our business is referrals and the rest comes from the Internet.

Tom