While many brokers continue to question the ROI of social media along with the amount of time their agents devote to posting, tweeting, pinning and the like, it has proven to be a very valuable resource for real estate professionals. It’s helped them promote their listings in front of a larger audience. It’s helped them attract a more targeted demographic to their open houses. And for a while now, it’s been a very low-cost way for agents to publicize their personal brands in a way that could lure new homebuyers.
But that low-cost—and in some cases, free—marketing model is changing. The nation’s biggest social media sites, Facebook and Twitter, have gone public. They are no longer private companies lacking a fiduciary responsibility with the sole purpose of connecting users. Now, both sites are huge media corporations looking to monetize all of their platforms and leverage customers, particularly the businessmen and businesswomen who use the sites for their own profit-driven goals, such as real estate brokerages and their agents.
Cindy Welu, a real estate agent in the Minneapolis, Minn., suburbs, had been spending small amounts to promote her listings on Facebook, but she says the company recently began upselling her.
“We’ve tried it for a couple years, but two months ago (at press time), I noticed there had been quite a change,” says Welu. “Before, $5 got you quite a bit of bang for your buck. Now I get notices three or four times a week that say: ‘Your ad is not reaching enough people. The reach is not big enough for the current budget. If you want to reach more people, you have to increase your budget.’”
Determining the value of the return on investment for these types of campaigns is nearly impossible, Welu adds.
However, she is curious enough to see what a little extra “reach” can do for her business, so she recently increased her budget for Facebook advertising—from $100–$200 per month to $1,150.
“It’s quite an increase to come up to about $1,000 per month,” she says, adding that it’s still less than the cost for print advertising. “We’re going to test it out for six months.”
While the number of advertisements might be the same as what Welu had bought with her old budget, she expects that the new budget would trigger the Facebook algorithm to target better users, like the ones who are likely to respond to her listings.
“We are constantly evolving, trying to figure that out,” she explains. “You can get a lot of people (to see the listings), but I’m still researching to see if they’re good people.”
Welu reports that she has yet to sell a home to a person who had originally seen the listing on Facebook, but she has had a few come to her open houses. That’s the first real step toward a sale, she explains, and it’s enough for her to keep plugging away on the forum.
Welu is also interested in joining the Facebook Agent Directory, a sub-social network containing property pins and agent referrals, but her local MLS has not given her permission yet. For a cost, the directory links to an agent’s MLS feed and provides written content and regular posts.
Los Angeles real estate professional Chelsea Robinson—a member of the Facebook Agent Directory—claims she has found it useful, though not yet profitable.
Robinson spent less than $1,000 on Facebook advertising in all of 2013, and now averages about $10–$25 a day per campaign, which typically runs four to five days at a time. If it yields a sale, she says it will pay for itself many times over.