Today’s property market is at a crossroads of high-tech and traditional approaches, where companies are faced with a choice between investing heavily in marketing and deploying automated systems that can replace constant human intervention. Below, we will analyze both options to determine which one is more advantageous in real estate.
Recent sales and marketing trends
One of the key trends of recent years is the growing penetration of artificial intelligence (AI), which property market players use to create visuals, texts, and even to call customers. Not only does this technology reduce the cost of creating content, but it also significantly speeds up all the processes. AI can be used to regularly inform customers of discounts or new offers, which helps retain potential buyers. However, automation is effective only in conditions of mass demand. A company offering products at above-market prices certainly needs professional marketers who can communicate the value effectively and respond to individual customer needs.
With resort real estate, the best marketing strategies to increase your return on investment include joint activities with agents such as team building sessions, training programs, or intellectual games. The cost of holding an event like this is usually within RUR 200,000-300,000 ($2,300-$3,500), but it can boost your sales by 30-40%, generating a 100% ROI.
At People Group, we held intellectual events such as What? Where? When? and Quiz, please! type games for representatives of agencies, inviting teams of five to seven people. The questions focused on their professional sphere, the property market, as well as on other interesting subjects. All participants showed high enthusiasm and competitive spirit fighting for the prizes, and eagerly shared their impressions on social media afterwards. This format helps not only to strengthen business ties with your partners, but also to significantly increase the professional community’s trust in your company.
Special minibus tours for brokers are also popular, where participants travel with a representative of the developer giving them a tour of their properties. During the trip, the manager talks about the main features of each property while creating a relaxed atmosphere with the help of entertainment activities and interactive quizzes. This format is best for combining business interaction with elements of team activity.
In central Russia, real estate companies are actively involved in social projects, financing city events and helping with the renovation of schools or hospitals. This predictably improves their standing with the local residents, enhancing the company’s positive image, and ultimately driving sales.
Certain companies, especially in resort regions, tend to use less than sustainable marketing methods. A pop-up ad depicting a luxury villa in Dubai captioned ‘Buy an apartment in Anapa for 4 mln” might attract attention, but customers end up disappointed when they land on the webpage of an economy class project. Another popular tool is announcing “limited-time private sales” or “members-only specials” with their allure of exclusivity. The more inaccessible an offer seems, the more desirable it becomes. However, such methods can undermine customer trust in the long run. Once your customer finds out the truth, they may start warning others against doing business with you. In the long run, this will damage your customer base and entail a loss of repeat customers. It can be extremely difficult to restore trust after a few public scandals.
What is a sales automation system?
An automated sales system is a set of tools designed to process incoming customer inquiries with minimal human involvement. These tools can include CRM systems, dynamic pricing models, 3D tours, and VR technologies. However, such systems tend to work best in environments where demand is high while prices are low.
Sales automation would typically mean you are offering your product at a lower price. The higher your company’s margins, the more skilled specialists you will need to engage customers effectively. For instance, a website for customers to easily purchase an apartment in just a few clicks will only succeed if the prices are 10-15% lower than average market rates, with people willing to buy real estate online just like they book a trip to the sea.
Yet, when you need to convey the value of the project to explain why the selling price is 20% higher than the market one, you will essentially require professionals to address specific client needs and promptly provide detailed information about the property 24/7.
A well-designed website and CRM system won’t yield results if your sales team is slow to respond or unwilling to engage. Affluent buyers often prefer working with agents who guide them through the property selection process and handle the complexities of the transaction. In such cases, your success hinges on finding ardent enthusiasts – sales professionals who can sell your project using just a few pictures and floor plans.
Although a powerful tool, automation is not the ultimate solution. It works best when you have a large influx of clients and your sales team struggles to keep up with the volume. If there is a lack of clients or limited offerings, your first priority should be to invest in marketing to generate demand through advertising. In the premium segment, none of the systems will be as effective as fostering strong relationships with experienced real estate brokers who understand the market.
The cost of automation and marketing in real estate
The average conversion rate in real estate is around 20%, meaning that typically only 2 out of every 10 leads turn into buyers. If your conversion rate is declining or fluctuating, you need to implement a comprehensive sales system that integrates marketing, quality control, automation, and human involvement. The cost of implementing such an automated system can range from 3 million rubles to potentially much more. Marketing investments should typically be between 1 and 2 million rubles in cities with a population under 500,000 and between 3 and 5 million rubles in larger cities with a population over a million.
Automation serves as a means to streamline the handling of incoming requests; it doesn’t directly attract customers. If your phone is constantly ringing, implementing CRM systems and other tools can help ease the workload of your sales team. If you’re not getting many clients, your focus should be on improving your marketing strategy.
Choosing the right fit
The decision between marketing and automation depends on your business’s needs. Always prioritize hiring talented individuals: without them, your business will struggle to achieve strong sales. If you are new to the real estate industry, focus first on building a solid sales system. Ensure your team is prepared to handle incoming leads; otherwise, you risk losing potential customers that you’ve already invested in acquiring. In the mass market with its high volume of customers, automation can help reduce the strain on your sales team, while the premium market essentially requires professionals that offer personalized customer service.
The key takeaway is that you need to create a system to integrate marketing, sales, and automation. Combining these elements will allow you to attract clients and convert them into buyers, ensuring steady business growth.
By Anatoly Tsekhin, leading expert in the resort real estate market in Crimea; founder, People Group