UPDATE: The 2020 Home Builder Marketing Report is now live!
The 2019 State of Home Builder Marketing Report is now live and we've pulled some of the top takeaways to help you on your way to home builder marketing and sales success. In the report we saw a variety of new tactics being implemented, mistakes being made, and opportunities being missed by home builders from across the US and Canada.
New Tactics for Home Builders
Currently, home builders are utilizing a variety of marketing tactics to generate traffic and convert leads with the top tactics being social media, word of mouth, and email. While each of these tactics is important, there are also some notable tactics that aren't being utilized by all home builders including blogging, video, and SEO implementation.
Home builders surveyed in the 2019 State of Home Builder Marketing Report plan on adding a variety of new content distribution channels in the next 12 months including a variety of tactics that include the up and coming marketing content, video. If you're not incorporating video in your marketing and sales efforts, now is the time to start, you don't want to be left behind when your competitors start engaging consumers with video on platforms like Facebook video, Instagram, and Youtube.
A couple of other top selected content distribution channels home builders plan to add include messaging apps like Whatsapp and Facebook Messenger, Snapchat, podcasts, and push notifications. When thinking specifically about inbound marketing projects, home builders' priorities include:
- Growing their organic online presence through SEO
- Building online tools
- Creating interactive content
- Creating content in the form of blogs
- Distributing content
- Filming How-to videos
Marketing Mistakes Home Builders are Making
Generating traffic and converting leads continues to be one of the top challenges home builders face throughout the country, but why is generating traffic and leads so challenging for some home builders? There are a couple of mistakes we noticed from the data that could be the cause of these struggles.
Not Spending Enough on Marketing
The age old saying "you've got to spend money to make money" has some truth in this context. According to Pro Builder, large home builders should be spending between .07% and 1.5% of gross revenue on marketing and advertising not including salaries or model home expenses. However, smaller home building companies who are looking to grow may want to invest in marketing more heavily.
The majority of the home builders surveyed average an annual revenue of less than $10 Million each year. Most home builders surveyed also plan on spending less than $25,000 on marketing in the next 12 months. This equates to .25-2.5% of profit on marketing spend, assuming the home builder generated between $1 and $10 Million in revenue.
Not Calculating ROI on Marketing Initiatives
Thirty-five percent of the home builders we surveyed said that Inbound marketing produced the highest ROI for their organization, while only 9% said outbound marketing practices provided a higher ROI. But what about the other 56% of home builders? The remaining home builders said that they do not or could not calculate ROI or that they simply don't know which brings them a higher ROI. If you're not keeping track of what sources are bringing in the most revenue, how do you expect to generate more revenue at lower costs?
Marketing Opportunities Home Builders are Missing
As we saw from the previous section, many home builders aren't calculating their Return on Marketing Investments. This is a huge opportunity for home builders to understand where their money is going and how much of that money is being returned in the form of customer purchases. If you know where your customers are coming from, it's easier to spend money on the things that bring in customers and cut back on the marketing items that may not be adding enough customers in your sales funnel based on how much you're spending. Calculating ROI is very beneficial to your overall sales and marketing efforts but how can you calculate your ROI? One of the easiest ways for home builders to calculate their ROI is with a Customer Relationship Management system, which we also saw in the report was an area home builders needed to work on.
According to the 2019 State of Home Builder Marketing Report, most home builders have a CRM but it is underutilized. A CRM has many important qualities that make it an opportunity for home builders. First, a CRM can keep track of all your leads and customers in one place and give you the knowledge on where each person is in your sales funnel. This is helpful as you continue to nurture leads and turn them into customers, something 36% of home builders struggle with. The best thing you can do is get a CRM system and make it a priority by setting aside time each day or each week to ensure the information is accurate and up to date.
For more insights and resources to improve your home builder marketing in 2019 and 2020, download the full State of Home Builder Marketing Report, that has several stats and our expert opinion on where you should be spending your time this year.