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What I learned building a six figure property business

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It took me a long while to realise marketing is more important  than selling  and the best way to win is to have no competition.

As an old school sales guy I  took a pride in being responsible for my number, as I started my own businesses I trod this linear path – belly to belly one on one selling of ideas, services and concepts. Furthermore, I liked the cut and thrust of winning in the battle of ideas against competitors.

But to scale –  to truly build something worthwhile quickly – you have to be a marketer- you have to love it and be consumed by it. Building you business or brand hangs on your ability to market your ideas effectively – and if you do it in a way that cannot be easily replicated and where no one else is doing it in quite the same way –  you have a winning, duplicatable formula.

Last year I got seriously interested in property. Buying, selling and trading residential units. I had toyed with it on and off for months before commiting my mind and effort to it. That commitment and I suspect a my non property related background allowed the business to hit pro rata six figure revenue inside 90 days and grow a substantive, profitable  business that today is still growing.

Let me take you through some of the processes and mental gymnastics.

First off – the whole market has changed from twenty years ago. Rightmove and to a lesser extent Zoopla took hold of where we look to find a property. Estate agents windows and the centre page of your local newspaper don’t attract the audience they did – the web portals dominate.

Secondly estate agents  commoditised themselves –  over thirty years they have been battling over fees and doing whatever it took to get instructions from clients – including inflating likely selling prices, meaning properties stuck on the market for far longer than they had to.

I understand that the march of online estate agents is not solely down to agents devaluing what they do – technology has caught the sector up – and for most residential properties in the UK a pre packaged sales service as delivered by Purple Bricks does the job – with the property portals doing the heavy lifting in terms of finding buyers. But estate agents for the most part don’t want to change – they want to continue fishing for enquiries, valuing homes and charging often hefty fees at the far end.

All of the above allowed me to structure something that works really well. In the property business, like any other my first action was to build an online campaign targeting those who wanted to sell their property quickly rather than sit on the market for an indeterminate time. If we get get a priced agreed our business could then make a profit on the buying price v the selling price to an investor or homeowner who wanted to live there. Simple trading, reliant on arithmetic, an understanding of the market and faith in the process.

But in short order we were spending five figures per month on online advertising to attract these buying opportunities – we needed another way to monetise the ones that did not fit the buying model. Initially I planned to create an estate agency brand and push these through this channel. It became clear however that this would involve a high touch business  – with all the processes and staff that this required. The middle ground is we bought an existing property auction and developed it into an online property auction business. This allowed us to be more choosy about the stock we took in and select only the stuff that would readily sell and that we could demand higher fees for – best of all from a seller’s perspective they got this service free with the buyer paying an auction fee to secure the property.

Whilst traditional and online estate agents are broadcasting messages along the lines of being the best agent in the area, or the biggest or newest or oldest or cheapest etc – we don’t pitch in this way.

Our differentiation was simple and our offer is irresistible to a high proportion of vendors – we will buy your property immediately or we will find you a buyer quickly and you don’t pay any fees.

Getting that message right and communicating it effectively has been worth a boatload of business – positioning it outside the competitive field has made it one of the most lucrative businesses I have been involved in. Our process worked so well we were asked by others how they could replicate so we created this course. Property Trader Academy –  if you would like to build something similar, get in touch.

Barry