The old school "smile-and-dial – you can sell anything to anyone approach" that is common with print and outdoor advertising and high-pressure sales techniques, won't make quota, at least not in the real estate sector. Just ask Shamir Duverseau, managing director of Smart Panda Labs, a digital strategy consultancy that advises real estate companies on how to sell to today's buyer while cutting advertising costs and boosting cash-conversion. GlobeSt.com caught up with Duverseau to dig deeper into this topic.

How do firms reduce ad spend while shortening cash conversion cycles?

Cash flow affects the bottom line in any business and in real estate it is especially critical. Real estate developers leverage significant amounts of cash when building, developing or renovating, and these projects take anywhere from one to three years (or more) to close. Therefore, when development nears completion, it is imperative to accelerate incoming cash flow and shorten the cash conversion cycle (CCC).

CCC is the time, measured in days, it takes to convert investments in inventory and other resources into cash flow from sales. Shortening the CCC means you are more effective at developing, bringing in revenue, and meeting commitments to partners, banks, and loan providers. It almost always means that you are more quickly building the value of your organization.

Today, marketing plays a significant role in shortening CCC. It's incumbent upon real estate marketers to optimize digital strategies and touchpoints in their customers' considered purchase journey. That journey is a complex buying decision with a high degree of financial or emotional risk/rewards. It requires meaningful investigation and vetting by key decision makers and influencers prior to sale – taking anywhere from months to years. The cycle can be shortened by personalizing online experiences that target the right buyers nurturing them from first contact to deal close.

What do buyers expect?

Over the last 30 years, buyers have become educated and discerning online consumers. Today, almost 85% of all potential real estate buyers use the Internet in their purchase process. This is especially true for people 30 to 49 years old, and more so for millennials. And, online retailers are continually refining the shopping experience to target specific eCommerce behaviors. Real estate is no different. Buyers expect the same level of personalization, which most firms do not provide – showcase a property that speaks to the individual buyer's lifestyle and preferences.

How do we meet those expectations?

To meet the expectations of today's buyers, savvy real estate developers must optimize the customer journey – including advertising, websites, mobile apps and emails/SMS communications – to create a highly personalized experience in which buyers feel they are in control. Take a cue from some of the world's biggest brands such as Amazon. Focus on one-to-one interactions – match the consumer with a specific product, remember them when they return, and communicate with them throughout their journey.

How does a company get started with this process?

It starts with data. Successful real estate digital strategies are built on data-driven personalized experiences. Enhance and optimize the customer's digital journey with in-the-moment-strategies and tactics that span targeted search campaigns, testing and personalization, customer email journeys, digital analytics, and business intelligence. Develop relationships with both prospects and customers based on their needs, and then, continually monitor and analyze data for insights to improve the ROI on campaigns, websites, mobile apps, and communications.

Can you provide an example?

The Related Co., a recent Smart Panda Labs client, is a great example. Privately-owned with a worldwide portfolio of properties valued at more than $20 billion, including some 20-plus luxury apartments in premier locations. Related wanted to generate more leases and reduce the cost-per-lease acquisition.

Our approach focused on new customer acquisition, nurture, and conversion with a comprehensive data audit. This started with the examination of acquisition performance metrics such as cost per click (CPC), click-through rate (CTR), and cost per acquisition (CPA). The audit also examined the user experience and engagement metrics (i.e., exit rates, return frequency, calls-to-action, etc.). Through this audit, we gleaned insights on the effectiveness of the firm's acquisition and conversion rates along with customer-relevant data accuracy.

Using these findings, the team crafted a digital strategy that addressed prospects with a campaign focused on keywords matching prospects' search intent, which also required the firm to improve its SEO tactics. The team designed and developed new landing pages with focused content that continually leveraged experimentation, using Optimizely, to better understand prospect expectations and refine messaging. And the firm's database was cleansed to map key attributes and data feeds to collect all data into a single system (Salesforce Marketing Cloud).

Related's program netted quantifiable results:

26% reduction in acquisition spend
101% increase in paid search CTR
164% increase in organic search traffic conversion
112% increased lead-form initiation and 25% increased completion through A/B tests.
66% decrease in paid media CPA due to improved user experience
50-60% email open rates average (industry average: 30-40%)
12-15% email CTR average (industry average: 9-12%)

More importantly, the optimizations lead to improvements in their business metrics. Related saw 1000% increase in lease approvals, a 37% decrease in cost-per-apartment tour, and a 23% decrease in cost-per-signed lease. Impressive numbers that translated into improved cash flow and shortened cash-conversion cycle while building customer loyalty and trust.

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Marketing's Role in Shortening the Cash Conversion Cycle

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