As an agent you can be a vendor's best friend or worst enemy. Chances are, money will have a lot to do with them thinking of you as a hero or someone they don’t want to even think of next time they think real estate. Considering most of this will come back to the final result you get them at auction, the importance of exposing their listing in the best way possible is essential. Here are the reasons you need vendor-paid advertising (VPA).
1. VPA provides measurability of interest
One of the key things a vendor will want to know through the campaign is the level of interest. If you have advertising, you can monitor this. Getting online ads up will allow you to measure the click-through rate of interest; you can also ask all leads where they found out about the property. By doing this you can explain to your vendors where leads are coming from and validate their spend on advertising.
2. VPA provides maximum exposure for your listings to get qualified leads
Having VPA helps you generate more leads and increase the sale price. As an agent, your main objective is to generate awareness, you are also then meant to be able to sell the features and benefits. If you get VPA, you will reach more potential buyers than you would have before. This ensures that come sale time, everyone who should have seen your home for sale, now has. It also means that you won’t need to go back and have a conversation saying this is what we should have done. You put your best effort in first.
3. You gain the seller’s assurances they want to sell. Their money speaks louder than words
Every time a vendor pumps in money for advertising, you know they are motivated to sell. Why? Because they won’t see a dollar of this back unless they do sell. As VPA can be quite expensive, the more they pump in, the more they are required to get something back. If a VPA schedule is requiring $15,000 or $20,000 from the vendor, they will find it harder to walk away from the presented price, even if it isn’t their dream figure.
4. VPA ensures you get the maximum sale price
The reality of VPA is it increases exposure, and more exposure creates more awareness. Awareness is the number one key to a top sale price. How many times have you heard from a prospective buyer that if they would have known about that home they would have bid? You need to relay this to the vendor and say we can’t afford to hear this from people down the track. We need every possible buyer there from the get-go.
5. It’s a vendor's home, it’s a vendor's costs
A lot of vendors will come back and say that the competing agent is willing to absorb the cost of the advertising. As an agent, you need to be able to walk away from these deals and not get into a slog over this. Explain to the vendor that if the agent is paying the advertising, don’t you think they will EXPECT a result. Explain that come auction day, they will be pushing you to sell no matter what, because they NEED their money back. Explain that as their agent, by not being financially invested, you can advise the best course of action and let the transaction take a little longer. If you don’t need a sale on the day, you can deal privately with prospects and get the best price, it may take a little longer, but imagine what your vendor will say when you don’t just get them the $20,000 back for their advertising, but more!
Rocky Bartolotto is the national sales director for homely.com.au. Rocky's extensive experience in introducing new product offerings to the market and client management abilities makes him one of the most knowledgeable property specialists in the country. In addition to his time working in the online space, Rocky is also one of Sydney’s top auctioneers, with over 4,000 auctions performed through his business. He is the director and chief auctioneer at Property Auction Services.