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Marketing As a Key Component in Multifamily Real Estate Investing

In a recent webinar, I mentioned Peter Drucker's profound and time-tested maxim that business equals innovation plus marketing. Drucker knew what he was talking about and business owners and aspiring business owners would do well to consider what that equation means for them.

While Drucker's "business equation" might prove true for any type of business, consider what it means for an entrepreneur who runs a multifamily real estate investing company. How does "marketing plus innovation" play out in that scenario?

We are going to examine how the marketing side of his equation plays out in the multifamily apartment investing scenario.

Marketing: Other businesses might have the conventional approach to marketing only to end-users, entrepreneurs who do apartment investing have the unique challenge of marketing to up to four different groups. (Some investments might require just one or two of these groups, but many multifamily investments might require that you market to all four):

The first group is the owner of the multifamily apartment building itself - someone who is looking to earn more than what they are getting or exit from the headache.

The second group is the investors who need to be sold on why this particular multifamily investment is a good one to buy into.

The third group of people is the new tenants that you might want to attract to the building once you start to populate it.

And the fourth group, if you end up buying the property and reselling it, is the person or company you will eventually want to sell to.

When you think about the marketing you need to do to communicate with these four groups of people, consider that each one has their own needs and end-goals. On a piece of paper, list those four groups and list two or three goals for each group.

The owner of the multifamily apartment building might be losing money and wants to break even, or perhaps even earn some profit but get rid of what they perceive to be a huge time commitment in maintaining the apartment. The potential investors will want to see that you increase their potential return and that you actively mitigate any money-losing risks that might appear.

The new tenants that you would like to move into the apartment building might want to know that you are a good landlord offering responsive service, a safe place to live, and reasonable value. And the potential buyers - if you sell the apartment to someone else - will want to know that the property has been taken care of and will likely offer them a good return on their investment. Those are to get you started, but you might think of a few more on your own!

Just doing this basic exercise can help you when it comes time to communicate with each one. When you know what they want to get out of the transaction, you'll be able to better "speak their language" and you'll be amazed at how much easier it will be to present the opportunity to them.

Next, make sure that all of your marketing is designed to communicate to at least one of these groups. You might use flyers, or newspaper ads, or a website, or Google AdWords, or billboards, or business cards, or any of a million other marketing methods.

But every time you invest some of your hard-earned dollars in your marketing, you need to make sure that it is effectively targeting at least one of those four groups and that your marketing speaks directly to their interests.

Drucker's equation - business equals marketing plus innovation - provides us with a valuable springboard from which we can create effective marketing for our real estate investing businesses.

Article Source: http://www.bo-knows.com

Lance Edwards is living proof of his mantra that you don't have to "graduate" from single family to multifamily - you can start with multifamily; using none of your own money and not dealing with tenants and toilets. For FREE information, visit www.ApartmentWealthMachine.com.

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