Elements of a Successful Auction, Part V

The Ability to Promote Adequately in the Marketplace

A fundamental difference between the auction approach to marketing real estate and other methods such as ordinary brokerage is the time element. When sellers approach us with an auction assignment, it is not with the idea that they want to sell it “in the next 6 months or so” or “the next year or so” as is usually the case with brokerage listings. When a seller wants an auction, they want it done now!

Realistically, the closest we can do to now! is typically about 30 days. That means 5 days to a week to develop the marketing material, and 3 weeks to implement it.

There are several tools in our kit we can use to get the word out about an auction. The first step obviously is to identify our target markets, based upon the product types, locations, specific and general market conditions, and marketing tool availability (for example, signs are not allowed in certain communities).

Developing the correct marketing mix is an imprecise science; it is based partly upon budget, largely upon past experience, and partly upon gut feelings about what might be effective.

Some items of the marketing campaign are very low cost items, such as signage or ads in Craigslist or email blasts to our internal lists. Some are more substantial, such as a large display ad in a major market newspaper, or a direct mail campaign to 10,000 names in a radius pulled by SIC code, or net worth. Online marketing can run the range from a banner ad in multiple portals to email blasts to targeted lists from industry-specific vendors to developing a Google adword campaign to PR campaigns targeting affinity groups either online or in hard media.

Although it is always possible that an auction marketing campaign can attract sufficient bidders simply by putting up signage on the property and placing the asset on our website and promoting to our email subscribers and our exposure to search engines (a very low cost), it is usually preferable to draw interest from a variety of media by spending some money to reach prospective bidders in places they do business or leisure activities. To that end, we will develop a budget to adequately reach the marketplace.

A marketing budget is very much like an insurance policy. You can spend only a little and on auction day you may not have much protection, or you can spend the optimal amount and ensure that you have reached the market and have bidders there who are ready to compete for the asset.

The ability to promote adequately in the marketplace to get that ready, willing and able crowd is a very important element of a successful auction. Let us show you how!