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Why Facebook Ads WON’T WORK For You

Why Facebook Ads WON’T WORK For You

So I’ve been seeing a lot of comments on my Facebook page and different facebook posts from real estate agents saying that Facebook ads just Don’t work for their business So I want to kind of bring out the whiteboard right here break down some of the numbers and at the end this video You can decide if Facebook ads are gonna actually work for your business If it’s something you should go with or if you should just focus on referrals door-knocking : all these other prospecting methods Right. So let’s get a few things straight first of all So let’s get some kind of national averages down on the whiteboard and then we can work backwards do some mathematics Right and then see if it’s actually worth to invest our time and our money into Facebook Ads So the first thing that we need to know is that the national average the national cost per lead Average is about six dollars per lead. Okay, so write it up here six dollars per lead So if you go look at that compared to like a Trulia Zillow realtor.com Usually those sites you’re paying about twenty five to thirty five to fifty two even more Dollars per lead and the other thing is like these leads are not even Exclusive to you, whereas with Facebook. These leads are a hundred percent exclusive to you. And this is the national average guys So what that means is that there’s a lot of areas where? The lead costs are even much lower than six dollars per lead Now the areas where the lead costs are higher than six dollars per lead, you know, they’re gonna be areas like, San Francisco LA New York City where obviously the purchase price is a lot higher so your commissions are a lot higher so at the end of day It makes it totally worth it still to actually go through and pay for those leads now the Second thing that I want to get down on the board before we work Backwards and kind of like take a look at all this math as far as Facebook ads and lead generation Go for the real estate space is that the average close rate is about two to three percent For online leads. Okay. Now that is across all like all online leads doesn’t matter if it’s from Facebook Google your website Whatever it is. So let’s put that down We got about two to three percent Okay now thing I always hear is when people hear this or like well Jason I closed about 75% of referrals and that’s awesome. And I’m not saying that you shouldn’t focus on referrals as well The only thing about referrals is there’s going to come to a point where you run out of your existing Network, right? You only have so many friends. You only have so many family members. So at some point you’re not gonna have that Consistent flow of deals coming through because you only have so many friends and so many family members All right. So let’s break down the math here. Let’s just say that you are generating about three to four leads per day Okay, so let’s write this down. So If you get three to four leads per day That is about a hundred leads per month, okay, so you’re riding around 90 to 120 so let’s just say 100. So hopefully this is big enough a 100 leads per month All right, so three to four leads per day honestly guys If you go through and you watch all these other videos on my youtube channel I break down step-by-step how to actually go through and generate these leads. So to get three to four leads per day Really isn’t that difficult? Alright, so now we’re at a hundred leads per month and our national average will separate this right here Okay, two to three percent Of the leads are actually gonna turn into closed deals Right and a lot of times you can see a little bit higher than that It really all depends on your follow-up, but let’s break this down. So we got two to three deals So 100 if we have 100 leads per month, we’re getting and we close two to three percent We’re closing two to three deals now I was just on a phone call over earlier today and someone had generated 46 leads and it already closed two deals from those 46 leaves. They had generated this month Okay, so then the last one was like 26 27 days. They generated 43 leads two deals So that’s more around like the four or five percent conversion rate right there, okay So if you have two three percent, you’re gonna have two to three deals Go through right now let’s just say and obviously every every area is a little bit different based on the home sale price and you commissioned your split with the broker and all that stuff’s a little bit different but let’s just say on average you’re making $5,000 per close transaction, right? Which I know you’re probably making a whole lot more than that but let’s just say $5,000 to keep this basic and simple so $5,000 here you’d be making 10 to 15,000 dollars in gross Commission income there, right? So now You’re making 10 to $15,000 from these 100 leads and this is typically within the first 30 to 60 days That’s not even having the continual ongoing followup with all these leads coming through because now you closings 2 to 3 deals right here we’ve got 97 to 98 other leads that you can continually follow up with and nurture and these are people within your Specific area right now, like let’s even say half of those, you know, turn out to be bogus phone numbers Which usually it’s not that that’s not the case but half of those you still have 47 to 48 other real people in your area that you can nurture and Follow up with to eventually close down the road. Okay So now we’re at ten to fifteen thousand dollars right here and gross commissionable income Well, let’s break it down by the National League coughs right up here. So six dollars is their average cost per lead Okay, so we’re getting three to four leads per day 100 leads per month. So let’s say a hundred will just even go up here So if we got four leads per day, right and there’s 30 days in the month. Let’s say that’s a hundred and twenty leads so 120 okay, we’ll say weeds right there times the six dollars Okay. What is that math? I don’t even know what that is That’s like so let’s see six hundred dollars times that so that’s gonna be seven hundred twenty dollars In ad spend right to make Ten to fifteen thousand dollars in Commission I mean Here’s the numbers guys right here. Now. I know a lot of you guys are probably looking this insane Well, Jason Like I’m only gonna close two three deals for 100 leads Like that’s just like who has time to call and follow up with all these leads. Well, guess what? This is the exact same thing I use in my business But guess what? My goal is I want to close 1.5 to 2 percent of the leads that I’m generating. All right Now the way that I’m able to do that with basically a one-man show. Obviously, we have some support members on our team They’re able to go through And fulfill on on everything that we’re selling But we use leverage we use technology. We use email marketing. We use text message marking. We use facebook Messenger, right? And so all these different paths where you don’t have to go through and kill yourself calling every single one of these leads now obviously if you have an is a an Independent sales associate and going through and calling every single one of those leads and figuring out Okay, is this lead like ready to go or not? Then obviously that’s gonna help out Dramatically, right but if you have all of this automation in place of email marketing sending automated emails out dripping on That person consistently sending out text messages sending out automated Facebook messages then you’re able to trigger and start conversations with every single one of these leads and then you’re only spending time with the leads who actually Respond back. So let me just really quick. I’m just gonna erase this so we can get this all nailed down So we can make a decision an educated decision on whether or not Facebook Ads actually work for our business So let’s say we’re at fifteen dollars per lead. Okay. Well, let’s even say twenty dollars per lead okay, and then we’re gonna do three to four leads per day a per day, which is going to be about 100 leads per month Today so now we’re at 20 dollars per lead 100 leads per month. And so that’s gonna be about let’s say $2,000 in advertising Right. Well as we talked about before to get those hundred leads we’re gonna have to pay two thousand dollars and if we close two, To three percent of those 100 leads. Well, let’s do this. Let’s even cut that in half Let’s say we’re only closing one deal from those 100 leads. All right, so one deal and you’re making on average Five thousand dollars per commission. Okay. Well look at this You made $5,000 in GCI From spending just two thousand dollars on advertising. So you are more than doubling your money right here Right now guys over the last couple of days I’ve been listening to a book by Tony Robbins called money master the game another one’s called unbreakable or unshakable I can’t really remember the name but they’re talking about getting investments where you can make a consistent 7 to 8 percent return on an annualized basis Right where you are literally doubling almost tripling your money Even with these terrible lead costs and the terrible 1% close ratio Within 30 to 60 days all right, so when you’re going through and looking at Facebook Ads it’s really the mental mindset and really just thinking about of like going through and Doubling your money and having your money work for you. Okay, this is more an investment It’s like investing the stock but you have full control over it because you know how much money you’re gonna put in, you know exactly how many leads it’s gonna kick back out and You know how many deals you can actually close from those leads that are being generated and once again? Because of technology it’s a beautiful thing. We have our email marketing. We have our text marketing We have our facebook messenger marketing all on complete autopilot And then once you start to scale this up, okay, usually at first you’ve got all the time in the world But you don’t have money right and then it kind of starts to transition and you start having a ton of money But you don’t really have any time So what you do? Is you go hire an ISA you hire an assistant you hire somebody? To go through and call every single of those leads as soon as they come in and maybe that adds an extra $5 per lead to your overall lead costs, but as we showed you guys by the numbers right here Even if you hire an ISA, even you’re paying through the nose for some software that’s automating your email text marketing facebook Messenger marketing Which is you guys? No, Arsenal is a very like a very affordable solution to be able to handle all that for you You’re still extremely profitable right here. All right so basically I just wanted to shoot this video really quick and break down Facebook Ads by the numbers and how they can actually Work for you and guys, this is exactly how I’ve grown my entire business I am the only sales person. The only sales rep. I do all my marketing I do all my sales and this is the exact process. I invest money into Facebook Ads There’s no way I could handle all of the sales calls, right? And so what I do is I leverage email marketing. I leverage text message marketing and then Based on those people that respond and show interest Then I’m able to sell them on whatever I’m selling and the same thing goes with you in real estate I mean the benefit for you in real estate is the things you’re selling are Extremely high sales prices. So the Commission is insanely high which obviously The higher the sales price the higher Commission the better overall return that you’re getting on your money so anyway guys I just want to kind of debunk this whole myth that I see all the time on my facebook page on my facebook post Facebook Ads everything of Realtors saying Ah Facebook Ads don’t work They don’t work because they’re not willing to go through and do this math work Backwards from how much they’re actually gonna make from the deal and then actually like commit enough to generate at least 50 to 100 leads a lot of people that I see a lot of real estate agents that I see that are not successful with Facebook Ads They’ll commit to getting about 20 to 25 leads and then after the 20 to 25 leads if they haven’t closed a deal yet They’re like Oh Facebook Ads don’t work right, whereas if you just push a little bit farther if you’re committed to that 50 to 100 or even two hundred leads mark It’s really not that much money invested, and the return can be absolutely insane so anyway guys I hope you guys this this video helped you kind of debunk the myth if you’re like one or now a new Facebook guys really work How can I actually make them work for me just do the math working backwards? It’s pretty simple and then leverage technology to be in your favor And as soon as you start making that money hire an assistant hire an ISA so they can be doing the phone calls So you can be doing what you do best, which is working with your clients one-on-one Actually closing deals helping them sell and buy their home So anyway guys with that said I hope you enjoyed this video If you did go ahead give it a thumbs up. Also if you’re a brand new here to the channel My name is Jason Wardrop I launched new videos every single week on how to generate more leads make more money and grow your business. So make sure you subscribe hit that notification bell so you can be notified every time I launched a new video and with that said Thank you so much for watching and I will see you in the next video

24 thoughts on “Why Facebook Ads WON’T WORK For You

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  2. Thank you Jason. You are so F'n right. But I live in the San Francisco Bay area and the one thing I will disagree with you on is that it is not worth paying that extra money to these top lead providers for their sh1ty leads. As you mentioned the non-exclusive nature of those leads make them crap. You are absolutely right…this business (real estate sales) takes consistency and patience to see the fruits of it. It's a Marathon not a Sprint. Thank Bro!

  3. This is such a great breakdown. Displaying this will definitely ease concerns for the prospective clients I'm seeking to market for.

  4. Thanks for sharing this my friend, this was simple but effective, thanks for the breakdown. I always enjoy your content.
    I have a quick question for you for you, if you don't mind? 🙂 How much do you charge your real estate agents that you work with? I understand it probably depends on what you are going to be doing for them, (Content/ad creation, Facebook management, email follow up etc.) but where do you start? Do you offer packages, hours, project, campaign, all the above?! LOL Thanks in advance for the reply!

  5. I have been using Jason's Arsenal Marketing for 3 years now. There is nothing else out there that is so easy and so effective and you get support when you need it. Go For It! Debbie in Dallas TX Area

  6. This was SUPER helpful! Im just starting the process of getting my FIRST client for my SMMA and trying to understand the numbers is difficult for me. So, thanks Jason

  7. Hey Jason! Say you're a real estate investor/wholesaler who writes contracts between buyers and sellers of properties to then flip, could you use FB ads to close instead of bandit signs and sending letters which is not as cost effective..?

  8. Thank you Jason …But my question here is !! You mean any lead you generate through Facebook about real estate is going to cost 6$ ? Wow that is very huge for us here in Africa…

  9. Jason my wife just got on board with the Arsenal MKG However we are not seeing the leads converting at all. Our audience is 26 + excluding realtors and anyone associated with real estate employment. $10/day budget Is there anything we need to change?

  10. This stuff is a no-brainer. I’m shocked that many agents don’t even have a Facebook business page or feel they need one. They seem to believe ad content is posting pictures of closings on their personal page with a CTA to contact them.

    I can attest to the fact that one deal pays for ad spend many times over. Thanks for this context.

  11. Jason. Love these videos. Questions…. (1) Do you find better results with a "single property" ad or "homes list" ad? (2) Do you find better results with PPE ads or straight lead gen "lead ad"? Thank you for being realistic with these numbers and not BSing your avid followers. Really appreciate the honesty 🙏

  12. Glad I watched this, have had few people telling me exactly the same stories (that FB ads don't work) simple math like this is really good to clear the picture! Thanks for upload

  13. Your videos are very helpful. I'm a RE wholesaler in Houston, TX. Do you have any videos for wholesalers? I see most of the RE videos are for realtors.

  14. Does this lead generation system work in Singapore? And what is cost of signing up? My objective is to generate qualified commercial real estate leads.

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