Counting the costs
Should your business be charging ‘Landlord Paid Advertising’? Our experts give you the tools to start implementing this necessary fee right now
Vendor Paid Advertising (VPA) is not a new term in the real estate industry, but it is a staple. For years, motivated vendors have been reaching deep into their pockets to ensure their property gets the finest marketing possible.
They know if they sit on the first page of a listing website they double their chances of a buyer looking at their property. They realise the importance of having a branded signboard out the front of their home to attract passers-by, and to get the neighbours pondering an upgrade. For the vendor it is a no-brainer – they invest money in their final sale price.
Unfortunately, ‘Landlord Paid Advertising’ (LPA) is slightly more obscure. Don’t get me wrong, LPA is around and many businesses are charging it. But are you – and more importantly, your landlords – getting the full benefit of this added cost?
According to Fiona Blayney, director of Blayney Potential Plus, LPA is an untapped source of income for many businesses.
“To me [LPA] is one thing everyone in the industry should have,” she told Residential Property Manager.
“One of the biggest things you do for a landlord is to market their property and get the right tenant. At the moment, LPA is just something businesses have chucked into their fees, and not really given too much thought.”
WHY IMPLEMENT LPA?
The benefits of an LPA campaign are two-fold – for the property manager and the landlord – according to Amy Sanderson, head of property management for LJ Hooker. She says it is the perfect way to cover costs.
“Internet subscriptions and newspaper advertising are very expensive and we need to ensure we recoup those funds from somewhere,” she says.
“Secondly, it is also about buy-in from the investor client, similar to Vendor Paid Advertising.
“When a client has paid money up-front for something, they are more committed to achieving a result with you.”
Tara Milzewki, Harcourts state operations manager for property management in Queensland, believes a comprehensive advertising campaign will put your property management department ahead of your competitors.
“The property management department will be seen as the agent of choice amongst the competition. As with selling a home, the property management first impression is what counts, and the presentation of the advertising will help the agency to stand out,” she says.
Those principals who do not implement LPA in their business are giving away their services and skills for free, says Michael Connelly, head of network property management at McGrath.
“My bet is many principals would have heart failure if they really knew how much they were giving away for free,” he says.
READ the full interview in the latest issue of Residential Property Manager – ON SALE NOW
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