Most start-ups have at least one thing in common — the need to acquire new customers. zipRealty.com is no exception. The residential real estate brokerage company, which works with home buyers as well as sellers, is constantly looking for ways to increase its customer database.
In October 2000, zipRealty.com turned to email marketing for help. The company teamed up with Domania Inc., a marketing firm for the real estate and mortgage industry, and came up with a plan for sending out regular mailings to registered Domania users: zipRealty.com sponsors Domania newsletters and sends out monthly registration offers, as well as follow-up messages, to Domania users.
Through this program, zipRealty.com gains an average of 1,400 new members per month, according to Devin Saylor, director of business development at zipRealty.com.
How It Works
Domania has about 120,000 members in its database. Once a month, zipRealty.com sends out “LeadGrams,” messages that encourage Domania members to sign up for zipRealty.com. The messages have been filtered by ZIP code so that they go to Domania members in the 13 major markets that zipRealty.com covers. The LeadGrams encourage users to click back to the zipRealty.com Web site and register.
The messages go to about 50,000 individuals each month. They generate, on average, an 8 to 15 percent click-through rate (CTR), with about a 20 percent conversion rate for those emails that have been clicked on.
Yes, the messages are sent to all Domania users who have not yet registered for zipRealty.com and live in zipRealty.com’s coverage area, even to those who received the message the previous month. Ben Joslin, the vice president of marketing and customer management at Domania, says he keeps a close eye on the unsubscribe rate, which hovers at about 1 percent. If that number were to go up, he adds, his company would consider sending messages to new Domania members only.
Plus, the messages include language at the bottom that says, in part, “This message is coming to you from Domania.com on behalf of one of our trusted partners…When you registered with Domania.com, you asked to receive future home sales updates and other relevant information.” In all likelihood, this language helps to cut down on the number of unsubscribers.
Then, to those who received the LeadGram but did not register for zipRealty.com, a remarketing message is sent out a few weeks later. Joslin notes that these messages result in about a 15 percent CTR.
Another prong of the approach revolves around the newsletters, affectionately known as “DomaniaGrams.” These content-based mailings don’t carry a sell message. Instead, they include tips on evaluating a home, facts on new home buyers, definitions of real estate terms, and other information.
Portions of the newsletters are sponsored by zipRealty.com, which is the exclusive real estate agency advertiser for any one newsletter. (Other portions are sponsored by a mortgage company.) zipRealty.com sponsors a short article, and the sponsorship carries a link back to the zipRealty.com site.
What It Achieves
Joslin says that the newsletters get about a 20 percent overall CTR, and roughly 10 percent of that is split between the partners. The other 90 percent of those who click through do so by going to a customized Domania.com page, where a zipRealty.com banner awaits them.
“The newsletters build product awareness, so that when [members] see the LeadGrams, they say, ‘We know these guys,'” Joslin says.
Now, I mentioned earlier that the email marketing strategy results in about 1,400 new, registered customers each month for zipRealty.com. Saylor didn’t break out which pieces — the lead messages, the remailings, or the sponsorships — generated which percentages of these new customers, but the business model is set up so that to zipRealty.com, at least, those figures are relatively unimportant.
That’s because the company pays Domania a flat monthly fee for a guaranteed number of new subscribers. If Domania delivers more, it gets a bonus. If it falls short — but that has yet to happen — the remainder would carry over into the next month.
So if you’re a start-up — or any other company — looking to acquire new customers, keep this business model in mind. It might just make all the difference.
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