Commercial real estate is all about relationships. So the industry's interest in social media — a venue where relationship building is turbocharged — should be expected.
"We have gained several clients because of the exposure we received through Facebook," says N. Justin Cazana, CCIM, principal at Cornerstone/Cushman & Wakefield in Knoxville, Tenn. Cazana is one among many CCIMs who have used the social networking site as an effective business development tool.
As social media becomes a more integral part of business development, commercial real estate professionals are getting results by incorporating Facebook, Twitter, and other platforms into their marketing strategies. A social media presence can increase the likelihood of being found by new clients, establish professional credibility, and streamline communication. Although social media is free, it does require time to learn and maintain. So what's the return?
Quantifying the Value
"Learning about social media and setting up my profiles took a lot of time," says Chad Gleason, CCIM, of Real Estate Investment Services in Kent, Wash. Although it can be an efficient tool, there is an opportunity cost for overcoming the initial learning curve, refining messaging, learning new programs, and staying current on existing ones. And high-profile gaffes by celebrities and politicians remind users of the potential risks of participating in social media.
Given this risk and opportunity cost, commercial real estate professionals — people who rely on models and analysis for decision making — are naturally interested in measuring social media's return on investment. "It's hard to determine," says Greg J. Vollman, CCIM, of Apartment Investment Realty in Cincinnati, voicing a common sentiment among CCIMs.
Even Fortune 500 companies are still finding their footing in social media analytics. Ford Motor Co. recently launched a $95 million marketing campaign that included a Facebook page, but the company still had difficulty determining the value of the interest it generated. "They can give you Likes," Scott Kelly, Ford's head of digital marketing, told The Wall Street Journal, referring to the Facebook feature that allows users to provide quick, positive feedback. "But the question is, What is the value of those Likes?"
"It's too early to establish an ROI on the time I invest in social media," says Shawn E. Massey, CCIM, partner at The Shopping Center Group in Memphis, Tenn. "My goal was to increase exposure and keep my name in the retail community during this slow period. Based on that, it has worked very well."
However, one concrete form of measurement is new business. Cazana — whose company has four Facebook sites, three Twitter feeds, and two blogs — has gained several new clients as a result of social media. Daniel Palmeri, a senior associate at Colliers International in Las Vegas, uses LinkedIn to locate potential clients and connections to them. "This has resulted in a far greater success rate than a cold-call," he says. He attributes three closed deals to social media. Gleason says that 40 percent of his deals can be linked to social media connections, which gives him a larger presence in the market and a larger pool of lease tenants.
"When I get a call from someone I connected with through social media, I know my social media campaign is effective," says Martin Barkan, CCIM, CRE, senior vice president of First Property Realty Corp. in Beverly Hills, Calif. Barkan is working on several transactions that originated from connections on Facebook, LinkedIn, and his blog. "These transactions with new clients took six to 12 months to develop after the initial contact, but I believe the return on the investment will be exponential over the next two to three years. I'm certain this will be the single biggest market visibility and client growth platform in my business."
Candice A. Donofrio, owner of Next Wave Real Estate Investments in Laughlin, Nev., gained referral business using social media. After reading a commercial real estate blog post, she found the author's Facebook page through a Web search. After commenting on the author's Facebook wall, she received a phone call from him about a business opportunity, which she referred to a colleague in Las Vegas.
Donofrio's story is an example of how social media can help with inbound marketing. Prospective clients are searching the Web for information about potential business partners, and LinkedIn, Twitter, and Facebook profiles and updates are often top results when an individual's name is searched.
"When someone searches for me, my LinkedIn page, Facebook business page, and Twitter profile are at the top of the results," Barkan says. Social media sites give users privacy settings to control what parts of their profiles appear in search engines. But it pays to have some information available to the public, especially if it's business-related. A recent Pew Research report found that 92 percent of adults use search engines to find information, making it the most common online activity, along with e-mail. Creating a social media profile can help commercial real estate professionals be found online, and it gives their peers a convenient way to communicate with them.
I'm There. Now What?
The initial aversions to social media are being replaced by questions about how to best calibrate and integrate social media into a broader marketing strategy.
Integrating social media into a marketing strategy doesn't have to become a part-time job. Palmeri limits his social media use to an average of 30 minutes a day. Other interviewees worked effectively with even stricter time limits. Third-party sites like Seismic, TweetDeck, and HootSuite improve efficiency by allowing users to update multiple social media profiles from one site. Using these time-saving tools, "I am able to update my Facebook and Twitter profiles with material from my blog with one click of the mouse," Barkan says.
An initial decision also needs to be made about how "social" social media should be. Users like Palmeri don't mind mixing business and personal information. "You need to express a little bit of your personality, which gives insight into who you are," Palmeri says.
Gant B. Hill, CCIM, president and principal broker of Venterra Realty in Louisville, Ky., also chooses to share personal information alongside business information. "I don't mind mixing the two," Hill says. "It creates character and makes you more approachable, but never take either to the extreme."
Facebook and Google+, Google's social network, allow users to have it both ways. Facebook users can create a group of business friends and share only certain updates with that group. Google+ offers similar functionality with its Circles feature.
For those looking for more separation between their business and personal lives, the solution is to create different profiles for each. "People who want to communicate their professional information to their personal network can simply post the relevant information in both places," says Jeffrey B. Pollock, CCIM, principal at Pollock Commercial in Atlanta.
What to Share
Sharing information about recent transactions, insights into local market observations, or trends in certain property types can help establish credibility among peers and potential clients. "People are looking to us for information, and we use social media to provide news about properties and tenants that have come to the market," says Cazana.
LinkedIn is a particularly good platform for such information. For example, Bob Rein, CCIM, associate vice president of NAI REOC Austin in Austin, Texas, posted a series of LinkedIn updates to attract investment from his home state of Arizona. What started as a single post about Austin market trends turned into series of 10 posts. A prospective client saw the posts and contacted Rein, suggesting they work together when an investment opportunity arises.
Finding business-related information to share can sometimes be as easy as repurposing existing content. Barkan takes advantage of the low incremental resource cost of social media by repurposing blog and newsletter content on Facebook and Twitter. Businesses and individuals without blogs can still create a social media presence by finding quality industry information and sharing it with their followers. CCIMs can share insights by applying CCIM education concepts to current commercial real estate news.
Other sources of business-related information include quotes from industry events, reactions to other users' posts, product reviews, and more. A little bragging doesn't hurt either. "I used LinkedIn to announce earning my CCIM designation, and my profile views went up significantly as a result," Rein says. His connections congratulated him on the accomplishment and asked for information about the designation.
Social media is about building relationships, and in the U.S., that relationship building is mostly occurring on Facebook. The site dominates among social media platforms. U.S. Internet users spend 16 percent of their online time on Facebook, according to Citi Investment Research and Analysis, a figure that has steadily increased over the past few years. Businesses are recognizing the importance of going where their customers are. Booz & Co. recently reported that 94 percent of the businesses surveyed view Facebook as one of their top three social media priorities, followed by Twitter with 77 percent and YouTube with 42 percent. The same report found that 96 percent of companies plan to either allocate substantially or somewhat more resources to social media.
Part of the appeal of Facebook and other social media sites is their reach. Social media provides an opportunity for businesses to reach outside their customer contact lists to a much bigger audience. "The more I grow my social media presence the more my inbound marketing increases, which has been essential to growing my business," says Barkan, who like other CCIMs, is finding that making sense of social media makes business sense.
Dennis LaMantia is interactive marketing manager at the CCIM Institute.