After recently writing an article ranking the quality of leads, I received a ton of questions about joint venture relationships. In the article, I ranked joint venture leads as the second-best type of lead you can generate. A joint venture is defined by Wikipedia as:
A relationship formed between two or more parties to undertake economic activity together… The venture can be for one specific project only, or a continuing business relationship such as the Fuji Xerox joint venture.
A great example of a joint venture is the one between AT&T and Apple for the sale of the latter’s iPhone. AT&T derives benefit by gaining a ton of new subsribers without doing any marketing, which Apple handles. Apple, in turn, receives a commission on each new subscriber AT&T signs up. This additional revenue helps offset the marketing costs Apple incurs to sell the iPhone.
Both businesses benefite from the relationship. The main benefit of a joint venture is a lower cost of sale.
As real estate agents, we have the opportunity to engineer joint venture relationships into our businesses to reduce our cost per sale and our cost per lead. This lead generation strategy is very important in today’s market because of the reduced volume of home sales. Many agents are struggling with cash-flow and are looking to generate new leads inexpensively. Joint venture relationships should be an integral part of your marketing plan.
Let me give you an example. I put together a joint venture relationship with my attorney. I drew up a letter that he could mail to his database offering them a free gift, which was a copy of my book. Any of his clients who wanted their free copy had to call my message center and leave their name, address and phone number. I handled the mailing on my end and sent the letter to about 200 clients of his. The mailing generated about 40 leads for a cost-per-lead of about 40 centers. And because this letter was an indirect endorsement of me by the attorney, these clients were “pre-sold” and the leads were consequently high-quality leads.
My attorney benefitted fro the relationship in three ways. First, I referred all my clients to him for asset protection and estate planning, which every investor needs. I also plugged his practice and featured a couple of his articles in our client newsletters. The second benefit for him was the ability to give a “free gift” to his clients without spending any time or money doing so. The letter appeared to be from him, but we handled everything for him on my end. Lastly, he got calls from clients asking him about us. So he got the chance to talk to clients he hadn’t heard from in a while. This win/win relationship generated inexpensive leads for both of us.
Couldn’t you repeat this same strategy with multiple joint venture partners? Contact lenders, insurance agents, financial planners, accountants, home inspectors, home stagers, interior designers, contractors and other local businesses, and offer to send a letter to your client list, promoting them. In turn, ask them to send a leter to their databases promoting you. It’s a win/win relationship for all involved.
I know what you’re thinking …
“But I don’t have my own book!” Well, you don’t need a book to implement the strategy. You do need SOMETHING of value. How about a free report or a free CD? Or you could set up a conference call with your joint venture partner and interview each other. You can market the conference call to your database and to the partner’s database and share the leads that you generate. An example of a great joint conference call right now might be:
“3 Costly Legal Mistakes Buyers Make When Buying a Foreclosed Home”
During the call, you and your attorney could highlight some of the mistakes buyers make. At the end of the call, you both could have a special offer for listeners.This same strategy could be repeated over and over again with different joint venture partners:
“3 Costly Mortgage Mistakes Buyers Make When Buying a Foreclosed Home” – Lender JV
“What You Have to Know About Insurance When Buying a Foreclosed Home” – Insurance JV
Hopefully you’re beginning to see how valuable to your business these joint ventures can be. Yes, they require work to set up, but they’re valuable lead generation tools. You’ll generate high-quality leads inexpensively, and you’ll attract more “pre-sold” clients. Set a goal to launch one joint venture promotion a month for the rest of 2009. Once the first promotion is put together, it will be a piece of cake after that because you’ll be able to reuse marketing pieces with each new partnership!
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