Case Study: Selling A Subscription Product To Cranky Aussie Real Estate Agents

Selling a subscription product, where the buyer is committing to ongoing periodic payments, is not easy.

We have a subscription product that we offer to residential real estate agents in Australia (and New Zealand and the United States).

It’s a system that helps sales agents nurture their contacts.

It’s not available year round.

We offer it just two, sometimes three times a year.

Australian Market and Competitive Framework

Aussie residential real estate agents are deluged with offers for business-building tools, educational products, training, events, coaching, mentoring, and software.

Many of them feel like it is year round hunting season.

And they’ve got big red targets painted on the backs of their Italian suits.

The thing is, they get marketed to a lot.

Feel a bit set upon.

And many are not exactly thrilled about it.

Can’t say I blame them.

Despite the average punter’s perception of agents as look-at-me, latte-sipping layabouts, most sales agents are diligent … and typically, very busy.

So they can get a bit testy, jacked off even, if they feel like you are distracting them or wasting their time pitching them with stuff they don’t want.

In summary, in Australia the residential sales agent market is a small, mature market with a ton of competing products, lots of marketing noise, and a sophisticated, busy, and skeptical prospect universe, many of whom have tools, training, and coaching lapping the gunnels.

And they’d rather get poked in both eyes with a sharp, burnt stick than take on any more of that.

Especially if it’s something they have to pay for every month (or every year) and in effect, gives them yet another job to do.

In short, they are a bit of a tough crowd in a small and mature market.

But they have an enduring, nagging problem.

There’s almost always furious competition in their local markets.

More agents than there are good properties to sell.

The successful ones know they need to keep honing their edge.

And engaging with the homeowners in their trade areas.

They cannot rest.

They sleep with one eye open.

And take their corners wide.

For our product, the best prospects are typically operating in the middle of the pack.

Complete newbies, or those at the top of their game who are shooting the lights out making more than $1m a year in commission, are not our best prospects.

Newbies are still figuring out how everything works.

And the top-guns have got well-functioning systems that they are wedded to.

So it’s the aspirational middle ranking agents that are of interest to us.

Instead of doing the typical internet marketing product launch event twice yearly, we use simple emails to reach our prospects.

It is low key.

And doesn’t take long to implement.

Gets pretty good results too.

Here’s how this campaign went …

We have a contact database that contains the at work email addresses of 8,000 real estate sales people.

It’s not segmented.

So we don’t know who our ideal prospects are.

Pretty basic stuff.

About as sophisticated as playing in the dirt with sticks.

This is NOT a permission-based email list.

These agents have not granted us permission to contact them via email.

So this is a cold email prospecting campaign; that is, sending email to people who are not expecting to hear from us.

We are interrupting their day.

And deliberately trying to shake them up a bit.

Rattle their cage.

In an elegant and professional way.

Anyway, we sent two emails to 1,000 of the 8,000 contacts in an A/B test, determined the winner, and mailed the winning email to the remaining 7,000 contacts on the list.

We did this using personalized, plain text looking html templates, sent in small batches of 200 or less from our own email address (not via an SMTP relay service).

Emma Baldwin from our office worked her way through the list, mailing on Tuesdays, Wednesdays, and Thursdays at 11 am, 1pm, and 5pm.

We know from past experience that those are productive days and times to mail this specific audience.

All activity was tracked.

Here’s Email A.

SUBJECT: Do it like Chiminello

BODY: [First Name]…Marcus Chiminello earned just on $4m in GCI in 2015.

With a relatively tiny contact database.

Would you like to hear about his unusual (but effective) approach to making this happen?

Let me know what you decide [First Name]?

Thanks for considering,

Emma

A few explanations in case you’re not familiar with the Aussie real estate market …

Marcus is a well-known agent, one of Australia’s most successful.

And GCI is Gross Commission Income.

Go Marcus; you good thing!

Here’s Email B.

SUBJECT: Is this worth a quick discussion?

BODY: [First Name],

Are you doing everything possible to nurture your contacts?

I guess you’ve got something pretty good in place already.

But maybe you’re looking to build on that success in 2016 and beyond?

I’m not sure of your specific situation [First Name].

But are you open to discovering an unusual (but effective) approach to nurturing your contacts that almost always generates new listings and easily protects your fee?

Would you like to hear more about this via a short email conversation?

Please let me know what you decide [First Name]?

Regards, Emma

Now you need to know that with any mass email prospecting campaign like this to a cold list, you’re going to get some push back.

Gonna take some flack.

Not everyone is going to be thrilled to hear from you.

On rare occasions, some folks can get pretty narky.

The odd one, abusive. (I’m looking at you Ivan from Belmont).

So gird your loins.

And don’t take it personally.

By the way, we don’t recommend you do a mass email campaign like this, to a cold list of contacts, until you have honed your email prospecting skills by doing a lot of one off bespoke emails like we reveal in the Crackerjack Prospecting System.

Anyhow, here are some of the responses we got …

  1. Please f**k off Emma. (It’s nice when folks are polite.)
  2. Go away.
  3. Remove me from your list.
  4. Piss off spammer.
  5. Delivery to the following recipient failed permanently.
  6. Hi Emma, Thanks for your email. I would like to hear about Marcus’ approach with his contact database. Thanks Paul.
  7. Hi Emma, Sounds good. Let me know the magic pill that will enable me to write $4mill too please??
  8. Hi Emma. I am interested in speaking with you. Can we chat tomorrow?  Please keep in mind WA 3 hours behind Vic time. Thanks and kind regards. Julie
  9. Yes. Kind regards, Warren
  10. I love Marcus, I really enjoyed his speech at conference. What’s the go Emma?
  11. Emma, Could you give me a bit more detail on content?
  12. Send me some info thru. Regards, Piers
  13. You’ve got my attention. Well done. What’s the go?
  14. Go ahead.
  15. Hi Emma, Pls add me on wait list. Greta
  16. Call me thanks 0421 227 006

We got 391 positive inquiries asking for more info.

More (but not many) will trickle in over coming days, weeks, and months.

Not too shabby don’t you think?

We replied to all inquires with a brief email like this one …

Sure thing Paul.

I’ve put some info together here.

http://allstaragents.com.au/sns-feb-2016/

Let me know what you think?

Regards, Emma

Now, almost every agent knows that it’s a good idea to nurture their contacts.

But it’s a bit like weeding your garden or washing your car.

A good idea perhaps, but a chore.

And it’s sure not a hair-on-fire priority.

So our product, the Simple Nurturing System, is not going to be a fit for 95% or more of the admittedly small addressable market in Australia.

And that’s OK.

We are sorting, sifting, and screening to find the 5% or so that are motivated enough to give it a crack.

At the 1 week post-campaign mark, we have sold 38 annual subscriptions at $1,997 each.

That’s $75,886 in potentially recurring annual revenue.

We know that our average customer’s subscription duration is 2.2 years across our Australian, New Zealand, and United States customers.

So the Customer Lifetime Value of these new subscribers is $166,949, adding approximately $250,000 in enterprise value to our business.

That’s because subscription income like this typically attracts a multiple of 3.5 times annual subscription revenue.

And on top of that, we’re got another 147 of those inquiries on our wait list/nurturing sequence – experienced agents who are interested and motivated to give our product a try, but the timing isn’t quite right.

Many of these will convert to sales in May/June as agents finalize their marketing budget and mix for the 2016/17 financial year.

So we should convert some of those in the weeks ahead.

All in all, not bad for a simple, short, and ethical email don’t you think?

If you want to learn how to use simple emails like these to get more customers, clients, or projects, rattle my cage at jeff.gardner@prospectifier.com and I’ll send you a copy of a free Special Report that will get you started.

Or if you’re ready for some advanced training, bundled with software and email support, and you’ve got half a gorilla to invest in your future prosperity, head over here.

All the best,

Jeff

P.S. Please keep in mind that the purpose of prospecting emails like these is to pique curiosity and start sales conversations with your prospects. You still need to know your target market, present them with a compelling offer and be able to answer the question: “Why you,why now?”

Basic stuff, but frequently overlooked.

Email prospecting can work well in small markets like Australia, or large ones like the US … with niche products like the Simple Nurturing System, or any B2B professional or business service.