KEY POINTS:
1. Houses are going FAST
2. Look Ahead at the Market
3. Be the FIRST Agent They Meet
3. Clearly Communicate Your Value
5. Meet FACE to FACE with Clients
6. Eliminate Bottlenecks
Houses are going FAST
Zillow just put out an article saying that it was the fastest they've ever recorded, which is super exciting, but what are you doing to capitalize on it?
It's exciting news. And most people are feeling it all around the country. Most agents are just dealing with lack of inventory. Multiple offer situations like the market is on fire, and the thing is if you're not making a great deal of money right now, you should be highly concerned because it's a good time to make money right now.
But what's interesting about this particular article and topic, is because the people who trudged forward in spring are being richly rewarded. The people who kept their homes on the market or put their homes on the market during COVID, during the shutdown, who didn't stop working, are reaping the benefits right now. And that was one of the things that we had prescribed strongly like, "Hey, put yourself in a position to come out of this thing on top."
Look Ahead at the Market
What we want to specifically go over is really the cycle and the journey as far as the customer is concerned, because it's still alludes so many really smart, really good agents because they've just never been exposed to this thought process or this type of information. Most of the training that we receive in the business, doesn't really dive deep into the buyer's journey or the psychology of the customer and really how to snag them and capture them and make sure they stay your customer throughout that process so that you can build yourself a nice pipeline, because here's the thing: if you're not getting yours now, that's okay. There's still time. You just have to plan for it. You have to position yourself for it and you have to do it now. Otherwise, you're going to be reading the next headline going, "Dang. That could have been me. That should be me."
And unfortunately, the bad news is that there's nothing you can do about it to capture it right now, but you can start to where in the next few months, next year. People overestimate what they can do in a week but they underestimate what they can do in 10 years. That's true, but people really underestimate what they can do in five. And so specifically, and we've drawn this out before, what most people do is they go after just the instant now business, which is where everyone else is going after. They're spending all their money there. And I have an abundance mentality. I had to create an awareness around that. It didn't come natural. I was always under the impression that one for someone else meant one less for me.
It was really Dan Kennedy who changed my paradigm in that regard, he said, "Money is like the ocean. And it doesn't care if you come to it with a teaspoon or a five gallon bucket, it's still the ocean. So make sure you come correct, right, with what your needs are, what you actually want. And it's never going to go away because it's still the ocean." And so that being said with an abundance mentality, it's hard to have that if you don't have some delayed gratification tied to it and really an understanding of the buyer's journey.
So if everybody's going after ... let's say that there's in a market 200 transactions in a month and there's, a thousand agents in that market. You couldn't divide that equally. So it feels like this huge rat race where, as Zillow pointed out, the people who put their homes on the market in the spring, the agents who were working during COVID, the agents who were thinking longer term than what was in front of them right now are being richly rewarded.
Be the FIRST Agent They Meet
The agents that go for the 3-12 month out business are generally the top agents in your market and what they have is they have a followup plan in place. They have a system in place that works just agnostic of them. It doesn't require them to keep it up and running to keep in touch with these people.
So the latest report that came out in June said that:
new listings that hit the market in the DFW area was 14,587.
Pending sales: 12,415.
Closed sales: 12,126,
And the closed sales was up 10% from the same time last year.
A lot, right?
54,000 year to date of closed homes.
So if you look at the rolling average, it's usually somewhere between 12,500 and 13,000 new listings and closings each month. So when you look at that in that little circle of time frames in the buyer's journey, if you could pick what you could have a certain percentage of, would you pick getting a percentage of the 12,000 closings that are going to happen in this month, or a percentage of the 132,000 closing that will happen in 12 months?
Catagorize
You've got to chunk them up into categories. And I think that's where a lot of people get lost. I've heard "A" leads, "B" leads, "C" leads, all kinds of different methodology, but really it's just based on their timing. That's the difference in a lead, aside from whether or not they can buy something, right? And so early on in the relationship, you don't know. So you got to chunk them up somehow, and timing is the way. So it's zero to three months, three to six months, six to 12 months. And the way that you know that is just by asking them, like, "If you were to move, when do you think that might be?" "If you were to sell, when do you think that might be?"
They're going to answer. And even if they're wrong, at least you got an answer, at least you've got a way to categorize them, which gives you then a game plan to follow up with these people to know, "Hey, they said that they're going to move in this time. What can I be doing to add value to them, to start to educate them, to start to position myself as an expert and as an authority on this topic in their mind between now and the time that they actually get ready to put their home on the market or buy a home for that matter."
Our pipelines are categorized by timing, but there's so many different methodologies out there. It's so easy to miss how important that is. Anytime you're getting timing, you should find out why they're looking to make a move. And so if they've clearly told you an extremely good reason on why they're waiting, for example waiting for their kid to graduate from high school, they're a senior going into senior year, so they're going to put it on the market next summer, right? That's a great situation that you should be able to nail and have a good relationship going forward, but it's not going to be by berating them, being like, "Hey, so when are we going to put it on the market?"
But you want to stay in front of them during that timeframe, and you want to do it in a way that's cool. That's not putting yourself out there to look like an idiot. And more important than that, you want to do it in a way that makes them think highly of you, which is called positioning in the marketing world, so that when they think of you, they think of you as an expert so that naturally when they get closer to their time, they're going to do business with you above all other options. And I think that what you were trying to communicate earlier, which is you were essentially saying, would you rather have a percentage of this market, which is the 12,000 transactions now, or would you rather have the same percentage of this market, which would essentially be 36,000 transactions.
If it's the same percent, let's just use 10% for example, which is ridiculous, but let's say it's 1200 transactions. You want 10% of that, right? Anyway, 10% of three months out as much more, you know what I mean, collectively, then 10% of the now business. But the thing is in real estate, it's so hard because we've got to get money now, right? We've got to get money now. And so it's harder to think like a businessman or woman and have a game plan around getting in front of your competitors because let me tell you something, it's much easier to convert somebody here earlier on before they have a relationship with another agent than it is here. It's much easier to differentiate yourself and position yourself as an expert here three months from now than it is right then on the spot.
Right then on the spot, they're just looking for people to open the doors. They don't see you as anything other than really an overpaid concierge at that point. I mean, I've been sitting in a deal ... I remember I had this one deal, and it was when I was rebuilding after the recession. And this lady was buying ... it was her for her and her family, they were buying like a $120,000 condo, and they're all excited. They wrote it up, and she's looking at me thinking I'm really excited about this teeny tiny commission. And she's like, "We changed our mind. We don't want to buy it now." She's looking at me. She was trying to aggravate me. And I was like, "Oh, okay." But the thing that was insightful to me was in her mind, right, like the process was like, "Oh man, I'm going to have this huge windfall of $3,000." Lady, that don't even pay my month's bills for the business, but that's what they think sometimes, not always. A lot of them don't even have an understanding of how we get paid. But it's interesting to me that because that's what she was thinking. And she just leaked the information. Yeah. Yeah.
Communicating Your Value
And it boils down to the difference in converting a sign call or Zillow lead from somebody who's an internet lead who is earlier in the process. If you don't have a specific set of skill and training on how to convert somebody that's earlier in the process, you're not going to convert them. And you're going to blame it on them like, "Oh, they're no good. They're not a good lead. They're not a good prospect," but really the truth is they're just people and you just don't understand how to communicate to them effectively, a value proposition that they see clearly as something that's going to be better than the alternative, which is doing business with another competitor.
If you have to think about something to make a purchase, the value isn't clear. And so if they have to think about which agent that they're going to use, the value isn't clear. You haven't made the value clear to them, and that's a "you" problem. That's not a "them" problem. That's your skill set problem. You haven't learned yet how to properly position yourself and how to properly communicate your value in a way that is, again, above and beyond them doing business with anyone else in your marketplace, period.
But there's a difference between doing that as a self serving thing, and then doing that as an actual you're giving them true advice, right? And it just comes off two different ways. And it's just that self serving thing will always protrude out and just deflect business. You do want to help them with the right information and advice. And sometimes you do got to nudge them and push them. I can't tell you how many times I've said, "if I weren't involved in a lot of the transactions that I did, they would've never happened." And that goes against my mental model, which is you can't make a bad deal good, you can't make a good deal bad. Sometimes a good deal doesn't readily present itself as such. You've got to help them think through the process and that's part of your job
Value of this Method (Communicating Our Value)
If you can do this and you can work with people that are three months out in a way that is impactful to your business, three months from now you're going to be in a much different position than you are today, and arguably when that skillset hits, for the rest of your career. That's the thing that's so amazing because you make these little tweaks and little changes and little educational benefits to yourself, it changes your trajectory. It's just a small degree of change for your understanding, for your paradigm and for your skillset. And this was the biggest change for me, understanding how to do this and how to do this properly.
If you don't have minimum of eight months set aside to let this run without you making a dime from it, don't even think about it. Just don't do it. If you don't have a consistent influx of leads coming in, whether they're from online or from print ads and the old toll free numbers with free recorded message, it's going to be disappointing. It's going to be disappointing because if you measure your cost per lead, you're going to throw up. But if you have those combined in tandem, what happens is when you call these people who've come in and be like, "Oh yeah, you're that guy on the radio." "Oh yeah, you're that lady on TV."
That's how it works.
Meet FACE to FACE with Clients
We can generate you a ton of leads. We can set you a ton of appointments, but if you can't get face to face with them when you're talking to these people that we've set on your calendar that have said, yes, I want to speak with you, you're not going to make any money. That's just the sad fact. And so it's not like a magic pill, you still got to work, right? You still got to say the things that you need to say in order to bring the value to the front, so the value is apparent in working with you. And then if their timing is now, you've got to compel them to get in front of you. Three quarters of all buyers do business with the first person they meet.
If clients don't want to meet with you or they're apprehensive or you can't get them to meet with you, you're not clearly communicating the value. And there's a lot of ways to increase the value. There's a lot of ways. One of the ways that I used to do is I'd give them a free gift bag complete with over $400 worth of coupons that you can use towards your purchase, coupons and goodies or something just for meeting with us. And people would come to my office, and they walk in the door and they'd be like, "I'm here for my gift bag. They'd have the car running outside with their kids in the car." I'm like, "Okay, go shut off the car and bring in the kids, then let's talk about your home".
The value was more clear right away just for coming in to meet with us, and then when they got there, we would tell them all about the rest of the value and why doing business with us was going to be in their benefit. And by the time we tell them about all the value, they'd be like, "Whoa, how much is this going to cost me?" "Well, that's a great news, actually. Our fees are paid by the seller, so you don't have to." They'd be like, "Okay, sign me up. How do I do business with you?"
And that's the beauty that is really when you nailed the entire process, and you're looking at it like a process and not just a moment in time where you need to get a deal because the moment in time where you need to get a deal, the commission breath is at its fullest. And you're not even listening to what they're saying because if it's not what you want to hear, you're immediately shutting down, and your fear taking a future deal and just completely tearing it up in front of your face, right? You're still going to need to make that money.
People Want To Be Told What To Do
From the research I've done, subliminal messaging is not more effective than just straight out telling somebody what you want them to do. They're both equally effective. So you don't even have to be creative about it. People want to be told what to do. So when you're talking to these people, tell them what to do. Here's what we're going to do, right? They need to be led, especially in the process of buying or selling real estate. You got to think of yourself more as a Sherpa than anything else. You know what I mean? You're helping them get up this mountain. You're helping them get to the top. You're helping them get to the finish line. They need your direction. They need your guidance. And if you don't give that to them, you are more likely to lose the opportunity than if you did.
And I think that that's a big paradigm shift as well. Most of the time people are like, "Oh, I don't want to be too forward or too bossy." All you have to say is, "Hey, here's all the information you need. If I were you, I'd want to know this stuff. And by the way, here's what I can do for you. Would you like me to do X? Cool. I'll get that done for you. And I'll follow up with you. When's the closer time to when you're going to be ready to look at some homes or find out what your home is worth in detail, so I can come out and tell you?" That's it. Just over and over and over.
I was telling somebody the other day on my team, if you were to join my team, the first thing you learned is a script, second thing you learned is a presentation, buyer presentation, seller presentation, to convert those people because the script is going to work. The leads are going to be there. And if you give them the presentation, they're going to do business with you. Even my rookies would go up against some of the most seasoned agents in town using the presentations that we gave them and the scripts and convert them.
Eliminate Bottlenecks
There's only so many points, right? So you got the leads that come in, you got a certain amount that you're going to actually connect with. And of those people that you connect with, there's going to be a certain amount that you're actually able to get face to face with. And then of those people you get face to face with, there's a certain percentage that will actually become clients. So when you simplify it, as much as you possibly can, at any point, there's a bottleneck in your process. And you have to focus on alleviating the biggest bottleneck, and then moving on to the next one.
Which is what we did. That's why we deliver preposition appointments. We've removed the bottleneck that was the bane of most agents' existence: calling these leads, prospecting them, chasing them around. But there's still the next bottleneck, which is you clearly communicating your value to that person to do business with them now or in the future. If you can really take that it gets explosive fast when you're looking at it and just being like, "Okay, this is my bottle, and this is what I need to work on. And the minute I crack that ..." because a little bit of a increase here goes a long way. Running the branding stuff that we do with billboards and park benches and following these people around Amazon style with retargeting and stuff, that is impactful at the beginning, but it is even more impactful after doing it for six months, 12 months.
After that time, they'll think, "Hey, I know this guy. This person's a big deal, and I can reach out and call them. In fact, they're sending me properties that they promised me. They're sending me information on a regular basis. I have a relationship." It makes them feel more important, which gives them an increase in serotonin. It's just powerful. It's a powerful mix. It's the next best thing to alchemy. And the good news is there's so few agents that are doing it properly even today with all the advances that we've made as an industry and the innovations, the truth is that most of these advancements and innovations have made more agents more lazy, right? They're not trying to go to capture more. They're just trying to keep the status quo because it's easy to throw money at this particular Zillow, for example, and get a marginal return on investment.