Wednesday
August 24, 2016

Weekly Book Scan

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Updated: 16 min 36 sec ago

Do You Know Your Clients’ Tribe?

Thu, 08/18/2016 - 13:42

‘Tis the political season, wherein the country is sliced and diced into segments: blue vs. red, male and female voting blocs, and dozens of different demographic groups. So perhaps there is no better time to crack pollster John Zogby’s latest book, We Are Many, We Are One: Neo-Tribes and Tribal Analytics in 21st Century America.

It’s a fascinating look at 11 different subsections of American adults based on an extensive survey launched in 2009 where Zogby, rather than relying on the current media constructs listed above, actually asked 8,000+ respondents to define themselves.

Credit: Ryan McGuire, Gratisography

You may be wondering why real estate pros should care. But I found the book to be not only a potentially powerful marketing tool, but also a concise way to better understand how these segments of America feel about and interact with the housing market, their communities, and the American Dream at large. So, here are Zogby’s tribes (in ascending order in terms of their approximate share of the overall population) and some of the relevant housing data he reports in the book.

The Outsiders (5.8 percent of the adult population)

It’s a good thing these guys are such as small percentage, because man, are they sad. Zogby defines them as a cynical lot who have been dealt setbacks and don’t expect anything all that great to happen to them. They also aren’t strongly affiliated with institutions or other communities.

  • Only half own their own homes, the lowest percentage of any of the groups
  • 37% live in the suburbs, 24% are in small cities, 21% in large cities and 18% are rural
  • Nearby amenity to look for: privacy. They lead all the tribes in terms of self-identifying as individualists, and they don’t rank any the tribe-building activities Zogby asked about (festivals, school events, places of worship, etc.) very high at all

The Self-Perfectionists (8.3%)

This is an individualistic group concerned with improving themselves and not focused on community events or entertaining. They have the highest percentage of single, never-married adults (41%) of all tribes.

  • They have the second-lowest concentration of home ownership, at 62%
  • 33% live in the suburbs, 28% in large cities, 23% in small cities, and 16% are rural
  • Nearby amenity to look for: Food co-ops and farmers markets. Well over half of them pay close attention to the environmental impact of their food and care about locally produced food

The Happy Hedonists (11%)

This group wants to live life to the fullest and enjoy themselves in the process. Also, they’re not afraid to spend some money in the effort.

  • 61% own their own home
  • More live in large cities (36%) than any other tribe; meanwhile 33% live in suburbs, 20% in small cities and 11% live in rural areas (the lowest of any other tribe)
  • Nearby amenity to look for: gyms and good restaurants (they lead the pack in emphasizing the importance of good food and exercise)

The Adventurists (12.2%)

These guys lead the pack in terms of having the highest percentage of members in the “investor class” and are more likely than most tribes to consider themselves social networkers.

  • 64% are homeowners
  • While 35% are in the suburbs, they are second-highest in terms of those who live in big cities (31%); 18% are in small cities and 16% are rural
  • Nearby amenity to look for: Opportunity for adventure! They’re the most likely of any tribe to want to dive to the bottom of the ocean, and they’re tied for the top in terms of the percentage who have an active passport.

The One True Path (13.4%)

Zogby defines this group as the new face of American Evangelicals—conservative and religious, but more concerned with social justice than traditional marriage, say.

  • 65 percent own their own homes
  • 36% are suburban, 27% are in large cities, 20% are rural and 18% live in small cities
  • Nearby amenity to look for: Opportunities for family connection. While only one in four have children living at home, this group places more value on family than any other tribe (translating to a need for guest bedrooms, formal entertainment space, and/or granny flats, perhaps?)

The Creators (14.5%)

These artsy, free-spirited bohemians are eager to forge their own path to happiness and personal fulfillment. Perhaps a bit tongue-in-cheek, Zogby says “Regardless of where they live physically, their minds and hearts belong on the Upper East Side.”

  • 66 percent own their own homes
  • While 32% reside in suburbs, a relatively high percentage live in big cities (27%). You’ll find 24% in smaller cities and 17% in rural areas
  • Nearby amenity to look for: 70% say music festivals strengthen their tribal bonds, though they also dig farmer’s markets

The Persistents (19.4%)

These folks are mostly likely to name a tragedy as the defining factor in their lives, and what binds them together is their ability to persevere beyond it.

  • 2 in 3 own their own homes
  • 36% live in suburbs, 23% live in big cities, 21% in rural areas and 19% in small cities
  • Nearby amenity to look for: Charities or support groups that can help them connect with others who define themselves as survivors; in forming interpersonal bonds, 71% look for such qualities in others

Go With the Flow (23.5%)

Members of this group seek balance. Zogby notes they “say what they mean and mean what they say. And they say it gently.” Interestingly, they’re least likely of all the tribes to say the American Dream is dead (12%).

  • 62% own their own homes
  • 33% are found in big cities, another 33% in the suburbs, 20% are in smaller cities, and 14% are rural
  • Nearby amenity to look for: Dependable, stable chain stores. This group ranks very low in terms of wanting to be the first to try something new in their neighborhoods

The God Squad (24.9 percent)

Zogby defines this group as “relying on God, family, and traditional values to give them some stability and an explanation for their world gone sour.” Interestingly, two in five say that, in a fantasy world, they would still be living in their current home.

  • 68% own their own home
  • Most (33%) live in the suburbs, though a higher percentage of them (24%) live in rural areas than almost every other tribe. 23% are in large cities and 20% live in small ones
  • Nearby amenity to look for: A place of worship (83% place special importance on this feature in their lives)

The Dutifuls (26.9%)

These folks follow the laws of society closely, living simply and according to the Golden Rule. They’re also highly oriented to family and the value of authenticity.

  • 71% own their own homes
  • They have the highest percentage of suburbanites at 38%, with the rest more or less equally distributed among the other three living environments
  • Nearby amenity to look for: easy access to family-friendly getaways. From the range of tribe-building activities Zogby asked about, they get the most satisfaction from family vacations, and are more likely than any other tribe to spend unexpected money on family members

Land of the Free (33.2%)

This group counts the largest number of veterans of all the tribes. They’re more than willing to step up and fight for “truth, justice, and the American way” (though Zogby notes they’re most likely to feel the American Dream is on its last legs).

  • They have the highest percentage of home owners at 73%
  • 38% live in the suburbs, 22% in rural areas, 21% in small cities and 19% in big cities
  • Nearby amenity to look for: Opportunities to age in place. They are the oldest of the tribes, and they value their independence

What do you think? See your clients (or yourself) in any of these groups?

What Are You Really Selling?

Fri, 08/12/2016 - 14:41

Mark Roesler hopped in his car on a Saturday morning in the 1980s and drove to the quaint Indiana town where family members of the late film icon James Dean lived. An intellectual property rights attorney, Roesler sat down with Dean’s aunt and cousin on their farm to explain to them that they deserved rights to Dean’s image and authority over how it was used commercially. Roesler made no fuss — he didn’t make a show of being a glitzy, high-powered lawyer. He simply earned the family’s trust, which opened the door for him to represent them in a multimillion-dollar landmark case that changed the entertainment industry and made it so that corporations no longer owned sole rights to the images of celebrities they made famous.

Photo credit: Yoel/Morguefile.com

Before matchmaker Janis Spindel introduced her client to the love of his life, she went on a date with him herself. Over dinner, she made small talk with her client, getting to know him and what he was looking for in a woman. Naturally, he wanted someone beautiful. “Men are very visual and can be extremely superficial and shallow. It’s part of their DNA,” Spindel told her client. It didn’t exactly sound like a good pitch for her services. “Don’t worry, I will find somebody that you will be attracted to. But then, there is the rest of the package.” Her honesty won her client’s heart. She introduced him to a schoolteacher — and by the end of the year, they were married.

When Phillip Styrlund, now head of consulting and sales training firm The Summit Group, landed his first sales job, he had no experience. He had been working in IT for a telecommunications company, but when the firm was about to lose one of its biggest clients, Styrlund’s boss told him he would be in charge of mending the client relationship. He’d never done anything like that before. So on the first day of his new role, he decided to be as transparent with the customer as possible. “I’m brand-new,” Styrlund said. “I’ve never been in sales. Guys, tell me what to do. How should we go about mending this relationship? What needs to happen?” His admission could have put the client off. But instead, it encouraged them to truly alongside him to repair the relationship. In two months, Styrlund and his client checked off a laundry list of grievances that had been resolved, and the customer was happy to stay.

No matter who you are or what you’re selling, everyone uses this main tactic to close a deal: make the customer believe in you — and then they can believe in your product. That’s the overarching theme in a collection of personal short stories from entrepreneurs of all business types captured in Success Secrets of Sales Superstars: The Moves and Mayhem Behind Selling Your Way to the Top as Told by 34 Industry Leaders. Authors Robert L. Shook and Barry Farber tapped leaders in a wide array of industries — including real estate — to talk about some of the most challenging and memorable moments of landing a tough sale.

Farber has written for REALTOR® Magazine before on the “4 Ways to a More Honest Sales Relationship.” Chief among his tips is to focus on connecting to something that’s important to your client instead of trying to make the client connect to what you’re selling. If you can win their loyalty by connecting with them on a personal level, clients will buy into your sales pitch. In Success Secrets of Sales Stars, it’s clear that’s a near-universal philosophy, as sports agents, financial advisors, CEOs, auto salespeople, and real estate professionals alike write about how this practice helped them win the sales that made their careers.

We all need a little inspiration from outside our own circles to learn how we can do what we do even better. If you want to see how the successes of salespeople in completely different industries can apply to your real estate business, this book is a good place to start.

Lean, Mean Team Machines

Thu, 07/28/2016 - 10:17

Real estate teams are growing, and whether you’re on one already, a solo practitioner competing against them, or a broker trying to manage them, you’re likely looking to learn more about how they work.

Credit: Highways England, IMcreator

The reason I presume you want to know more is because there isn’t exactly an abundance of statistical information on teams. A big part of the reason for the absence of data is because the definition is hard to pin down. What’s the difference between a top producer who has a licensed assistant and a mentor-protege team? Sometimes teams are really just two individual agents who work together on certain deals but have their own separate books of business; other times they operate more like mini-brokerages with their own branding and detailed internal structures.

The only way we can reliably “count” a team is if they self-identify as one. And that’s why the newly-released report, The Real Estate Teams Playbook: Aligning Structures and Strategies With Goals and Growth is worth a look. Released by REAL Trends in collaboration with BoomTown, ERA Real Estate, and dotloop, much of the insight used to create this playbook comes from a study conducted in the first quarter of 2016 by REAL Trends to better understand the landscape. They interviewed 25 team leaders and broker-owners and surveyed more than 2,450 real estate professionals across the country. The size of teams varied widely, from three team members to more than 50.

One interesting element of the findings is the large role that culture plays in establishing a successful team. The report puts a fair amount of responsibility on leaders for their “ability to conceptualize and foster a team culture.” However, the authors also note that the personalities and goals of team members and the tools available to them “have an equal impact on team culture.” But the buck doesn’t stop with team leaders and members, according to the report. Broker-owners, brand leaders, and coaches must play an active role in how teams operate and function in the wider industry, according to the report.

Here are some of the more surprising findings from the study:

  • The average monthly compensation for team members (not including team leaders) ranges from $2,000 to $12,700, depending on their role in the team.
  • Most teams are on the small side. Of the surveyed teams, 38 percent comprised of 2 to 3 members; 41 percent counted 4 to 9 members
  • The majority of the teams that were part of this survey are relatively new. More than one-quarter (26 percent) formed less than a year ago and 37 percent formed within the last one to three years.

Re-engineering the Real Estate Sales Process

Mon, 07/18/2016 - 16:14

The real estate sales model is broken—and in more ways than one. Think about how many areas of expertise must be mastered to not only to sell one house, but also to thrive with consistent deal flow in one of the most competitive sales industries. Among the specializations required are knowledge of local inventory, financial analysis, prospecting, negotiating, marketing… Just look at the categories covered in NAR’s field guides and you will catch my drift.

Photo: kakisky, Morguefile

That’s a ton of pressure for someone new entering the business and just trying to make it through their first year. But how does a true professional carve out the time and investment needed to serve a prospective homebuyer or seller at the highest level? Sometimes we need to look outside the industry to see what’s working in order to model success for the future, which is why the Sales Development Playbook should be your next read.

Author Trish Bertuzzi lays the smack down on why sales organizations need to re-examine their strategy and operations. It’s time to stop doing what isn’t working. Beyond leadership, execution, retention, and recruiting, let’s dive deep into the specialization required as highlighted in her book, and figure out how it applies to selling real estate. To clarify: We are not talking specialization in expertise in the sense of developing a niche in new construction, investment properties, or green homes. The focus is here is on building a team to field the roles that make a transaction work. These include:

  • The lead research role is responsible for streamlining the pre-call process.
  • Sales development reps make introductions, set appointments, and create opportunities.
  • Inbound sales reps are responsible for lead qualification.
  • Account executives close the deals, drive revenue, and are the highest compensated out of the four.

At the traditional real estate brokerage, these roles are one in the same. The agent must generate new leads, qualify them, and close for either the buyer agency agreement or listing contract then negotiate the sale. But to assume all of the roles listed above is unrealistic if sales productivity is the priority. Compensating each role the same isn’t fair either. So how do brokerages make the transition from the agent-centered model to the team model with the least disruption? Bertuzzi recommends the following:

  • Agree with specialization. Until you understand “the why,” you will never be able to delegate “the how.” Once the team has more than four members, then you can start to specialize.
  • Attitude affects the role. Different people handle rejection and interruptions in different ways. Being able to bounce back from a failed listing appointment takes much more resilience than rebounding from a hang-up of an unqualified lead on the phone.
  • The salesperson’s comfort level with the consumer shapes the role. It’s one thing to target your sphere of influence. It’s another to target a relocation portfolio of a Fortune 500 company.
  • Messaging matters. An inbound sales rep asks, “How can I help you?” whereas the agent in the field helps the customer think differently about the value proposition.

If you are new to real estate, join a team. If you’re up to your eyeballs in paperwork and want to continuously grow your business, start a team. The Sales Development Playbook is an excellent guide demonstrating how companies have successfully changed their model and I hope it does the same for you.

Who’s Afraid of the Big, Bad Block Party?

Tue, 07/12/2016 - 16:18

Last Saturday, I faced a serious trial as a new home owner: first block party. We moved into our place late last summer, just after the annual block party and the local festival, so this would be our first real neighborhood event. I was wracked with anxieties and questions: What should I bring to the potluck? How early/late would people be hanging out outside? Should I set out some chairs in the front yard or stick with the bench up on our porch? Buy some sidewalk chalk for the kids? Make up some sun tea, or offer up home brew?

Credit: Ryan McGuire, Gratisography

My husband—who is undoubtedly the extroverted social butterfly of the family—would be off at work all day. And unlike many others on our block, we don’t have a kid or dog to help grease the skids of socialization. So I would have to do this all on my own. I am not kidding you when I say I lost sleep over it in the week leading up to the event. I almost considered making plans with friends so I would have an excuse to skip out.

Thankfully, I’d been reading This Is Where You Belong: The Art and Science of Loving the Place You Live, by Melody Warnick. It’s basically a guide to fostering what the experts call “place attachment” in oneself. Warnick had moved many times as an adult and wondered why she didn’t feel at home anywhere. She began to think that maybe it wasn’t the places that were to blame but her lack of effort at becoming rooted. So she embarked on a series of “Love Where You Live” experiments and projects to see if she couldn’t convince herself to fall in love with her new home in Blacksburg, Va. Alongside this highly personal experience, she bulks up the book with copious studies and interviews with experts on placemaking, social science, and community building, making it widely applicable to home-seekers worldwide.

So there I was, loving reading this book, and absorbing all kinds of ideas on how I could invest in my community and get all kinds of great benefits in return. Investments like volunteering, eating/shopping locally, getting into nature and politics, and—wait for it—
…talking to my neighbors and attending block parties. OK, Warnick was not going to let me out of this one.

So. Moment of truth. On Saturday, I did do something sort of sneaky, in that I volunteered to smoke a pork shoulder and make tacos for the potluck. That gave me an excuse to be semi-social and outside all day without making my neighbors feel like they had to walk over and talk to solo ol’ me. This activity has the added benefit of producing delicious tacos, which I would later promise to make again next year at my neighbors’ urging.

And I’m happy to say it all worked out in the end. I found out that my neighbors are fun, warm people who care about their block and the people on it. And while the party was still going merrily along by the time my husband got off work and joined in, there wasn’t one taco left on the platter for him. Oh well, there’s always next year!

Cracking the Burglary Code: Are You a Target?

Fri, 06/24/2016 - 10:40

Criminals study a neighborhood using a totally different calculus than residents and real estate pros do. In Geoff Manaugh’s A Burglar’s Guide to the City (Farrar, Straus and Giroux, April 2016), you get a front seat view of what the world looks like through the eyes of a burglar. It’s a fascinating read for any student of real estate, both for its examination of historical heists and the view of modern law enforcement practices that ordinary citizens don’t often see.

Credit: quicksandala, via Morguefile

But for the purposes of the real estate industry, the most helpful parts are when Manaugh points out subtle features of neighborhoods and buildings that put them at increased risk. Here are a few of the elements criminals use to profile their target subjects.

  1. Parking for the getaway car. Property on a cul-de-sac is less likely to be targeted, Manaugh says, because cops can more easily box a perpetrator in. Conversely, a corner lot is more likely to be targeted because there are better options available to fleeing criminals.
  2. Cookie-cutter copycats. If your home or building is laid out in a way that’s not obvious from the outside, and isn’t based on the layouts of your neighbors, you might be living in a place that’s less likely to be targeted. Manaugh explains how some thieves can use seemingly harmless information such as fire codes to build a probably layout of apartment buildings before they even see the lobby.
  3. Neighborhood features. Manaugh says burglars are more likely to avoid houses that have schools nearby because they tend to lead to an increased presence of police and eagle-eyed parents. Meanwhile, a forest in one’s backyard could mean thieves have a place to disappear into. Finally, walkable neighborhoods are likely to make burglars nervous because pedestrians might notice something’s amiss.
  4. Items placed up against a building. Manaugh notes that burglars have been known to climb inside a Dumpster that’s positioned against a target building and chip away at the wall of the structure over a period of several days. Not only do they have cover, but the Dumpster provides a convenience place for criminals to store the resulting debris. Also, be wary of scalable junk piled up during construction. As Manaugh cautions, “A pallet is a ladder to a burglar.”

Now that I’ve got you good and paranoid, let me share one last thought with you from Manaugh: Your website might be part of the problem. “All a savvy burglar often needs to do these days is look at the website of your home builder or the property agency in charge of your apartment building to pull up a floor plan; these innocuous online tools ostensibly made for real estate bargain hunters are also amazingly helpful burglars’ guides,” he writes.