The Relationship Business
The Relationship Business
Are you an attractor or a seeker? If you want to make it in real estate sales, it pays to know the difference. An attractor casts a wide marketing net—using the Internet or direct mail—and then waits for a prospect to bite. A seeker proactively builds and manages a base of friends and acquaintances with an eye toward doing business down the road.
The condition of your local housing market dictates which approach will ultimately lead to more sales. Research from the Keller Center at Baylor University shows that in healthy markets, a mix of 60 percent attract-oriented and 40 percent seek-oriented activities delivered the highest lead generation conversion. In weak markets, just the opposite is true. There, a 60–40 emphasis on seek strategies—phone calls, networking, and acquiring referrals—yields more appointments and, ultimately, closed transactions, says Chris Pullig, who conducted the 2008 study of about 1,200 real estate professionals.
What’s the Keller Center?
Much of the research cited here is from Baylor University’s Keller Center. The center, established in 2007 with a donation from Keller Williams Realty Founder and Chairman Gary Keller, focuses on factors that influence home buying decisions, as well as real estate and small business marketing and management issues.
Pullig’s research demonstrates that in these still-dodgy times for the real estate industry, it’s vitally important to be proactive in your quest for customers. But creating pathways to successful relationships depends on far more than e-mail blasts or depleting your supply of business cards at a cocktail party. “Consumers continue to be more knowledgeable as a result of all of the information they have available to them,” says Pullig. “You need to be able to demonstrate value.” And in this modern age, value is often measured in intangibles, he says. “It comes from forming a solid relationship and by being true, genuine, and honest.”
Read on for more enlightening research, as well as great ideas from your peers, on how to build thriving and sustainable business—one relationship at a time.
Step 1: Building Bonds
Every day holds new possibilities for creating connections. When you find people with whom you have something in common, relationships are likely to sprout. They can occur over shared interests—butterfly gardens, Bundt cake recipes, bike riding—or shared friends. “If you and I have someone in common or a common interest, that makes me like you a little more and want to chat more,” says Michelle Tillis Lederman, author of The 11 Laws of Likability (AMACOM, 2012). “When we discover similarities, we form deeper and more lasting connections.”
Eventually, those connections may lead to business—but they don’t have to start there.
Tip: Turn every interaction into a business building opportunity.
Allen “Al” Rusca, ABR, e-PRO, wears his “Diane Turton, REALTORS®” name badge around town. “That badge opens many doors for me when the inevitable question arises: ‘How’s the real estate market these days?’ ” says Rusca, a salesperson based in Ocean Grove, N.J. “I’ve gotten business from the local coffee shop, the barber shop, the dry cleaners, the grocery store, the gas station, the doctor’s office, the bank, my church, the local senior center, and more. Being visible and active in the community is the best way to find new business.”
Formal networking or referral groups, such as chambers of commerce or BNI, can help you expand your reach, too. BNI is an organization with chapters across the country. Only one person per professional specialty joins each chapter. The reason: Pros from different fields network and swap referrals. You can find success through routes that fit your particular interest, too. Diana Baylor, a sales associate with RE/MAX Masters in Covina, Calif., builds relationships through the California Women’s Conference and charity events benefiting cancer prevention programs.
Tip: Connect deeply via online social networks.
If you’re going to spend time on online social networks, do it with a keen understanding of what each network delivers. Pinterest, for example, has been called a “woman’s social network.” The site—which enables you to pin Web content you like to your personal or business page and share it with your Pinterest followers—has an audience that’s more than 82 percent female. Because women are big influencers in home purchase decisions—and “home” is the No. 1 category of “pins” on Pinterest, according to a study by R.J. Metrics—it may be a good play for making meaningful connections with female buyers. (Pinterest recently added the ability to create business pages and created separate terms of service for businesses.)
One enthusiast is Sue Eller, a sales associate with Dilbeck Real Estate Real Living in La Canada, Calif., who has pinned hundreds of photos of local architectural gems, parks, and more. “Pinterest is a good way to build affinity marketing by connecting over not just real estate but also hobbies and interests,” Eller says. Eller posts architectural photos she loves on her Web site and uses Pinterest to drive traffic there. Her Pinterest page also includes categories such as “How to Make Your Home Sellable,” “Favorite Homes I Have Sold,” and “Gardening and Gardens.”
Tip: Strengthen your reputation in an environment where there’s no sales pressure.
Bryce Fuller, a broker with Coldwell Banker in Northbrook, Ill., hosts a neighborhood open house each year. It’s a way to meet the neighbors and establish himself as the local expert with a vested interest in home values. Fuller provides each family that attends with a neighborhood market analysis. “The BBQ allows people to approach me, get to know me, and ask questions,” he says. “As they spend more time around me, their comfort level increases. That comfort level and trust coupled with my listing signs and activity in the subdivision is a one-two punch that can’t be beat.”
Tip: Have a “wingman” sing your praises.
Boasting about your own sales record and accomplishments can come across as arrogant, says Kurt W. Mortensen, author of The Laws of Charisma (AMACOM, 2010). But if you can get others to say it for you, it’s powerful. Getting friends to introduce you to their peers, for example, gives you built-in credibility, Mortensen says. Testimonials on your Web site or LinkedIn account can be just as powerful. “Written reviews from satisfied customers enable trust to be formed more quickly,” says Michael Davenport, a broker-associate with King Realty Associates LLC in Sarasota, Fla.
Step 2: Maintenance Mode
You’ve made the introduction and extended the handshake. Now, how do you keep this budding relationship growing?
Tip: Start off with a blitz.
Get in touch with a prospect eight times within eight weeks following an introduction. The “8×8” program is what Donna Boylan, productivity coach at Keller Williams Consultants Realty in Dublin, Ohio, teaches agents for keeping in touch. The program centers on the idea that people need to be exposed to something eight times before they remember it—and that “it” includes you. The forms of contact will differ (for instance, phone, e-mail, postcards, and so on) and should be tailored to that person (such as potential first-time home buyer or seller), Boylan says. The content could include anything from a “thinking of you” card to mortgage information to a market comparison of the person’s neighborhood.
Tip: Get attention with the occasional less-than-serious missive.
Need to add pizzazz to a blog post, e-mail, or other communications? Have some fun: Hallmark offers up a list of nontraditional “holidays” to celebrate. For example, in honor of “National Dress Up Your Pet Day” on Jan. 14, you could promote a contest on your social networks for best-dressed pooch. Invite your prospects over for a sweet get-together on Feb. 7 to celebrate “National Chocolate Fondue Day.” On Feb. 25, swap the best chili recipes on “National Chili Day.” Or just send a thoughtful card in honor of Feb. 7, “Send a Card to a Friend Day.” Silly occasions offer a vehicle for making a fun and memorable connection. A Keller Center study, “What Do Consumers Expect From Agents?” supports the effectiveness of humor in business; a real estate agent with a good sense of humor is more likely to have a positive reputation as someone customers want to work with, according to the 2008 report.
Be sure to balance the entertaining with the useful. You’ll find a vast array of valuable content on buying, selling, and maintaining and improving your house at HouseLogic.com’s REALTOR® Content Resource. The handouts are free of charge for NAR members and customizable. Prospects will love your tips on buying, selling, energy efficiency, money-saving remodeling ideas, and more.
Tip: The thought really does count.
Handwritten notes are a great way to acknowledge birthdays, graduations, wedding anniversaries, a new baby, and even a pet’s birthday. But sometimes you may want to offer something extra.
Carlyn Parker, a sales associate with Real Living CO Properties in Denver, tailors her approach to the client. For example, for a relocating family on a house-hunting trip over Easter weekend eight years ago, Parker made up Easter baskets for the small children, who were 2 and 4 at the time. Now she pays a yearly visit to the family with Easter baskets in hand. The visits help keep the relationship alive and have led to three real estate transactions so far. For other families, she’ll try other things, such as “wine of the month” club.
Dolores Mauriello, ABR, a broker with Century 21 Gemini LLC Realty in Wayne, N.J., offers a Lowe’s 10 percent off coupon to those she meets at open houses. All they have to do is provide their e-mail address so she can follow up. She uses the Lowe’s REALTOR Benefits® Program, a free service available to REALTORS®, to send a customized, real estate newsletter, along with the coupon.
Tip: Find reasons to get face-to-face.
Avoid becoming just a name on someone’s social network or a spam in an e-mail in-box. Put in some face time with your prospects. Some real estate professionals do this by holding an office open house, a special dinner, or a fund-raiser for a local charity. Sheri Bailey, a practitioner with Keller Williams Boerne in Boerne, Texas, invites prospective female buyers to lunch every month or so. “Especially if they are new to the area, my clients love to try out a local restaurant while we catch up on the latest happenings in their lives,” Bailey says. “For the price of a sandwich or salad, I can stay in touch.” Even if there’s no explicit conversation about real estate, she says the meetings are valuable to strengthen those relationships. Remember, though, in order to count such a lunch as a business expense for federal tax purposes, the main purpose of the lunch must be business; you must discuss business before, during, or after the meal; and you must have a reasonable expectation of generating income or some other business benefit.
Step 3: Getting Down to Business
If you’ve built it, will they come? Certainly likability will help you win over some hearts, but just being the nice guy won’t get you to the closing table. You eventually need to get down to business.
Another 2008 study from Baylor University—this one conducted by Chris Blocker, an assistant professor of marketing—suggests the value of taking an adaptive selling approach. In other words, take your clients’ preferred communication style, values, emotions, and needs into account in how you serve them. “The agents who are the most successful tend to look for ways to meet [prospective clients’] individual psychological and emotional needs in the sales process,” Blocker says.
Tip: Don’t be afraid to have a point of view.
Blocker’s research, which tested various approaches in real estate for turning leads into clients, shows agents are most effective when they not only adapt to their client’s style but also look for ways to make clear, explicit suggestions that advise a specific course of action. “The agent who offers expertise instead of ‘here’s a stack of things to look through’ tends to have a higher success rate,” Blocker says.
For example, say you’re working with Judy, a buyer who is stressed out about not living close enough to her job. Weave those concerns into your discussions with Judy. If a house she’s considering is closer to work and has a great space for her to work from home, talk about how those factors might reduce her stress. “Help prospects see themselves in that home and neighborhood,” Blocker says. “Speak their language and pull at their heart strings.”
Tip: Watch for turnoffs.
Housing data, sales scripts, and incentives can all be useful tools to a point. But relying on them too much can actually backfire, according to Blocker’s research. “There’s a tremendous amount of housing data available,” Blocker says. “Too much information can sometimes cause people to ‘check out’ ” or feel overwhelmed, particularly if the information is presented with no explanations or recommendations. If you offer a packet of information and they actively consult it, they may want more. If they shove it into their bag and never refer to it again, they may not be information-oriented.
Buttering people up with incentives—like an offer to discount your commission—may not be effective either, the study found. “Basically, you’re trying to appeal to the client’s wallet, and that can be a turnoff,” Blocker says. “They don’t want to feel pressured to make a decision.”
And while sales scripts can be a useful guide to navigate various client situations, they can potentially undermine those interactions. Relationships are complex. People have unique personalities, life histories, and goals that don’t fit into one boilerplate script. So be flexible enough to go off script and tailor your presentation to individual clients, Blocker says.
Tip: Inspire gratitude.
A considerate gesture can go a long way—and it doesn’t have to cost money. Recommend a great contractor or painter who will offer a good price; take the time to ask how someone’s doing after a surgery or family death; or refer their teenage child for a job. Gratitude is a powerful emotion that makes others want to reciprocate.
“After receiving a benefit, people feel a deep-rooted psychological pressure to reciprocate,” according to a 2009 Keller Center study on gratitude by Robert W. Palmatier. On the other hand, the study says, “the failure to repay obligations can lead to guilt.” As the saying goes, “You scratch my back; I’ll scratch yours.”
To feel gratitude, others need to feel that your actions and concern for their well-being are sincere and not selfish or commission-motivated. So, by all means, seek opportunities to reach out. But do it simply for the wonderful bond you’ll create.