Most sales people understand that all sales boil down to two factors:
If you were selling a widget this would come naturally to you, but because being a real estate agent is so much more than sales it oftentimes escapes us.
I have spent thousands of hours on the phone with real estate clients.
I’ve spent even more time with agents teaching them how to prospect effectively and the single biggest thing that helps improve an agent’s prospecting is NOT having the perfect script, or the best pitch, or the most experience.
It’s knowing their numbers.
Most agents have no idea how many leads it takes them to close a deal.
Or how many calls they have to make to get a live lead.
We’ve all been there.
Calling our leads haphazardly and then hoping we stumble on the one who is ready to buy tomorrow.
Then we turn around after a while and either blame the lead quality or beat ourselves up for not doing everything we could with the leads.
Being an expert in your numbers unlocks a plan for connecting with customers longterm and the attitude and mindset that help you follow through.
Depending on who you talk to, there are a hundred different stats you should be tracking and just as many ways to do it.
I am going to simplify it for you.
This will work no matter the lead or your prospecting approach.
First, you have to have a CRM. Any CRM will work if you use it regularly. If you don’t have one, find a free CRM–or join Magna Realty and use our fantastic CRM called Propertybase
Then there are three (yes, only three) numbers you will want to track religiously.
- Contact Rate. This is percentage of leads that you reach vs. the number of leads you have. Inbound online leads will typically have a contact rate of around 50%. Colder leads (like a FSBO list) may have a a contact rate that is much lower.
- Success Rate. This is the number of people that respond positively to your first call. Of course, this requires that you an objective for your first call. For my approach, we expect a success rate of 75% or higher. Different objectives may result in a different success rate. The important thing is that you track this number.
- Closing Rate. This is the number of leads to close a transaction. According to NAR, agents close around 1 deal for every 24 leads (~4%). The type of lead matters, but what is most important is your average closing rate over time.
How you gather this information doesn’t matter, but I usually set aside a half hour at the beginning of each week to review the notes I made on the leads I generated over the last week and jot down my numbers.
Not only will knowing these numbers help you identify if something needs to be tweaked.
Over time, you will begin to get a true picture of your ability on the phone.
This is huge because your motivation will wane, especially as you occasionally run through a dry spell of reaching people or run into that jerk who screams at you to take his number of your list (even though he’s the dummy who registered at YOUR website).
Knowing your numbers means that if you just stay the course and continue to call, your contact rate will hold up, which will lead to your success rate if you take the right approach, which will ultimately lead to commission dollars from closings.
We will be covering effective prospecting all month, so make sure and stay tuned.