This whole month we are going in-depth look into real estate prospecting.
Any training about prospecting would be incomplete if we didn’t also show you how to generate leads on your own. We have a whole set of tools that helps agents do just that.
Last week, we talked about overcoming call reluctance and simple ways to track your numbers.
Today, we are going to talk about the natural law of prospecting.
Just like gravity keeps us from floating into the clouds, there are certain laws that exist that guide our customers actions, attitudes and receptiveness to us.
This set of laws is known as the “Buying Cycle”. Every business on earth has a buying cycle, by the way. But in real estate that buying cycle can last up to four months or more so understanding that cycle is more crucial.
Before you decide what to say to your customers when you reach them (our favorite tool from Guerilla Realty RECallScripts.com has some great ideas), you have to identify what phase a customer is at in the buying cycle.
This may be the first time you have heard about the buying cycle, but I can assure you it’s not the first time you have dealt with it.
Whether you are buying a home or a candy bar at the corner store, you go through three phases whenever you purchase a product.
1) Information gathering phase (Survey available products and gain knowledge of the market)
2) Product Search (Find the right match for your needs based on the information you gathered)
3) Escrow (Paying for the product)
Think back to the last time you made a purchase. Maybe you walked into a department store to buy a new winter coat.
Within minutes of you coming in the store, a sales clerk approaches you and asks nicely, “What can I help you with today?”
Without even thinking, you reply with…
“No thanks, I’m just looking”.
It’s almost a kneejerk reaction for most of us. Beneath the surface of this interaction, you are indicating that you are in phase one of the buying cycle and want to be left alone for a few minutes to look around and gather information.
You are NOT telling the clerk that you will never need their help.
You are NOT telling the clerk to buzz off because you can do this all on your own.
You are NOT telling the clerk that you aren’t buying anything today.
In fact, eventually after looking around for a while, you will probably approach that exact same sales clerk and ask them to help you find the right size (phase two) or to ring you up (phase three).
As you can imagine, a sales clerk who jumps right to the register trying to ring you up when you are still gathering information might not make the best impression.
Or a clerk who waits around for you to gather information while you are standing at the register ready to buy may miss out on the sale.
In the department store world, this buying cycle stuff is easy because the cues are clear and all three phases happen within 20 minutes.
In the real estate world, it may take a couple of months or more of information gathering for a customer to be ready for a home search and we are trying to read the cues from limited conversations with a customer, oftentimes over the phone.
Traditionally, agents have always connected with customers in phase 2 of the buying cycle. Think open houses, sphere of influence marketing, farming, and even FSBO/Expired leads.
And the prospecting training that goes along with those leads urges agents to be direct and assertive with probing questions designed to “close” the customer.
That approach works great for a customer who is searching for homes and just needs to find an agent.
Or a customer who is ready to list and just needs to be convinced to work with an agent.
But what if you grab your customers where 93% of homebuyers start their search–online. If they are just starting their search, they are likely in phase one of the buying cycle.
Being aggressive with those customers leads to a poor impression for the customer and lots of frustration for the agent.
You have probably heard the phrase “Buyers are Liars”. Well, they lie because we make them lie.
How would you respond if you were a phase one customer just gathering information and didn’t really want to get sold by an agent just yet?
“No thanks, I’m just looking.”
But then the agent is persistent, peppering you with questions about the home you want to buy and what your timeline and motivations are.
You’d probably make something up to get them off the phone, right?
Online leads are the same way. They are legit customers who we just happen to catch in phase one of the buying cycle.
In fact, we know that 74% of buyers and 76% of sellers end up going with the first agent who they come contact with.
Sounds like a great reason to get them early, right?
With the right approach we can not only turn those leads into real viable closings, but gain a significant advantage over our competition in the meantime.
Later I am going to reveal my entire approach to following up with phase one leads, but to be effective in following up with phase one leads, you have to have some phase one leads.
If you want to test out some of the methods I’ll be teaching you need to start generating more leads.
I get 20-30 leads per month using our Magnabase system. It’s used by all of our agents at Magna Realty who generate even more leads than I do.
They use the same methods I do, generating organic leads without spending a dime in advertising.
If you want to join them, check to see if we’re sold out in your market.
If we’re not you can get setup today. No activation, no contracts. Start generating leads tomorrow.
All the best,