The key to success in this business is very simple. You either have the ability to generate business or you don’t. In this post we’re doing to discuss the concept
of attracting new clients in real estate from your Sphere of Influence.
Attracting new real estate clients is the complete opposite of prospecting. My entire career has been about attracting new clients in real estate right from my database and in this post I’m going to share with you my findings.
In order to understand how this process works, you need to understand how and why people refer or use Realtors. I have a more in-depth article you can read here about the psychology of whats makes someone refer you, but let me summarize it for you.
People refer and use Realtors they know, like, trust, and… REMEMBER!
Attracting new clients in real estate from your database starts with creating a marketing campaign that makes it easy to be referred. You don’t need any tech experience, a super duper autoresponder, or a killer “Script”. You just need your brand or service to be top of mind to the people who already know, like, and trust you.
Over recent years, many “shiny objects” have infiltrated the real estate marketing space and although they sound really bad ass, the truth is that online Internet leads only accounted for about 3-5% of closed transactions last year. It amazes me that so many real estate agents pay so much attention to systems that account for such a small percentage of closed sales.
66% of buyers closed with the agent they were referred to or already used in the past
10% of buyers closed with a Realtor they met off a yard sign
4% of buyers closed with a Realtor they met at an open house
I don’t know about you, but the first thing I would do in any business I owned is research where the largest amount of sales originate from. I can then craft a marketing plan to speak directly to that audience. According to NAR, 80% of buyers closed with the agent they already knew, were referred to, or personally met.
One thing that hasn’t changed with the Internet is that the majority of people still use the first real estate agent they come into contact with. It’s no coincidence that the first real estate agent consumers come into contact with is most likely also someone they used in the past or are referred to.
I believe the reason for this is because buying or selling real estate is an emotional decision that people want to do with someone they can feel they can trust. Therefore people still overwhelmingly depend on a referral from a trusted source for their real estate needs.
There is nothing more powerful than what someone else says about your product or service.
Don’t believe me?
Before you booked your last vacation, did you read the reviews before you made your decision? Case closed.
So how do market your database?
I’m so glad you asked. You follow the exact same marketing plan every business follows. Your create a target audience out of your past and most ideal clients, then continue to keep your brand in front of them through consistent communication.
Your audience is your rolodex of relationships and past clients!
Attracting new clients in real estate from your database begins by first defining who goes into your database. There are several meanings to the word database so let me explain.
The database I’m talking about is nothing more than a collection of people you would invite to your wedding or funeral if you had an unlimited budget for both. Your database is NOT a collection of Zillow leads, opt ins, or other people you have no personal relationship with. I’m talking about your best friends, your neighbors, your dentists, your family, your cousins, the parents at your kid’s school, and anyone else you would say hi to in the grocery store.
Anyone who you would be pissed off to log onto to Facebook and see them holding keys to their new house with another agent is part of your database.
Your best referral sources are your best friends, past clients, and family. Quite often, real estate agents shy away from “marketing” their closest relationships in fear of being cheesy. You are only cheesy when you send them cheesy shit so quit talking about interest rates and start talking about things people care about. Nobody cares how many houses you sold this month so quit bragging about your closings and start telling stories about the people you helped instead.
TRUE STORY: I got married in Cabo! When you get married, you create a wedding list of people to invite. My wife’s side of the family knew me as Mike, Allie’s husband, not Mike The Chicago Real Estate Dude. Although I see them every other weekend, they didn’t look at me as a Realtor and I knew that.
After the wedding, I made sure I added everyone on my wife’s side of the family to my direct mail and email lists. I knew that by adding them onto my marketing lists would turn into referral and direct business. Within 12 months I almost paid for half of the wedding. The point of the story is that you should never assume those closest to you know how to help you with referrals.
What Do You Mean By Marketing “Them” Or Marketing Lists?
The key to marketing your database is being a great storyteller so that your messaging is not self serving. You don’t want to send your database sales related messages talking about interest rates. You also don’t want to send them watered down “turn back the clock” emails reminding them that Spring is coming either. My marketing messages don’t really talk about real estate at all, but they do infer that I’m in real estate. Feel free to read this blog post and learn the ins and outs of the messaging of my marketing by clicking here.
When I’m marketing my database, I’m not doing it to generate a lead, I am doing it to generate the attention of my audience. I’m doing it so that my brand can remain associated with the term real estate. I want my entire network to automatically think of The “Dude” when they think of real estate. That is how you win in attracting new clients in real estate from your database. I communicate consistently and authentically to my database.
Why ATTENTION is So Important…
Having the attention of your database creates top of mind brand awareness. Top of mind brand awareness creates a higher likelihood of you being the first person they speak to about making a real estate decision.
10-15% of your database is moving this year.
100% of them can refer you to someone who is moving this year.
Attracting new clients in real estate from your database is about creating a consistent communication strategy with them so it’s very difficult to be forgotten about.
Have you ever heard about direct mail farming?
It’s a concept that had been around since the dinosaurs ruled the Earth. An agent will pick out a number of homes in an area and mail them out a postcard once a month. These numbers are pretty consistent with the results in a typical farm area.
Year 1- 1-3 listings
Year 2- 3-5 listing
year 3- 5-8 listings
Over time, you begin to brand yourself as the neighborhood go-to-agent, but it takes time and consistency to do it. If you decided to take 3 months off your campaign a year it could derail the whole thing. It’s the consistency of the mailings that eventually builds your brand.
Do you know the difference between farming a neighborhood vs farming your database?
Your database has the ability to refer you business where a farm typically doesn’t. People don’t refer their friends and family services they have not experienced themselves so farming a neighborhood is really about playing the turnover game. Farming your relationships you play both!
Both strategies work, but farming your database is more effective because you have the ability to generate referrals from them which accounted for 51% of closed buyers last year!
So if you want start attracting new clients in real estate from your database, start by recognizing who your audience is, and then setting up a consistent communication strategy no differently than you would if you were setting up a farm. It really is that easy.
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