"There’s no better person qualified to deliver this message - funny, insightful and useful.”
Dominic Nicoli, Inaugural Member of the Intero Real Estate Services Hall of Fame
"Inspirational and entertaining while literally providing a pathway to success."
Adam Eyre, Top 100 Lender at PrimeLending and previously Top 100 at Wells Fargo Bank
A SUCCESS GUIDE
for real estate lenders, real estate agents and those who would like to learn about the professions.
It will be worth your while to read this chapter twice. I am going to blend two concepts together in this section, incremental psychology and lead follow-up. This chapter will make you money. I will guarantee little—but I’m telling you, you can make money from this chapter. Let’s go.
First, let me set up a real-world problem or opportunity so that I have your attention. You are competing head to head against a competitor. It’s a dead heat. The customer is honestly torn—the score is 50 to 50. It could go either way. There is a $20,000 commission on the line, depending on who gets hired. The customer is stuck—you need to get him or her to move in your direction.
Okay, is that good? Change the economics to your economics if you prefer. Maybe your average deal is $5,000, maybe it’s $100,000, so change it. Either way, that’s a real-world problem/opportunity. Win two or three (or more) of those per year, and you change your performance for the year. So let me teach you how to win.
A customer is a customer and a lead is a lead. A customer has made a commitment; a lead has not made a commitment. So in this section we are dealing with a lead that we would like to convert to a customer.
When you are doing lead follow-up and trying to convert a lead to a customer, you need to maintain control and set the date. You must take 100 percent responsibility for the conversation. Never leave it up to your prospect to take that next step. If you do, you are dead.
Here is the right way to do it. “Okay, Sue, sounds good, I’ll buzz you tomorrow to get you that information about title insurance.” I set the date. “Okay, Steve, I’ll drive that comp tomorrow and get back to you with feedback.” I set the date. “Okay, Stan, great meeting you and Esther yesterday. I’ll call you tomorrow with more information on that insurance question that you had.” I set the date. You tell them the next step. You tell them what is going to happen next. You set the date with them. Never leave the conversation hanging.
Here is what not to do. “Thank you for your time yesterday, Steve, I’ll be around if you have any more questions.” No date. “It was great meeting you yesterday, Kim. I’m happy to give you more information if you need it.” No date. “It was so good seeing you yesterday, Armando. I’m so excited, and please, please let me know what else I can do to earn your business.” No date. “I really enjoyed spending time with you yesterday, Bill. Any more questions?” No date. Those are nice things to say. But those are also dead-end statements. Where do you go from there? Nowhere. You just lost control of the conversation.
When you do it right, you are setting a date. Just like a date when you were dating. No, maybe not exactly the same, but you are setting an expectation that you will be talking again soon, very soon. “I really enjoyed spending time with you yesterday, Bill. Any more questions?” No date. “Okay, Steve, I’ll drive that comp tomorrow and get back to you with feedback.” Steve and I have a date tomorrow.
It’s a fine-line distinction, but it’s the difference between winning and losing when you are in a neck-and-neck battle. I’ll let you take a minute and digest that while we digress.
Incremental psychology. One of my business friends told me about this concept in the late 1990s. He actually just said it in passing one day: incremental psychology. Still to this day, I have done little reading on the subject, but I understood what it meant (for me) the second he said it. I asked him to back up, and we talked about it. “Jim, I literally use this concept daily in business.” He was a senior executive at a publicly traded technology firm at the time. “Jim, once I learned this concept, I became a better businessperson.” Donald Trump indicated in one of his books that he pays attention to “momentum” daily. Well, my friend pays attention to “incremental psychology” every day.
What do you think it means (to you)?
“Hi, Mrs. Jones, can I have a penny?” She seems like a nice lady, so Mrs. Jones gives her a penny. The next time she asked for a dime. Wow again, but it’s only a dime after all. The next time it’s a dollar, and the next it’s ten. The commitment was small, and now it’s bigger and growing. And you have just made four separate commitments. The level and frequency are growing. Now they are up to $100. Would Mrs. Jones have given the nice lady $100 if she had asked for that amount from the beginning? Maybe, but unlikely. But by the time they arrived at the $100 level, Mrs. Jones and the lady had a relationship, and Mrs. Jones had already made multiple and progressively larger commitments to the lady.
Back to lead follow-up and converting the lead to a customer. When you are in control (not in a controlling way) of the conversation, you are asking the customer (in a gentle, helpful way) to make multiple and progressively larger commitments to you. Simple. And for you supercreative types, you’ll love it because you can utilize all those creative juices that are running around in your head 24/7 to keep the conversation moving.
You’ll figure how to do it over time. But for now, I’ll give you a tip to get you going. A real estate transaction is serious business; there is a lot money involved for the customer, and there are tons of moving parts. Listen, shhhhhhhhhhhh, listen. Plato says, “Wise men speak because they have something to say, fools because they have to say something.” There will be some things that your prospect brings up that you won’t be able to fully and adequately answer right on the spot. That is your moment. That is your moment to set the date. That is your opportunity to continue the conversation. It could be something supersmall or superbig; either way it’s fine. Set the date. Trust me, your competitor is going to let it die by saying something to the effect of, “I am so glad we talked and I enjoyed meeting you. I’m here for you, I really want to work for you, and I think I can do an amazing job and help to produce a great result, so please let me know if you have any more questions.” Dead end. While he or she just ended the conversation, you are continuing it.
Once you learn and believe in this concept, it’s not even a fair fight anymore. You are playing with bigger, more powerful knowledge, know-how, and machinery. It’s like a major leaguer playing with a high schooler now.
Here is a personal example. I was competing on a listing with another real estate agent. We were both referrals. It was a neck-and-neck battle. Both of us had already made listing presentations. I knew that staging and all the dynamics thereof were important to the prospect. So I called later that day (actually I called as I was driving back to the office) and suggested that I would be happy to send over a stager to take a look, no obligation, and they could hire the stager independent of hiring me. This is key: I told the clients that I would follow up after they met with the stager (set the date). They agreed and met with the stager (without me). I followed up to see how it went, as I said that I would do. They decided that they couldn’t afford the stager and they would do it themselves. That’s fine, I said, I would be happy to come over and give them an opinion on some staging ideas in that case; no obligation (set the date). They agreed. I went and did my thing. They still weren’t ready to commit, but at that point they made two additional commitments to me (while at the same time I was helping them move the process forward). I met with them to give them my personal opinion on staging. While I was there I gently reminded them of how important good curb appeal can be to the end result. I also said that I would be happy to send my tune-up landscaper guy over to take a look, no obligation. They agreed. I said that I would get back to them with a time and date (set the date). I called them back, set a time, and gently said that I would be happy to attend to give them my personal opinion on curb appeal (set the date), no obligation, of course. They agreed. We all met at the property and had a good meeting. I said I would get back to them the next day with the landscaper’s proposal (set the date). I called the next day, at which time they decided to hire me. I was having this ongoing conversation with them while my competitor was waiting around for a decision.
The action of lead follow-up is to set the date, and the concept (behind the action) is incremental psychology. Sometimes the customers will just be ready to go. Fine. Get the contract signed and move forward. Sometimes the customer is stuck and you need to get from point A to point Z in tiny baby steps. In those cases, ask the customer for multiple and progressively larger commitments along the way until such time as they are comfortable with hiring you!
You got this.
Go get ’em!
Force has no place where there is need of skill.
A valuable principle of life is not to be too addicted to any one thing.
Find ten great real estate agents and “schmooze” them. That’s roughly what I was told when I started in lending as a green pea. What if I can’t find ten that want to do business with me? And what if it takes me two years to build those relationships? What do I do for income in the meantime? What if I can only find three? And what if one of them gets mad at me? What if all of them get mad at me?
So off I went, finding these ten golden-goose real estate agents. Someone gave me some tapes on how to do it, so I listened. Send this letter this day, call this day, drop by this day, and on and on. I remember it like yesterday. I stayed at work all night one night trying to load all these prospects into the computer, then do a mail merge (whatever that was), then print—it was a mess. This went on for three months, with no progress to speak of, no love from my real estate agent golden-goose prospects. I even had real estate agent friends; they knew I was in the lending business now, and no love from them either. Everyone said, “It will take time, all great things take time, blah blah.” Now it’s month number six, no results, and I had followed the instructions almost without exception. That was it; I’d had enough of Happy Sam’s Real Estate Agent Marketing Program.
It’s important to note that during that six-month period, I stumbled onto a lot of business through my friends, my network, floor time, and some luck. So it’s not like I wasn’t producing, but in my mind, I was only filling time until the real estate agent people started sending me carloads of business.
Okay, Jim, you need a new plan. I had a meeting with myself. I studied the industry again and decided that I gave up my steady-paycheck job for lots of reason, but two of them, and they were at the top of list, were freedom and control. I felt like a hostage to these soon-to-be (currently invisible) real estate agent people (don’t forget, I was one of them later on). These ten phantom people were in control of my career, my income, and the success of my family. The more I thought about it, the less sense it made to me. So, I have to base my entire success in this industry around ten people? Hmmm. They (whoever they were, because they hadn’t sent me a single deal so far) get to dictate my income, my business, my future? I don’t think so.
I made a decision to never be too reliant on any one source of business again. Look at the quote at the beginning of this chapter. If something didn’t work out, no big deal, the ship sails anyway. If Carol Standtall the real estate agent didn’t send me a single deal that year, no problem. If my direct-mail piece didn’t work out, it was just a hiccup. If my family didn’t send me a single deal for eight months, I’d survive. If my display ad campaign didn’t produce a lead, I was strong anyway. If my past customers didn’t have any leads for me that year, I was still kicking butt. If my college friends didn’t need help at the moment, I was growing anyway. If my speaking engagements produced nothing in the last year, I enjoyed it nonetheless. If floor time produced a big goose egg last month, I didn’t even break a stride. Make numbers your friend. Broaden the base. Lots of sources of business are good. Never again! Never again was I going to be too reliant on any one person or grouping of people to drive the revenue line of my business.
Broaden the base. This one marketing concept can save your business in this business. Make numbers your friend. Multiple sources of leads are good. Think of it as a chair with ten legs in support. All 10 legs are naturally sources of business. Now envision all ten of those legs all having roughly equal strength. Now, remove three of the legs. The chair is still strong. But what if one leg is ten times stronger than all the others? And what if you remove that single strong leg? Would the chair survive? Maybe. The chair would be severely wounded—for sure.
When you are building a business, you are building it for strength, speed, and endurance. When you are launching a career in lending or brokerage, you are doing that exact same thing, except with fewer personnel. As an aside, if you have enough lead flow, you can hire people to help you with operations. So building a strong real estate business is largely about lead generation and, more specifically, broad-based lead generation. Be thoughtful about that. Small, medium, and large companies crash and burn yearly because of this lopsided deal-flow model. They lose one big customer, and they are crushed. Don’t be that person; keep control over the business and broaden your base.
“Commerce with all nations, alliance with none, should be out motto”—Thomas Jefferson. Multiple sources of leads are good.
Go get ’em!
Chapter 24 - Broaden the Base
We are going to be talking about softening the brand by introducing our personal life to the customer. Successful softening of the brand in real estate will have a direct correlation to your revenue line and therefore your profit for the year.
What are you going to show your customers regarding your personal life? Is it smart to give them a glimpse or a sneak peek into your life outside of real estate? For the longest time, I showed my customers next to nothing regarding my personal life. My attitude was, I am here to do a job, and I plan to do it to the best of my ability; that is enough. My customers don’t need to know about my house, my car, my kids, my wife, or really anything else, for that matter. That attitude softened over the years.
Should the customers have a right to see that part of your life? Well, they don’t really have a right to see anything; it’s your personal choice, of course. But how much should they see? Is it smart to show them a little? Remember, we are providing a very personal service, a service that is mainly delivered by us—personally. The customer won’t separate the person from the service. They are linked—one and the same. Sometimes we would like to think they are not, but they are one.
When I was a lender, I noticed several of my colleagues sending out holiday cards with the whole family at Disneyland or Thanksgiving greetings with a family picture prominently displayed. I just wouldn’t do it. In fact, the thought of it sounded so cheesy to me.
A few years into lending, we were having a party at the office. It was casual and you could invite your friends, clients, family, really anyone that you wanted. So I invited some clients, several of whom showed up. We had three very young daughters at the time, all under the age of seven. Our babysitting plans fell through at the last minute. I told the manager of the office what happened; actually, I told the manager’s wife. She said, “Oh, bring them, we’d love to see the girls.” Even so, I still had the good sense to not bring kids to business functions, but this was different. This was a true family-feel office, small, tight, and cozy—and this was more of a meet-and-greet setting than a formal venue. So we headed over to the party (office).
Softening the brand. I had never seen my clients so joyous. They were never that joyous when I was around. In fact, they pretty much ignored me at the party and talked with my wife and cooed over the kids. Where did that person go that was beating me up on the interest rate yesterday? Why are they so happy? It’s really the first time any of my clients (other than close friend clients) had met my wife and kids.
The next week I needed to lock the rate for one of those clients that was at the party. Ring ring. I gave her the story about locking the rate. My client says, “Yeah, yeah, yeah, that’s fine, Jim, do it, we love the girls, it was so fun seeing…” And on and on she went about the girls. I don’t even think she even heard me on the rate that I quoted her. So I said it again and her response was, “Fine, Jim.” And then she started back in again about the girls. Is this the same person that told me last week she was considering another lender if I couldn’t get her the exact rate she wanted? Wow, I needed to think about this.
Is it smart to give your customer a tiny glimpse into your personal life?
As a real estate agent, I was competing with another agent on a listing. He went first, then I second. He was in a different office, but I always liked and respected him. We both came from referrals so it was going to be either him or me. The clients were transparent with us and told us as much; nothing hidden, which was great. I showed up at the meeting. After a little chitter chatter, they said to me, “Oh, yes, and we met with So-and-So yesterday.” And then Mrs. Client started talking about my competitor’s family. As I’m listening to this I’m thinking, “Did they even talk about real estate?” I mean, Mrs. Client rattled off so much personal information about my competitor; I could only presume they spent one hour on personal stuff and ten minutes on real estate.
Normally, I wouldn’t think anything of it, but I really respected this guy. He was a good operator, modest, reserved, successful, and smart. You wouldn’t describe him as a chatty person. In fact, I would describe him as professional, strategic, and mostly all business. He got the deal, roughly a $47,000 commission check.
Will your revenue line be the benefactor if you soften your brand?
By the way, you do have a brand. Your brand may not be by design, but we all have a brand nonetheless. Think of your brand as your image; the word image might be easier to digest. In fact, the words image and brand are used interchangeably in many cases; overall it’s the “personality” of the product or, in this case in real estate, the service. As your business skills grow, you will be able to modify your brand by design. Your brand should be authentic but at the same time it should be intentional; intended to drive revenue to your business.
The big picture. We wear a certain hat as real estate agent or as lender. We are there to do a job. Yes, we are. But could the experience be enhanced for the customer knowing who we are beyond the lender or beyond the real estate agent? Can it be a richer experience for all parties if they (the customers) know just a little about us personally?
Tactful. Is there a tactful way of doing this? Of course. Use good judgment, maybe a holiday card in December or a Thanksgiving card in November. This is not an every month kind of thing, just enough to let your customers know that you are more than just real estate agent or lender. You are simply softening the brand.
It’s a business decision and also a personal decision in this case.
Remember, we are talking about only a glimpse, a half a teaspoon. I do believe there is a direct correlation between softening the brand and your annual profit.
Go get ’em!
Things done well and with care exempt themselves from fear.
Chapter 38 - Sneak Peek
Chapter 25 - Set the Date
Three of the twenty chapters included in the section called MARKETING.
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