Building Your Sphere of Influence

To me there is nothing more important for a Realtor, new or established than to build a Sphere of Influence. People buy from people they like and would rather deal with someone they know than a stranger so here is a list of 100 potential additions to your sphere of influence.

Click here for Your List to Build Your Sphere of Influence

Take a minute to fill in the names that spring to mind and carry it with you for a week or two and fill in as many blanks as you can. Pull it out every few weeks and add more names.

What do you do with it?

Create a database of names and addresses and start contacting them on a regular basis. See other articles in this blog about how to contact them and what to send.

When Do People Look for a Realtor?

First let’s look at how they find a Realtor.  There are probably as many answers as there are buyers and sellers, but I like this explanation the best:

“If a consumer knows a Realtor, either as a friend, family member, acquaintance or a past relationship who stands out in their mind in some significant way and they feel comfortable with them, they will call that agent and ask them to come list their home. If there is no single agent who stands out in their mind, they may ask a friend they know for a referral.

Another option is that they might call two or three agents that they perceive as successful and whom they have a good feeling about, and ask them to come over for an interview. If they don’t know or recognize any agents in the area, they will probably pick up the paper, homes magazines or phone book and look for a Real Estate company whose name they are familiar with and call them. If they don’t make a connection with the agent they talk to, they keep calling or going to open houses until they meet an agent with whom they do feel a connection.“

I also read a study by Nansi Hall of House Values that summarized the selling and buying cycle something like this:

Sellers

The home selling process can take up to five years and be divided into four distinct “phases”- only three of which are actually measurable. Lasting up to four years, the first phase is a vague awareness that selling their home could solve a problem, offer a financial advantage or provide a needed change.

During the 4 years a specific triggering event such as a desire/need for a larger house, wanting to live in a certain area, job relocation and family concerns would occur that moved sellers into the next phase of the process.

From this point the selling process is about one year and includes three measurable phases:

Thinking about selling - 5.5 months
Researching a sale - 1.4 months
Actively selling - 2.4 months

Buyers

Buyers also go through a period of up to four years during which they were somewhat aware that they “should” buy a home for a wide variety of reasons.

Like sellers, buyers did not enter into the measurable part of the process until after a specific triggering event, including wanting or needing a larger home, wanting the financial advantages of buying instead of renting, family reasons and job relocation.

Following the trigger event the home buying process takes an average of almost a year and a half (16.4 months), split into the following three measurable phases:

Thinking about buying - 7.1 months
Researching a purchase - 5.3 months
Actively looking for a home - 4.1 months

So what does all this tell you?

1. You need to ensure that all clients are your raving fans and you keep in touch with them on a regular basis every quarter.
2. You can advertise in the newspaper every week for years, but if a prospective buyer or seller who does not already have an agent does not see your advertising or marketing material during the 6 months or so when they are in their “active stage” you are probably not going to get their call.

Another way of answering this question is to look through your client list. I will bet more than 80% are people you knew, referrals from clients, or people you have met at an open house. So why are you marketing to total strangers who take 5 years to buy or sell a house, are only interested in finding a Realtor for a few months during that 5 years and probably already know a Realtor?

Breaking the Ice

I found this great web site where you can make your own newspaper clipping and made a few up for fun, but recently I used the idea with a prospect I had not met, but who had been referred to me.

I came with a great reference, but the prospect is very busy so to break through the clutter and show my interest in her business I made the following clipping and emailed it before calling her.  It was a bit cheeky, but she is a motivational speaker and I thought this would be a hit.

I bet you are wondering if it worked? Send me an email at marketingguy@ shaw.ca and I will fill you in on the results.

Alliances Are Golden

I work with a lot of Realtors and one of the first things I ask them for is their list of alliances. (By the way this applies to all businesses and professionals.) More often than not there is not only no list, but no understanding of how alliances can play a major role in improving your business.

I can almost guarantee that if you spend as much time writing down allied businesses and seeking new businesses to be allied with as you do looking through the phone book, your business will improve dramatically. How?

Referrals
Allied businesses refer business to each other. If a florist you do business with hears about someone moving into the neighborhood they can either alert you or give your name to the newcomer.

People love to refer their friends to an exceptional company or service so they can experience the same good feeling they had. In turn their friend or acquaintance holds them in higher regard and will try to return the favor.

“Espionage” or Early Warning
In the case of Realtors, one of the first people to know a house is going on sale is often a repair service of some kind. “No we don’t want a new furnace because we will be moving in the Spring. Just fix it as best as you can”. Now your Furnace Repair alliance calls you and gives you the heads up.

New Business
If you do business and refer business your alliance will frequent your business and recommend you to their friends.

Reactivation
If you want to get in touch with customers you have not spoken with in a while and need a good reason to contact them, why not send a list of recommended businesses and services. They will appreciate your list and think of you the next time they require your product or service. Now they are reactivated as a prospect or as a source of referrals.

Here is a partial list that a Realtor should work on. I have a more complete list in the article called Building Your Sphere of Influence.

Mortgage Broker
Home Inspectors
Lawyer
Notary Public
Insurance Broker
Property Manager
Interior Design
Gardener
PC Software Training
Moving Coordinator
Chartered Accountant
Tax Lawyer
Home Staging
Immigration Lawyer
Home Detail Installations
Plumber
Window Washer
Electrician
Gutter Cleaner
Power Washing Company
Appliance Repair
Caterer
Janitorial Service
Florist
Photographer
Moving & Storage

8 Great Giveaway Ideas

Realtor Magazine Online had an excellent article on Giveaway Ideas for Realtors, but they apply to most businesses and professionals.

Potholders and house-shaped refrigerator magnets which were a staple giveaway in the past have given way to items that are unique, creative, and fun.

Choose items that are appropriate for your target prospects and fit your marketing message. When suitable, add your logo, web site and phone number to the giveaway, but the most important thing to remember is not to make the logo so big that they’ll never use the gift. In the case of memo pads and magnetic fridge calendars less is more. Who wants to write a not on a piece of paper that has advertising on half of it.

Following are some good ideas from the article.
1. Moving Day First-aid Kit Provide a moving day kit filled with such items as snacks, paper towels, plastic cups, bottled water, flashlights, aspirin, and carton openers. Don’t forget the phone number of the favorite local pizza delivery spot, along with a coupon.

2. Mother’s helper.
Bottle warmers, bibs, and diaper bags are great for new parents. Form a partnership with a local hospital and sponsor the gifts they give to new parents.

3. Sports-related items.
Imprint your logo on kites, baseball caps, sports water bottles, ball markers, sports towels, tennis balls, and walking odometer.

4. Stress reduction.
Help them wind down after stressful weeks of looking for a home or unpacking. In a basket, include bubble bath, tea and cookies, a bottle of wine, potpourri, candles — and, if you’re really creative, some names of potential babysitters.

5. Home-related gifts.
Give clients or prospects something that shows you understand how much they love their home: bird feeders, a doormat, a newspaper or home-improvement magazine subscription, attractively potted plants, flags and gift certificates to a local hardware or home improvement store.

6. Relocation kit.
They’ll appreciate things that will help them learn their new city quickly. In the kit, include things such as: a laminated folding map of the city, a list of the best restaurants in several price ranges, five local points of interest with directions on how to get there, phone numbers of local movie theaters, little-known historical facts about the area.

7. Home office options.
Post-it notes, custom mouse pads, cool pens, computer glare screen, and thermal coffee mug.

8. High-end options.
Custom door wreath, crystal vase or paperweight, matching Coach key rings with house keys, and caviar and champagne.

One study I read recently pointed out that people feel less guilt spending a gift certificate than they do cash. Think of a gift certificate that they would not buy themselves; a his and her spa treatment, day fishing expedition, hand car washes, a night at a downtown hotel or a tour of their own city.

Income Required to Buy a Home in Greater Vancouver May 2007

I live in Vancouver and it never ceases to amaze me how hot the real estate market is. To put it into perspective for readers outside of Vancouver following are some sobering statistics:

Property Type - Single detached
Benchmark Price - $ 653,616
Annual Income Required - $ 172,299

Property Type - Townhouse
Benchmark Price - $ 406,676
Annual Income Required - $ 108,005

Property Type - Apartment
Benchmark Price - $ 331,519
Annual Income Required - $ 88,016

Occupation Average Annual Income

Early Childhood Educator $ 32,760
Firefighter $ 57,540
Nurse (Registered) $ 55,237
BC MLA $ 75,400
Police Officer $ 54,639
REALTOR® $ 50,000
School Teacher (Elem) $ 53,222

So unless an elementary school teacher marries both a politician and a Police Officer there is not much chance of him/her buying a single family home in Vancouver.

Now I Understand Why They Didn’t Choose My Design

I always wonder what I could have done differently when one of my designs fails to make the grade. Usually I just blame it on things out of my control like solar flares or the global warming. That was until today when I learned people have 26 different decision-making and behavioral biases referred to as Cognitive Biases and it’s one of these that did me in. (or one of the 23 Probability and Belief biases or 18 Social biases…read on)

What is a Cognitive Bias?

Cognitive Bias is distortion in the way humans perceive reality. Some of these have been verified empirically in the field of psychology, others are considered general categories of bias.

Many of these biases are studied for how they affect belief formation and business decisions and scientific research. Following are few examples, but for a complete list go to Wikipedia.

Bandwagon effect — the tendency to do (or believe) things because many other people do (or believe) the same. Related to groupthink, herd behaviour, and manias.

Bias blind spot — the tendency not to compensate for one’s own cognitive biases.

Choice-supportive bias — the tendency to remember one’s choices as better than they actually were.

Confirmation bias — the tendency to search for or interpret information in a way that confirms one’s preconceptions.

Congruence bias — the tendency to test hypotheses exclusively through direct testing, in contrast to tests of possible alternative hypotheses.

Contrast effect — the enhancement or diminishment of a weight or other measurement when compared with recently observed contrasting object. etc

It doesn’t end there. There are also 23 biases in Probability and Belief and 18 Social Biases.

So here is how I am going to explain my last marketing defeat:

My client, hyperbolically discounts my work having a stronger preference for more immediate payoffs relative to later payoffs, the closer to the present both payoffs are and due to the Primacy effect or the tendency to weigh initial events more than subsequent events and their perception their knowledge of their peers surpasses their peers’ knowledge of them or an Illusion of asymmetric insight…and they didn’t like my work.

Now that feels better.

Pick a Color, Any Color

One of the most difficult phases of creating a new brand or designing marketing material is getting all of the parties to agree on the same color. (colour in Canada and the UK)

While most of our clients can provide a general idea of the colors they would like and we always recommend what colors we think will work best, it is important to understand the client and their target market as colors convey different messages. While I won’t pretend this is an area I know much about there are great web sites that will provide the proper definitions such as:

RED: Red is associated with anger, aggression, blood, sex, and power.

BLUE: Blue is associated with water, sky, masculinity, coolness, peace, knowledge, contemplation, loyalty, trust, and justice.

YELLOW: Yellow is the first color your eye will see. Yellow is associated with wisdom, sunshine, joy, radiance, intellect, and idealism.

Picking Colors

The first step in many projects is to determine a color palette. Often we send clients to ColourLovers.com where they can poke around until they find a palette or two they like. The advantage to us is that we then have the hex or RGB codes as a starting point.

The use of acronyms in printing is nauseating for the uninitiated and you will read about RGB, CMYK, HEX and Pantone, but what do you need to know?

Color printing is the reproduction of an image or text in color (as opposed to simpler black and white or monochrome printing). The method used to print a full range of colors, such as for reproducing a color photograph, is referred to as four-color process printing because it used three primary ink colors — cyan, magenta, and yellow, plus black (abbreviated as as CMYK).

Another method of full-color printing is six-color process printing (for example, Pantone’s Hexachrome system) which adds orange and green to the traditional CMYK for a larger and more vibrant gamut, or color range.

Color printing can also use “spot color” inks, alone or in combination with the four-color process method. Spot color inks are specific formulations that are printed alone, rather than mixed to produce various hues and shades. The range of available spot color inks, much like paint, is nearly unlimited and much more varied than the colors produced by four-color process. Spot color inks are used to print colors from subtle pastels to fluorescent greens and oranges to metallic silvers, golds and other finishes.

Best advice is to leave the acronyms to us.

Now We Have the Color

Or at least we think we do. It gets a bit tricky working over the phone with clients as we have found that no two computer monitors or displays will show the same color and no two printers seem to print the same color; and that’s where the problem starts. More than once the client is talking about the lovely mauve and I am looking at a blue. At this phase we often send clients to look Site Pro Central or December where we can discuss colors they like on the web site.

Prior to generating a proof from the printing company we often we send a proof of the design to the client and the color they see will vary depending on whether we print it on a color laser or color inkjet printer. I have learned never to trust this color. The printing stage is where the color choice is most critical and this is where we rely on a proof generated on a high end Epson printer to show the client. This proof is as close

Testimonials

I was asked the other day how important testimonials are and started thinking about where I would use them in marketing. Then I remembered one I received a while ago and thought I would share it with you.

Actually you too can create a testimonial like this at hetemeel.com.

Building Your Referral Business

Generating leads from referrals is both an art and science. There are time-proven steps (the science part) you can take that will provide the highest probability of success, but there is the human factor (the art part) that seems to be a determining factor in the results you will achieve. If you haven’t read my article about Referral Misconceptions now would be a good time.

Following are a few ideas to get you started.

Step 1 - Build a Database

Whether it is in Excel, Outlook, Maximizer, Top Producer, Gold Mine, Act or any other Customer Relationship Management (CRM) software it does not matter as much as actually doing it.

Who should go in it? Clients, friends, prospects, neighbours, family and vendors you work with to name a few.

Step 2 - Categorize your Database

Within each category you need to re-categorize them. Some people use A, B and C to qualify their likelihood to refer clients. You can use hot, warm or cold, but most importantly be honest with yourself whether the person is likely to refer clients to you.

Step 3 - Get Back in Touch

Develop a plan for the next 12 months to re-connect with all of the clients on the list. The A clients may justify 12 touches, the Bs 6 touches and the Cs 4 touches. What is a touch? Begin reconnecting through activities such as personal notes, direct mail, letter writing, email, newsletter phone calls calls, visits, client parties and business luncheons. At every opportunity it’s important to communicate your appreciation and to remind them that you’re never too busy for their referrals. this is often referred to as give-to-get marketing, give them information, your time, your interest in them and ask for their referrals.
One client I work with has “touched” their A clients for 9 months in a row and the referral business is taking off. What does an effective plan look like? Here is a really rough example:

Month 1 - Letter re-acquainting and perhaps explaining your absence. Ask for their referrals.
Month 2 - Letter with attached list of services or products you provide. Ask for their referrals and thank those clients publicly that have referred.
Month 3 -A letter with a useful memo pad.
Month 4 - A postcard listing all of the restaurants in the area or emergency numbers.
Month 5 - A letter with a market update….

You get the idea. A consistent, planned campaign to rebuild their trust and confidence, keep you at the top of their minds and constant education on how you can be of service to their friends, family and acquaintances.