As salespeople, we do face a problem with buying ahead of time. Over the past two to three years, many consumers have taken advantage of historically low-interest rates to either purchase a new home or make substantial improvements to their current residence.
Real estate agents face new and ongoing difficulties because of this shift. We must rise to the occasion of the challenge. Future markets will be more competitive than ever as the number of leads dwindles due to the growing buy-it-forward movement. We will need to expand into more competitive locations to create listings and sales. In reality, most agents intentionally keep their list of potential sellers small. This decision was made because we did not wish to compete for listing space. Most agents would prefer that sellers contact them directly. To bring in customers, we focus on a narrow market sector. This niche market relies solely on recommendations from satisfied customers and repeats business from established clients. There are primarily six types of prospects to consider while assessing the available listing opportunities.
Customers that are considering listing with you right this minute
The vast majority of Agents specialize in this field. No one ever leaves the group. We are not ready to compete in the more open market. Those that do not fit this description are, in our opinion, not worth our attention. We’ve been trained to believe we can only trust this particular set of people to conduct business with. Unless your business is built on word-of-mouth, it has no value. Experts tell us their method will make our relationships so strong that we won’t need to compete with one another. In addition, they promise that so long as you are utilizing my referral system, you will never again have to deal with any opposition. That’s a load of nonsense. Sticking to that method only will make running a firm more challenging as time goes on. Despite our best efforts to build a referral-based firm, this sector is rapidly contracting.
I would rather not be seen as anti-referral in the business community. Like you, I think that kind of business offers the best combination of low risk (in terms of rejection) and high potential reward. I think it’s a bad business strategy to be exclusive when the market is shifting and customers have more options than ever when selecting a Realtor. Competition in the market is expected to increase in the coming years.
We need to be ambitious and hungry for success if we’re going to achieve our goals in the other areas where we should be regularly competing. Please don’t mess up; we’ll have this group of people considering listing with us covered. There just aren’t enough of these types of folks to go around. If our listing presentation goes smoothly, we’ll get the listing. The absence of a stubbed toe is no indication of a successful listing presentation. We must be ready to compete in the broader market, not only this specific segment.
Those most likely to list with you
These are potential supporters who are leaning in our direction but haven’t made up their minds yet. There’s a chance we’ll be in a tight race for this client and this commission, but if we show up and perform a few things well, we should still come out on top. To get the listing, we need to figure out what kind of service they anticipate from us and deliver on that. We need to know their decision-making process and whether or not they’re prepared to make a choice right now. Being present at the correct time is essential to making sales. Getting the appointment is the first step, but too frequently, we rush through the preparation and timing that would set us apart from the competition.
Even this subset is dwindling in size. You probably know at least one Realtor. If all other factors are equal, most customers will choose an Agent based on commission or pricing. Most Agents can’t differentiate themselves from the crowd beyond “being a nice guy.” Consumers are wise to the lack of differentiation amongst Agents and are increasingly opting for the lowest fee or highest asking price. As Agents, it is our responsibility to convince clients that their choice of representative is crucial.
3. Potential sellers who have not yet picked which agency to list with
The race has officially started. When compared to everything else, it is massive. Most Agents quit about this point. Only the first two categories receive any of our attention. Those communities are lovely but don’t represent an enormous chunk of the market.
This market subset is developing quickly. Every day, this market subset takes a share away from the ones that are or would be listing with you. We will miss out on a sizable portion if we do not consciously and actively participate in this market.
Due to the widespread belief that a Realtor’s services are overpriced, consumers are out shopping in record numbers. The media has relentlessly criticized our prices and service quality over the past few years, and consumers appear to have bought into the narrative. Consumers will care about pricing if there is no clear differentiation between products.
Customers view us professionals as a commodity. With a commodity mentality, you recognize that price is the primary determinant of your purchase decisions. Whether they’re Dole or Chiquita bananas, most of us don’t care. We only have the prices of two of them: 59 and 79 per pound. For 59 cents per pound, we’ll take one. We will be at the mercy of the commodity mindset until we strategically shift the consumer’s perspective using our benefits, competitive points of difference, and competitive advantages. As professionals, we need to believe we are the best and be the best at what we do when it comes to making sales. We own it if we win. To win their business, we must demonstrate how working with us will satisfy their top three wants.
Let me explain the process to you. When qualifying a lead, we need to ask the right questions to find out the following:
When choosing an Agent, what are their top concerns?
o What do they value most when it comes to Agent services?
o What will constitute a successful partnership for them with us?
o When can we expect a response from them?
If you had to choose only two things to look for in a Realtor, what would they be? Customers usually respond with some combination of “price and commission.” We’d rather avoid direct competition in these spheres. I’d instead not go head-to-head with anyone else over such details, as someone will always be willing to do it for less money and drive up the going rate. I’d rather not have to charge more while making less money.
If we want to prove that we’re the greatest, we need to show them that we can enhance the likelihood that they’ll obtain the highest price by discussing price and commission on an equal footing.
Listings that the company or we currently have active: More signs means more phone calls. It also expands the potential for ancillary sales. Our capacity to find them the ideal purchaser is inversely proportional to the number of purchasers we generate. The best purchaser improves the likelihood of a better sale price, a more transparent sales agreement, and a more orderly transaction. Thereby relieving their financial, mental, and emotional burdens.
Our/the company’s market share, indicated by clause B: Gaining market share means more potential buyers and sellers will be calling. Our leadership position in the business affords us more opportunities due to our market share.
C. The average discount we secured off the retail price is evidence of our bargaining prowess. Once we assure them we can guarantee a particular sum, they can relax. They will know what to expect financially in the final contract negotiation stage. If you want to surprise me, save it for my birthday.
D. Number of days on the market: This metric attests to our product’s popularity and explains our overall success. How swiftly we do the assignment is a measure of our Agent competence.
I guess that we haven’t drastically undervalued the house. I hope agents are trustworthy enough to fulfill their fiduciary duty to their customers. The number of days on the market reveals how well we achieved our goal price.
I could give other examples, such as having more units sold than years of experience or an average ratio of listings taken to listings sold. You may give yourself an edge in the market in various meaningful ways.
When discussing commissions, looking at the bottom line rather than the top is essential. The gross and the actual commission charged are a losing combination. There will always be a cheaper option. Throughout the globe, you can easily find Agents who are open to performing a commissionectomy. Use a level-shifting script for the commission conversation.
An excellent script to follow is:
What I gather from what you’ve said so far is that you plan to work with “the Realtor that provides you the best opportunity to net the highest dollars.”
This diverts attention from the price you charge and onto the topic of the internet.
We stay above the B level since we aren’t competitive. Avoiding situations where rejection is likely is a top priority for us.
That, my friends, is just how people are. The fear of rejection is universal. That fits the definition of typical. It wouldn’t matter who the seller was or how many other buyers there were if we were confident in our chances of winning. When selling real estate, this was one of my busiest niches. The majority of Agents avoid this most lucrative and expansive niche. This is a fantastic group since its members are eager to take action. They’re not sure who, however.
I didn’t give it much thought if the vendor was serious about making a sale. I was ready to offer my services as a shopping assistant if I knew who it was. I aimed to distinguish myself from the other Agents by emphasizing my unique abilities. Learn from the best, and success will be yours.
Those who have already decided to list with a different agent
It’s at this point that the odds begin to lengthen. We need to convince them that rejecting us would be a severe error.
Our central argument is that picking the right advocate for your goals is crucial in any industry. The time and effort you put in, the amount of money you stand to gain or lose, and the amount of stress you experience during the transaction are all factors that count.
To receive the listing, we must understand and surpass their expectations. We need to get them to see that their first judgment on who to do business with was made hastily and without all the information now available. Given the new data, we are your only viable option.
5. Potential listers who are considering other options
We need to educate potential customers on why they should sign up for our service right now and why they should sign up right now. Insufficient leads prevent most Agents from achieving their objectives. We need more people, and we need to persuade some of them that it’s better to get moving sooner rather than later.
These individuals have yet to make a choice. To assess the likelihood of a sale, we need to know the main factors that influenced their decision. We need to market our exclusive representation services to win the listing. If we give the proper presentation, we can’t be sure of success like in options A, B, and C. There are reasons why this person probably won’t advance even if they hear the correct pitch.
This individual may require further follow-up, but we must prioritize a few initiatives to boost our listed inventory in the competitive listing industry. Between following up on leads and scheduling appointments, I estimate that this process takes no more than two hours per week.
Individuals who decline to list with you, number 6. Currently working with another Agent, but would value your feedback or knowledge nonetheless
We should stay away from these individuals because of how much effort would be wasted on them. They have no intention of ever listing with us.
Agents have focused solely on Grades A and B assignments for the past few years. We have been in a safe zone for some time now. Fearing failure in the face of the open market’s fierce competition.
In a purchasing forward market, we don’t have that luxury. The most challenging competitions require us to put ourselves out there. To improve, we must take the chance of being laughed at.
John Wooden is rumored to have recruited Swen Nater to play basketball at UCLA. Coach Wooden warned Swen that he would be playing second fiddle to Bill Walton for most of his time at UCLA.
Swen was assured that he would have the opportunity to train against Bill Walton, widely considered the finest player in the world, every day at UCLA. He would improve as a player by engaging in a daily struggle with Bill. It took a man of great character, Coach Wooden reasoned, for him to accept to be a backup player when he could have been a starting player practically anywhere in the country.
Swen listened to Wooden’s prediction that he would spend much of his career as a backup player and enrolled at UCLA. Swen was selected in the first round of the NBA draft when his collegiate career ended, and he has since amassed a fortune playing basketball. Swen attributes his success to the daily tough competition while playing for UCLA. He is the first to claim that attending UCLA made him an NBA player.
Get in the game. Avoid picking the simple tasks that anyone can undertake. Resolve to embrace the test as an opportunity to grow. Avoid only scheduling appointments for the rollover listings. As the market competition level rises, you’ll see a decline in the listings you can sell. Join the action and compete for the win!
Dirk Zeller is the President & CEO of Real Estate Champions, an Agent and an Investor. More than 250,000 Agents worldwide receive annual training from his organization through seminars, webinars, online courses, and publications. He has written over 300 articles and books, including Your First Year in Real Estate, Success as a Real Estate Agent for Dummies®, The Champion Real Estate Agent, The Champion Agent Team, and Telephone Sales for Dummies®.
When it comes to coaching, look no further than Real Estate Champions. Anyone interested in real estate marketing or investing and new agents can benefit from the training provided.
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