Most real estate agents and mortgage loan originators don’t know how to find business. I fear that some of the social media strategies I’ve shared have morphed into a “build it and they will come” approach to business development. Greg Swann did a nice job of identifying this problem when he said that time spent on social media marketing is wasteful:
“Marketing” by social media is a huge waste of time. Selling is one-on-one, focused, time-consuming and goal-directed. Marketing, done properly, is broadcast, diffuse, time-efficient and passive and long-term in its goal-pursuit.
He’s absolutely correct. The time investment required, to keep your social media current, never pencils out if you want to make six figures annually. You will get some results but trust me when I tell you that you could have equaled or bested those results by handing out business cards at the swap mart (and yes, I’ve done that, too). Here’s where his opinion gets a bit murky, though:
Even if you are really doing your best to market your services on-line, if you are doing it by engaging people one-on-one in fleeting media like Twitter or Facebook, you are almost certainly wasting your time.
That, I can tell you from experience, is only partly true. Using social media to prospect can be exponentially more effective than cold-calling or handing out business cards at a swap mart because of the rich information users provide. People buy from people they trust and connections help to build trust more quickly. I’ll come back to this later but it helps to understand the difference between marketing and prospecting as lead generation tools.
Greg’s working definition of marketing (op. sit.) is a good one. The long-term benefit of marketing is that it is scalable. Online marketing, especially blogging, can be a workhorse, which generates inquiries from prospects for as long as the information is relevant. The hour investment in a well-written blog post can attract tons of inquiries over time (I have a few blog posts that perform that well). Likewise, a consistent display advertisement in the town’s weekly newspaper can trigger you to “top of mind” status for people seeking to sell their home. The problem with marketing? Marketing costs either time or money. If you need rather than have money, you might consider prospecting as a lead generation tool.
Prospecting is best defined as an active business generation effort. You seek potential customers in the “river” and sift through the “silt” to find little nuggets of “gold”. It is, by nature, a disqualifying process where you throw out people who have no immediate or pressing need for your services. Good prospecting rejects certain interested people as much as it does to accept them. Consider this advice about prospecting from Russell Shaw:
You don’t want to pay a lot for advertising for two reasons: you don’t have the money to pay and you wouldn’t know what to put in the ad anyway. Okay so skip advertising for now. Prospect. Learn what people consider valuable just by trial and error. See enough people and ask enough people what they might be interested in and in very short order (a few hundred people from now) you will know what to say and what not to say when you are talking to a prospective customer.
There are exactly two methods of getting business in our business: marketing or prospecting. Learn to effectively do one or both of those or leave real estate sales. Fortunately, or unfortunately, those are the only three choices. The skill of getting customers is the “important skill” in our business. For a really bright future make this important thing your important thing.
You can blindly cold call names out of a telephone directory. You can wear out the shoe leather by knocking on doors for listings. You could ask the question “Wanna buy a home?” when you hand out the business card at the swap mart; that action alone turns the marketing effort into a prospecting effort. Ask any top-producing securities broker or insurance agent and they’ll tell you that, in the beginning of their career, they built their business through cold prospecting. The top producers still prospect but they use a much more sophisticated strategy; referral prospecting.
Referral prospecting leverages your proven work results by soliciting introductions from happy customers. This can be as crude as the “referral card at closing” or as sophisticated as asking a past customer for an introduction to a specific person. A personal example of the latter was when I asked a securities broker, for whom I secured a refinance loan, for an introduction to another broker in her office. I thought I might have an opportunity to write a bigger loan for next broker; I was right. The challenge with that strategy is that you must have a specific “target prospect” in mind.
Social media offer us a peek behind the curtain of the previously hidden relationships our customers have. It helps you to identify that “specific prospect”. LinkedIn shows us our customers’ colleagues, friends, and customers. Facebook might identify our customers’ political connections, work colleagues, kids’ Pop Warner coaches, family members, and neighbors. Social media narrows the field so that you can more effectively “target” the people with whom you wish to speak.
Social media marketing is really not a cost effective strategy for business generation but social media prospecting can help you fire an arrow at more bull’s eyes. I’ll share some specific strategies, which can produce immediate positive results, in future posts.
Happy hunting!40 comments