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Archive for January, 2009

Selling real estate the engenu way: Because I can make content-rich web sites so easily, I can make my points more convincingly

Can premium rental homes in suburban Phoenix throw off positive cash-flow at 75% of market rents?

An investor asked me that question the other day. It’s an academic problem, really, a matter of costing out typical homes to see how they perform under that scenario.

I can do that much standing on my head, but answering a question like that with a spreadsheet is not terribly satisfying. We live in a data-rich world, and I wanted for my investor to understand exactly what we were talking about. So not just the spreadsheet, but also MLS listings of typical homes. And not just the listings, but also detailed photos of those homes, with descriptions of what might be wrong with each one.

In fact, I could have answered the question any way I wanted, from tap-dancing on the telephone to an attempt to set a showing appointment. But I know from experience that the more questions I can answer in a completely credible fashion, the greater my chances of forging a long-term client relationship.

And that’s a big “Duh!” — isn’t it? How would I want to be treated if I were thinking of dropping some substantial fraction of a million dollars on investment real estate?

And this is where engenu comes in. I can shoot the spreadsheet across immediately, as an appetizer. But I’m not selling spreadsheets, I’m selling houses, so I put together a list of houses that I thought might be financially impressive. I toured each one, taking photos of everything, then came home and built an engenu web site from my findings.

I’ve been talking about engenu for nearly a year, but I’m not sure I’ve ever gotten the point all the way across. We use engenu to build our single-property web sites and to provide supporting documentation when we blog about homes for sale. We use it as a way of previewing homes for out-of-town buyers and investors, and as a way of communicating staging advice to our sellers. The language of real estate is photography, and engenu enables us to build (and rebuild) large, photo-rich web sites with minimal effort.

So: I came back to the office with my photos, sorted them into folders by home address, threw those seven folders into an encapsulating folder called “Coldwater_Springs_Bargains.” I tossed the PDF of my spreadsheet in there, too, along with a PDF file of the MLS listings. Then I uploaded everything to our file server.

From there, all I had to do was run engenu. Look at the web site I built. One master page leads to nine sub-pages. Two of those are the PDF files, but the other seven are photo slide shows. All of it is linked together into an easily-navigated hierarchy — and the pages are SEO-optimized to boot.

So how long did it take to build that site?

Less than ten minutes. It only took that long because I wrote copy and captioned some of the photos. Had I taken the structure just the way I had it built, I could have inherited the whole site in less than a second. You can see me demonstrating this kind of automated web site creation in The Way of the Farmer from last May’s BloodhoundBlog Unchained.

So what do I end up with? A very elaborate web site to answer my investor’s question, for one thing. There is no one he can talk to in Phoenix — or anywhere — who will provide this level of documentation. Moreover, I’m building my own credibility by being completely transparent about the claims I am making about rental properties in the Phoenix area.

But wait. There’s more. I now have a site that I can share with other investors. Facts are facts, and my facts are backed up with numbers, listings and photos. So, of course, I wrote a blog post about the web site. We sell a lot of rental homes, and I want to sell a lot more. This is a very effective demonstration of why investors should be putting their money into properties in suburban Phoenix — and doing it with me.

And all of this is made possible by engenu.

There are 146 photos in that site, which is not a lot by our standards. There is no way you would email 146 photos, and, even if your client received them, they would have no way of making sense of them. engenu makes it easy to communicate vast quantities of information — photos, PDFs, off-site links, YouTube videos, Google maps — while sending your client nothing but a single web-site link.

Cathleen and I built over 1,500 engenu pages in 2008. That’s in addition to blog posts or WordPress Pages. This is a permanent, highly-relevant, highly-searchable improvement to our inventory of on-line content, all done in seconds or minutes per page.

At Christmas, I pointed out that Realtors have a publishing problem. engenu is one way we have come up with of solving our publishing problem.

And what does all this have to do with you?

I’m going to teach engenu at BloodhoundBlog Unchained in Phoenix. I’ve talked about this software plenty enough, but Teri has convinced me that people won’t really get it until we go through it again and again, engenu in action, engenu in real life.

I’ll be teaching tech stuff because it’s what I’m good at, but Unchained is about breaking all of the chains that are holding you back. We’ll be doing Social Media Marketing and Search Engine Marketing, all that geek stuff. But we’ll also be covering Direct Marketing and belly-to-belly sales techniques. We’re not about weblogging or (god help me) Twittering, we’re about converting the sale.

If you want to learn how to convert more sales in the coming wired world of real estate, we’re the only game in town.

So: Commit yourself. I’ll show you how to make ten wicked-slick web pages in ten minutes, but that will be just one of the classes you’ll take with us.

Click the appropriate button below to sign up now.

CyberProfessionals: $397


















Unchained Alumnus: $597


















Regular Price: $697


















Every session will be taught by an expert, by a working real estate professional balanced on the bleeding edge of hi-tech marketing. We’re building this curriculum for our own self-improvement, too, so we know there is simply no better investment you can make in your career this year.

We’re looking forward to seeing you in Phoenix!

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17 comments

Reading the signs and portents of Obama’s America

We call it inauguration after the Romans, of course. Beginning at midnight on January 1st of each new year, the priests would take the augurs — the signs and portents — for the two new consuls, the duoviri who would govern the Republic for the next year. The ceremony would end with a long, slow march to the top of the Capitoline hill at dawn, at the end of which the senior consul for that year would sacrifice a bull. Only then would the new consuls and the senators convene in the Curia to take up the Republic’s business for the year.

And Janus, for whom January is named, is the god of doorways, presiding not just over beginnings but also endings. Today marks not just the beginning of Obama’s presidency, but also the end of the Bush era in Washington.

Both Bushes, pere and fils, seemed to me to be fundamentally decent people, quite unlike the man who served between them. But Bush the younger, by being so roundly reviled as president, has nowhere to go but up from here. Someday Americans will have the fortitude to thank this man for calling Islamofascism by its true name: Evil. In the mean time, the bull is no longer his to slay.

I’m less afraid of Obama than I was on election day, but still I fear for capitalism and for individualism. The good news, always, is that socialism cannot work. The bad news, always, is that millions perish in the process of discovering that socialism cannot work. Janus may well be opening the door to a renewed appreciation for classical liberal virtues, but it seems likely that the glorious light we associate with ages of reason may be found at the end of a long, dark hallway.

The one hope I hold today is to be found in the photo at the top of this post: I hope that today is the beginning of a post-racial America. Everything we’ve done about race so far, for four hundred years, has been pretty stupid. I hope it turns out that electing a black president was the first smart thing we have managed to do to bridge this divide.

Augurs and their portents, with or without the animal sacrifices. What signs do you see for America’s future?

33 comments

A Tale of Two Paradigms

Glenn Kelman’s recent Call to Arms brought to light for me the two  paradigms that exist within the realm of transacting real estate – the traditional broker/agent-centric view and the evolving consumer-centric view.  Ultimately both paradigms attempt to better serve the consumer, however, the perspectives are very different.

Glenn’s post queries why traditional brokers, i.e agent-centric business model, don’t embrace the consistent measure of customer satisfaction on an agent by agent basis after the completion of a transaction.   The question is extremely valid – measuring customer satisfaction is a way to preserve the integrity of the broker and/or agents’ brand.

I question the validity of the metric – customer satisfaction – what is the criteria?  In fact Glenn asked, “how do you measure customer satisfaction?”   Defining the criteria is critical to measuring the ultimate value of the outcome – is 9 out of 10 a valid measure?  What does 9 mean?

I’ve held the QSC – Quality Service Certified – Certification for almost 6 years.  After each transaction, a third party administers a survey to measure how satisfied my clients were with the service level I provide.  Interestingly, never once in 6 years have I had a potential client or prospect contact me because of my rating.   In an agent-centric model, I measure customer sat by referral and repeat clients.  I get measured on a scale from 1 to 5 and have been able to maintain a high level of satisfaction, but ultimately my clients have spoken more effectively about my skills and knowledge rather than my score.

While it may be important to know whether or not a particular consumer may recommend or even use the services of an agent and/or broker, I believe I need to know the “why?”.

The question has been asked many different times – what do consumers want?  Again, Glenn asserts that consumers are seeking more metrics on agents.  Depending upon whether or not a client is buying or selling, their wants have remained fairly consistent.

Buyers want assistance finding the the right home.  They also want help negotiating the sales terms and price.

Sellers want to price their homes competively and effectively market their homes within a specified timeframe.

How does a number between 1 and 5 or 1 and 10 for that matter effectively communciate to the consumer that a potential agent can get the job done?

If sellers are concerned with pricing their homes correctly and selling within a specified timeframe, I think the better metrics might be the ratio of sale price versus listing price of homes an agent has sold within a seller’s area.  How does an agent’s days on market compare to the comparables?  How many cancelled or expired listings does the agent have?  Why?

Is the criteria clearly being tied to what consumers want?  Is the final metric meaningful enough to communicate that a potential agent understands and meets the needs of potential buyers and sellers?

Greg Tracy of BlueRoof also weighed in on the discussion with the following response:

But the typical real estate person is extremely different from the typical technology person- in almost every way.

Tech people crunch numbers and details- real estate people do not. Tech people develop and, more importantly, use, systems to check, monitor, and improve things- real estate people do not.

Real estate people in general are not detail-oriented people, they are sales people. They care about people, not processes. Redfin is a technology company so it is inherent for you, but not for typical real estate person, to accumulate and crunch this type of data.

Brokers and agents need to utilize technology better and this is one great example of how technology can help Realtors everywhere.

Agents don’t crunch numbers?  We’re not detailed oriented?

Wow.

What about the consumer?

It seems there are two tales of two paradigms at play here – the agent versus the consumer AND technology versus the consumer.  Regardless of whether or not real estate agents are technology or process focused, the real issue is:

What do consumers want?

Are consumers solely focused on the data?   My experience suggests not entirely.  In fact, I find that consumers want to understand the process of buying and selling – what are the steps?  What information do I need – once I have it, how should I interpret it?

NAR’s 2008 Profile of Buyers and Sellers again confirmed that buyers and sellers want to understand the process.  The irony for me is that there is no real technology solution which deals with the process of buying and selling, only aspects of the big picture.

8 comments

From Blogs to Klogs: How Blogging Will Become Useful

Blogging is a fad and by definition, it will eventually run its course and fade away to a small niche. Blogs will be the bell-bottom pants of Web 2.0. The technology of Blogging will not go away, but the style of what we now do on Blogs will change significantly and will be renamed “Klogs” (more on that later).

How can I make such a claim in the face of overwhelming statistics documenting the growth and popularity of Blogs? That’s an easy question. My answer: because this is a Blog post and I can spew whatever opinion I wish and the only thing you can do is try to out-spew me with your own opinion. But spewing opinions is not what is going to undo Blogging – lack of civility will keep Blogs out of the mainstream.  Simply put, corporate leaders have not embraced the Blogosphere because many Blogs often spiral down into a pit of venom and character assassination while hiding behind a cloak of anonymity. Many Blogs revel in being snarky because it gets them quick exposure and generates lots of readers and comments. It is all in good fun until someone gets their eye poked out.

Corporate leaders are fearful of Blogs because these freeform formats of fun are too risky for the image of the Company.  Sure, many corporations have started a Blog, but most are tame, humorless, boring sites used for product promotion and press releases.  The NAR Blog is a good example of that.  These are not real Blogs because the writers are not free to say what they think; rather, they must say what the company wants to say/hear.

Because there is not widespread adoption of Blogging on the corporate level – and VERY few individuals are making money off their Blogs – I can only draw the conclusion that Blogging will fade away to the fashion status of bell-bottoms, or at least not reach a significant level in business communications.  Without adoption by the business community, Blogging will not have sustainable cache’ and, I believe, has almost peaked in popularity.

Currently there are about 4 Blog readers for every 1 Blog.  In the real estate market, 4 “buyers” for every property is great, but in communications, that is an unsustainable number.  In addition, Blogs have a very low level of credibility (ironically, I site a Blog as the source of Blogs having a lack of credibility).  Capitalist, however, often see beyond such shortcomings and adapt a product for use in a business environment.  Thus, I predict that we will soon see phase two of the Weblog and it will be called a Worklog or Klog.

What is a Klog?  A Klog is a private Internet discussion site that provides employees, entrepreneurs, and scientist a freeform format to discuss, develop, and debate issues, products and services without the fear that is attached to Blogs.  By “private” I mean password or firewall protected from the general public.  Businesses may shun the risks associated with Blogs, but they will recognize that the technology – which is simple and powerful – has many valid business applications.  Klogs can replace many meetings, connect employees from all over the world to discuss product development, and document the entire thought process.  Klogs will be a powerful new business tool for the transfer and storage of knowledge much like Blogs are able to transfer and store opinions.  Klogs will not be as fun as Blogs, but that’s why they call it work.

Here’s a Klog image for you to consider:  E-mail – “Greg, we have set up a Klog at http:RotaryKlog.net to discuss the failings of Realtor.com to position itself as a valuable asset in the minds of NAR members.  Categories have been set up to discuss the topics of long-tail marketing, automated evaluations, and the extortion of members money.  Please weigh in on all these topics by Friday and plan to attend the web meeting on Monday at 10:00 a.m. est to discuss our future actions to correct this mess.”

Klogs are already in use.  In my office, we have set up a private FaceBook group to allow staff to share business information that is not appropriate to discuss in an open format.  Staff is free to share a thought, professional opinion, or idea without the fear of being blasted by some anonymous jerk.  I have also set up a Klog for a committee that I am involved with by using a standard WordPress Blog format.  The safety of a Klog will promote more people to share their real thoughts which will, in turn, create better thinking.  Many people are not as bold as those of us who are willing to share our thoughts and opinions with the entire world.  Klogs will be a safe haven for the 99% of humans not contributing to Blogs.  They will also facilitate knowledge management in small businesses that can’t afford expensive and complicated technology.

(Note:  I consider the BloodhoundBlog to be one of the most legitimate Blogs because almost all those who comment here use their name.  Without a willingness to attach your name to an opinion, you are meaningless to me.  Blogs like this are the exception to the rule and will serve as a valuable resource for as long as Greg, Brian and the many talented writers are willing to be part of the 1% of humans creating content on the Internet.)

16 comments

BloodhoundBlog Radio: About Success With Jason Blackburn

Jason Blackburn of Laser Focus For Life was our guest on BloodhoundBlog Radio last week.  I “met” Jason on Facebook two months ago, when preparing for the “Power Of Twelve” seminar.  Jason wrote a referral script for my seminar and asked nothing in return.  That connection led to a number of telephone calls which made me realize that Jason had a lot to offer.

Jason points out that many of our actions are incongruent with our mission.  He explains that our actions need to be inspired by the “buy-in” from both our hearts and our minds.  Jason is not a “touchy-feely” success trainer. He’s a nuts and bolts sales pro with over twenty years experience.

I expect we’ll be hearing a lot from Jason.  You can hear our 40-minute interview with him here.

PS:  If you click only one link, click “referral script“.  Jason lays out a simple way to generate referral business in about 800 words.

1 comment

Hittin’ Fat Fastballs — Diggin’ For Gold — Skinnin’ Cats

I remember something a great football coach once said. He’d been asked about the vanilla offense he ran, and how defenses were shedding old fashioned ideas, and learning how to stop tradition offenses with ease. He said, “Let ’em do whatever they need to. If my guys block their guys, we win.” That coach was a 1.0 guy if ever there was one. 🙂 I bring that up only as a preface to what my point is today.

It’s still all about skinned cats. It’s amazing how many are still calling guys like Chris dinosaurs. I’m sure his feelings are mortally wounded as he cries his way to the bank every month. Much like USC football coach John McKay replied when asked about his ‘student body left, student body right’ running game. Said Coach McKay: “When they find a way to stop it, I’ll try something else.” His boring, predictable offense produced multiple Heisman Trophy winning running backs.

Chris Johnson stimulated some pretty productive give and take with his last couple posts. Chuck Marunde and I joined in with our own thoughts on the subject. Where Chris was in his glory talkin’ about his use of Ma Bell’s favorite toy, Chuck was lamenting his local market’s dreary numbers. And dreary might be an optimistic description. He was up to here with high maintenance owners on sloooow moving listings. Me? I think Chris is a born cold caller, one of those rare people who knows the percentages, shrugs his shoulders, then works ’em, all the while wondering why his competition can’t see the gold too.

Chris’s core message as I see it is this: If he told you that digging a 100 three foot holes a day would uncover a pot of gold a week, every agent with a pulse would be grabbin’ gloves, a pick & shovel and headin’ out the door. Why? Because they’d be thinkin’ of the year’s worth of gold they’d have by consistently diggin’ those daily 100 holes, right? You know that’s true. Yet in real life they don’t, do they? Those who won’t dig understand why, so I won’t mash their tender souls further by continuing to drive that stake. They’re suffering enough as it is. How hard must it be to know there’s gold out there with your name on it, but you’re so afraid of your own shadow you can’t even hold the shovel longer than a couple stabs at the dirt’s surface?

And please, no harping from those I’ve just described. If, as Chris so eloquently put it, you’re already doing 40 deals a year, I’ll shut my pie hole. If you’re not, but you’d like to, your high pitched whining about how all this ancient 1.0 stuff doesn’t work, makes you look pathetic. I’m sorry, as those who’ve met me or read my stuff for years realize I’m never mean spirited, at least intentionally. Sometimes I tire of those who tell me what can’t be done, when so many good people like Chris are doing it daily with empirically measurable success.

Translation for Mr./Mrs./Ms. Excuse: HIs bank account is ever growing.

And for the record: If you’re runnin’ outa walls on which to nail all the cat skins you’re accumulating while using totally different methods, I applaud you. BawldGuy Axiom: Nobody cares how so many cat skins got up on all those walls — until that is, they ascertain you actually skinned all those cats. Then? They’ll be all ears.

Allow me a short digression.

My way isn’t the only way by any stretch, and I’ve never for a second believed nonsense like that. In fact, I’m writing here on Bloodhound because I was willing to listen to new stuff. I use 2.0 like crazy. It produces for me big time — six figures a year like clockwork. But overall, 1.0 production slaughters those numbers. Look, there’s a difference between using 2.0 exclusively and being content with whatever it produces. I get that. Fair enough. But if you’re hankerin’ to reach whatever you perceive as the next level, 2.0, at least at this point in its development, ain’t gonna get you there in and of itself. Also, with some notable exceptions, 1.0 can produce huge success without ever using 2.0. The same simply can’t be said about 2.0. The day is coming when this won’t be the case. But that day remains stranded in the future tense.

BawldGuy Axiom: Proactive prospecting vs passive prospecting is to income production as Lions were to Christians. And for those who simply will not get it, Proactive is spelled L-I-O-N. 🙂

End digression.

Chuck finds himself dealing with a market almost literally devoid of sales. 12 closed deals in a month for an entire county. Wow. He asks for wisdom, which is what wise men do. Almost everything I’ve learned has been from asking others, or failing miserably. I prefer asking others. 🙂 Chuck correctly observes the folly of those agents who, by whatever prospecting means, list bunches of property, most of which don’t sell, while sending their overhead to the moon.

He points out the erroneous goal to which so many agents aspire, but which is one of the fastest roads to Broke City — Listing the most properties possible. The goal our bankers understand much mo betta is: Listing the most properties I can sell relatively quickly. I know, Duh. Chuck gets it, big time. But how does he close more business?

I’ll begin with a (surprise) baseball analogy.

What if every time you came to the plate you knew when you were gonna get a fastball waist high down the pipe? You might be the first hitter in history to bat .500, that’s what. So why don’t you apply the same thing with prospecting? Instead of ordering lists from whomever and mailing, calling, knocking or what have you — why not make a list of nothing but 88 mile an hour, straight as a string, waist high fastballs right down Broadway?

Hey, now there’s an idea.

Approaching it that way seems second nature to Chris. For most however, it seems like the pot of gold nobody ever finds because it’s hiding in plain sight.

The old saying, “Everyone complains about the weather, but nobody does anything about it” is analogous to most of the real estate agents I’ve known since forever. That analogy though breaks down because we all know we can’t do anything about the weather. Yet most agents spend their entire careers trying to convince anyone who’ll listen, (but mostly themselves) that finding new business is exactly like the weather — totally out of their control.

If I wanted to hide a pot of gold from them, I’d bury it in a three foot hole in their own backyards. How much safer could it get? To them I offer a helpful suggestion. Spend 90 days working from a list of easily hittable fastballs that they’ve filtered to their own specifications. Talk to as many folks as you can each day. Then tell me what you learned.

Here’s a pick & shovel — go dig some damn holes.

2 comments

Bloggers. Transparency. Stimulus. and Laxatives.

First off, the following blog post is NOT political. PLEASE do not try to turn it political. (If you do, you will be 301 (read: permanently) redirected to the fact that this is NOT political.)

It IS about bloggers trying to improve the world around them by shining light on a political process and making politicians more answerable to their constituents and less answerable simply to the power brokers inside the beltway. It is about my opinion that as long as there are bloggers who care enough to invest the time, they will have influence and authority.

In response to the House of Representatives’ proposal to spend $850 Billion on another stimulus package, a blogger (and a great new media consultant) who founded Kithbridge.com launched a new blog. ReadTheStimulus.org. What does it do?

Glad you asked. Here’s what it does. It takes the PDF documents of the draft spending bills that the government is known for spitting out and it converts them to searchable text and provides a search engine for folks (including the press, if they care to), to search terms and find how much of the bill is stimulative to the economy, how much is stimulative to certain lobbyists vs what is well just laxative so to speak.

Want to know if there is a bridge to nowhere in there? or funds for the mating habits of the iguana? Don’t think that will stimulate the economy? You can now find it within seconds.

I applaud the efforts of these bloggers to get the 335 pages out there, indexed and in a searchable form for the public so that folks on both sides of the political spectrum can debate it openly. (Note: they are going to post the various other proposed bills as well.)

Anyone want to make a bet with me as to how many of the politicians (from either side…again this is not political) have actually READ and UNDERSTOOD the implications of these 335 pages. If there were 10 of them in the whole House of Representatives who had personally read it cover to cover, it would surprise me.

One of the other things that is specifically designed for bloggers is the ability to link to specific pages and even paragraphs of the bill and link to it from their blog. This means if I find that there’s pork in the bill that I want to rant about, it is a simple matter of linking to it from your blog and you are set. Citizen journalists rejoice.

I also applaud their effort to make it even easier for the public to understand where the money is going by doing a group spreadsheet and asking other bloggers to pitch in this weekend with a little time reading through the bill and picking out dollar amounts so that the public will be able to see where the money is going. Again the Army of Davids each grab 5 smooth stones and head to the battlefield.

Left, right or center, they (politicians) are getting ready to spend ANOTHER $2,428.57 ($850 Billion / 350 million people) for each man woman and child in the United States, and thus mortgage our future for a LONG time to come.

I am encouraged that bloggers (once again) are spending their time and effort to show people WHERE that money would go. Props to them. Pay the site a visit. Whichever side of this you are on, I think you will find it interesting.

I can find a ton more uses for this type of effort…from the local school board on up.

3 comments

A Call to Arms

Why, in an industry in which customer service is one of only two ways to set yourself apart, have brokers been so wary of measuring customer satisfaction?

It isn’t because agents don’t care. I’ve never met a Realtor who didn’t care about his customers. In fact, when we talked about Redfin’s customer satisfaction goals last week, a broker immediately contacted us to ask how we measure customer satisfaction.

Will the Brokers Who Measure Customer Satisfaction Please Step Forward?
I was going to refer him to someone else in real estate who uses our scoring system — we’re just beginners — but then I couldn’t find anyone else. Which is surprising, given that it’s the same system used by Apple, Costco, FedEx, American Express, Dell, Vanguard and literally thousands of other companies in virtually every industry — except real estate.

The broker ended up scheduling a meeting with Redfin’s Matt Goyer at Inman Connect. It may have been one of the only Connect meetings explicitly about customer satisfaction all week. In looking over the otherwise dazzling agenda — I have been to both Inman and Bloodhound conferences, and both are very good — I noticed that every type of marketing under the sun was in the program — except the one that works best: customer marketing.

The Perils of Transparency Are Worth It...

The Perils of Transparency Are Worth It...

The reason measuring customer satisfaction wasn’t more prominent is because people think of customer testimonials as the old-school word-of-mouth that Realtors traditionally rely on, whereas Connect is all about the new school: YouTube, Facebook and Twitter.

E-Commerce for Agents Not Houses
But the message matters as much as the new-fangled medium, and our message to the world has to be about the quality of our service. The same transformation in how consumers research listings will change how they choose an agent. Rather than meeting face to face to review listings, consumers now evaluate listings online. They can’t see or smell the house in person, so they bury their nose in numbers. When their first encounter with an agent is online, they’ll take the same approach.

Therein lies the great fallacy in many people’s original conception of real estate e-commerce: that the product being sold was a house. I’ve been asked a thousand times, “who would buy a house online?” In fact, what customers want to buy online isn’t a house but the services of a real estate agent.

Almost all of our customers don’t like choosing an agent based on intangibles. Who wants to be the judge in a personality contest? What people want is to choose an honest, competent, careful agent based on simple, objective criteria. We think the most important of these criteria will be customer satisfaction. The sites that have been scrambling to bring together all sorts of data about a property now need to do the same for an agent.

In this coming arms race, we believe that the most important weapon will be data about your own customers. And the only way you can use it is if you share all the data, not just a few cherry-picked reviews.

Gathering Customer Data
Since Redfin wrote up its first offer, we’ve surveyed everyone who works with us using a free online survey tool like Zoomerang. Zoomerang is dead-simple to use; no programming skill is required. We now have a formidable data, of thousands of survey responses, which we can use to guide not only our own decisions, but those of our clients.

Show the 5-Star Reviews, the Less-Than-5-Star Reviews and All the People Who Didnt Respond...

Show the 5-Star Reviews, the Less-Than-5-Star Reviews and All the People Who Didn't Respond...

The one question we’ve consistently asked in every survey is dead-simple too: whether the client would recommend the company to a friend. The yes/no answer to this question was from the beginning the primary determinant of our agents’ bonuses.

The Ultimate Question
Over the past year or so, after one of our board members read Frank Reichheld’s The Ultimate Question, we got a little more fancy about it. We asked clients the same question — it turns out that this question is Reichheld’s “ultimate” question — but with the answer rated on a scale of 1 – 10.

That allowed us to calculate what Reichheld calls a Net Promoter Score (NPS), which is the percentage of promoters (9’s and 10’s) minus the percentage of detractors (0 through 6). Everyone in customer service at Redfin, including me, has a bonus that depends on this score.

It turns out that the difference between just saying you’re “satisfied” and actually being a 10 out of 10 is huge. And we need as many 10’s as we can get: nobody is going to make the leap from seeing your web profile to becoming a client unless you have raving customer lunatics spreading your gospel all over the Web.

On the flip side, the damage one detractor can do to Redfin — I feel like I know them all by name — has been staggering. Given customers’ high expectations from real estate agents, it makes sense for us to add up the promoters and then dong ourselves for every detractor. Every one else in between affects our score too —  as a lost opportunity to create a fanatic.

Frank Reichhfelds The Ultimate Question is Redfins Little Red Book

Frank Reichheld's "The Ultimate Question" is Redfin's Little Red Book

Raising Response Rates
Who gets surveyed? Anyone and everyone. We survey people who tour a property or make an offer, regardless of whether their offer goes through. About half respond. We used to give people a $25 Amazon gift certificate for filling out the survey, but we tried taking away the gift certificate and response rates didn’t change.

Reichhfeld’s book tells you to stop asking any questions in the survey except the ultimate question, so more people are likely to respond, but doing that never changed our response rate much. 50% – 60% of folks answer the question, while only 25% overall answer additional questions in a second survey, which is linked to the first.

The only tactic that really increased response rates was a short survey link, to prevent the link from breaking up across two lines in the email we use to send it out. We use bit.ly to shorten the link.

But Why Can’t the Clients Just Say It To Your Face?
By now, you’re probably thinking you want to do this informally, just in person whenever you get the chance. Big mistake.

Opportunities for Introspection in Real Estate Can Be Rare...

Opportunities for Introspection in Real Estate Can Be Rare...

Clients will tell you plenty in a survey that they would never have the courage to say to our face, especially when someone besides the agent — the broker, for example — sends out the survey, and anonymous responses are allowed. By rigorously surveying everyone, you can  track down people you had a fleeting encounter with, and never find out why they chose another broker.

Letting that person just disappear is a lost opportunity — not just to earn a commission, but to get better. Our surveys have taught us not only how individual agents can raise their game — each agent gets a complete report on his client’s responses, every month —  but how we have had to improve as a company: speeding up the website, hosting more tours and offering more agent choice.

We have made so many mistakes at Redfin that we can no longer hope to be smarter than our competition, but we do think we know more about our customers. I often wonder how a large brokerage has any idea what’s going on between its agents and its clients.

What We Like About NPS
To start learning, you could probably use any old survey and it would do the trick. But here’s what we like about measuring Net Promoter Score:
1.    It’s simple. The best thing we ever did to our compensation plan was to simplify it. Pay through the nose for promoters; nothing for detractors.
2.    It allows us to benchmark our performance to those of other companies. Anything above 50% is considered a good NPS score. You can do better.
3.    It separates the goats from the sheep: simply asking a customer if he is satisfied resulted in uniformly high scores. Focusing on 9s and 10s makes it easier to reward the top performers.
4.    Agents love it: getting a score every month that isn’t just a sales number, but a real reflection of how your customers feel about you is really uplifting. Agents need more feedback like that.
5.    Consumers love it: we started publishing ratings to our website about halfway through 2008. Traffic to those pages shot up.

The only problem was that consumers don’t understand NPS well enough for us to publish our results.

This was easy enough to fix: in the survey we added the word “yes” below 6 and up, and “no” below 5 and on down. Now we can say that 97% of our clients would recommend our service — 97% gave us a rating that was correlated with “yes” — even though our NPS score for last quarter was only 75%. We can also publish the numeric rating for each transaction. Maybe as NPS becomes a more prevalent concept, we can publish our aggregate NPS score straight up. We’ll probably start doing that soon.

How Do You Measure Customer Satisfaction?
By now this post is very long, and we should cede the floor so we can hear how other brokers monitor customer satisfaction. All of us can learn from the discussion. In a time of economic anxiety, digital personas and skepticism about Realtors, letting the world know how we treat our customers is the only way to build trust, which is the only way to begin all the other conversations we want to have via Twitter, YouTube, Facebook and blogs.

(Photo credits: Golo on Flickr, E3000 on Flickr)

37 comments

My 2 cents on Shawna’s Mall Metaphor

The use of design metaphors was one of the first things Web designers explored in the mid-90’s on the early commercial Web sites. A Southwest Airlines site used the airport ticket counter as a design metaphor, for example, and the mall metaphor itself was widely used by early eCommerce developers.

I did it, too. I designed a site for the RI Teacher’s union that used a ruled-paper background, and the homepage navigation was designed to look like stuff that was left on top of a notebook. I even had a coffee ring on there.

In the mid-90’s , most of the first Web designers were coming over from print. As Marshall Mcluhan pointed out, we tend to use a new medium the way we used the old one, so a lot of early Web design was driven by what designers knew from print, including the use of metaphor.

While you can make the argument, as Brian has, that a design metaphor can be used to make people feel comfortable with a user experience by basing it on something they already know, there are good reasons why Southwest and the RI Teachers no longer have metaphor-driven Web site designs.

If you really want to get into this, check out Jacob Nielsen’s book Designing Web Usability (where he dissects the Southwest ticket counter site), but it boils down to this: The Web has essentially become an operating system, and successful Web sites are basically apps that run on it. The reason your users come to your site is to complete a task using your app.

That means that Web design has morphed from print-based design principles to software user interface design principles, and the problem with metaphors in UI design is that they don’t scale well as you add functions to your app to enhance your audience’s ability to complete primary and related tasks.

You end up stretching the metaphor until it breaks, and something that started off  giving you a fresh and interesting way to look at a hierarchy of information becomes a drag on your ability to extend that hierarchy. Already on Shawna’s site, you have to wonder if labeling the mortgage section link the “ATM” is a good idea, because it makes people think, and they hate that when all they want is the mortgage section.

IMO, that is sacrificing usability to further the metaphor, which ostensibly exists to enhance usability in the first place. This paradox of metaphor-based Web design is the reason you don’t see more of it.

I’ll admit, UI-based design has made the Web more boring than it used to be, because as  Web sites  adopt emerging standards, they look more and more alike. This may be visually boring, but the upside is that users have a better idea of where stuff is and how it works from the moment they land on your standards-compliant site.

The notable exception to this trend is MySpace, which is apparently where animated GIFs and wild paisley background patterns went when they were banished from the mainstream, sort of like how lots of the people who followed the Grateful Dead ended up in Boulder after Jerry died.

The difference with MySpace is that the task its users are there to accomplish  is precisely to express their individuality within a collective.  That is not the primary reason most people visit Real Estate sites.

That said, listing search, which is the primary reason most people visit Real Estate sites, has become commoditized, so it takes more and more technological horsepower to differentiate a Real Estate search site, (plug alert) such as our use of Google’s own hardware to make IDX feeds “googleable”.

Which is, of course, why smart brokers and agents like Shawna have adopted blogging, because it enables you to compete on the strength of your content, not just your technology. In that sense, all Real Estate blogging is niche marketing, and if Shawna has decided that her niche is  mall shoppers, then maybe she is on the forefront of a backlash against boring, UI-based Web site design and a return to a more print-design inspired Web landscape, at least on niche blogs like hers.

Shawna will know soon enough if this design is striking a chord with her users if she is tracking site performance. I just checked and I didn’t see a Google Analytics script in her code, so  Shawna — even if you are using some other hit counter —  do yourself a favor and set up Google Analytics. Its free and easy. Then pay close attention to the bounce rate, the repeat visit rate, and the average time on site. These metrics will let you know if your target audience is responding to your metaphor, or not.

4 comments

The Wild Wonderful Web We Weave. How tightly wound it will be.

Yesterday was Teri Lussier’s Birthday in case you missed it.  If you did, then by all means go and give her your well wishes already.

Aside from working on your birthday, Teri and I have a few things in common.  Beyond real estate, our shared interest might have a lot to do with why I’m writing on Bloodhound.   A little over a year ago, after reading this blog for probably a year-plus prior, she pulled me out of lurking and into commenting on this post about twitter. It was not the utility of twitter that was as much of interest, but rather the evolving way that we communicate with one another on the WWW.   Twitter, as we all knew was offering a new line of communication at the time in the micro-blogging arena, and Teri was sharing her thoughts on the concept by using a shared favorite film as a metaphor.

It was her use of something that was of great interest to me that attracted me to her post.   Timing, curiosity, and a shared interest can start relationships in a heartbeat. Since then, Teri and I have become friends on and offline.  Meeting last year at Bloodhound Unchained in Phoenix and again at REBlogWorld in Vegas.

I value her viewpoint and honesty as I do everyone I have come across that contribute to Bloodhound.   Being so, we occasionally message each other with ideas or join in what has been dubbed a scenius.

None of this is ground breaking except for the idea that it is becoming easier to connect.  Since I spend so much time in the machine, I rarely take a step back in reflection as I did yesterday morning.

What Teri said via email is what got me started:

I’m quite partial to grainy B&W foreign movies… a joke… sorta…. Brad will laugh.

I went on YouTube to search for a trailer for Wings of Desire” to send to Teri in a message and what I came across was fascinating to me.   There is a whole sub-culture of people on YouTube that have edited different music over the top of parts of the movie as well as the trailer.  Everything from the soundtracks originals songs, to modern Radiohead favs, to some self-produced covers.  It looks like some have also gone as far as to upload the entire movie in 10 minute chunks as well.  Fans build communities and relate on the platform where they meet in their shared interest.

Here’s something else.

From what I know at least 3 bloggers on this site have found their significant others on the web.   My wife and I have an ongoing inside joke about how our mutual friend ‘Craig’ introduced us.  Again, not much new, really.  People have been finding ways of connecting despite every seemingly arcane tool of tech that’s put in front of them.  What is new, is the refinement of how relationships are formed . The detail in frequency is becoming more and more clear in the social ways of the web.  Facebook aggregates interactions with their your friends, family, and interests in a real-time life stream and now features chat – two more ways to reach out.  It is one of the most popular, growing by over 600,00 users a day.  Google it would seem, understand this as well, and It would look like they are continuing to strengthen the social functionality of their profiles.

What does the future hold for the average citizen of the WWW?

My aim, if I have one here is to point out that the “Long Tail” is not so long when it’s where you are connecting with what it is you are looking for.  In terms of Real Estate and social media,  I get leads all the time.  Many are a bad fit for me and the prospective client as well.  I’m certain as my brand continues to grow with more transparency and clarity of who I am and what I have to offer as a professional, I will attract more ‘like minded’ people looking for assistance with condo and loft purchase in San Francisco.  Beyond that, It will be helpful to know that we are going to get along OK.  Hard to know until meet.  But for all the talk of the RE.net’s joy of #IRL, you get a sense online of whether of not you want to work with someone for 30 days, let alone 6 months through a stressful transaction.

Sales gets called “a numbers game” all the time, but as with all relationships that eventuate, I would rather be find myself in the company of what will likely happen anyway –  connecting with like minded individuals that like and respect my point of view and what I have to offer, as opposed to being at a mixer with blinders on with thousands of others looking to host my attention.  It’s doubtful to me that this is something that will be shuffled along by something like review or recommendations, but rather the sum amount of how you represent yourself online in public conversation – your digital self if you will.

“Top producers” will always find 50+ reasons to list why you should work with them.  It’s one of the biggest memes in Realtor history.  I wonder how many pros would be up to digging up the 50+ different reasons why one should not work with them, or even ask that question of themselves.  The observations found could be very helpful in how we represent ourselves.

The world will continue to grow as technology and the social web continue to make it smaller.  A smaller space for us to share, a smaller space between the lines of you and me.  With everything shared in the social space of blogging etc, a tighter web we weave of connectivity.

This one’s for Teri and some other friends of mine whom were joined a few years back after meeting on a Radiohead message board.

Now that I’ve given you a bit more about me.  How about you?   I’m always curious about the readers that don’t give voice to their thoughts as they read here.   Come on out and say hi and let’s talk about this.   Let me in on how you are representing yourself online and what your aim is when it comes to attracting a like-minded sphere via your WWW efforts.   Have you ever established a relationship with a client online that had the small talk work of ‘you get it’ facilitated right on through to meeting face to face?

(Veteran voices welcomed too) 🙂

16 comments

Shopping For Greenwood, IN Real Estate? iShopGreenwood.com Is a Real Estate Mall

If you’re looking for Greenwood, IN homes for sale, what better place than a real estate “mall”?  It’s the PERFECT idea but there’s one problem; I hate malls.  I’m not an agoraphobiac but  I AM a gun-totin’ American male.  On Saturdays, I park the pick-up at the Mall and sneak into the Sports Bar while Mama Bear and Girl Cub go bargain-hunting.   A blog that looks like a mall makes me crave Buffalo wings and onion rings; call it a Pavlovian response.

Who cares? Greg Swann always jokes that ” Mama buys homes and Dad sells them” so Shawna may have created something very powerful with her blog design.   Think about your last ten buyers.  Mama was measuring, dreaming, and creating while Dad was crunching numbers with the local mortgage broker.   Let Dad read the pin-striped mortgage blog, Mama’s gonna dig the pastels (and mall-themed layout) of this real estate blog.

I concur with Greg Swann. Shawna has content…lots of GOOD content.  I love the “closed listings” and “client testimonies” categories- that is very smart marketing.  The numbers appeal to a clients’ desire for performance and the pictures, with the testimonials, provide social proof.  We talk about the fact that a potential client is looking for a reason to DIS-qualify you when searching online; I can’t find a reason to do that with Shawna.  Her site’s content sells me on every point.  Shawna appears to be a VERY busy and competent REALTOR which is exactly what I’d want.

How can Shawna promote this site so that it is a must-see for every potential Indy homebuyer?

The URL is great because it plays upon two themes:  the hip “i-” theme, made popular by Apple and the keywords are easy to remember while being Googlicious.  I’d take to the offline trenches to promote this site with Greg’s tiny little workhorse; the business card.  I think I’d want a stack of those cards in every hair salon, speciality store, and place where women visit.

Would T-shirts be a good idea?  I’m thinking ‘What Would Sarah Palin Wear?’ when designing the T-shirt line.  When I asked Mama Bear if she’d prance about La Jolla in a pastel-colored iShopGreenwood.com shirt,  she responded “You Betchya” with an exagerrated wink.  If you can get my wife to wear that shirt, I guarantee that every Indy hockey mom will.

I have no idea about how much money Shawna wants to spend but a picture (or better yet, video) of Peyton Manning in one of her baby-blue T-shirts will be sure to attract throngs of admiring fans.  Offer “picture day” at the local Mall, with Peyton in his shirt, and I guarantee Shawna traffic.  The question will be, is it worth the steep fee she’ll pay?

READ:  Celebrity Testimonials in Your Promotional Efforts

I’m in love with Facebook so I’d consider a campaign there.  Set up a “fan” page for iShopGreenwood.com and promote it with Facebook pay-per-click advertising.  I’d run three campaigns:

(1) to single women (360 people), linking them to a landing page about buying a home by themselves

(2) to engaged women (120 people), discussing how home ownership is the foundation that a family is built upon

(3) married women (900 people), discussing the concept of  their “dream home”.

These Facebook ads costs about 60 cents per click.  Shawna will target about 1200 people so she’ll get lots of impressions.  I’d be shocked if she spent more than $40 per month.

Read Kelley Koehler’s tutorial about how to properly build landing pages that convert.

Shawna’s landing pages can be part of her WordPress blog and should be designed to get the user clicking all over her site.  Kelley advocates “being clicky” so give them a reason to fall in love with iShopGreenwood.com.

We talk about daring marketing ideas on BloodhoundBlog.  Consider a promotional venture, with the shops at the Mall, with coupons that can only be downloaded from iShopGreenwood.com.  I’m thinking along the lines of “free conditioner” with a salon visit.  Shawna can buy a bunch of those bottles, with the iShopGreenwood.com logo, and stock up the local shops.  Cross-pollenate the idea with that stack of business cards and she can create a dozen local salespeople, promoting the site.

Shawna asked me about what to put in the “ATM” section.  My first thought is to change the name of that section.  It suggests that a home is an ATM and we don’t need to promote that idea anymore.  Rename it to “BANK”, change the color to green (instead of pink), and get a local mortgage broker to populate it with financing articles.  .

iShopGreenwood.com seems purposefully targeted at Indy hockey moms and that’s a great idea.  My wife kind of dug the whole theme and she is exactly who Shawna wants to attract.

PS:  An afterthought.  Name one of those rooms “Sports Bar” and populate with high school sports stories.  You might open a back-door for Sarah’s husband, Todd.

Just a selfish thought.

PPS:  Please offer your comments about iShopGreenwood.com here

Comments are off for this post

Shawna Ebersole’s iShopGreenwood.com is very rich in content — but it may be just a little bit too rich in color

My apologies for my recent absence. I came down with a cold — a warning from god about going to Seattle in the Winter — then got bit in the ass by a long-standing Real Life Dilemma. I missed all of the vendorslut “news,” so I don’t even know how deeply inspired were the attendees by being yelled at by Gary Vaynerchuk. (“C’mon! People! It’s not customer service unless you emote from the throat!”)

Am I being hypercritical? I don’t think so. We’re all of us victims of bullshit now and then. The trick is to scrape it off your shoes before you track it all over everything.

Meanwhile, Brian Brady shot this to me by email:

Shawna Ebersole asked us to critique iShopGreenwood.com and give her some ideas for promoting her weblog.

Well. At the risk of seeming hypercritical, I will say that the site seems to me — a male specimen — to be girly and cluttered. The overarching them is High Concept — which means you have to figure it out. No, that’s not a collection of girly-colored boxes, it’s a mall, a big-city indoor shopping mall.

Even so, I don’t care. I don’t care for the colors and I didn’t like having to figure out what was going on, but I don’t think that hurts anything. I also don’t think it helps anything. There are a zillion much-less-clever real estate weblogs, and they probably do just about as well as this one.

But here’s something I really, really liked: The site is very rich in content. My take is that Shawna Ebersole predates real estate weblogging by quite a while, and she seems to have retained every bit of the content she had developed before she took the plunge with a blogsite from Jim Cronin’s RealEstateTomato.com.

Isn’t that a bad thing? I don’t think so. I’ve written before — and should write more extensively — about the idea of satisfaction — feeling full. When people are sampling any of your marketing, they need to be able to consume enough to “feel full.” No one acts before they’re ready to, and you have to hang on to them long enough for them to achieve that feeling of satisfaction — or they will move on. Having lots of good, consumer-focused content is essential to converting visitors to prospects to clients.

In light of that, here is a real defect in the site: The contact form is thrown off onto another page. Brian and I know from testing that the more difficult you make it to buy your product, the fewer people will respond. I think code to make contact by phone, by email or by form should be available on every page of a consumer-focused real estate weblog. I’m starting to think I want to plug the idea of contact at the bottom of every post and page in the weblog. You cannot make making contact too easy, but it is much too easy to make it too hard.

I don’t like all the Javascript widgets, and, at least on Safari, they slow the site down a lot. My take is that anything that is not focused on converting visitors to clients is a waste of space, bandwidth and mindshare.

As for promoting the site, this is what we talk about all the time. Shawna’s clients are not other real estate webloggers, so she should stop trying to engage or entertain them. Her clients are buyers and sellers in Greenwood, Indiana, and her weblog is her best way of connecting with them by passive means. She promotes the site very well in her collateral pieces — and here the graphic richness seems to pay off better.

The next step is to make connections with other local webloggers. There are a lot of ways to do this, but one quick way is to create a Scenius scene of local news and information, and then make that available for free to other local blogs. This is useful both for forging relationships with bloggers who can actually send her business and for enhancing her SEO profile.

Shawna’s a hard-working dog, and that shines through in her site. I’m betting that my typically-male reaction to the colors and the clutter is offset by the response of typical females. In any case, the weblog gets a lot right, and I doubt it is hurt very much by what it is getting wrong.

Here’s the fun part: Your thoughts. Shawna volunteered for this scrutiny, so I’m hoping she can bear up to it. In your opinion, what should she be doing differently?

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14 comments

Happy Birthday, Teri

brian_teri_jamie

We started her celebration in Orlando.

10 comments

More Arguments in Favor of Ma Bell.

Guess who woke up full of passion, piss and vinegar?

Shiver me timbers, it’s GenuineChris.   So, let’s talk 1.0, 2.0 and stuff.

NEVER did I say–or advocate–that it’s acceptable to burn through clients.  You can AFFORD to when you have 1.0 skills.  But it’s wasteful, stupid and inefficient.  So, get this: I said I’ve been wasteful stupid and inefficient in the past.  Who hasn’t?  Who admits it?  You find people to honor.  To help, to serve.

NEVER do I say that you list anything, work with anyone.  INITIATING a conversation doesn’t obligate you to take junk listings or work with mentally ill drama queens.  You’re looking for the BEST AND MOST PROFITABLE people to sell to.

NEVER did I–or will I–say that “cold calling was the ONLY way that I generate business.”   Fact is, I adovocate “deliberate connecting,” first, THEN cold calling.   Connect with, and build a Brian Brady proof fence around EVERYONE that you know.  EVERYONE that you interact with.  (By the way, a Brian Brady proof fence would be a magnificent thing).   Connect, DELIBERATELY.  A call to your top 400 people once a quarter.  That’s just: 133 calls/month.  Or ~40 calls a week.  Or ~8 calls a day.    And it’s unobtrusive, and if you do it serving them…

…you’ll never starve.

Most people won’t even do that.   I dig the drama, the tension, and that’s why I like honing myself as a “cold” caller.  I do it to build my ability to connect with people as much as anything else.  Fact is, I’m persistent, I’m Rocky Balboa.  I get my face beat in but I keep coming back for another round.  And the fact is, I call people, in roughly the order:

-People that know, like trust and seek me out
: every 30 days.  There are 45 people on this list.  And I talk to them as often as I can, and I make it a point to honor all of them.  Never forget the people that have helped.  Be present and ready to give them a %%^& referral.

-People that know me and recognize me.
Every 90 days, a CONVERSATION.   Today?  We’re at about 216 of these folks, but I need to scrub and clean my list.  Probably will be at 250 or so.    But we talk anyway.  These people?  What do you do? Add value to them.  Give first.  It’ll pay you back.   Trust it.   It might not come back from the person you put it into…but with the increasingly good BS detectors that your fellow citizens are armed with, you need something.  Just like blogging pays you back if you do it to share, lead and help.   Tell ’em about the market.  Tell ’em about their website.  Tell ’em about something inspiring.  But CALL these folks every 90 days.

Then: people I want to know but are above my level. 5 a day.  25 a week.  I have a list of 150 people I want to meet.  I want to serve all of ’em.  And one by one, I’m connecting, adding them to my Facebook.

People (maybe the ninety and nine) merely in my database. Once a year if they like me, once every six months if I don’t think they do.  This is everything else.  Every name, if I recognize it or if I don’t gets called.

After this, if (as is the case in JANUARY) my revenues are lower-than-intended.  Call strangers, anyone.  Stir the soup.  Be ridiculous.    Get it?  OK.  Stop withering like a ninny every time i say pick up the effing phone.  No, I never, ever, ever said it’s the only thing to do.   Come on.

It’s REALLY EASY to offer a convincing rebuttal when you don’t hold yourself to the standard of being sure that the other person actually took the position you’re bashing.  Just don’t let your ‘cold call’ derangement rule the day.

Next Point:  You are NUTS NUTS NUTS if you only have one way to get business.   IN-sane.

K?  Here’s the thing.  ANY souce could dry up.  Hell, with our nanny state, we could get a Do Not Connect list for social media.  A national OpenID powered list of people that you’re not allowed to connect with.  Who knows, could happen.  What then?   Blogging could become too hard to break into.  What then?   Any one source could dry up.  My standard is that I need to support my expenses with three sources of business.  I’m not currently there, FYI, but I’m not stopping till I am.

The standard that I want is this: AS MUCH gross referral business as possible, but no more than 40% of the total business from any one source.  Why?  Because I’m getting RICH when I keep myself on the streets getting new people.  The folks that say, “I only deal by referral,” make me smile.  “Good.  I am glad you don’t have the stones to market.”

Now: social media–done right–builds a fence around people that you already know.  So, some of your social media efforts in connecting Brian Brady-proof your list, and make it easier to connect with people.

So, if 40% comes from your list/referrals MARKETED TO DELIBERATELY…where’s the rest?   Doesn’t matter provided that the ROI is right.  But, for me, it’s about 15% blogging, 15% social media & 30% prospecting.   I’ll be the first to say: I have what I think are the BEST sources of incoming people.  But I don’t have enough sources.  I need more.  I probably think at least 7 wholly different sources are minimum.

OK, get it?   Good.   More to come, people, more to come.   I gots to make me some calls to connect and help.

13 comments

Please No More Listings! I Can’t Afford Them!

We’re in a slow real estate market, I get that.  The peak where I practice was 2005 when any Tom, Dick, or Jane could list and some dorky agent in the MLS would sell it.  The rule was “List as many homes as you can, cold call, advertise, mail, whatever, but list and it will sell.”  Badda bing, badda bang!

But let’s admit it, this market has dramatically changed how we play the game.  We had about a dozen total closed transactions in my entire county last month, so there is almost no volume to speak of, and certainly not enough volume to keep 327 agents alive.  Okay, 70% of those agents are practically dead, but that still leaves 98 agents clawing each other over the scraps.

Here’s the dilemma as I see it.  Clients tend to be high maintenance these days.  They are frustrated.  They want to know what’s going on, why their neighbor sold their house in 10 minutes at full price, and explanations for 100 other mythological rumors.  Listing maintenance is extremely time consuming, more so now than in many years.  I applaud Chris’ 1.0 argument for going back to basics, and Jeff’s diplomatic affirmation, but my argument is that lots of listings may actually be a great way to go broke right now.

Okay, I admit I don’t have Jeff Brown’s IQ, Chris Johnson’s stamina, or Greg Swann’s common sense, but I am a genuine bald buy who spent some time in Arizona, and so I feel some affinity with these guys.  Let’s just see how sharp these guys are.  Yes, I’m looking for wisdom, and I’m dumb enough to admit that.  But I think this is an issue that Realtors around the country are grappling with, and the answer has major implications for our clients.

Here we go:  When it would take about 100 listings here (and many other places around the U.S.) to sell one house every other month, at least statistically, and when an agent cannot manage more than about 20 listings with such high maintenance clients right now, it seems to me an agent can easily go broke chasing listings in big numbers.  First, there are hardly enough hours in the week, and secondly, the average listing must cost us $2,000 to $6,000 each over a period of the listing (not in a normal market, of course).

Assuming agents go out and knock on doors, cold call expireds and FSBO’s, send out mass mailings, and so on, and get lots of listings, is this really the profitable model right now?  Very few of these listings are selling.  This is a great way to spend 60 hours a week, a lot of money and stress, all to sell one house every two or three months, if you’re lucky.  I’m watching several brokers who are about to go bankrupt, because this is exactly what they have been doing all these months during the slow down.

Or should we let other agents do all that listing and spend all that time and money, not to mention all the phone calls and emails with the clients, and should we just be trying to connect with buyers?  This is a legitimate question.  What say you guys?  What are top producers doing that is working so well for them now?  Any strong opinions on this subject?  Let ‘er fly guys!  I can take it.  See what I’m doing at Sequim Real Estate.

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