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Archive for September, 2009

Three new dogs for the Bloodhound pack — Damon Chetson, Robert Worthington and Greg Dallaire — and a reminder about transparency

Yesterday I had mail from a Realtor who had proposed the idea of custom yard signs to a listing prospect. The client’s eyes lit up, and he saw not only the immediate possibilities but the future portents. Here’s what the Realtor had to say about it all:

One thing I found so interesting is that any time you mention custom signs, all the agents who don’t use them make comments about how worthless they are, but this guy, the client, the seller, got it immediately. Got the reason for it, could see how it would stop traffic, understood it all — without me selling him on it.

Funny how you have to sell agents on stuff that would make perfect sense to their own clients.

We’re adding three new contributors today. Two of them are envelope-pushing Realtors, but one is a certified, bonafied real estate client, an educated consumer who can tell a hawk from a handsaw — and who isn’t shy about speaking his mind about the utility of either one.

That consumer is Damon Chetson, a BloodhoundRealty.com client from way back and a long-time contributor to our comments threads. Damon is a newly-minted criminal defense attorney in Cary, NC, but he will be talking to us here about how he perceives the real estate industry as an informed outsider.

Robert Worthington is another frequent BloodhoundBlog commenter. He’s a hard-charging Realtor in Manitowoc, WI, and he spends all of his spare time looking for technobabble bubbles to burst.

Greg Dallaire is another Wisconsin Realtor, working out of Green Bay. Not only does he have a first name that rings sweetly to my ears, he sings a song very dear to my own heart: “I’m passionate about implementing technology into my business to increase productivity, improve efficiency, and increase profitability.”

As you might have inferred from my absences, punctuated by brief bursts of brevity — the wit of soul — I’m a busy boy. I’m about to become a busier boy, because I want to undertake a task for the ages. In the mean time, this was my response to the email cited above:

The actual message of that Mike Ferry video was this:

“I don’t do high-tech and I don’t intend to, so I’m going to affect to undermine it in my marketing.”

You know when people know they’re being evil or stupid because they can’t resist the impulse to say so out loud. Accidental error is taciturn and usually tenuous. Willful error can’t shut the hell up.

Everyone understands everything there is to know about the world by the age of five. Conceptual fluency is the moment when the scales fall from your eyes and you understand what is going on around you. Everything after that is details.

We talk all the time about transparency, but the idea of being completely transparent is important for this simple reason: Your clients already see right through you. If you’re not doing something you could and should be doing because you’re lazy and cheap, you might as well say so. Making jokes about people who work harder than you will fool no one — least of all the people who congratulate you for being so lazy and so cheap so amusingly.

But: If you insist on loudly insisting that wearing a shit-eating grin is a marketing strategy, be sure to use the two-ply to wipe your face. You wouldn’t want to look even more like an ass.

Meanwhile, make our new authors welcome. If they are very kind, they will tell you everything you don’t want to hear.

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If you’ve ever found yourself fuming by the side of the road, muttering to yourself that cops are assholes…

…prepare yourself for the asshole cops…

Just think: If you just keep voting for more and more government, eventually the nanny-state might find a way to stuff you back up into your mammy’s womb. Or, failing that, they’ll exterminate you and everyone you know and love. Either way, the world will finally be rid of the pestilence of pesky humanity.

Black humor? No shit. But at least you don’t have to wonder who’s the asswipe now…

8 comments

Yes, there are Good and Honest Loan Officers in Florida!

Two weeks ago, I attended the Miami REBar Camp to witness for myself what I had been hearing and reading about. While I found the event educational and interesting, what I enjoyed foremost was getting to meet and know Chris Brown better.

Being on the Mortgage Revolution Education Committee, I had spoken to Chris, however had not had an opportunity to get to know him well. Being the information gathering Ninja loan officer I learned Chris is, he conducted marketing intelligence and reviewed the attendee list and who he would like to meet. Upon seeing I was attending, he called and told me he “would love to meet me and talk shop.” When he discovered I was planning on driving from Atlanta to Miami, he asked if he could catch a ride with me as I drove through Orlando. Being that we had several mutual friends and they assured me Chris was stand-up guy, I agreed to meet and pick him up at one of the Orlando I-75 exits.

For the trip, my Mother also decided to tag along for ride, as she had never been to Miami. Needless to say, Chris and my Mom hit it off immediately and for the first hour of the trip, they discussed and shared their favorite Bible passages. As for me, if my Mom likes someone, that is normally a good sign. For the last three hours of our journey, Chris and I engaged in a Socratic learning experience that truly impressed me. Quite frankly, Chris loves learning and implementing strategies that put his clients in the best overall financial position, even if that means he makes a lesser commission or recommends NOT getting a home loan (no commission). Having been in the mortgage business for twenty-three years, believe me; I can spot and smell a bull shitter a mile away…Chris’ sincerity and concern for his clients and referral partners is genuine.

In addition, Chris was aware of my background and the success I had experienced as a mortgage originator, sales manager and mega-bank executive. In a nutshell, he maximized his time with me asking questions on how to take his game to the next level. While I have provided this same information to countless individuals in the past, most originators do not follow the advice and continue being average. That again is what impressed and separated Chris from a majority of originators; he IMMEDIATELY implemented the strategies and techniques we had discussed. Guess what, they worked and I was beaming with pride watching Chris professionally and ethically cultivate and harvest referral partner relationships.

Don’t get me wrong, we also had fun while staying in the heart of South Beach Miami. However, I did learn one personal non-business thing about myself…I don’t like Mojito’s!

Long story short, it always makes my day, when I see there are mortgage professionals like Chris Brown representing the mortgage lending industry.

P.S. I am not specifically calling out Florida loan originators, rather, highlighting Chris as someone who impressed me.

28 comments

Making the Numbers in Real Estate Marketing Add Up

In a recent Bloodhound post about Twitter (only Brian Brady could write the third post in just over a week on the same subject and generate so many comments!) there was a comment on marketing numbers that so intrigued me I felt compelled to respond in a post rather than a comment.  It’s been my experience that many of us do not accurately calculate the numbers when it comes to our marketing.  This should really come as no surprise – numbers and especially statistics can be beguiling and even misleading.  But if we’re not tracking and calculating our marketing efforts correctly, we’re just shooting into a dark room hoping we’ll hit the target.

The numbers quoted (or maybe it was just the idea) are credited to Larry Kendall, but they provide an interesting opportunity to work a real world example of marketing in general and Twitter specifically.  For this exercise I am pulling some examples from the actual comment, but just about every one of us has made this type of calculation before.  I follow each with a slightly different view.

I want 50 local people that I can really connect with (on Twitter).  If I have 50 people and they each know 50 people, I have a pool of 2,500 people.  Not quite.  It means you have the potential to reach 2500 people, but it’s unlikely.  For the purpose of calculating marketing numbers… you’re reaching 50.  This is akin to speaking at a seminar filled with 50 people from the neighborhood and assuming you’ve reached all 2500 people in the neighborhood – you haven’t.  If, on the other hand, you send a direct mail piece to all 2500 people in the neighborhood, then we say you’re working from a pool of 2500 potential clients.  Is it realistic to think all 2500 read that mailing?  Of course not.  But our expected conversion numbers take that into account.   The expected conversion numbers are simply based on a pool of 2500.  A pool of 50 will generate no usable statistical model from which to base a marketing campaign.

If the *normal* turnover rate in my local area is every 5 years, that means that 20% of the market is up for grabs. Each house has 2 possible transaction sides and that would mean that 40% of the marketplace has a commission attached to it.  Again, not quite.  Let’s assume for now that the average turnover is once every five years (which I believe has actually expanded to more like once every seven years), that still does not translate to 40% of the marketplace having a commission attached to it.  Twenty percent of the marketplace has a commission attached to it and that commission (for sake of argument) is 6%.  Whether that commission is split between two brokers or (unethically) double-ended by one broker doesn’t matter; for purposes of your marketing campaign twenty percent of the market is available at any one time.  Why is this important?  Again, if you don’t know the actual number of targets in the room, you might as well go back to shooting in the dark.

2500 people in my Twitter network = as many as 1,000 transactions.  Not to put too fine a point on this, but there are 500 transactions (20% of 2500).  If you are calculating your business – and more especially if you are creating your yearly business plan – you need to know the number of potential transactions as well as your expected capture or conversion relative to that number of transactions.

5% of the potential = 50 transactions.  As we now know, 5% would be 25 transactions (5% of 500 transactions).  More importantly though, we have arrived at the most integral question of all: What is my conversion rate? Owning 5% of the transactions in a marketplace, while a laudable and maybe even attainable goal, is quite an achievement.  The aforementioned 5% would most definitely NOT be my starting place.  There are plenty of very successful agents who have never achieved a 5% saturation in their marketplace.  The best way to calculate this would be to look back over at least the last five years and discern your actual conversion rate.  You can take into account whether or not that rate is growing, slowing or erratic when coming up with the final number you use for calculations going forward.  Absent a five year history, or in the case of entering a new marketplace, I would calculate my numbers this way:

From your Title Co. get an accurate count of transactions in your marketplace for the past twelve months.  Through the local board, Department of Real Estate or whatever source you can find, try and ascertain a relatively accurate count of the number of agents located within your marketplace.  (For now, we’ll discount agents from out of the neighborhood who are working a one-off deal in your farm.)  Divide number of deals by number of agents to get an average per agent, then divide that number by total number of transactions to get the average conversion rate per agent.  Now, the 80/20 rule is pretty universal (although my take on real estate is that it’s more like 90/10!).  If you want to be conservative go with 80/20.  Calculate 80% of the total number of transactions and divide that by 20% of the total number of agents.  Finally, take that new number (which is equal to total number of transactions per “top producing” agent) and divide by the total number of transactions in your marketplace.

EX:
500 total transactions
200 total agents
500/200 = 2.5 and 2.5/500 = .005 or .5% avg conversion per agent

400 transactions (80% of total transactions)
40 agents (20% of total agents)
400/40 = 10 and 10/500 = .02 or 2% avg conversion per top-producing agent
(incidentally, these numbers –  if scaled up – are not far off from San Diego’s actual numbers)

Now you know the conversion rate of an experienced, top-producing agent in your area.  Assume you are not one yet and set your conversion rate at somewhere between the average of all agents and that of the 20% who are producing.  From there, go forward with your marketing plan.

The point of this exercise is not to isolate the comment of any one person.  The point is this: if we want success in a commission based career, we must track our numbers and follow an intelligently thought out marketing plan.  Armed in this way, we can achieve our dreams.

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List of People Real Estate Agents MUST Follow on Twitter

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Sorry to go all Mike Ferry on you but at the end of the day, you’re time is better spent following would be home buyers, driving from open house to open house, with a carefully designed plan to  “run into them” at the 7-11, every Sunday.

PS:  Been there, done that, got the twee-shirt

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Whats the Downside to Investing Today?

My previous article suggesting today was the right time to start getting back to real estate investing was met with expected cynicism. Investors make money by going against the crowd, not with it, right? By the time everyone agrees that you should be getting back into real estate, you really should have been back six months earlier.

But it is important to address the very legitimate concerns of those still urging caution. The major concern was what if the market gets worse. I would answer this concern by first looking at what would need to happen for things to get worse. Inventory is already running pretty high and building has been stalled for almost a year. In order for things to get worse, even more inventory would have to hit the market, but would that really make things worse? In places like Florida and California with hundreds of thousands and homes and condos already on the market, ranging from vacant, bank owned, distressed sellers, non-distressed sellers, etc. what would a few thousand more do? In my opinion, not very much.

The economy could also get worse. Investors are demanding a stiff return on capital today under Draconian underwriting, so fire sale prices are in effect in most parts of the country. Sure, it’s currently tough to get financing and it’s expected to remain so over the next couple of years, but investors are pricing that in to their offer price. Rents are low and expected to remain so for the next year. Great, price that thinking into your offer price, every other investor has been doing that for the last six months.

Ok, so the final argument is no one would sell at those prices. The great thing about millions of homes being for sale is that someone will sell at that price; you just have to find the right property. Smart sellers are wising up to the fact that a low offer is better than foreclosure. Banks are wising up to the fact that a low offer is better than a vacant property.

We will get into choosing the right properties and the right cities in short order, but for now understand that these are the right dynamics to get back into the real estate investment market. Be aggressive in negotiation and be diligent in underwriting. In my opinion the likelihood of upside under these factors far outweighs the downside. There is no need to rush the diligence process, but at the same time, there is no need to wait for even lower prices.

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When the weather finally breaks in Phoenix — it breaks for ten solid months of pure paradise…

This from my Arizona Republic real estate column (permanent link):

If you live in New York or Boston or Chicago, there will come a day in the Spring when the cold will seem to be in full retreat. The sun will be shining. The icicles on the trees will be melting, and the tickle of the cold drops of water on your hair and neck will make you want to throw your arms out wide and rejoice in your release from the awful prison of Winter.

That happens in Phoenix, too, but it happens six months earlier, on September 15th. Mid-March has its own charms, when the citrus trees open their blossoms and the air is thick with the nectar of heaven perfected. But it’s when the Summer breaks in Phoenix that people come outdoors, knowing that the next ten months will be simply perfect.

Consider: On August 15th, the late-afternoon temperature could be 115 blistering degrees. The sun will be relentless, seeming to hang for hours above the horizon, seeming never to set. The relative humidity will be 40% or more — which doesn’t sound too bad until you remember the temperature. Late in the day, huge storms could come thundering into the Valley of the Sun, flooding the low-lands and even tearing the roofs off of older houses.

That season — we call it “the Monsoon” — lasts from July 15th to September 15th. But when September 15th rolls around… paradise ensues. Daytime high temperatures drop to below 100 and the relative humidity tops off at below 10% — so dry you can smell the dry leaves and pine needles baking in the sunlight.

That might still sound too hot to you, but it’s not. It’s just perfect, an ideal time to be outdoors — all day and all night. There is simply no place like Phoenix, no place on Earth. We suffer, slightly, during the Monsoon, but we are repaid with ten months of the kind of weather that other cities are lucky to see for ten days in any given year.

And Winter — which you are just now beginning to dread — is our most perfect season of them all…

7 comments

Real Estate Investors: Its Time to Come Out of Hibernation

Is it time to start investing in real estate again?

 

First positive sign, I am writing again.  While I write that half-jokingly, there really has not been a lot to write about for the past six months.  My previous advice was to take shelter and start researching the markets.  Well, I have done that and I hope you have too.  It’s just about time to put that great research to work.

 

Second positive sign, mortgage rates are still historically low and the media has begun to talk about a real estate recovery.  Since the news outlets are always about six months behind the real estate market, I would assume we are probably at least six months into a modest real estate recovery.  Low real estate prices and low mortgage rates create an excellent investing climate.

 

Third, mortgage rates are beginning to rise and there is substantial talk of a market recovery.  As the economy recovers, expect mortgage rates to rise.  Depending on the inflation indicators, we could see mortgage rates rise rapidly or we could see a gradual increase interest rates if it remains tame.  Regardless, no one expects rates to get substantially lower, so if you can qualify for a mortgage (and that could be a big IF), it might be time to buy.

 

Expect more from me as I see a general market recovery.  As one of the few real estate investors on this blog, I like to consider myself a slightly more objective analyst of the real estate market, as oppose to the perma-bull Jeff Brown.  Agents should start contacting their investor clients now and investors should start contacting their mortgage brokers.

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Eliminate the Government Option For a Healthy Mortgage Industry

Most loan originators are grateful for the “government option” in the mortgage markets because of the liquidity crunch. I submit that the reason for the mortgage liquidity crunch was TOO much government involvement in housing and its increased involvement has ruined mortgage banking. That’s going to be a hard concept to grasp because all of us have relied on the government, at one time or another, to insure the mortgage loans we make. Lend me your mind for a few minutes and consider what might have been had we weaned ourselves off of the milky government teat for a free market approach to residential real estate loans.

Government lending didn’t really start until the 1920s with farm and home loans. FDR’s New Deal supercharged the idea of US government-backed home loans as a “band-aid” to the Depression-era liquidity crisis. Poorly-trained, high school social studies teachers taught us that the New Deal policies are what saved the American economy. In fact, evidence suggests Federal intervention ultimately prolonged the Depression, curbed creativity and innovation in lending, and turned the residential lending industry into a ward of the Government.

Twice, in recent history, did residential lending attempt to divorce itself from this dependent relationship…twice, we failed. Current legislators use these failures as evidence for why free market capitalism is “dangerous” when left unchecked. In reality, the de-regulatory efforts towards banking in the 1980s, and securitized real estate lending in the earlier part of this decade, were constrained by a government-provided safety net (FSLIC insurance and expansion of the GSE mortgage conduits) akin to bad parenting.

Consider the teenager. Adolescence is the awkward period between a child’s dependence on his parents and the independence from those parents that comes with adulthood. Responsible parenting dictates that greater responsibilities be given, as the adolescent ages. Responsible parenting rewards the adolescent for good choices and levies punitive restrictions as consequences for poor choices. It is when parents indulge the adolescent in freedom without responsibility that adolescence continues to the child’s middle-age years.    In short, if Biff kills his girlfriend in a drunken driving accident, in Dad’s Porsche, and Dad’s lawyer gets him off, Biff is going to continue to drink and drive. Dad removed the moral consequences that comes with the responsibility of adulthood.

The government is guilty of bad parenting and mortgage lenders will be perpetual adolescents because of that. The 80’s banking deregulation permitted savings and loans to expand its loan customer base without removing the “safety net” of FSLIC insurance. Was it any wonder that the adolescent loan officers engaged in “drunken driving”-type loans? The result was insolvency of the FSLIC.  Savings and loans were folded into the FDIC insurance system and we all went on our merry way. What regulators should have done was rip a page from the Barron Hilton playbook and disinherit those wards.

More insidious was the social engineering that was associated with our most recent demise. The Community Reinvestment Act, among other wealth redistribution efforts, blurred the lines between government and industry and created a moral hazard unseen in human history.  Government “social engineers” provided a huge safety net for mortgage lenders with a quid pro quo provision that certain wealth redistribution tactics would be incorporated into the lending guidelines. Is it any wonder that (a) the system collapsed? and (b) the lenders engaged in REALLY risky behavior?   This “bad parenting” was akin to the cougar mother who trolls bars with her teenage daughter, for casual sexual encounters. Why would we be surprised if the young lady contracted a communicable disease?

Today, mortgage lenders make few, true “free market” loans. One look at the jumbo mortgage market will show that the real cost of mortgage capital is in the 6’s, for borrowers with pristine credit, lots of income, and at least 25% in equity. Ask any Californian looking for a $1,000,000 loan about the costs and hassles associated with a jumbo loan approval. Where did all the creative financing options go? Why won’t an ambitious bank should step up and dominate a profitable niche ?

The private mortgage market just isn’t as profitable as the “government option” right now. Government-subsidized banks have access to really cheap capital (around .5% carrying cost) and can lend it out with a loan guaranty, at 5.5%.  This is less than what the free market is telling us is the “real” retail cost.  If a foreign competitor engaged in this type of behavior, in another industry, it would be gulity of “dumping“.  The government option is creating a “single-payer” system for real estate finance which curbs creativity and innovation.

It’s gonna bite us in the ass….again.

FHA will be “technically insolvent” in two weeks.  The FHA Commissioner is complaining that there a bunch of “bad teenagers” in his home.  He’s wrong; the FHA is a bad parent. Instead of addressing the problems with its lending guidelines, the FHA Commissioner’s solution is to find richer “bad teenagers”.  If we learned anything from the most recent attempt to divorce ourself from government lending, it is that wealthy teenagers just create bigger losses.

What’s the solution?  Kick governments out of lending…for good.  If Governments want to offer home loans as an employee benefit, like teachers and veterans get, they need to originate and fund those loans themselves rather than to offer them as a loan guaranty through the mortgage industry.  We need to kill the “government option” and let healthy lenders develop profitable loan  products .  It’s going to be ugly in the short-term.  A larger liquidity crisis will develop which will accelerate the housing price decline to a ridiculously low level.  Properties will be so cheap that only a fool wouldn’t lend against them-

-that will be the beginning of the profitable private mortgage market.

PS:  You might accuse me of hypocrisy because I originate a lot of government-guaranteed home loans.  As a mortgage originator, my responsibility to my borrowers is to arrange financing at the least costly terms .  As a private citizen, my responsibility is to point out why this system will ultimately fail.  As you can see, I love my job so much that I’m thinking about a solution for the inevitable problem.

19 comments

Give Mike Ferry’s Social Media Guy A Raise!



Give agents who are too lazy to adapt an excuse not to?

I think it’s brilliant… Because the number of agents that this vid will resonate with is much larger than the number of those who will shake their heads and call Mr. Ferry a dinosaur.

Is going to be fun to watch this one go ironically viral?


27 comments

Video: Howling with Brian Brady in Phoenix in the dog days of summer

Brian and I gave a three-hour presentation last Friday to a small group of top-producers at the Phoenix Association of Realtors. We asked Bloodhound Terry Melcher to help us set it up, and she packed the room with some of the most successful Realtors in Metropolitan Phoenix.

Brian was in town to help me shoot promotional videos for BloodhoundRealty.com, and we made a video of the speaking event as well. Don’t pester Ryan for a BHB.TV channel: It’s our usual garage-band quality production.

We cover a lot of ground in the 2.5 hours of video linked below, but there’s not a lot of cutting-edge stuff in there. If you’re new to our schtick, though, this might be a good short introduction to the BloodhoundBlog Unchained way of thinking.

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Client Lunchbox – BloodhoundBlog.TV CRM Channel Premier

Ok, here’s the first episode for the CRM Channel. It’s a quick peek under the hood at ClientLunchbox.Com that I made tonight using the cool twitter integrated, web based screen capture tool, Screenr.Com.

[Just a quick disclosure, because I’m scared poopless of ever plugging stuff here: Dane Maxwell, the guy who created ClientLunchbox asked me if I would write a blog post about his product months ago. I told him I would, so here it is. At the time, I was thinking HouseYourMom.Com but sorta forgot, so I’m overcompensating by talking about Lunchbox on the big stage. For the record, Dane builds stuff for Realtors, but he didn’t even know what BloodhoundBlog was. Blasphemy, I know. I only mention because of the vendor sensitivity around here…. and… I guess I’d like to add — I’m hoping it’ll be cool to do a lot more (honest, nonpaid) vendor reviews in the coming months because at the risk of appearing to be hawking something, I think this kinda stuff is interesting to a lot of folks? ]

Anyway…here’s the video. It’s been set up with the “secret tag” for the CRM channel in Youtube and should flow onto the CRM page within a few hours…

And for a more in – depth view use my affiliate link, or if you prefer, this clean link to some more info about Client Lunchbox.

[So what’d you think? Anyone else want to do a similar screencast review for BloodhoundBlog.Tv? ]

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BoodhoundBlog.TV – Channeling a Video Model For Large Brokers

Using the Tubepress plugin’s shortcode paremeters it’s easy to create a bunch of different video galleries within one wordpress install. I’ve been calling these different pages “galleries” because it sounds fancy, but maybe for BloodhoundBlog.TV we can call them Channels?

In order to have any of your videos show up on a channel, all you’ll need to do is use a “secret tag” when you upload the video to youtube.

I’ve tweaked up a special sidebar so that all channels will flow into the sidebar as links when created using some wordpress list_pages fun. I’ll spare everyone the nitty gritty technical details here and maybe save some of the code snippets for a later post, but I want to mention that this is all being set up within one wordpress install for a reason — Because I think following a similar configuration could be useful to any broker who’d like to create a TV station within his/her blog.

For example, a Mega Monster Multi Contributor Broker Blog could included the following channels, all with videos created and emailed from phones by agents.

  • Weekly Market Updates
  • New Listings
  • Neighborhood Driving Tours
  • Area Restaurants
  • Area Parks
  • Agent Interviews
  • Scenes From Settlement

You get the idea? Consider how sticky your broker site be if all visitors were confronted with a series of 2-5 minute videos created by your team of agents. How likely would these visitors be to “subscribe to receive all new videos? Combine this with open registration on a solid idx integration, and I think any broker with the stones to encourage (pay for) agent generated video content could quickly increase market share in any market.

But oops… sorry for the digress into how this stuff might actually be applied to make some coin. 🙂

Back To BloodhoundBlog.Tv

Obviously even though the technology behind the thing is the same, we’re going to need a different set of channels for BloodhoundBlog.TV.

So, I’ve gone ahead and created a “CRM” channel which I’m hoping will soon include various under the hood peeks at CRM systems geared toward Realtors. CRM’s a dirty little geeky obsession that I think I share with a lot of folks around here, so maybe it’s a good place to start?

Can you think of some others? I’m hoping y’all won’t mind using the comment section here to make your own areas of interest known by suggesting some channels for BloodhoundBlog.TV. And if you’ve got any current Youtube videos that you’d like to see included on the channels you suggest, feel free to include links. I’ll respond asap with the “secret tags” as the channels are created…

Meanwhile, here’s the TV page again with the new custom “Channel’s” sidebar….

2 comments

I’m Drinking More Tea

Late this Spring, I came to the realization that my life wasn’t in enough upheaval, so I decided to give up everything and move back home to Texas to be closer to my family and aging parents.  My trip to visit my parents while my dad recovered from surgery in April made a much larger impact on me than I realized.

Family matters.  Life is short.  Carpe Diem.

… and let’s face it, my business was in the toilet and I’ve been toying with starting my own Web 2.0 endeavor so what the hell.  Texas here I come.

It’s been more than 2 months and I am working on my business plan.   I have a  lot more free time, so I am reading a lot.  I am enjoying seeing my folks, my brothers and sisters-in-law, nieces and nephews, but surprisingly, I’m having difficulty reconnecting to my home town.

I finally started reading The Fountainhead and I am looking forward to reading Dan Brown’s new book, but one book in particular that I just finished has really made me think about the process of really starting over – starting over is tough.

The book Three Cups of Tea has profoundly impacted my process of starting over and reconnecting.  It’s about the power of relationships – deep, meaningful relationships.  Relationships that truly transcend our differences and forge  bonds because of our shared experiences and common purpose.  If you haven’t read the book, needless to say, I highly recommend it because I believe it has remarkable relevance to how we value and maintain relationships in our business and personal lives.

In the book, the significance of sharing tea with a person is a deeply routed cultural experience with profound meaning.  The more one shares tea, the stronger the bond.  Connecting and reconnecting with people is all about building, nurturing and maintaining relationships.   Building a relationships begins with a common purpose or shared experience, but to maintain it and for it to become valuable, it requires nurturing.  How much time do we really, truly devote to the nuturing of our own relationships?  Not just our business relationships, but our personal ones as well.

What relationships warrant the sharing of more tea?

At dinner one night recently with my folks, we got into a philosophical discussion about spirituality and relationships.  I add these disclaimers:

1. No, we were not drinking tea

2. No, there was “nothing” in what we were drinking

My mom shared a story about fate, spirituality and how it impacts relationships.  Heavy, I know.  She recounted the time when my parents were in New Mexico a few summers ago walking a trail near Taos.  As they headed up the hill, another couple about their age were walking down.  Immediately, my dad notices that the man was wearing a Bears cap.

Both my parents were born and grew up on the south side of Chicago.  My father is a dyed in the wool, navy and orange Bears fan, regardless of the fact that he nor my mom have lived in Chicago in almost 40 years.  He could not easily walk past someone wearing a Bears’ hat and not acknowledge the man’s intelligence nor his good taste in professional football team attire.

They find out that in fact they grew up in relatively close proximity to each other – talked about their parishes and life in Chicago.  But what made this meeting more than just a casual talk was the fact that the man’s uncle was an employee of my mom’s father’s stoneyard.  My grandfather owned a stone company – still in existance today – on the south side of the city.  My mom remembered his uncle and remembers seeing him at the office as a child.

During our dinner conversation, my mom said that the man’s uncle was an alcoholic – had a tough time at work and in life – and was a heavy burden to my grandfather, but my grandfather did everything he could to take of him.

At the time the man shared his uncle’s name on the rocky train in Taos, my mom said she was overwhelmed by the presence of someone who was not there – her dad.  I believe that relationships not only transcend our differences, the ones that really count, take root in our soul.

This meeting – and albeit brief relationship with this couple, struck up because of a less than average football team – was deeply meaningful.

How many opportunities have we missed to truly connect with others?

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Why We Should Rename It SMP (Social Media Prospecting)

I asked if SMM were dead as a precursor to our session with the Phoenix Association of REALTORs.   A few of y’all mentioned that social media was helpful as a lead generation tool.  I suggested this yesterday and  I want to be perfectly clear about the utility of social sites as lead generation pools.

Serially creating overly commercial, spammy messages on your Facebook status bar is never going to be effective.  Kelley Koelher once said in my Unchained session that you’re supposed to be SOCIAL on social media.

I don’t disagree.  I often liken your behavior on social media like a party, wedding, or community event.  If you showed up to cousin Fred’s wedding and handed out your business card, you should be tossed out on your ear.  If  bride Wilma’s sister asks you “What’s the market doing ?”, it makes sense for you to get her number and reconnect with her a week later.

Now, more than ever, prospecting is paramount to success as a REALTOR.  Consider this video of Gary Keller and Jay Papasan, discussing the shift from marketing to prospecting.

Here are my takeaways:

  1. the 8 X 8 is about cementing a relationship.  These can be phone calls, interactive comments on social media sites, e-mails, and postcards.  I think 3-4 different forms of media touches hardens the relationship cement quickly
  2. the 33 touch is about saturation.  I can’t stress enough that you must have permission to continue this saturation strategy on a prospective client
  3. The monthly newsletter is a non-threatening way to buy brain cells.  My yellow postcard might only be read for the 8 seconds it takes to go from the mailbox to the wastepaper basket but it does get read.  I get calls from it.
  4. The principles of direct marketing are more important now than ever. This means that you should ask people questions…directly (eg- do you know any teachers looking to buy their first home?)

How do social media play into this strategy? Here’s a Facebook tactic:

  1. Call everyone on your “friends list”
  2. Ask them who their REALTOR is in (your town)
  3. If they have one, politely move on.  If they don’t, ask if you can adopt them.  If they don’t live in (your town), inform them that you know they’ll refer someone to you one day and want to be know as their (your town) REALTOR
  4. Look at their “friends” list for someone whom you find interesting; ask for an introduction

Does that sound creepy? Well, that’s sales, folks.  Lead generation is the MOST important part of your job.  Keller and Papasan suggest that 3 hours of your day be dedicated to lead generation daily.  Can you imagine how supercharged your business would be if you took their advice and optimized the social media contacts you spent years developing?

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