What are your New Year’s resolutions for 2011? If one of your resolutions is to make more money, a great place to begin is by expanding what is working and by dumping any activity that is losing money.
There are two ways to make money: You can earn more or you can spend less. The easiest way to earn more is to expand your existing profit centers. For example, if you have a successful farm area, expand into a neighboring area. If you regularly convert Internet leads, expand the scope of your website or drive more traffic using pay-per-clicks. If you like representing first-time buyers, spend more time prospecting rental housing. The key point is to build on your strengths.
While many agents focus on earning more, few focus on eliminating non-revenue-producing activities. In some cases, market conditions change. What was profitable yesterday may be a money-waster today.
A major part of the challenge is that most agents fail to track where their leads originate. Unless you track how much money each of your prospecting activities generates, you will find it difficult to recognize what really works and what is a waste of money.
If you’re ready to rake in more money in 2011, take a careful look at your business to determine your personal money-wasters. The list below is a great place to begin.
1. Are you wasting money on "up time"?
How many transactions did you close in 2010 from sitting on the "up desk"? If you didn’t close at least four transactions, chances are that "up time" is a money-waster. The challenge with "up time" is that it is passive. You wait for the lead to call you. In contrast, engaging in proactive prospecting activities (e.g., holding first-time-buyer seminars, knocking on doors, or calling on expireds and FSBOs) puts you in charge of your lead generation activities. When you’re waiting for the phone to ring, you’re at the mercy of others rather than controlling your time and business.
2. Be a specialist, not a generalist
Most top producers focus exclusively on two or three niches where they specialize. Common niches include geographical farms, new homes, estates, relocation, etc. If you are still trying to be everything to everyone, you are probably wasting money by spreading yourself too thin.
To see if specializing will work in your business, try this experiment for 90 days: Focus exclusively on expanding your three top income-producing activities. Because you are working with your strengths, there is a high probability that your business will increase.
3. Do you have a productive farm?
Have you closed at least four transactions from your geographical farm in the last 24 months? If not, it’s time to do more face-to-face follow-up or to replace this activity with something that is profitable.
4. Is your networking really netting you money?
Be honest: Are your networking activities generating leads? If you network to generate leads, look at how many transactions you closed in 2010 from your networking activities. If the answer is "none," you need to openly solicit leads (i.e., stop being a secret agent) or dump this activity because it’s both a time- and money-waster.
5. Clean up your database
Examine your database to determine which members you contact on a regular basis. Delete anyone who has been in your marketing program for more than 24 months and has not sent you a lead or done business with you. Spend your money on the people who refer you business and stop wasting time and money on those who don’t.
6. Forget the experts — do what works for you!
Are you knocking on doors, calling on FSBOs, or trying to convert expireds and not succeeding? If so, stop. If you hate doing an activity and it does not generate leads, spend your energy elsewhere. Each agent is different. Build on what you do well and stop worrying about what someone else says you should be doing.
7. Should you spend your Web marketing budget elsewhere?
Has your website produced more than one closed transaction in the last year? Are your listings current? Can potential sellers find you easily on the Web? If you answered "No" to any of these questions, upgrade how you are marketing on the Web. A great strategy is to hire a virtual assistant to handle this for you. If you hate Web marketing, spend your Web marketing budget where it will produce better results.
8. Are your open houses a waste of time?
Unless you actively solicit visitors to your open houses by door-knocking, an open house is a passive activity. Even if you prospect, do you have a strategy for gathering names and numbers? (One easy way is to have a drawing for a gift certificate or movie tickets.) According to the National Association of Realtors, 98 percent of all agents do not follow up on open house leads. If you do not follow up with your open house leads, stop wasting your time doing this activity in 2011.
There’s no better time than the beginning of the year to dump tired approaches that no longer work and to capitalize on what is working right now in your business.