What’s the best way to cope with market shifts? Face-to-face is the name of the game.
Our last three articles looked at three strategies for surviving shifting markets, i.e. creating a three-level business plan, guerilla marketing, and back to basics. Today’s article examines the most important strategy of all.
Shifting Market Strategy No. 4: Personal Connection is the Name of the Game
No matter what type of market that you are in, the most important survival strategy is personal connection. Real estate is, and always has been, a local business. Major companies that lack a local presence have difficulty competing against someone who is well known in the community. This is especially true when it comes to listing business. While buyers aren’t particularly concerned about the agent’s company when they are purchasing, sellers generally want one of the top three most active firms in their area to represent them. Furthermore, while 15 percent of the consumers shop exclusively based upon price (i.e. commission), a whopping 80 percent are concerned about value, i.e. a combination of service and price. Consequently, to capitalize on this fact, you must do what the Internet and competitors from outside your area can’t do–be face-to-face with as many potential clients as possible. Very few people are willing to do business with a stranger that they meet on the Internet. They may visit Web sites that access the Multiple Listing Service (MLS) or that place a price on their home. Nevertheless, when it comes time to purchase or sell their most important possession, most will do business with the agent who has seen them most recently face-to-face. In fact, 73 percent of all sellers only interview one agent. Fourteen percent only interview two agents before determining whom they will hire. To keep your business running strong, use any of the strategies below to increase your “face time.”
1. Invite-a-friend open house
Put a new twist on this tried and true strategy. Hold an “Invite-a-friend” open house where the sellers invite a group of their friends and acquaintances to an open house that you host and cater. The invitees are asked to “invite a friend” who may be interested in the property. You send out the invitations, host the event, and follow-up to say thank you and offer a service such as a complimentary Comparative Market Analysis (CMA) or a membership in your home management club. This puts you in front of the sellers’ sphere of influence as the person they have selected to sell their home. More importantly, it’s a non-verbal endorsement by the sellers that’s infinitely more powerful than testimonials on your Web page or mailers that you send out.
2. Neighborhood appreciation event
On a holiday weekend such as Memorial Day or July 4, plan a neighborhood block party for the area where you conduct geographical farming or for where you live. Serve fun food and soft drinks. Invite kids to decorate their bikes or tricycles in red, white, and blue. Give prizes for the best decorations. Invite people to bring their pets. Take plenty of pictures and post them to your Web site with the instructions for downloading the pictures. You will have plenty of folks who will visit your site to obtain the pictures of their children.
3. Sponsor a charity drive
In the spring and the fall, people often do major house cleanings and prepare for the change of seasons. You can contact a local charity and arrange for pick-ups on a specific weekend. Alternatively, you can rent a truck and handle the donations personally. Drop off sacks labeled with your contact information and instructions. For each person who makes a contribution, personally visit them to give them their receipt for their donation. Don’t forget to make an offer of service and to wear your name badge.
4. Kids day at the movies
Most theaters are not open until mid-morning or early afternoon. When there is a new kids’ movie out, plan on renting the theater for an early show and inviting the children from your sphere of influence or geographical farm. Provide healthy, non-sugary snacks and drinks. Make sure that the children get a small gift for attending and that you have a pen or something else with your contact information for the adults as well.
5. Sponsor a real estate investment seminar
Invite a tax attorney as well as a financial planner to talk about strategies for investing in real estate including tax write-offs. Have them emphasize how real estate is still the best strategy for retirement since it pays for itself and generates consistent income once the mortgage is paid in full.
Market shifts are a fact of life. The smart agents adjust their strategy as the market changes, niches their business, and stays face-to-face with sellers and buyers as much as possible.