Brokers are missing an opportunity to improve their bottom line, recruiting and customer happiness by not focusing enough on the experience for active clients.
If there’s a group of professionals incessantly pressured to generate more and more leads, real estate brokers top that list by a mile. Naturally, we’ve focused our business on winning this rat race by doing whatever we can to generate more leads for our agents.
I recently realized, however, that this uber-obsession with just generating leads might have masked the real ingredient to achieving an impact on business growth for our agents and the brokerage: generating offers, aka “offer gen.”
A recent Inman article by Andrew Flachner on a concept called offer generation reaffirmed my faith that investing in a client’s experience during their homebuying process is just as important, if not more so, as investing in lead gen. So the question is, how does this concept of “offer gen” also apply to brokers? How can our businesses benefit from this concept?
To answer these questions, I’ve compiled three reasons why adopting an offer generation focus is critical for every broker in 2015.
1. Offer gen equals more profit.
At the most basic level, offer gen is about focusing on helping clients desire to write offers faster, thereby producing more commissions for our agents, but in less time. Obviously, this is a plus for the brokerage, but the story goes much deeper.
The most motivating aspect about offer generation is that unlike lead gen, offer gen is both cost efficient and a multiplier to a broker’s business. As we’ve all experienced, lead gen requires constant feeding for it to be effective. The moment we stop spending on exposure or advertisements, the leads stop.
Therefore, business growth requires a one to one increase in lead-gen spending, which is capital intensive, especially given long sales cycles. On the other hand, investment in offer-gen tactics can make substantial and long-lasting impact at low cost.
As an example, imagine an offer-gen scenario where you decide to build a brokerage-wide database to share your homebuyers’ home search preferences. This database will enable much more efficient communication between your buyer and seller agents, and it increases the chances of your firm double-ending transactions.
What does it take to pull this off? A Google spreadsheet, a little agent training and a few hours of an admin’s time. With minimal effort or cost, you have created a useful offer-gen tactic with long-lasting impact.
Offer generation tactics such as this, ultimately increase the return on investment of all of your leads because your moneymaking formula is fundamentally changed through better lead conversion. Not only do you have more money to reinvest in offer gen, your higher returns will let you spend further on lead gen as well.
2. Offer gen means more recruiting success.
Recruiting both rookie and top-producing agents has gotten more and more competitive in recent years as both the real estate and job markets evolve. Building differentiating value propositions for your brokerage is an absolute necessity.
Typically, I hear three main talking points a brokerage will present to their candidates:
1. Excellent training and tools.
2. Attractive commission splits.
3. Access to brokerage-generated leads.
Curiously, I have rarely heard a brokerage brag about how good they are at converting leads into offers, and ultimately into commissions.
Brokerages are missing this opportunity because the process of effectively generating an offer is key to an agent’s success in the business. The most direct way to discuss this with a candidate is to walk them through the funnel conversion rates from lead/offer/transaction, but it’s a bit dry and technical.
There are few other stats you can gather that drive home the same point: How many properties were shown by your agents to their clients past quarter? How much shorter is your sales cycle, compared with the national average of three months? What’s the average number of customers an average agent handles at any given time?
All of these numbers can be a great indicator of how well your firm is generating offers and can indicate to candidates that your brokerage is unquestionably passionate about performance. By adding this fourth value proposition to your interview process, you can onboard coachable, next-level talent looking for a firm they believe will help make them better.
3. Offer gen equates to more customer satisfaction.
Every powerful brand, no matter who it is, relies on the same backbone — successful, happy customers. As brokers, shifting away some of our attention from the cold numbers game of lead generation — to the more human-centric world of offer generation — can improve your customer’s experience drastically without sacrificing the bottom line.
Here’s an example: The National Association of Realtors’ surveys show year after year that the largest reason for customer dissatisfaction stems from an agent’s lack of availability and responsiveness. Addressing this problem might seem like a nice-to-have — something that doesn’t drive the bottom line. From an offer-gen perspective, however, this is an apparent “kill two birds with one stone” situation.
Let’s say that your proposed solution for this responsiveness problem is to hold training on how to communicate more effectively with your clients through texting and introducing a few SMS apps to streamline workflow. Yes, this addresses the responsiveness issue head-on through a measurable strategy, but it also increases the chances of creating a happy customer, and, therefore, a successful transaction.
The lesson here is that an offer-gen mindset will open your eyes to opportunities with a double bottom line: short-term economics on one side and customer success with long-term, financial benefits on the other.
In isolation, offer-gen tactics might not seem revolutionary for brokers, but the change in mindset opens up a vast array of opportunities. By practicing offer gen, brokers can expect better growth, recruiting differentiation and, most importantly, satisfied customers.
Incorporating offer gen alongside lead gen was a no-brainer for me in my business. I’m curious, though, will you?