Real estate coaching pioneer Mike Ferry started The Mike Ferry Organization, a real estate training firm, 45 years ago. About 13 years in, he accidentally started what would become the real estate coaching profession that is now ubiquitous.
In a phone interview, Ferry told Inman about agents’ biggest fears, why he reads 150 to 200 books a year, and how the pandemic is making good agents better, faster, while the rest are falling behind.
This interview has been edited and condensed for clarity.
Inman News: How did you get into coaching?
Mike Ferry: We actually started the coaching industry in real estate in October of 1988. I was in San Francisco doing a seminar at the Fairmont Hotel. I had this wonderful group of 400 agents for three days and there was no connection between my material and the audience.
Finally, on the second day, I very casually said to them at the end of the day, ‘I’ve got a great idea. Why don’t every one of you write me a check for $5,000. I’ll call you once a week and tell you what to do and I’ll do that once a week for a year.’ The seminar ended and I walked off the stage.
The next morning, there were about 300 cards sitting on the podium. I asked everybody, ‘What are the cards for?’ and they said, ‘These are the people that want to pay you $5,000 for you to call them once a week.’ That’s how we started the coaching. Out of the 300 cards, we had 200 sign up within probably three days. It was more by mistake than it was really on purpose.
We’ve coached, since that time, probably 120,000 or 130,000 agents over that 30-some years.
Do you have a coaching philosophy?
Our coaching philosophy is based on the fact that any agent that chooses to improve the productivity that they have can learn how to improve their productivity. Our philosophy is if you tell us what your goal is you want to accomplish, we’re going to help you write a plan to make that happen and then teach you the techniques and skills to allow you to make it happen. The plan is custom-made for them based upon what they’ve done.
Is there any resistance to what you tell them?
Oh, just about 100 percent. The reason for the resistance is you’re asking people first to learn sales skills, sales behaviors. Second, you’re asking people to change some of the sales skills and behaviors that they have learned through experience in real estate. So the skills, the techniques, the dialogues that can cause the person’s production to go up, they have to change their behavior to make those become part of who they are.
Is there something you tell them or something you do to help them get over that resistance?
Well, first of all, we tell them it takes time. It takes six, 12, 18 months to change a person’s behavior. That’s if they really want to change behavior. We take it in little bites. So let’s take any one technique that an agent can use to improve and we’ll work on one little technique to help them build the confidence that they can change their behavior. So the biggest thing is accepting the fact that it takes time. It’s like an exercise program. Exercise takes time to develop the muscles and the skills to become stronger.
Is there a particular behavior or several behaviors that are common that you need to undo or teach them otherwise?
Probably the biggest fear they have is the fear of rejection that they have to accept as part of the sales process. They’re calling people regarding listing their homes, so when people say, ‘No, I’m not interested,’ they have to learn to deal with that type of rejection. They’re not being rejected for who they are. The seller is simply saying, ‘I don’t want to sell my home.’ So they have to learn not to take rejection personally and make it part of the process that they have to go through to gain the prospects that they want.
So that’s their biggest fear, the fear of getting rejected?
No, they also have the fear of ‘what if the customer says yes?’ They call a for-sale-by-owner, for example, and say, ‘I’d like to come by and talk to you about getting your home sold’ and the client says, ‘Fine, come on over.’ Well, that also is a problem because if they don’t know what to say in the presentation, they’re not going to get the listing. There’s the fear of acceptance, fear of embarrassment, the fear of rejection, all of these things take place if they do not have sales experience.
A big part of what we do is teach people what to say so that they can do the job that they’re supposed to do.
Do you teach them what to say in a script form? What’s your method for that?
We have scripts for everything from what do you say to a prospect to see if they want to buy, sell, how to prequalify them, to make sure they have the ability to buy or sell. So how to make a presentation to a buyer or seller to get them to sign a contract, scripts for handling the objections that they’re going to receive. We have scripts for every circumstance that they could encounter.
We recommend a broker have script practice every day. Professional athletes, all they do is practice so they can improve their performance. We have probably today 6,000 or 7,000 agents that are on the phones every morning at a given time practicing with each other different scripts. They practice every day and they’re all top producers because they practice.
Do you have a particular type of client that you work with? Is there something that they have in common?
The fact they want to improve performance. So that pretty much opens the door to everybody until you tell them what they have to do to improve performance. The hard part of what we do is everybody wants to make more money until they find out they have to change how they operate to make more money. Then all of a sudden, their openness to making more money often disappears.
Is that just because people are set in their ways?
Real estate is an interesting business because they’re independent contractors. They can be told exactly what to do. They can know that if they did it, they’d be more productive. But yet, they don’t have to do it.
Is there something you say or do to change that mindset?
All we can tell them is ‘If you want to achieve the goal you’ve set, you have to change your behavior.’ That’s why a college team, a high school team, a Little League team, a professional team has coaches. To help the players change their behavior, so they can perform at a higher level.
Has your job changed at all during the pandemic?
It’s changed to the degree that in my company, we normally would do 35 large seminars throughout the United States and Canada per year. Live events. With the pandemic, there are no live programs so now everything is done virtually. Today we can do an event and invite anybody in the nation to attend because there’s no travel involved. So it’s changed the dynamics of how we deliver the information.
Those weekly calls, how long do those last?
Thirty minutes. I think almost all the coaching companies that are our competitors follow the same format we use, which is 40 calls a year, 30 minutes per call.
Is there a reason that you keep it to that timeline?
A coach should be coming to the call with some specific questions that the client needs answers to. They should be coming with a tidbit of information that the client can work on during the course of the next week and they should be checking out what the client has done for the last week. We started out doing 15 minutes. We settled on 30 as being what we felt was the most effective many years ago.
So it’s part accountability and it’s part teaching?
During the pandemic, have any of your clients been coming to you with different problems?
The biggest thing is teaching them how to make a good virtual presentation. The dynamics of energy, enthusiasm, the smile on your face, the questions to keep them engaged so you can get your points across. We’re trying to help agents understand that you have 20 minutes on a virtual listing presentation to get them to accept what you have to say. So it’s a whole new type of selling process.
Do you find that agents have a different expectation of what coaching is than what you offer?
No question. Their expectation is we’re going to give them a magic formula and they’re going to be great. The hardest part is helping them understand that doesn’t exist. Change is a process that a person has to go through. That process, depending on the motivation of the person, can be quick or it can be painfully long.
We tell people all the time: ‘If you will give two to three solid years of following a coach’s advice, you’re going to have exceptional results,’ which is why we have probably today 750 to 800 coaching clients that have been clients for more than 20 years of my company because they keep learning, keep growing, keep moving forward.
How do you keep them engaged that long?
Somebody said, ‘You can’t teach an old dog new tricks.’ But the truth is, all dogs live to be old dogs because they learn new tricks. So we have to keep repackaging and reinventing.
How do you do that for yourself so that you can teach it to your clients?
I don’t have any formal education, but for the last 45 to 50 years I’ve been reading 150 to 200 books a year. Business books, biographies, autobiographies. I enjoy learning how to get better at what we do.
Has your advice to clients changed during the pandemic?
I do five to six webinars a day for our large broker customers all over the country. I’ve been doing them since March 15 when this pandemic really became the issue it is today. The one thing I keep telling everybody today is you have to understand the quality of what you say and the quality of what you offer has to improve because you’re not having that physical presence where they can see and build a level of trust with you.
Do you show them how to improve?
What we say to them is look at your company and the services they offer and how can you present them in a more meaningful way? Because the truth is, almost every real estate company offers the same basic services. Every company claims that they have the best technology. They all have the same technology. If you really look at it, is there any really big difference between KW and Compass and Coldwell Banker in terms of technology? Honestly, no, but they all tell you why theirs is better than the rest and whoever tells the story the best is the one that gets the deal.
So they’re having to reach out to people in a different way. Is that something that you walk them through? Or how do you tackle that?
When the pandemic started, we would say to them, ‘Okay, I want you to take a minute now and give me three good reasons why I should list with you versus somebody else.’ And they will ‘uh, uhm. Uhh uhm.’ Uh uhmm is not a good reason. That’s a poor presentation.
In a live presentation they can cover up a lot of their miscues or they can hide a lot of their words. When you’re doing it virtually, you can’t hide because you got the camera right in your face and the camera right in their face. So you have to become more definitive in what you’re going to say and more definitive in your offer.
Here’s the biggest difference in the market during the pandemic: the best agents are all getting better a lot faster and the rest of the world is falling farther behind. The gap between productive agents and non-productive agents is the widest it’s ever been. I’ve been in real estate for 56 years. It’s the widest I’ve ever seen.
Why do you think that is?
Because most agents simply will not change their behavior. They keep talking about the new normal we have today. Well, it’s the new abnormal. Because it’s really so different from what we used to do that they can’t adapt quickly enough. If you can’t adapt, you’re left behind.
Is there anything about your job during the pandemic that surprised you?
The biggest thing that surprised me is how many people — and nobody knows that number, but I’m estimating 30 percent of all the agents — have never re-engaged, reactivated, re-participated. They’re still hiding in their house. They’re so worried about this virus, and it’s an understandable concern, but if they follow the protocols, there’s no real concern.
The brokers will tell you the same thing. If they have 100 agents, where they used to have, say, 75 that were active, today they have 25 that are active. That’s the part that’s most surprising to me.