Many real estate agents today create temporary relationships with home buyers and sellers. Agents provide transaction services, take buyers from property search to home closing; or take sellers from property listings to home closings. But when the closing is completed, most agents hand over the house keys and move on to the next hot prospect. It’s the nature of sales.
Some agents keep in touch with past customers by sending trinkets, jam, calendars, anniversary cards and holiday greetings. But too often, past customers are neglected as a prime source for future transactions.
When you neglect or ignore a happy, well-treated, well-served customer, you give up a great deal of hidden value in the form of client goodwill. Immediately after a successful real estate transaction, a satisfied customer is prepared to become your client for life. A customer becomes your client when you pro-actively provide products and services distributed throughout the years in between transactions: newsletters, information reports, market alerts, product discounts, seminar invitations and other useful information about your local housing market.
You now have a long-term, professional relationship with these home owners or sellers. They’re impressed that you treat them well and fairly, even though the transaction is complete. You become their real estate agent - the name they know and the professional they recommend.
Indeed, past clients recommend you to family, friends and neighbors, generating quality referrals and prospecting leads. And expect these well-maintained clients to buy or sell more real estate using you as their “insider” authority. The goodwill factor stays with happy clients years after the sale, when you reach out and maintain interest and contact.
Now, this sounds good in theory, but you don’t have enough time to provide services to past customers. You have to cut expenses, generate and convert leads so that you generate income today, not five years down the road.
Not to worry, the client approach gives you the best of both worlds. You focus on making money today, while obtaining clients for tomorrow. You do both because the time and cost of client management is insignificant when weighed against the benefits you derive.
Agents continue to use traditional marketing channels such as online lead generation services, postcards and mailers, open houses, local newspaper advertisements, local real estate listing hand-outs and telemarketing to focus their near-term activity on converting leads to customers and fulfilling customer transactions.
Now let’s look at the client-based approach. Growing a client business is based on the concept of “self generating” referrals and leads, accomplished by creating a large network of exposure points, which, in turn generate more referrals and leads naturally, organically.
For example, an agent who conducts a seminar on foreclosure sales to an audience of 100 people creates an exposure point because once the seminar is over, the power and reach of your expertise and authority spreads by word of mouth - the best advertising an agent has.
One hundred seminar attendees now have a favorable opinion of the agent. Each tells family, friends, neighbors and colleagues about the agent. In turn, some of these people tell others and your reputation grows virally. A one-hour seminar creates a self-generating process of referrals and leads.
The fact that a client-based approach creates self-generating referrals is a bonanza for today’s ambitious agents. According to a recent survey conducted by HomeGain, real estate agents believe that referrals are the most effective marketing strategy to acquire new clients.
Clients Eventually Generate More Business
If you keep clients for life, they’ll ultimately naturally generate more commission income for your business practice, while you are focused on generating short-term customer business. Here’s why:
A meaningful percentage of an agent’s book of clients will eventually purchase a trade-up or trade-down property, organically generating more business for the agent and agency.
A percentage of clients will eventually purchase a resort property, giving the agent the referral fee from another agent in a different location.
A percentage of clients purchase investment properties, giving the agent all of these transactions.
Satisfied clients refer their agent to family, friends, and neighbors, growing the agent’s client base. This word of mouth exposure expands on its own as the agent continues to provide advice and counsel.
And finally, serving a large number of clients in a relatively small community gets the agent recognized as highly credible with a solid reputation.
Simply stated, clients are worth more than customers-over time.