There are just four things that matter if you want to win more work in commercial real estate.
The relative importance of these four things depends on the preferences of the would-be client and the characteristics of the competitive environment in which you operate.
If you’re an agent who wants to do more deals, your job is to figure out what is most important in each case and then to create the optimal mix which makes you the obvious choice.
Here are the four things that matter:
1. Relationship
Previously seen as the be-all-and-end-all advantage, a solid relationship is still important, but it’s not the trump card it used to be.
People are increasingly busy, meaning golf days and long-lunches are far less prevalent, and most prospects aren’t looking for new friends.
If you don’t have the strongest or longest relationship, you can neutralise this disadvantage by being a friendly and cooperative person who the prospect is comfortable to work with during the transaction process.
Conversely, if you already have the best relationship, don’t be overly reliant on that to get you over the line. You must continue to prove your value and demonstrate your capacity to deliver the strongest result.
2. Market position
Are you seen as the market leader or as a credible alternative to them?
If the answer is yes, you’re in the game and you just need to make sure that perception is reinforced.
On the other hand, if you don’t have a long list of comparable deals under your belt, see if you can leverage the experience of your colleagues.
Alternatively, are there transactions that you’ve completed that aren’t directly comparable, but are still demonstrably relevant?
If you’re not the market leader (or on their heels), the goal here is to be seen as a safe pair of hands who has an obvious capacity to perform.
3. Ability to deliver on the brief
If you’re new to the market, this is a good place to focus your energy.
You can’t create long-standing relationships or track record that doesn’t yet exist, but you can outwork your competition.
Do your homework about the market and the property. Be a better presenter. Have more creative marketing strategies. Add more value through the pitching process. Rehearse anticipated questions and be overly prepared for every interaction with the vendor.
Putting in the work will give you competence that you will draw confidence from – this will help you overcome any inherent disadvantages, so you have a better chance of securing the listing.
4. Fee
Unless you’re in a position to increase your fees, I don’t recommend tinkering with the commission.
On the one hand, many agents say their clients don’t haggle much over the fee. On the other hand, some of those agents will lament the fee erosion that is occurring in the marketplace.
The point to note here is that your fee structure is a lever you can pull to improve your position – but it’s better to rely on other factors to demonstrate your worth.
In my experience, clients that are only focused on the lowest fee don’t recognise the unique value you can deliver. Moreover, if your competitors are busy serving these clients, that keeps them occupied when owners who can see your worth are looking for representation – and that’s inherently a good thing.
There may be other factors which are internal to the client and specific to their circumstances, but the four areas I’ve listed is what can be assessed from a market perspective.
When you’re evaluating your position in these four areas, it’s the perception of the decision maker(s) that will determine who comes out on top – remember, this might not reflect the truth or the way you see things.
Therefore, try to uncover what the prospect’s perception is so you’re not clouded by your own views. If you don’t know what they think, then it’s time to get to work and find out (tip: talk to them!).
Once you know how you’re perceived relative to your competition, you can start conditioning the market – neutralising your weaknesses and augmenting your strengths, just like you do during a marketing campaign for a property; this is the work you need to do before you secure the listing.
