We are in a market where agents complain constantly about a lack of listings. Buyers are sheep-dogging over the top of each other to make first offers on a limited number of available properties.
This means the struggle is not selling, but rather getting the stock on your books in the first place – and you are competing directly with every agent in your area to secure those vendors.
In reality, a big part of beating out your competition is quite simple. You see, I have a basic mantra that’s won me literally millions of dollars in revenue over the course of my real estate career: “To be great, just don’t be second-rate”.
The significance of this saying was brought home recently during a conversation I had with a Sydney friend looking to sell his property but struggling to select an agent.
He had a home worth around $1.5 million and had identified three agents he thought would be a good fit. These were all experts in their area with solid reputations for selling success. Here are four golden rules my mates experience revealed on beating out the competition.
Lesson 1: Stand out
My friends arranged to meet with each of the agents to discuss their selling proposals. He walked away from those meetings dumfounded by one particular thing – all the agents were offering near identical service.
They all proffered a fairly similar market appraisal on the property, near identical commission proposal and the same marketing and advertising plans. They all wore the same sharp suit and delivered the same market patter.
There was no standout differential between them – it felt like a waste of time. He may as well have flipped a coin.
So, if you’re going to compete, you can’t be vanilla. All one of them had to do at this early stage of the process was be different from the others, and my mate would have signed up.
Always ask the client if they’ve discussed the listing with other agents, and what their thoughts were on a marketing strategy – and make it your mission to pitch something unlike the others.
Lesson 2: Cutting commission doesn’t work
We chatted a bit further about the pros and cons of each of the agents, and my mate confirmed an industry truth I’ve always believed – cutting your commission is ineffective in winning good clients.
My friend said the real-dollar difference between the highest and lowest commission pitches was about $3000. When you’re talking about a $1.6 million property deal, $3000 is really just a rounding error.
On the whole, discounting your commission won’t win you more business, because sellers will pay a premium for excellent service.
Those agents who cut commissions as a marketing tool are telling me two things:
A – They’re lousy negotiators
It’s a lazy move offering to drop your price to win business – and lazy is certainly not what I want from my selling agent.
B – You’re suggesting your service is not as valuable as that of the other agents.
Clients are happy to pay a little extra for the right agent offering the right service.
Lesson 3: Automation is killing our industry
To try and break the impasse on my friend’s selection process, I suggested he road test the agents.
He asked one of his associates to send each of the agents an inquiry via realestate.com.au about one of their current listings, with a contact phone number included in the message.
The results were telling.
Two of the agents sent an automated reply, but neither picked up the phone and called the inquiring buyer.
The third was different. Within an hour of the message being sent, the agent phoned our ‘secret buyer’ and made arrangements to show them through the listing the very next day.
No surprises for guessing it was this third agent that got my friend’s property to sell.
Lesson three is stop relying on automation to manage your relationships. We’re not selling cheeseburgers at a fast-food joint. We are selling homes worth hundreds of thousands, if not millions, of dollars and buyers looking to spend this amount deserve more than a generic response to their inquiries.
People do not want to deal with robots. Pick up the phone and provide customer service.
Lesson 4: Being great isn’t hard
In short, you don’t have to do much more than be a decent service provider to really stand out in the crowd.
Remember – you are always being tested. You never know who you are truly coming into contact with and how or why they are judging you, so be an optimal service provider at all times. Make sure everyone you deal with knows through actions (not just words) that you’re the best person for their job.
Take my advice – to be great, just don’t be second-rate. It will be better for you and for our industry as a whole.