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00:00 Introduction and Session Overview: Samantha McLean
01:07 How can we get lead gen through PM?
Welcome, good afternoon everyone. It’s great to be here with you. I feel like I’m flying that property management flag today, because I think that the topic that I was given was around the concept of breaking down the silo between the sales team, which is you guys, and of course that property management team. What I’m looking at I suppose, I’ve said, okay, “Well how can we get lead gen through PM?” because it’s all about how the Super Six can actually take greater advantage of this property management business.
From my perspective, when I think about sales, the fundamental challenge that I feel most sales people have is really looking at your business as a long-term process, right? I think well, you know what if I was a sales agent in today’s market? We see new agencies open up every day, the Super Six, and others kind of trumping at your bit. Ideally, we want to look at how do we actually create a sustainable business model for you so that you’re here for the long haul and that your activity of today is actually helping you to create more of an automated funnel for two years from now, three years from now, four, five, six.
To me it’s one of those goal setting things, is it all about planning and how can we plan for more automation in the future? When we look at that, I go straight to the internals of your business. We can sit here and come up with all the different lead generation ideas around where you can uncover potential vendors under rocks all over the country, where do they hide every day? But for me it’s all about how can I find them inside your business right now? What I’m going to do is I’m going to take you through five areas or tips/insights that I really want you to focus on over the next few months.
02:53 See the human as the property manager sees them
Straight off is that we’ve all got this same human that we look at. I get very technical and very statistics, I love numbers. I think they tell you a lot about your market place and certainly with property managers and investors. If I look at this human and they are walking down the street, right? Take yourself to your particular area, you’re in Maroubra now, Jamie, and you’re walking down and you see this person walking towards you, hopefully she doesn’t look exactly like this. She’s walking towards you and atypically when you’re looking at her and you’re looking at her and you’re thinking to yourself “vendor/purchaser” because which genre do they fit in?
Typically from a business context you’re thinking about this person as “are they are a vendor or are they a purchaser?” Now, throw yourself into the property manager’s shoes for a sec because part of the concept of lead gen through PM is being able to see the human as the property manager sees them. Because once we can start to really assimilate with them that whole lure of reciprocation is going to start working a little bit more effectively if we can understand them. This person actually fits into the four categories. The four dimensions of a client for a real estate agency. Of course, for you as I said, vendor or purchaser, but when a property manager or a property management professional sees exactly the same person walking down the street, they’re thinking “landlord/tenant”.
But realistically in your market place, the wonderment that is real estate is that every single person that you see actually fits into at least one of these categories. You think about your particular area. Every single person that you meet every day is either financing the real estate industry through property management, be that as a landlord or a tenant, or they are financing the industry through sales, be that as a vendor or a purchaser.
Everybody actually has a price tag and I think the first thing that we can see if we can break down the silo and I’m getting you guys beat the path for every agency from my mantle, is if we can break that and break that silo and instead of seeing them as a client of property management or a client of the sales team, if we can actually see them as a client of the real estate industry, and we start seeing them technically with this price tag, we’re going to start looking at that person and say, “Okay, well how can I serve?” Which I know is something that you’ve all been looking at over the last couple of weeks.
But not only how can I serve that client in that four dimensions, but what is the value of that human walking down the street to our industry and how do I tap in to that fee? If we think about how I can tap into that fee, that price tag attached to that person being that you’re only in this for the long haul, then you’re going to be starting to set yourself up for your budget for not just twelve months, two, three, four, five years as I was talking and seven years when you look at the average lifecycle of a vendor perhaps in your marketplace.
06:25 Your Market
First thing, break down the silo. Second thing, we need to look at the price tag associated with the human for dimensions. Now, how can you, because to get the property managers on board, you’re going to have to take the first step. It’s like that loggerheads that you’re going with, with the PM team. You’re going to need to give to them first in order to get something back.
The first thing that I’m going to show you is around really, completely understanding your specific market now just relevant to investors. Homework and some of this stuff might be new, some of it might be things that you’ve been told before but you haven’t necessarily looked it from this vantage point.
Firstly, you’ve got to know exactly how many numbers, how many doors are in your marketplace in any given time. You’ve heard that one before, right? Know your market, understand your stats. The second thing though that I want you to know, which is taking that a little bit deeper, is not just how many doors do we have in Taree, as an example, but how many doors do we then have, what is the breakdown between being an investor door and being an owner occupier door?
There’ll also be a little bit of an anomaly there, which is quite an interesting anomaly which is an investment door or a renter’s door that’s owned as part of the public sector, what we call public housing. There is a percentage of public housing pretty much in every location, at some level.
When we look at that, you’ll then not just know what your market looks like, you’ll actually start to segment your market place because the way that you tap into your owner occupier market and I know you’ve talked about even just door knocking when you were speaking with Claudio earlier. If you’re attacking then an investor market, we’ve got to go at that a very different way simply because the investor is not at home in the location behind the door of that which is in the market, that you are atypically. Or be it we know and this is where your property management friends can start to help you, you can actually start to drill down even with your own rent rolls in identifying, where did those owners actually live? If I own an investment property in Balmain: do I live in Balmain, do I live in the Leichhardt Municipality or do I live somewhere else? Am I onshore, am I offshore?
There’s this wonderful thing called a database in your office and there’s an even hopefully what typically is a better version of it is your property management, the trust accounting system, the database carrying all the data of all of the clients. That’s going to very simply spit out for you a list of every single landlord that is in that database and you can even sort them by postcode, by state, by suburb, by territory.
You’ll end up being able to see not only how many properties do we have, are they owner occupied, are they investors, and then just using your own business as a snapshot, where do those people live? Of course, you can look it up, hey data and gain some absentee owner information and start calling that. But if you’re going to find out how can I talk to these investors both through the property management division and otherwise, we need to know where they are and start to build a little bit of an idea or identity of those investor clients.
When we look at that, hopefully you’ll recognise this image here then Ben. If you don’t, we’ve got some problems to start with. This is actually, as I mentioned before, I’m using Ben’s location, simply because it was one that I knew myself. When we look at this, this is Ben’s area. What we want to know is, statistically, what does, and I’ve used the Leichhardt Municipality just for generalisation as opposed to drooling down to the Balmain peninsula there. But in that location, and this is just taken from census data. Now of course from using RP data, CoreLogic, you can go down and drill down a lot deeper than this.
But for today, you’ve got 22639 houses; doors in your location. Now interesting enough, comparatively to the general Sydney market you’re sitting at 38% of those properties are private investors. The general Sydney market is probably about 25%. On average, it’s a lot higher than what you would imagine.
Sometimes I think that we feel like we know our marketplace just based on our kind of vibe each day. Our vibe is not necessarily a true reflection of what’s happening. Be that as we’re all obviously here to grow our businesses, we’ve gotten now what the wider market looks like as opposed to what our existing micro market is right now. Otherwise, we’re just, we keep trying to harvest the same stuff, right? If we look at that and I’ve just estimated that the value across the municipality from looking at a few different numbers, probably sitting at about a million dollars when you’re take into account the wider market apartments and houses, right?
Now if we look at two percent, maybe as your average. I don’t know Ben you’re up higher than that maybe in terms of your …Two percent is good, yeah, average comm. For every home obviously that transacts we know that there is a twenty thousand dollar commission up for grabs, right? We’re looking at it that way and with an average rent of six hundred dollars a week.
That is like just a quick snapshot on the market. I’d really encourage you and I can give you a spreadsheet where you can throw your own data in and it will help you spit out some of the stats that I’m showing you today. I’m happy to share that with you.
11:33 The Investor Stats
What we’ve done is that’s your market. Now then we need to look at, okay, well how do we drill down further into the investor stats and what does that market actually mean as an investor to me as a sales agent and this automatic funnel. With 5% typically, what I find with the agencies that we work with around the country, 5% they’ll say atypically is sold from their rent roll each year.
Now we have markets of course that will have a higher trend than that depending on what’s going on in any one time. But of that, if there’s a really strong relationship between the sales division and the property management division and we’ve got a well-functioning or adequate even to some extent property management business, you’ll tend to find that eighty percent of those investors will sell with the agent that they’re already with.
That means that if you’ve got this wonderful database of ten thousand contacts out in your market place and 38% of them are actually investors, of that 3800, if they own an investment property right now, when it comes time to sell, 80% of the time, they’re going to sell with the agent that’s already managing that property.
Murphy’s Law now starts to tell you, “Well hang on a second, let’s put, two and two makes four. We need to get those 3800 into our world because we’re otherwise, we’ve only got a 20% chance of securing that listing and in addition to that, that 20% we’re fighting with every other agent in the marketplace to get to that 20%. Does that make sense to everyone? Now, I’ve just worked on the basis here that the average property kind of turns over every seven to ten years just on average. Obviously some of them shorter, some of them longer, and depending on your various areas and what the, I suppose the culture is around holding investment properties in your location, that may waver so you need to take that into account.
If we go back to Ben and our example there, that would mean that of the seven thousand, six hundred and fifty two properties sitting in the Leichhardt Municipality right now, if 5% of those sell this year, there is a volume of three hundred and eighty three properties. Million dollars, twenty comm, that’s 7.65 million worth of sales commission that is being generated in that location, in that market this year. Now the question starts to become, how do I get that? What do I need to do, what do I need to make it easier to get that? Remembering that 80% of that volume is going to the agency that’s already managing it.
This property management division, now becomes so much more to you than simply an ability to serve people that you know. It starts to become the ability to automatically funnel through to you the people that you meet that are investors to get them into that part of the business because we want them 80% of the time coming to us.
14:40 The Club
All right, so I’m going to call this the club. Property management for you guys now is no longer allowed to be called property management. I want you to call it the club. Because this is like the club. We’re getting all these investors into your club. I think the easiest analogy I can give you is this thing. Very simply, this is my club.
Now obviously training and coaching, consulting, I’m flying all the time. Now I’m sure there’s a few people that have got a couple of colours up for me on this, but it’s not for me, it’s not about the colour, it’s about the metaphor that this club card brings me. Because when in the club, so when I’m in the Virgin club, I don’t fly Qantas. I freak out if somebody books me on a Qantas flight. I have a joke with some of my clients, “Oh, you want me to fly Qantas? Let it be business class because I’m not in the club.”
The metaphor behind it is that you want everybody you know, everybody that you come in contact with to be sitting inside the club because you want them in the Virgin lounge, you want them in the McGrath Balmain lounge. You want them in the LJ Hooker Taree Lounge. You want them in your lounge because you want them only flying you when it comes time to sell.
There are so many opportunities every day, every week, every month, every minute almost and I’m probably going to enter you into a bit of a mind field now about how you can get people into your club and it’s going to be up to you to pick and mix how deep you want to go with this and obviously the risk returned and how long, what the longevity is that you want to put in place and what you want to invest in it in terms of immediate reward and long-term reward.
Ultimately, the more people in the club, the more opportunities you’re going to have obviously as time goes on. What does that look like? Right now in Leichhardt, there are seven thousand, six hundred and fifty six people that want to be a club member somewhere because these are the private landlords. These are the guys in the private market, these are the ones that have their properties managed. You’ve only got access to 20% of that if they’re not in your club.
17:05 Building your club / client bank
What can we do to get more people in your club? I want you to help build the club. When you think about referring properties into property management, most of the time, we think about that from the perspective–I keep waving my club card around…a little bit of an advert for Virgin there. But we think constantly about when we’re building the rent roll or we’re ferrying people in, we see it for their benefit. We said we’re going to put another management on or well think about referring somebody across because we’re just thinking about it in the context of what does it mean today. But in order for you to have this automation, you’ve got to think about every single one of those as being an opportunity for the future because that’s where you get these automatic lead gen coming from.
If you want to think about … Instead of thinking about it as the club, you could think about it as being the client bank. This is the bank account that, over time, you’re going to go in and take a withdrawal out of. What do we do for that? When we look at the client bank, when you’re taking somebody out of the bank, we know that, and we were talking earlier, Melinda, about getting a lead from property management and sometimes we have fights with the property managers. They are like, “I’m a landlord.” Taking them, don’t sell it I’m renting it.
It’s also a culture internally that we need to change which is around we’ve got these clients there and ultimately at some point in the next, depending on when they bought the property, it might be in the next one year or it could be seven years from now, they’re going to sell or maybe we’re going to help them leverage in to buy something else, so we’re going to throw another property back into the bank.
Ultimately, they’ll at some point be a vendor or a purchaser. Depending on which way they go with that, they’ll then move forward from then, “Okay, well I’ve become …” Let’s say they were a purchaser, they’ve purchased another investment property. Now, at that point, maybe down the train, they’ll become a vendor or a purchaser of that property. At least we could sit here and go on and on about all the different kind of ‘choose your own adventure’ elements in terms of creating the bigger property.
What I want to talk primarily to you about is that’s what I call a company client. That’s just going to happen. This is like when you sell a property and you sell it to an investor, to me it should be a tick on the sales advice that says, “Are they an investor? Or yes.” It’s like standing in the McDonald’s counter, “Do you want fries with your Big Mac?” “Well yes because I’m not going to walk across to KFC to buy a packet of fries.”
What I want to look to you that is how do I actually get more people in the client bank before they’ve transacted. This is the non-company clients. Here is where you guys win hands down across your property management business every day of the week because you simply come in contact with way more people who are potential investors or the likelihood that they are investors is just off the scale comparatively to the property management team, say for example in a leasing philosophy. You look at that inquiry piece. Think about now how many inquiries you get every day from all of the varying angles that you get them. You think about it from an online inquiry, from one of the real estate portals, from your own website, let alone somebody that goes to an open home, they email you directly, they call you, the list just goes on.
20:32 Utilising your data for more club members
My question to you is what are you doing with that data to get them into the club? Because even though in inquire on 25 Smith Street, I might be inquiring that as an owner occupier and I might tell you that I’m actually renting a property at the moment. But I don’t tell you that I own three other investment properties in your market place. You want those in your club, does that make sense? Taking those inquiries and saying, “Okay, either they purchased with me or they are a non-purchaser.” If they’re a non-purchaser, then they start getting thrown into the client bank. Now using your databases, your CRM, you can actually start to automate a lot of these process. It does take time because of course you’ve got to call people and look at how can I keep in contact with them, and I’m sure if you rang every single person that you got as an inquiry across the week, you might need another two people in your business. Depending on how you stats are and your data.
Every one of those people is an opportunity. I can tell you myself as an investor, as a home owner, I could count on one hand the number of times we get a call back about anything. We own investment properties in locations, my husband will inquire as a potential purchaser on another location, nada back. We actually, as far as that goes, I can understand why that 80% of people go their existing client base because it’s just … There’s not the relationship there. It’s data, relationship, result. They are really the three things, I believe as being the core basic success of a real estate professional business owner or agent irrelevant of where you are.
Now if I look at that in terms of the hundred that you might pop through, let’s say you refer over the course of two years, three years. Let’s say you refer in. Remember, this is not converting deals, this is just referring them into somewhere else. A lot of your businesses now might have a new business manager and property management or someone that’s taking care of the actual conversion strategy. Just looking at a hundred, if five of those sell in a year, that’s eighty thousand dollars’ worth of available commission. I don’t know about you, but if I walked past eighty thousand dollars in the street, I’d probably pick it up. How can we get that, how can we get that, how can you automate that process and make that easier for yourselves in which to do that?
As I mentioned to you, I’ve got some … Which I’ll just try and pop into here. Where you can even put your own data into that shows you how to … Make this a bit wider … This I’ve just populated with Ben’s information. How many dwellings, percentages, rental number of properties, average rent, etc, and I can even drill down here into what the available rental market income is, twenty million. I can work down into the sales income, and I can even show what the average value of a human is to the real estate industry as a headcount as they walk down the street. Now every time you speak to somebody, that human is worth twelve hundred dollars in the Municipality of Leichhardt.
24:10 Work the club
Then you need to work the club. It’s easy. I’m saying to you, let’s just get as many people into that funnel as we possibly can. You’re at an open for inspection, maybe you’re asking that or when you’re looking at your scripts and dialogues, maybe it’s a different script that you’re using just to develop some rapport with the client. Instead of saying as you’ve been doing scripts and dialogue I know with Claudio, but when you’re looking at it and you’re trying to find out how their week was, have they sold something, what their situation is, say, “Tell me about how your investment is performing for you at the moment? How are you feeling in terms of cash flow with the investment market?” Australians, they take that as a massive compliment if you’ve assumed that they own an investment property. They’re like, “Oh, you thought I owned one? That’s kind of cool.” As a result you start to … That’s a different rapport building, but you’ve just identified, can you get them in the club.
I want you then to look at who are your existing club members. Start to understand, now if we bring that back to what we have today, because you want some quick results as well I’m quite sure. That understanding your club, understanding the investors that your property management team are already working with and remembering that the property managers are different beasts to you, completely. I don’t use that ‘beasts’ word in the wrong way. They are very ownership based around their clients, they are very protective of their clients, you’ll hear them talk about things like, “That’s my landlord, you’re not taking my property, you’re not calling my client.” They say ‘my, my, my’ rather than the business, right?
Part of it is then also understanding how the property manager’s mindset works. They’re very detail orientated and you guys tend to be very big picture. It’s kind of like the hunter gatherer. You’re the hunters, they’re the gatherers. They’re down collecting the berries making sure we have got the right amount for dinner, you’re off out killing the wilder beast. That’s literally as crazy as that sounds, that’s the diversity of how your brains work. If I put you in their chair for a week, we’d probably lose the entire rent roll. If I put them in your chair for a week, we probably wouldn’t do a deal and we we’d be doing everything for free. It’s just based on how everybody’s minds work.
There are some sales style support services that you can give them. It’s about building rapport with them because law of reciprocation like I said earlier, you give something to them, you’re going to get more back from them. What is it that you could do for the property management team? Most property managers and they’ll kill me for saying this, but the reality is most of them don’t understand investing. One of the best received training sessions we actually do is walking in the shoes of the investor where we take people through the process of what it costs to save enough money to buy an investment property to start with and then what it costs to maintain it, because the average property manager doesn’t own an investment property themselves. Really helping them understand your market and doing it from the expert piece in your organisation, again you’ll get a win with them in terms of, hey, you’re trying to show them some support.
Additionally, they’re not ringing the bell for a “sales deal”. They’re ringing their own bell at their desk quietly on their own, perhaps the bell doesn’t even go out off out loud about the tenant that’s finally paid their release. Or that conditioner report issue that got solved. It’s about … That really, they are so pleased with themselves of that as they should be because it’s quite a difficult task. You’d never want to do it and I don’t blame you but the way that it would look is that if you actually took an interest in what they were doing as well, they’re going to take more of an interest in you. I suppose it’s like that husband and wife partner analogy, looking at it that way.
The second thing is that if you want to start offering them some stuff back into the clients themselves, most clients have not had an appraisal of their property since the day they bought it. They are looking at the newspaper, they’re looking online, they’re going to the various portals to try and get some understanding of what their property is worth. Imagine if you set up a process within your organisation whereby you simply touched base with the clients and doing what I call a desktop appraisal meaning that you don’t necessarily have to go out and see the property with the wonderment that is the net now, you can see all the photos, they are there. Most of the time you’ve got a floor plan, you can walk through. It’s just a courtesy call conversation, letting them know where their property is at and hey, you might even start chatting with them about their opportunity for equity if you’ve got referral partners in, and maybe you’re now selling them an investment property in your area, doing a sale, throwing somebody else into the club.
Market updates. Looking at that data and I know you’re working around your data communication as part of this program. But really making sure that there is strong specific micro market communication going just to the landlords. I know businesses that do this terribly, there is five or six communication pieces that are pretty much the same thing, going to the same data because they’re operating those data across multiple channels in their office. You might have your own little database, sales team has got a database, the whole company has got a database, probably management has got their database and then there is your perspective client database or property management and the poor client gets the same newsletter five times, six times and I’ve seen that happen. Of course, that’s just dire consequences for any club there.
Ideally, what you do is you’d take that particular piece of communication, you’d merge it into one. It may be an amalgamation of the data that’s going out to the general database that particular month and then perhaps it’s with an investor overlay, but it’s in the same mail piece. The challenge that we’ve got now with data and mail communication, is we are getting flooded with it. Over a weekend, there’s nothing for me in twenty four hours to get a hundred and fifty communication pieces. I sit there with my phone and I do this. I love the edit button. Edit, delete, delete. I don’t even open it, because there’s too much. It has to be really great value add.
Everybody is calling their market piece to their landlords, the newsletter, I despise that term. They’ll call it, “My market update.” What if I’m getting a market update from five other people? It’s also about differentiating yourself even to your own landlord base which is where I suggest that you’re getting quite personal. Personalized marketing is going to be or personalised communication is going to be a very big part of where we move to I think in the marketing piece, and you want to position yourselves as being the experts for those clients, and even being the expert for them in terms of what is going to work best for them, getting really micro on it if possible. Challenging, I know.
Providing them with the opportunities to buy. In many cases, you’ll have investment-style properties that are available right now. Perhaps doing a specific e-blast to clients that you’ve identified as having equity available for them and then tethering that mail piece that actually talks all about the investment benefits as opposed to just the normal blurb and you’re just ripping it out of your existing mail database and just sending it out as it is.
Talking about why that particular property would be great for an investment as opposed or the investment features as opposed to just here is a property. Of course, working the club is not just about landlords, it’s about tenants. Right now in my marketplace, I’m not only a home owner, I’m also a tenant literally with a hundred meters of each other. I can tell you as a tenant, I had the most diabolical experience known to mankind. I had not one return phone call, I had not one response to email. The process being is that the opportunity is there but we’ve got to recognize where it’s coming from and understand the numbers so that you’re accurately communicating with the right place to generate these leads and get them automated.
The law of reciprocation we’ve talked about that a lot. I’ve talked about being interested in the team. Property management is going to love your clients. They’re not going to give them the exact same services you do. We’re going to put that out on the table right now and I’ll tell you why. Because they’ve got two hundred of them. They’ve got two hundred of them that they are servicing every day. When you look at how many listings you’ve got right now comparatively to how many clients they are going to have to deal with today who have actual challenges today, they’re vastly different. Just from a supply demand of time perspective, we’re thrown out there. Be aware that there will be a slight shift. You need to support them through that. Improve your knowledge in the investment market. Improve your knowledge around what it is to own an investment property, what you need to be aware of, legislation.
I don’t expect you to become a property manager by any stretch of the imagination, but from a lead gen point of view, understanding that investor market is going to also give you some additional dialogue that you can have with all of your inquiries that are coming through around investing. Things like smoke alarm legislation, pool legislation is going to be a big one if you’re in Queensland. Looking at the whole risk safety, blind cords safety, depreciation, really understanding how all of that works just allows you to then just take yourself up a notch in terms of the investor’s eyes. Being able to have more meaningful conversations, and then additionally meaning that the property managers feel like you’re more part of their team than what you’re probably sitting at right now.
Then creating some joint initiatives with the property management teams. What are things that you’re sitting down with them having an idea session around, ‘look, how can we help you generate more leads, how can you help us generate more leads? How can we grow this business together?’ Having some joint initiatives across the business for the entire organisation that everybody knows about. Most businesses, which I kind of laugh, the property management team have no idea what the goals of the sales team are for that year and the sales team have no idea what the goals of the property management team are, and there’s no joint initiative to make that happen when we’re all out talking to that same human worth twelve hundred and sixty seven dollars walking down the street everyday.
35:10 Conclusion of Lead Gen Through PM
Hopefully, you’ve gained some ideas here around lead gen through the PM. I could literally work with you on these all day. We could get into the nitty-gritties of your business. It’s about understanding the business as a whole and when you’re seeing that human walking down the street see that nice little price tag associated with them so that we can get them in your club.
I hope that’s helped and I wish you all the very best in building your club. I like automated funnels. Seven years from now if you’ve topped in fifty properties a year it’s one person finding one investor that you can get to join your team each week, out of the number of people that you deal with, seven years from now, that’s three hundred and fifty people in your club, properties in your club. A few of them are going to divorce, so you’ll get a couple of extras. Some of them are going to sell along the way. But remember every single one of those people that you throw across is a potential twenty grand sale with 5% of them converting every year. Good luck with that.
If you have questions for the coaches or for the Super Six tweet us @eliteagentmag #transform