Resetting for a New Year

Before you can take your business to the next level you have to know exactly where you are now and what needs to happen next. You gain this knowledge by tracking your numbers and then using them to project on the future. But you have to start where you are and learn about your current marketplace before you can visualize where you want to go and whether your expectations are reasonable.

There are three basic metrics for you to focus on:

• Average sale price
• Normal cap volume
• Fee percentage

Your current average sale price determines what your next step up should be. If your average sale now is $600,000 then your goal should be to sell at an average of $900,000 – representing a 50% increase in your fee. Knowing this number will help you determine how to reach it.

Volume is the measure of your yearly growth. If you are completing 20 transactions a year, then you should set a goal for 30. Beyond that you will need an assistant and a fresh plan to help you reach 60 transactions. From there you add another assistant to reach 90 a year. However, in order to continue your growth your marketplace has to be capable of providing enough properties for you to sell – and remember you have competition. So if your marketplace is not big enough to allow you to grow, then you have to expand into other markets that will.

Next, you want to be able to increase your fee, and that depends on how you are performing in the first two metrics. This is why you have to know and understand your numbers at all times. These numbers are interconnected, so what you do with one will affect all three as growth – or stagnation.

To realize growth you must know your marketplace well enough to project for the future. Tracking your numbers over time, and understanding what they mean, will give you a valuable intuition for trends and opportunities inside of your marketplace. That intuition is vital for you to be able to plan realistically for success in your upcoming year.

In viewing your marketplace trends, you will see that there is actually a primary and secondary marketplace. The primary marketplace is your foundation for stability as it is based upon your average sale price and should represent the bulk of your transactions. Then you have a secondary marketplace, which is less predictable, but offers the opportunity for commanding higher prices. The secondary marketplace is too volatile to build your business on, but doing some of your transactions there can help you step up to higher operating levels over time.

Negotiating your best possible fees requires critical knowledge of your marketplace and your numbers, and a real understanding of what exactly you are able to work with. You have to know how your competition is charging, and whether matching their fee percentage is truly helpful. Generally you should maintain your higher fee percentage by making sure your performance offers the greater value and can be proven to your clients statistically. Here is another place where knowing your numbers and being able to use them is vital.

Right now is a good time for you to review your numbers from 2014 and understand what happened in your business and in your marketplace over the past year. Use those numbers and that understanding to project on what you want to see happen in 2015, and determine what you can do to boost your growth this year.

And while you are planning your year, make sure you look into our Josh Phegan Membership, training events and coaching opportunities.

I hope you’ve enjoyed today’s Coaching Tip, and I look forward to seeing you here again next week.

What Would It Be Like To Be Your Customer?

Today let’s get a new perspective on the way you do business by thinking about what it’s like to be your customer. You already know how you go about your daily routine and what that’s like for you. How does your average client experience your brand?

Your marketing approach represents you, and determines how your customers perceive your brand. This is usually the first impression a new customer will have of you. Will you be connecting with your clients in a personal, emotional way? Or will your message be just another advertising mailer in their letterbox? Make sure you are delivering dynamic, quality marketing that lets you stand out from your competition.

One of the ways you make and keep connections within your marketplace is to be consistent with your communications. Establish a schedule of regular messaging and follow through without fail. This can be email or print, text or video, but it has to be personalized and it has to be delivered consistently. You must also be available for questions, consultations and appraisals. And make sure your marketing reflects the kind of business you want to build as if you were already at that level.

Some examples of effective marketing campaigns include a monthly video sent to potential sellers, market appraisals and past clients. Tactical mailers sent out at pivotal times of the year can help you establish relationships, too. Timing your communications for events like Easter, the financial year end, Christmas and the beginning of the school year puts you in position for the times people tend to make changes in their lives that involve turning over properties. Once you establish your marketing strategy and determine what works, you can simply update your messages each year instead of creating a whole new campaign.

As you develop your marketing approach it is helpful to have a particular customer in mind that you want to connect with. We call this idealized customer an avatar, and we use this avatar to build targeted marketing that communicates effectively. Imagine where this person lives, what level of income they make, what kind of car they drive, whether they have kids and if so, where do they go to school and what are their ages? Most importantly, what do they want to achieve with a sale or purchase of property? What might be holding them back? Using an avatar this way makes your marketing approach far more relevant and personal to the people in your marketplace.

The main thing you want to avoid is doing the same things in the same ways that the rest of the industry is doing. Avoid using the same tools and tactics as your competitors. You want to set yourself apart and above the rest. Think beyond what you see other agencies doing and find new ways to connect with customers. Create different kinds of promotions. Work more with video and mobile technologies. Be the first to meet and welcome new businesses to the area and establish relationships with them. And the greatest skill you can develop is to be able to design your marketing from the customer’s point of view.

Of course, your foundation for success is still maintained by making those phone calls, meeting appointments every day, and keeping relationships fresh with past clients and other people you already know. Dynamic marketing and consistency in doing business is the way you grow.

I hope you’ve enjoyed today’s Coaching Tip, and I look forward to seeing you here again next week.

Using All You’ve Got

Many agents feel that the people they know in their personal life should not be integrated into their business life. If you also think that is true then it’s time for a different perspective, because everybody you know needs to be in your database.

If you think about it, all of the people you know through patronising their businesses – hairdressers, butchers, tailors – have your name and information in their databases. Why aren’t they in yours? Imagine how many more networked connections you would have if all the people you know were in your database and receiving your marketing messages. How many people might they refer to your brand as a result of one of your mailings? And they would refer to you because they know you personally.

Another point to ponder is, if your marketing looks, sounds and feels like marketing, then your approach lacks authenticity. If you don’t feel right about sharing your real estate news with the people in your personal life, then your delivery is not personalised enough and it needs to change. Your business must be built on a foundation of solid relationships. If you aren’t connecting on a personal, emotional level then you are not delivering real value to your clients.

To build a great business you must have a great database. Every person you know needs to be in it, and they need to be properly entered into the nine categories we work with. Each of those people will match a category – or several. Wherever they fit, as buyers, potential sellers, landlords, past clients, past market appraisals, potential sellers, or key referrers, they all deserve to benefit from the valuable information your targeted marketing program delivers. And don’t forget to include all of the local businesses in your marketplace.

If you have not set up those basic nine categories in your database and categorized all of your clients into them, then it is crucial that you do so. You must be able to deliver relevant information to the right people and measure your progress by evaluating your numbers regularly. One of your vital measurements is how much your database grows every month, because if it’s not growing then your business isn’t growing.

Starting now, consider 2015 to be your year of intention. Focus on building a dynamic database, knowing your numbers, marketing effectively, building relationships and setting goals for growth.

I hope you’ve enjoyed today’s Coaching Tip, and I look forward to seeing you here again next week.

Strategies for 2015

It’s the beginning of a new year and that means it’s time to set your strategic direction for building your business over the next 12 months. Knowing what is really important from the start will help you stay on track with whatever happens in 2015.

A great place to start planning is with the Big Three Concept. Identify your top 3 business priorities for the year and outline your strategy for accomplishing those goals. It’s easy to think of simple things like growing and managing your sales team for greater productivity, but you really should be setting your expectations higher. You could consider buying out some of your competitors, or focusing more on property management as a source of renewable income. So let’s talk about some of the ways that other successful principals are preparing for the year ahead.

Begin by knowing your marketing trends and project on what kind of growth is possible. What are you doing to grow your primary and secondary markets? Think about prospecting in your core areas more at an agency level and assigning fewer farm areas to individual agents. Then build your marketing calendar for consistency throughout the year.

That level of consistent marketing is based on momentum generated by always having a reason for clients to go to market quickly. You can promote action through marketing themes that speak to the personal dreams and desires of your clients. Also be prepared to address their objections by redirecting them back to what they have told you they are looking for.

Review your approach to performance management and make sure you are investing time and providing guidance for your sales team. Spend some time with each of them regularly to help them increase their numbers, increase their fees, improve profit margins and take their next steps towards growth. Always be recruiting for new agents, but also cultivate solid relationships with your current agents so they will stay on and contribute their expertise to your agency.

Look at your annual targets, understand what you need to be doing at a strategic level, and decide where to focus your energy this year to continue to drive growth and maintain momentum.

I hope you’ve enjoyed this month’s Growth, Leadership and Management Tip, and I look forward to seeing you here again next month.

Getting Ready For 2015

It’s 2015, the beginning of a new year. Time to get focused on the things you can do now to make the rest of the year productive. And one of the best ways you can start your year is to plan for all of your holidays. Odd as that may sound, the truth is that you will be more energetic and focused on the work that matters if you always have something to look forward to.

You will also realize more success if you set goals every 4 to 6 weeks. This is especially important in January and February to build drive and momentum going forward, and to get you out of holiday mode and into the rhythm of prospecting, callbacks, and building customer relationships.

Start thinking now about the kind of growth you want to achieve this year, and how you are going to measure and track on that growth. Know your numbers of calls, connections and appointments, as well as listings, sales and your targeted income. Knowing how to measure your progress will change the way you work every day. It will also cut back on the distractions that can take you off course.

Another action you should consider is training. You can always learn new skills and techniques for increasing your effectiveness in prospecting, listing presentations, and staying ahead of your competition by better satisfying the selfish desires of your customers. This is also the time to review your marketing strategies and update that for your current marketplace.

Most important is to get your focus firmly in your business now. Book as many appointments as possible and get back into that flow. And don’t forget to eat right, exercise, and sleep. Get back on your schedule and moving forward again.

With all that said, you can see what an opportunity our Josh Phegan Membership is for you to learn the best ways to accomplish all of these actions and set the right goals for 2015. We would love for you to contact us for information about coaching and other resources we offer, but remember our events sell out quickly so let us hear from you soon.

I hope you’ve enjoyed today’s Coaching Tip, and I look forward to seeing you here again next week.

Getting Over Fear, Doubt, Uncertainty and Financial Pressure

In your daily business you will encounter many distractions that threaten to put you off track. The worst of these are based in fear, doubt, uncertainty and financial pressure. The good news is, all of that is completely under your control.

Taking control of distractions does not mean you will never face them, but that you will be able to deal with them. For example, you may be under stress right now with bills coming in from your holiday spending, but if you start planning now you won’t have to worry about this again next year.

Staying in control of the things that worry you begins with identifying your needs and making sure they are taken care of before they become problems. This gives you confidence and allows you to perform at your best, in your business and your personal life.

In the case of finances, this means having reserve funds to cover your lifestyle needs as well as emergencies. For your business it means you can afford to conduct daily business and also fund progressive marketing to expand your brand.

You want to maintain levels of financial security that include:

• Safety level – enough funds to feel financially secure
• Comfort level – money for entertainment and other reasonable luxuries
• Entrepreneurial level – funding for promotional projects and growing your business

Real estate is a business built on self-confidence, and nothing gives you more confidence than being financially secure. It allows you to build your best possible business, and also to become the best person you can be.

With a solid financial foundation you can then work on other sources of fear, doubt and uncertainty that raise barriers to your success. Start by making a list of goals for 2015, including professional goals, improving relationships, handling emotional issues, and arranging for travel and adventure you might enjoy.

One way to maintain your self-confidence is to keep a list of your personal achievements and read through it whenever you are feeling less capable. Reviewing your list of accomplishments is also a great way to begin your new year. Keep this list on your mobile phone so that it’s easy to add new achievements, and refer to the list when you need a boost. This will also help you visualize what you want to accomplish in the coming year.

Setting goals and having a plan for your year is vital because when you have clear goals there are ultimately no distractions that can keep you from achieving them. It also helps to realize how many distractions you have. Challenge yourself to try a low-information diet. For 30 days disconnect from social media, television, news feeds, and other things that exist outside of your life and your business. Instead spend that time with friends and family, exercise and eat well, and reconnect with people and activities that apply to the core of your life. You will be amazed how those external distractions create a sense of fear, doubt, and uncertainty – and they really don’t apply to you at all except for the fact that they diminish your performance and keep you from focusing on the work that really matters.

The most important thing you can do right now is to get your intentions right. Have a plan and set goals for the year ahead. Establish a sense of direction and control that will allow you to move forward with confidence, clarity and drive.

And while you are planning your year, make sure you look into our Josh Phegan Company membership, training events and coaching opportunities.

I hope you’ve enjoyed today’s Coaching Tip, and I look forward to seeing you here again next week.

Geography vs Relationship based prospecting

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If your approach to prospecting is not yielding the results you require then you may need to expand your focus.

There are two kinds of prospecting in real estate. Geographic-based prospecting is also known as prospecting farm areas. You basically draw a circle on a map and market to all the residents within that zone. The concept of dividing a large marketplace into farm areas and assigning those areas to individual agents is attractive, but in reality it may not be the most effective approach.

In relationship-based prospecting you focus on leveraging customer relationships. You may have a thousand people in your farm area, but no listings. That might be because you lack market share: Your farm area is too small to yield enough turnover for the income you need. It is likely you need to grow your market into a larger area, and you will best accomplish this through maintaining and building upon great client relationships.

Which of your team members would be best to convert your existing relationships in play? Should you send out a new rep to build new relationships, or a seasoned agent who already has some established relationships in the area? That answer may depend on the quality of existing client relationships and whether they have been properly maintained. For example, if you are still marketing to your past clients as though they are new clients, then you are not being relevant, frequent and consistent in your relationship with them.

Another question might be how large your farm area should be. Size could be important, but the actual turnover rate of properties in the area, plus your market share percentage, is what truly determines your possible number of listings and level of income for that area.

Traditionally the best farm areas are assigned to existing agents who are already established in those areas. That’s fine, but then new reps are assigned to new areas and expected to build market share there before they really know how to accomplish that. A more progressive approach involves the entire business working a core market area whilst individual agents work to develop secondary markets outside of that core. Then we measure growth to make sure agents are maintaining market share in their given areas.

The strategy most successful real estate agents use is to prospect both geographically and through relationships. They also work in several farm areas instead of concentrating on just one. Every person they meet goes into the database where they are placed into all categories that apply. This way automated target marketing by categories is relevant to each individual inside those categories.

Whether you focus on geographic or relationship based prospecting, it is vital that you have a system and follow it. You need a consistent marketing program that will reach your target markets with information that is meaningful to them. You must also build and expand your social proof, primarily with large numbers of your brand’s For Sale signs being visible throughout your marketplace, preferably with SOLD stickers on them. Build a strategy for getting more listings more often and follow it consistently, and you will see growth inside of your business.

I hope you’ve enjoyed today’s Coaching Tip, and I look forward to seeing you here again next week.

What To Do If You’re Starting Out

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If you’re just starting out, welcome to real estate. If you’ve been here awhile, try to remember how you felt when you were new to the business so you can lend a hand. Following are a few core ideas and insights to help you get going in the right direction, or lend direction to someone new.

Consider this question: Where do your customers hang out before they need you? Knowing this will prepare you for staying ahead of the game when they appear at your open for inspections and contact you about properties posted online. Work your warm relationships because they are your best referrals as well as loyal customers. Call the people who have been through your open homes during the year and ask them if they found a property or are still looking. Most agents never follow up with past contacts, but those people are a vast untapped market waiting to hear from you.

You can’t keep your database current if you don’t know which buyers are now sellers, which residents are now landlords, and who might be on the edge of selling and moving. You can’t effectively target your markets if your targets have moved into new categories. You may have thousands of contacts, but if they aren’t organized and categorized and, thus, useful, then that information is just a fat load of useless data, not a fit and responsive resource.

When you are starting out think in terms of building and maintaining momentum. Pick an agent who is doing business the way you want to and shadow them, preferably someone inside of your brand. You need to establish your own social proof as soon as possible and start building on it. Get to five open for inspections on a Saturday as quickly as you can and work up from there. This is where you will meet the most buyers, and can begin to build your database and client relationships. Start thinking about the types of marketing you can use to connect with these clients and categories.

You can also build your new client base by contacting past clients that were originally serviced by agents who have since left your brand. Again, past clients are some of your best prospects and it is highly likely that they have not been called back by anyone since the last transaction was finished. This is where you can start your first call lists.

Before you harvest that data, though, get some expertise around the art of prospecting and conducting successful phone calls. Asking the right questions and getting past customer blocking techniques are vital skills for booking appointments and beginning new relationships.

Everything you do in your business depends on prospecting and effective communication. You need to follow a proven system so that you know what to do and when to do it. Your first hour every day is for prospecting. Afternoons are for meeting appointments. Listing presentations require a system and understanding of client communication as well. In all your interactions your goal is to move the customer forward, whether that is to book an appointment or list their property.

Finally, the glue that holds all of this together is consistency. Follow your systems and do it daily. Set up schedules and follow them. Have a plan and stick to it. Make those calls and book those appointments every single day. Be consistent and your business will grow and prosper.

I hope you’ve enjoyed today’s Coaching Tip, and I look forward to seeing you here again next week.

Culture

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Every business has its own culture, including yours. This culture is shaped by the people who work for you, but you ultimately define whether your business runs on positive or negative energy. First you need to determine what your current business culture is like.

Notice how people enter the office in the morning. Are they coming to work early, energised, and on task the moment they walk in? Or are they arriving late and starting their day in a leisurely manner? Are they following a plan, or are they looking around for something to do? You want your people to be engaged and active, but if they are not your first task is to instill clarity around what you are all there to create.

Your people truly want to do well in your business, and they count on you to communicate the core purpose they are to strive for. Clearly communicating your purpose as a company is necessary for your people to know how the business will be built, what you want to be known for, how you connect with your community, and what you are all creating together.

You should understand that making money cannot be your primary purpose for building your business, or your business will fail. There has to be a more fulfilling context and outcome than financial profit, and that fulfilment has to be personal for everyone involved. The best managers are those who understand that their people need to be challenged and then given the tools and resources to succeed. People do best when someone believes in them and encourages them to grow beyond what they think they can do. A great leader is actively involved in knowing and supporting their people’s goals and what they personally want to achieve to feel fulfilled as individuals.

Of course, you are in the real estate business so your revenue target, numbers of listings, numbers of sales, income produced, and property management department growth are all crucial. But providing real meaning in your people’s lives is even more important to making your business thrive.

One small but effective incentive is to establish a rewards system. Have and promote a series of rewards for different levels of performance and achievement at regular intervals throughout the year. These could range from a certificate of recognition, to a free lunch, to a gift card. And make sure you are directly involved with handing out that reward. Spend a moment acknowledging the recipient and interacting with them on a personal level.

One of your greatest challenges will be the consideration of when to bring in fresh talent – and when to let someone else go. New blood can substantially energise and revitalise your culture. At the same time, you know there are people on your staff that you honestly would not hire today if you were starting over again, and the difficult decision to move them out may be a best decision for your business. When your vision is greater than that of your people, then you need new people who can be inspired by what you want to create. You need positive energy in your environment and that begins with you.

Positive culture starts with positive communication. There are different ways to communicate every concept you want to clarify for your team, and you will have more success when you keep your messages bright and avoid negative language. For example, you may want to help your people avoid burnout, but the term “burnout” is negative. A better approach might be to discuss how to maintain great energy. If you use the negative term you will put people in a negative place, whereas speaking of great energy generates positive energy.

End of year is an opportune time to start putting some of these tactics into play as there are many distractions and sales teams can easily lose focus. Have a sales competition and let that outcome determine whether your Christmas party will be held at McDonalds or in Las Vegas. With short-term rewards like that you can see how energised your team can become.

It’s up to you to provide incentives, clarify goals and expectations, and reward outstanding results. This is how you build the positive, inspired culture you want operating inside of your business.

I hope you’ve enjoyed this month’s Growth, Leadership and Management Tip, and I look forward to seeing you here again next month.

Leverage All You’ve Got – People You Know

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You probably know a lot of people in your life, but how many of those people are in your agency database? All of them should be. In fact, everyone you meet in your business or personal life should be added into your database because every one of them is a potential referral for you. Every relationship can be leveraged forward.

Think of all the people you know on social media sites like Facebook. Each of those people has an email address that you can add to your email database to receive your targeted messages. Now, you may say it feels awkward to market to people you know as friends and family, and you are afraid of how they may react to you approaching them that way. But these are some of the best people to work with because they already know other people in your marketplace, and they are already backing and supporting you personally.

Think of it this way: You can spend most of your time working with people you already know and have a good relationship with, or you can spend most of your time working cold. It is your key referrers who have sent you most of your business, and those are people you have established relationships with.

A lot of agents feel there is a difference between their personal life and business life, but the reality of your business is that you need to leverage that crossover in order to build even more new relationships and be more visible and active in your community. Be part of local events whilst delivering information about new listings, and be available to offer your knowledge and advice to those people. Rather than seeing you as a salesman they will come to trust you as an advisor as well as an active community member. Then those people who might otherwise do a Google search for possibly inaccurate information will be more likely to come to you for information they can believe in.

You know by now that to have a great business you must have a great database. And to have a great database you need to always be adding in the people you meet and the people you know. Then, you maintain that list of great people by providing them with exceptional, current and relevant customer service.

You also need to maintain quality information on the people in your database, which means getting good information at the start. You may meet hundreds of new people during a weekend of open for inspections, but if you rush through your callbacks the next week you will fail to qualify whether those people live locally, are potential buyers or sellers, are property managers, or may have specific questions. Your challenge is not to rush, but to ask better questions in order to keep the calls short and productive. Any call that runs over two and a half minutes is too long, but if you conduct the call properly you can find out your client’s current situation, agree on what their next steps should be, and schedule a face to face appointment.

Asking the right questions helps you utilise your time well. Your best question for yourself today is whether you are leveraging all your relationships to build your best database and stay current and relevant to your marketplace.

I hope you’ve enjoyed today’s Coaching Tip, and I look forward to seeing you here again next week.