Friday, October 18, 2013

Three Simple Strategies to Earn Higher Income

Who’s afraid of the big, bad sphere of influence?  Most Realtors.

1.        It is the source that generates the most business for the average Realtor.
2.       Many Realtors procrastinate in making calls to their sphere.
3.       Ironically, their sphere wants to hear from them and would prefer to do business with them.
4.       Three strategies to making the calls:  1) understanding reality, 2) eat the elephant one bite at a time (doing a little each day makes the task easy), and 3) get an accountability partner or coach.

Every year in late fall I meet with agents to talk about their business plan for the next year.  As part of that plan I ask them to source all of their transactions from the current year.  Unless the agent’s main focus is prospecting FSBO’s and expireds, what I find is that the typical agent has most of their transactions being sphere-related transactions:  cousins, brother, friend of my sister, neighbor, mother’s co-worker, etc.  When we add them all up we find that the agent’s sphere of influence contributed to more than half of the average agent’s income.

We realize together that if the agent regularly communicated with his sphere of influence throughout the year, if the agent maintained top-of-mind awareness in his sphere, then his income would likely go up.  We work out a communication plan.  The agent leaves my office excited about the potential to earn more money.  And then what do you think happens?

The agent begins to think that by calling his sphere, that well, he is begging for money.  A link is established between calling his sphere and the money he will get.  Now it feels sleazy and dirty.  He rationalizes that his friends know that he is in the real estate business; his friends will call if they need help.  He thinks, “I don’t want to bother them.”  Ultimately the agent only makes a handful of calls rather than reaching out to everybody he knows.  He chooses the easy calls:  the most recent sales, his mother or siblings, maybe a friend, and then he stops calling.  The income potential has been shrunk because of classic, rationalized procrastination and fear.

Strategy 1
Truth be told, your sphere of influence WANTS to hear from you.  They like you, and enjoy having conversations with you.  You are one of their favorite people.  Not only are they interested in you, but they are also interested in real estate.  They are curious about the market and how it might affect them.  It is this reality that an agent needs understand before they start making calls.  It changes the motivation for the calls.  Instead of being about making money, the calls should be about touching the people who are important to you and possibly helping them.  If, mentally, an agent changes the nature of the call from being one of “generating business” to one where the agent is sincerely interested in the life of the individual they are calling (family, occupation, recreation, dreams), then each call takes on significantly more meaning, and each call becomes easier to make.

Strategy 2
You don’t need to call everybody on your sphere list in the same week or month, you just need to call some of them each week.  Divide your list into 50 weekly allocations.  Maybe that turns into six calls per week, or maybe ten.  Whatever the number it is very manageable – anyone can do it.

But you won’t do it. 

You won’t.  I know it.  You know it.  You will start off with great resolve.  You may be convinced, but you won’t do it.  Life happens, and somewhere along the way, you get off track and fall behind.  When you fall behind, you get discouraged, and quit.  Does that sound familiar?  It does to me.

Strategy 3
An essential part of the formula for success is working with an accountability partner or coach.  When you have to report to someone else besides yourself, you take the tasks in front of you much more seriously.  Your commitment level rises tremendously when you have to explain to someone else the “reasons” why you didn’t complete such a simple task as calling six people you know and talking to them.  Sometimes accountability can come from another agent, perhaps from another office, or from a different part of the country.  Sometimes an agent’s sales director or manager fits the role well.  Sometimes an agent realizes the importance of their personal goals and recognizes the value of hiring a coach.  Would you pay $6,000 to $12,000 over the next year to double your income?  Find a solution that works for you and make the commitment.  It is that important.

Understand that your sphere wants to hear from you.  Make the task manageable by dividing it into smaller chunks.  Find someone to keep you accountable to your commitment.  Act on these three strategies and you will soon be helping the people you care about achieve their dreams, and you will be profitable.