5 Reasons Why You Must Build a Pipeline of Listing Nurtures
One of the toughest things about growing a real estate business is the lack of consistency.
There are months where you have multiple listing appointments and sales and then there are months where you couldn’t buy an appointment or a sale.
It can be maddening.
Sure, at the end of the year, things may come out alright, but who wants to live their life riding on the real estate roller coaster?
Likely not you.
Need more listings next year?
Now, there is a solution available to anyone who wants to put in the time and effort.
For some reason, though, most agents don’t take advantage of it, which is surprising because it’s nt that hard to implement and it yields great results.
It’s not magic and it’s certainly not a secret.
In fact, it’s nothing more than a pipeline of listing nurtures.
But…if you’re willing to shift your mindset – and your prospecting habits even a little bit – you can put yourself in position to enjoy consistent, reliable (and dare I say predictable) listing business on a year over year basis for the rest of your real estate career by building this pipeline.
And you can do it for a lot less money and in a much shorter time frame than by not doing it.
Here’s why you should build one starting immediately.
5 Reasons You MUST Build a Pipeline of Listing Nurtures
Success in getting listing business is available to anyone who does what it takes.
Here’s why you should do what it takes and build a pipeline of listing nurtures to have incredible success.
1) Consistency and predictability: Believe it or not, you can have consistency in a commission-only sales career.
We’ve done some extensive research on how to do this, especially as it pertains to building a pipeline of seller nurtures to make it happen.
A nurture is a seller prospect who meets the following criteria:
- Looking to sell in the next year (or maybe two)
- Open to working with you as an agent
- Not committed to another agent
- Has good contact info, i.e., phone, email, address, etc.
- Has a clear time frame as to when you can make contact again
To nurture a seller lead, you must continue to stay in touch consistently with the nurture prospect via calls, texts, voicemails and emails from the time you first make contact until the time they person is ready to sell.
It takes consistent effort on your part, but it can really pay off.
Essentially, regular follow up is the name of the game.
Here’s how we know:
Within the model we created, we know that 1 in 12 nurtures – roughly 8% – will sell within the 12 months following you making first contact and identifying them as a nurture.
By building your pipeline of seller nurtures to a pool of 600 sellers, you can predictably generate at least 4 listings per month for your business.
These are real numbers that we tested and confirmed through our own efforts in a year of prospecting and working with sellers.
If you’re a slave to what we call “NOW” business, this should be exciting for you because you can have the best of both worlds.
You see, as you’re doing your prospecting and talking to expireds, withdrawns, FSBOs, circle prospecting leads, home value leads and even your sphere and past clients, you’ll run across a number of prospects who are ready, willing and able to put their home on the market within 30 to 60 days of making contact with them.
You can look at it as your reward for establishing and fostering relationships with seller prospects through a solid nurturing campaign.
The great news here is that as you build your seller nurture pipeline, you’ll have the data you need to make any adjustments in frequency of contact, number of seller nurtures needed or any other criteria to get even more consistent results and sell more homes.
2) Business is easier with nurtures: If you’re like most agents, you would much rather do business with someone who knows you – friend, family member, referral, etc.
People want to do business with those that they know, like and trust; it’s a given.
When you build a pipeline of seller nurtures, you’re creating a steady stream of prospects who you will get to know better and better on a continual basis.
Each and every contact you have with your nurtures, whether spoken or written, strengthens the relationship as it makes them more familiar with you, what you do and how you can help them.
Once you’ve been in contact with a seller prospect several times, found out about who they are, their family, dreams, goals and desires, it makes the job of converting them from a prospect to a client that much easier.
What’s even better is that as you get to know them and vice versa, it’s very likely that they’ll call you and tell you they’re ready to list their home for sale.
You could argue that a good nurture is probably better than a referral because you already know everything about the person you’re going to meet and they are already sold on having you come over and sell their home.
There’s nothing better than having a seller call and say “I’m ready to have you come over and list my home.”
Having a pipeline of seller nurtures makes it possible for this to happen regularly
3) The amount of now business is minimal at best: You may have seen this before, but it bears repeating: only 3% of the universe of leads that you are prospecting are ready to make a move in less than 90 days.
20% of that group of prospects are at least 90 days out and 60% are as much as a year away from pulling the trigger on buying a home.
Knowing this, it makes sense that you’ll need to foster some medium- and long-term relationships with seller prospects in your area.
To make things even more challenging, it’s Freddie Mac expects that existing home sales in the United States are only going to increase 1.9% in 2018.
That’s almost a 58% reduction in existing home sales compared to the 4.5% year-over-year growth we experience between 2014 and 2016.
In order to capture your unfair share of the homes that do sell, you’re going to need build solid relationships with seller prospects so that when they do sell, you’re the agent they choose to help them with the sale.
And, with the pace that homes are “flying off the shelf”, it’s going to be hard to be in the right time at the right place to snap up some listing business if you’re not ahead of the curve, nurturing opportunities before they hit the ground.
4) Nurtures convert at a higher level than other seller leads: A few years back, Baylor University did an exhaustive calling study to see what results cold calling yielded over an extended period of time.
The results of their efforts were pretty astonishing (and scary):
- It took 209 calls to get a qualified appointment
- Those 209 calls resulted in a 28% contact rate (roughly 57 contacts)
- That’s a 1.7% close ratio for an appointment
- It took almost 120 contacts to get a sale
- That’s less than a 1% close ratio for a sale
If you look at the graphic I shared earlier, you’ll see that 1 in 12 or 8% of nurtures result in a sale.
That’s a 99.9% increase in your conversion rate for nurtures vs. straight-up cold calling.
A huge difference.
Now, are these nurtures going to fall into your lap? Absolutely not.
Will you have to talk to some people you don’t know to get that pipeline of nurtures built? Absolutely.
Remember, I said you have to do what it takes to have success in building a predictable pipeline of seller nurtures.
But if you do what it takes, it’s all worth it.
Other seller leads convert at somewhere between 2 to 3% at the point of contact on average.
Nurtures give you a huge opportunity to increase your conversion ratios immensely.
5) You’ll be able to sell your business one day: You got into real estate to make more money, have your time to yourself and even become the CEO of your own business…being able to work when you want and not work when you don’t.
If you’re going to do all of that, wouldn’t it make sense to have a clear exit strategy that gives you the option to sell your business if you want?
Many agents who do even a decent amount of business will never be able to sell their real estate businesses because they’re built on hunting and killing now business every day.
Even agents who sell 200 and 300 homes can have trouble finding a buyer for their enterprise because there’s no consistent real estate marketing and lead generation strategy that leads to a verifiable number of deals on a year-over-year basis.
This does not need to be your fate.
You know that 1 out of 12 nurtures you generate will sell their home.
Once you know that, you can build a business that will be able to demonstrate its ability to not only deliver consistent sales, but also forecast what sales will be year after year.
When you can do that, your company is a saleable entity from which you’ll be able to profit tremendously.
Building a pipeline of nurtures takes some time, but it will yield consistent results sooner and over a longer period of time than hunting down now business on a day-to-day basis.
The important thing to remember is that you need to call leads as soon as you can after they come in, establish timing and motivation, foster a relationship and then follow up consistently.
All easy things to do.
Once you do that, you will create a business that can provide consistent, reliable listings that you can turn into sales.
It’s one of the most important things you can do to build success and longevity in your real estate enterprise.