Why Agents Waste 97% of Their Leads
The single biggest mistake made by agents who are trying to grow their business is focusing solely on lead generation. You could have the lowest cost per lead and the most leads out of your entire market, but IF YOU CANNOT CLOSE THEM…IT MEANS NOTHING!
Agents waste up to 97% of their leads due to lack of understanding how to maximize and optimize everything they are doing. To not waste leads, you need to go through 2 steps. First step is understanding truly how marketing campaigns work. Second step is understanding how to close more deals from what your marketing campaign yields.
Let’s go through a couple scenarios to let the first step sink in:
Scenario 1: Bill generates 500 seller leads at $1.00 per lead and closes 1 deal for a commission of $8,000. So, he spent $500 to get $8000. That is an amazing ROI (return on investment) of 160X.
Scenario 2: Sandy generates 10 leads at $50.00 per lead and closes 1 deal for a commission of $8,000. So, she spent $500 to get $8,000. That is the exact same ROI.
So, which is better???
Well, based of the return on the $500 they both spent, it is the exact same. Some of you will say the Bill because he got 490 more leads……and you would be WRONG!
How long would it take you to properly call and follow up with 500 leads? How many did you get in touch with? How many times did you call them? Whether you are calling, or you are leveraged and have someone else calling, it is costing you time or money to continue to follow up.
Bill had to do 50X the work to get the same result. Or he found the one and wasted the rest because he just is worried about getting the one listed and sold.
So, you need to understand first the RETURN ON INVESTMENT (how much money you made/how much money you spent) and RETURN ON TIME (how much money you made/how many hours did it take).
Once you make the decision to change your thinking, you will be on your way to making better decision like a true #MARKETMAKER.
And, it will be like a disease for you which is a good thing because this is what they teach in MBA schools and how Fortune 500 CEO’s make decisions.
So, you have the first step and it will take time and effort to think like this at all times. Now, next step is understanding how to close more deals from what you get which is what Jay Abraham calls optimizing and maximizing.
There are a couple components in the process of closing more deals from your lead generation strategy. They are contacting more people, setting more appointments from those contacts, and closing more appointments you go on.
Contacting More People- This is where having a system comes in handy otherwise you are manually going to call, email, text, carrier pigeon….whatever it takes to get in touch with more people. Which is necessary for people when budget is a major concern.
But the known rule which we have covered in a previous post, is that you are 100X more likely to contact someone when you attempt within 5 minutes of them becoming a lead versus 30 minutes. You can only imagine what that is when you attempt the next day. But, we are in a world where some people prefer to talk over text or email, so you need to attempt with all three over a few weeks to really make an impact with your contacting rate.
We have found that 8 calls, 5 texts, 5 emails over 30 days will make a giant impact. Now, this is much easier with technology doing it for you automatically. There are a few options there which I don’t know much about but with Market Maker we built InstaContact that automatically texts, emails and sends no ring voicemails without any effort and responses go directly to whatever cell phone you assign to the plan.
Setting More Appointments- We tested and tested and tested all the ways to move this number. Using a proven script versus winging it is the first step. Get rid of your ego and stop just making it up and be COACHABLE. I have had the pleasure of working closely with agents that close over 500, 700, 1000 deals annually. The common denominator with them all is that they are always open to something working better and will test anything.
After you know you are saying what you should be saying(how you say it matters, so get trained) when contacting people, you need understand “not now” is a good, positive response. Getting a timeframe from them and following up is a great outcome because you are building a pipeline of potential sellers that you have spoken to and will already know who you are. Making sure they remember who you are and truly following up with where most agents fall short.
This is why most agents don’t build pipelines and start every month by asking “I don’t know where my next deal is coming from, what am I doing this month?” Agents hate following up, but the fortune is in the follow up. If budget is a constraint, you won’t be able to leverage highly innovative technology, but you should be utilizing a calendar such as Google Calendar to put reminders in your calendar to follow up with them a few times before the timeline they gave you expires. We have found that sending them emails, texts and content that is relative to their timeframe is what gets the most amount of people responding back or answering the first time we attempt when close to their listing date they gave us, READY TO LIST WITH YOU!
Closing More Appointments- I love hearing from agents who have not really started listing a lot of homes, because I get to use a core value of ours…”Open and Real Communication.” So, I need permission to tell you what you NEED to hear not what you WANT to hear. I’m going to assume that you said that it is okay.
If you think that you will close 9 out of every 10 listing appointments you go on, you are doing yourself a disservice by setting improper expectations. Agents that think they can close at that high of a clip, typically are only listing referrals, family members and friends. It’s a different ballgame when you are dealing with an inbound lead or a FSBO or an Expired. Now, there are some people that can actually close at 90%, and if that is you, I would like to give you a hug because nothing makes me happier than people who are having a ton of success reading blogs and doing whatever they can to get better. You have no ego and are going to have long-term success.
The use of a proven appointment setting script will ensure a higher close rate. A pre-listing appointment package will ensure a higher close rate. A proven listing presentation will ensure a higher close rate. Proper training will ensure a higher close rate. We typically see that once you have done all of those things and go on 30 listing appointments, you officially have made a market and are going to close at an insanely high rate and be able to beat ANYONE in your market head to head.
So, make sure you do whatever you can to make sure you are remembering to think of ROI and ROT. Then, first step to improving your key metrics is being able to see and know your key metrics. Leads to contacted to nurtures or straight to appointments to listings!
Track those, improve those and start running your business like a true #MARKETMAKER!