Where Does the Business Come From?

As part of my 10th anniversary series (I celebrated a decade in real estate on January 5th of this year), I’m reflecting on how things were in the business in 2004, and how they are today.

I was talking to someone this morning who is thinking of making a career change. We discussed the differences between working in your first couple years of real estate and of working many years in. I told her my clients come from different places now than they did at the beginning.

My first year and a half in the business, I sold 13 houses. The clients came from the following sources:

1 – an open house
1 – friend
2 – referrals
9 – floor calls

In the last 18 months of my business, I’ve sold 44 houses. The clients for those came from the following sources:

1 – a floor call
11 – referrals
14 – web site
18 – friends/acquaintances/previous clients

The Internet

What a difference!! Note that in 2004, my web site did exist, but I wasn’t capturing leads with it. It was basically a placeholder on the world wide web. Now, almost one-third of my business comes from the web — people searching for info about the Tri-Cities, real estate, sometimes “Tri-Cities real estate,” find my site and poke around. If they like what they see, they ask me to help them buy or sell real estate. Sometimes both.

Floor Calls

The mainstay of my business in 2004 and half of 2005 — floor calls, comprising just under 70 percent — made up just two percent of my business in the last 18-month period! My theory is that people now, instead of calling the number on the sign, look things up on the Internet. Only then, if they can’t find what they need, will they call the number on the sign or the number of the brokerage. Also, sellers used to routinely walk in and speak to the person on floor and say, “I need to sell my house.” That happens far less often now. Again, the Internet can take credit for that.

Referrals

A quarter of my clients came from people who knew and liked the way I did business enough to refer me to their friends, family, or colleagues. I consider that such a tremendous honor! It’s also supposed to be the hallmark of a solid, relationship-based agent. If an agent simply looks at his or her clients as a transaction, a pay check, it’s unlikely that the client will tell others about his or her experience, unless it’s in a negative “stay away from this agent” sort of way. When clients get the feeling that their agent truly cares about them, is truly representing their best interest, and will remain in touch long after the sale is closed and the commission check is cashed, that’s the perfect scenario. That’s when a client is likely to tell others about their agent and insist, “You HAVE to use my agent!!”

Friends & Acquaintances & Previous Clients

By the way, this is a different category than referrals. Referrals are from an agent in another city, or past client or a friend who recommend to someone they know but I don’t, that they work with me. This category is comprised of people I know already. Just about 41% of my business came from previous customers, or people I knew from my interests outside of real estate. It pays to stay in touch with your clients (see “relationship-based agent” above), and to forge connections with people who share your hobbies. This is what also enables me to schedule dinners out with my girlfriends and tell my husband, “But darling, I’m working!”

Obtaining clients your first few years is very difficult. There’s a lot more work involved. You’re “on” — you’re sharing knowledge and PRAYING no one asks you how long you’ve been in the business. The way I get clients now is less labor-intensive and more fun! The referrals, the web site, the previous clientele, friends, and acquaintances, already come to me knowing a bit about me. The awkward meet-and-greet, and the striving to “prove” my mettle as an agent isn’t necessary because they already know about me. I can immediately dive in to discovering their wants and needs, mentioning similarities and create a rapport far more quickly. This, in turn, leads to more referrals, and the cycle continues.

I can definitely say I like getting clients more in 2014 than I did in 2004!