To become a champion agent, you must understand the four rules for expanding your business. These rules are universal for all enterprises, but especially for servicing enterprises where competition is high and opportunities for repeat customers and referrals are higher. These factors well reflect the real estate business.
These four rules control the level of risk you need to take to achieve the Champion Agent business. The further you go on the list, the more risk you take, and the probability of achieving a return becomes even lower. I always advise customers to attack these rules in order.
Rule number 1 - Protect what you have
It does not take much work. Sometimes you are so worried about a new business venture or expansion opportunity that you are failing in your core business area. Your core business begins to slide and becomes obsolete, stagnant and lifeless. Never take your eyes off the ball. Each of you has one or two pillows of your business that generate significant business without much attention, but this requires some attention. Do not choke all the way back.
The vast majority of agents do poorly with this. We are so excited about new technologies, new systems and new sources of lead generation, which we neglect to protect our business, past customers and spheres of influence that we have now. As I once told a new client, explaining four rules for expanding a business, it’s like running a ranch. You spend all your time buying new cattle (which you will find through a little intelligence or through marketing). The problem is that the entire back of your corral is open, so your newly acquired cattle, which have not yet been branded, go out to a neighbor's pasture. You have some kind of fence that needs to be done.
The easiest and fastest way to grow your business is to protect what you currently have. It does not require a large investment of time or dollars. This must be done, or you will work too hard, too little profit.
The National Association of Realtors® has studied our customers for many years, as well as the level of satisfaction and retention of both buyers and sellers. The numbers are really awesome. In a survey conducted over a number of years, 69% of people were satisfied with the services of their Agent. When they returned with this test group, they found out that only 24% of the people who had linked up another real estate transaction did this to their previous Agent. We only produced 69% of the average number of satisfied customers, which roughly corresponds to class C. We received only 24% of the total amount in order to do business with us again - another 45%. These numbers are really terrible.
What boldly says that we do not defend what we currently have is very good; that too many of us send out trash and trinkets in the hope of those who lead to referrals and long-term relationships with our past clients and the field. Obviously, it does not work!
The champion works first to protect what he currently has before moving down to improve market penetration with his target market or those with which he already deals. Most agents are first sent to number three on the list. The reason is that it is new; it's fun; this is an adventure; someone recommended it; they are boring. Most agents move to third place first. Remember that risk and probability are turned further down the list of rules that we work. The risk is higher and the probability is lower when we go to rules three and four.
We must protect the farm that we have (if any), our past clients and our sphere of influence. First you have to protect your position, which means that you are currently creating a business ... protect it!
Rule # 2 - Improve your market penetration with a target market or people you already work with.
Once we protect them, we need to expand our reach in our target market. In principle, the rule is that wherever you have power or control, use that power to get more. Find out how to acquire a larger part of the business in the area where you have already penetrated, if you already control the piece. If you have a farm to work with, increase your market share in the farm. I have a customer who owns more than 30% of sales on her farm. Our first step was to create a strategy to increase market share to more than 45%. We did this by promoting its dominance over other Agents and even companies. We also promoted a second opinion concept for people who lived on the farm. She wanted to raise awareness of the changing market and that a second opinion is worthless, but gives them peace of mind that they are making the right decision. This strategy worked beautifully. In the first few months, she increased the number of appointments on the farm by 23%. It is on the way to easily overcome the 45% threshold of market share. She gets a much better return in a short amount of time with less risk, working Rule No. 2, not Rule No. 3.
You can also convince your clients to invest in real estate; to make more deals with people you are currently doing business with, forcing your friends and relatives to work with you. Your referrals are growing - this is action number 2.
The target market will be any market that you are currently aiming at creating a business. This may be geographically, for example, my example, or it may even be FSBOs or expired if you are already doing them. This is what you are doing now and kindly for starting a business.
Rule number 3 - Expand horizontally in your core business area.
For most, your main area of business is residential real estate. Regardless of what you create, 80% of your commission dollars is your main business.
When you expand horizontally, you open another section of your company or a new source, but still remain in residential real estate. You can start working as builders; a market for villas, multiplexes, investment property, FSBOs or expired; Egypt is creating a new farm zone. Go to conducting open houses, visiting service clubs and conducting seminars for home buyers, house sellers or investors. The options are truly endless for what you could do in this category.
The key is to expand this area as soon as you reach the drop-off point in the first two categories of rules. The law of decreasing profits means that you are approaching a maximum in this area, so the closer you get to the ceiling, the less growth you will receive, even if you put in huge efforts and resources. Not enough growth opportunities to make it worth it.
Rule number 4 - the modification and creation of vertical expansion.
To expand vertically would be to move to a similar, free business, which is structured as a real estate business or linked to a real estate business. This rule allows you to take what you have learned in real estate, or use the contacts that you have in real estate, and create an additional business and income stream.
The most common occurrence for agents in this area is the opening of an office of brokerage real estate and a set of agents to work for them. You could also create a mortgage company, title company, escrow company, attributed to land management, home construction or investment real estate. I even heard that agents are becoming or forming a business partnership with a supplier of property insurance and accident insurance.
If you have well-established data and you often communicate with your past clients and the field, you probably have the opportunity to serve them with other financial needs.
Champions are working on the four rules of business expansion. They focus on risk and the likelihood of working to keep them both in their favor. I know many Agents who have become Agents of Champions, just focusing on Rule No. 1 - protecting what they currently have, and Rule No. 2 - improving their production in the market with their target market or those with which they already work . Due to their skill, database size and frequency of communication, they can achieve exponential growth with limited risk.
