As mentioned in my first article on effective prospecting the goal of continuing success and income in real estate will only come from a well planned approach to your marketing. Remember, how effective you carry out your prospecting will be in direct proportion to your prosperity and your long term viability in selling real estate. 

Once you have decided on the important aspects of prospecting e.g. where you are going to operate and why you will target a particular area, the next step is to plan how you will obtain the business. 

Marketing by real estate agents over the years has been consistent in its style and type and although it seems bland at times all marketing can be effective. The major goal for your prospecting is to be contacted by anyone in your market area who is thinking of selling or seeking real estate information. Quite often agents operate with the blinkers on and seem only interested in prospects that are looking to sell immediately and fail to recognise that all contacts made can one day become clients. All contacts are good contacts if handled and recorded properly. 

This can only be achieved if your prospecting is one that builds relationships with all the property owners in your area. You should make sure that every one you come into contact with is entered into a database. Today agents should understand and use a database as it will make the job of contact and follow up so much more effective. It is essential however your database does not just become a mailing list, there is a big difference. Through a database all past appraisals, anniversaries, market updates, and call schedules for example can be programmed so no one is forgotten. You spend a lot of time getting leads and contacts to just let them pass by if they don’t want to sell at the time of contact is a waste of your time and effort. A database will not in itself guarantee success; other forms of activity will be required to maintain your presence in the area to ensure you are top of mind when owners decide to call an agent. 

Naturally one consideration that needs to be made is how much you should spend on your marketing. Whatever you decide make sure it is programmed for at least twelve months in advance and is done regularly regardless of market conditions. One can always tell when the market is slow as flyers and the like will appear in the letterbox and our inbox from agents you have never heard of or only from them when the market goes quiet. As I mentioned, promotions vary in style and quality so it is important that you develop your brand and stick to it. Only by being consistent in your contacts with prospects will you be remembered. 

The monitoring of your marketing efforts will ensure that what you are doing is effective. The question should always be asked of the contact to where they heard about you, and this needs to be recorded. From this information a pattern will develop to help you assess the effectiveness or otherwise of your investment. You need to see yourself as a business and future planning has to be based on all the information you can gather.

 In your day to day operation as an agent you need to ensure the funds you invest in your promotion are delivering the returns you want. Being on the look out for new ideas and ways of marketing is a good way to develop your brand and if done effectively will differentiate you from your competition. Social media and other forms of technology available today (and in the future) can also improve your marketing effort. They should also be considered as a means of your promotion and communicating with clients and prospects.

It is important to make the time available in developing your prospecting plans and if required seek outside assistance, ask others, attend seminars, buy a book or CD on marketing. Ideas are every where both inside and outside the real estate industry if you take the time to look. Effective, planned prospecting is not difficult, what is difficult is taking the steps to apply the time and recourses to develop your brand and the commitment to looking at your future in the long term. 

Finally remember the important steps to consider when you plan your prospecting;

Where are you going to operate?

Why you are going to operate there?

How are you going to operate there?

Prospecting is your lifeblood in selling Real Estate and by not giving it the full attention it deserves you will be held you back from earning the income you deserve.

This is an interesting question and the answer will always give an indication if the salesperson responding is operating like a business, that is, with an eye on profit. Do they have a vision, goals and a prospecting plan how to get there or are they just treading water, treating every day as it comes using the luck and hope theory for one of the most important aspects of their business life.

 Too many salespeople today are unfortunately not getting the full enjoyment from a profession that can deliver so much due to the fact they are frustrated with the hours worked, costs involved and the feeling of being a POW (prisoner of work). By taking the time to understand what is involved in prospecting a business area, with the goal of sales today and in the future, they will soon dispel negative feelings and build an attitude of confidence through taking control. 

To answer the question of why you operate where you do needs to be seen in commercial terms as it is only from this stand point will you assess the financial viability of your reward for effort. Where ever you operate or the model you work under the market you are in needs to have the potential to deliver an income you are satisfied with and meet your sales and income goals.

 Do the annual sales of the area and the price of the properties deliver enough dollar value to give the opportunity, through effective prospecting, of increased market share and a growing income? 

Are you prepared to give up those areas that after careful analysis don’t offer the return you need to justify the time, effort and cost of maintaining a presence?

In the area you operate can you build the relationships needed through the effective prospecting that is required for long term repeat business and future resales in five, ten, fifteen or even twenty years?

 Will the expense of marketing in your area be cost effective, fit your budget and deliver the results you desire?

 What level of market share in your area do you need to generate the income required based on the average sale price and the level of commission you can charge in that price range?

 The common mistake made is to focus purely on turnover and gross sales, but it is the costs of obtaining the business in the end that will determine if the profit margin is at or above the industry standard.  Activity for activities sake results in a feeling over time that is similar to the mouse on the running wheel, after great effort, the long hours, time away from family and the expense the result at the end seems to be just not worth it.

 This will result with the salesperson, who, was once satisfied with all the activity and gross sales looking back and seeing that the money in the bank is less than expected, overheads have diluted the profits. It can be seen time and again where an agent will dominate an area by being extremely active, but after a time they disappear, they failed to do the basics of prospecting and building their business for the future. Burnout in selling is real and many good salespeople leave the industry but with some careful thought and planning in where and how they operated they could have stayed the course and reaped the rewards.

When answering the question “Why do you operate where you do” your response has to be one that can spell out a clear plan based on sound market analysis and show a satisfactory financial return from your prospecting activity. 

“Your future is in you hands, prospecting is the lifeblood of the salesperson”.

Quite often agents spend their days looking for business in a manner that has evolved over time from their first days in the industry. While they have been concentrating on the day to day need to generate listings and sales little thought has gone into where they are operating. By failing to appreciate that for a long term career they need to look at this important aspect of their business.

There are many different business models in selling real estate and in any office these will be on show and it can be seen which one is the most effective. For example is it the agent who concentrates on an area, the one who goes anywhere, the specialist who only sells one style of property or a certain price range?

The most important factor in deciding where you operate is, will it give you the income you want and have the potential for growth. Without these two essentials all your time and effort will be wasted and the usual result will be the all too common approach to start chasing business where ever you can and spreading yourself too thin. This approach is ineffective for the longer term will cost more to service both in time and travelling from one area to another and more importantly become frustrating and drain your enthusiasm.

In deciding where you operate to a large extent will depend on which model you chose and what will suite your long term goals. You may decide to concentrate on the suburb where you live and have local knowledge, friends, contacts, and are well known in you community. You may find that from your data base, contacts, club memberships etc you know people over a wider area and this model will be more effective. Many agents are successful because they have particular knowledge or contacts in the building, development or subdivisions and develop their business in that area.

No matter where you decide to operate it needs to be understood that it must deliver the income you want and have good potential for future growth. Your prospecting will only be effective if it is consistent, promotes your brand, builds relationships and is targeted to the area you want to conduct your business.

Prospecting for business in the different models mentioned will require varied levels of investment e.g. a single banner press advertisement will be less expensive in your suburb compared to several publications if you are covering a larger area. This extra cost needs to be measured against sales results. The balance of reward for effort has to always be considered and what ever model of operating you choose a well thought out marketing plan, costed and programmed for at least twelve months ahead will put you on the path to success.

The reliance of the next sale coming from anywhere will only perpetuate the frustration in your work and the uncertainty of income we all want to ovoid. Once you have decided where you want to operate, based on sound consideration of the potential, you can develop your business. Your prospecting will be more effective as it will not be the shot gun approach we see so many agents using today and will set you apart from the competition.

“Choice not chance determines destiny”.

We have all experienced the up and down nature of our business where as a result of some of our marketing activity the listings come and then we are flat out handling the sales. When these circumstances occur we find that suddenly all our efforts need to lurch back into finding new listings to ensure continuity of income.

For the true Real Estate Sales Professional this situation is not a problem as they have mastered the techniques, disciplines and attitude to understand they need to operate like a business. They don’t rely on hope and luck for sales.
“I hope the phone will ring and if I am lucky I will get the listing”. This is no way to ensure a reliable income for you and your family.

If we take the example of a large business like Wesfarmers, who, when considering opening a new Bunnings warehouse worth many millions of dollars, don’t just decide on a location without spending money on a study of the areas demographics to see if the store will make a profit.

The approach in real estate is the same; you need to think like a business towards your prospecting. You need to decide where and how you are going to operate to generate the profits you need to be the success you want to be. How effective you prospect will be in direct proportion to your prosperity and your long term viability in the business.

With regard to your prospecting I feel a good test is for you to be able to answer these three questions comprehensively.

1. Where do you operate?
2. Why do you operate there?
3. How do you operate there?

These questions need to be able to be answered if you are to have a long term career in the industry as it is only with an understanding of the importance of good effective prospecting will you build your career and guarantee your future.

In the next post I will cover what you need to consider in deciding where you will operate. In the meantime reflect on how you would answer these questions with regard to your business.

“We don’t have to be smarter than the rest. We have to be more disciplined than the rest”. Warren Buffett

 No salesperson can practice their craft unless they have the prospects to present their proposal and proceed to the sale.

It needs to be recognised also that despite market and economic conditions in the business you are operating the task of prospecting and looking for clients and new business should never stop or be cut back. 

To achieve a sustained prospecting programme, plans, budgets and resources are needed together with a well thoughtout plan assigning activities to individuals and others who will carry out the prospecting.

The monitoring of prospecting needs to be recorded to ensure the programme stays on track and is delivering the desired results because without this oversight the return on the investment could be wasted.

Prospecting for client’s requires a level of creative thinking to determine where your activity will be directed and avoid the trap of just adopting a me too approach and following your competition.

It needs to be recognised the quality of your prospecting is important as once contact has been made the opportunity to establish a long term relationship exists and you need to understand that business may not be immediate but will come in the future from continued contact.

The motivation to undertake prospecting varies from the individual to the organisation as it is at different times in the cycle of the selling process the need for prospecting may not seem as important, particularly if sales are healthy.

Individual salespeople and companies need to remember that despite the current market conditions the following five points are important the surviving any downturn;

1. Continue talking to customers.
2. Obtain new customers and sales.
3. Maintain marketing.
4. Improve marketing strategies.
5. Capitalise on increased market share opportunities.

The responsibility for prospecting is one of the major tasks in the sales effort and should be viewed as necessary to an organisations business as the accounts department and human resources.

The recognition of prospecting by all in the profession of selling is necessary if they are to be successful and develop a long term career with a consistent and stable income.