Managing Broker: Helping Your Brokers Understand A Client’s True Value

Author: Carrie Georgitsis, Managing Broker, Redfin Corporation Managing Brokers are always looking for ways to help their brokers get new clients and make the best use of them, but brokers are sometimes careless with their leads because they don’t understand the value of them. It’s our job to help them understand this better.

Address A Client’s Value

Some agents pay real estate websites for leads; others advertise on bus stop benches and send mailers out to their sphere of influence. Landing a new client might cost anywhere from 500 dollars to over one thousand, depending on the advertising methods. If the broker employs staff or consultants such as web designers, then the cost per client can climb steadily. There’s also a less tangible opportunity cost of the contact made with a potential client. This new client can lead to future business, to another listing, to a great referral. So when a broker fails to answer their phone or drops the ball with a potential client, their inaction could cost them thousands of dollars. Brokers should think of this as real money. If they do, they’ll be less likely to let these opportunities slip away.

Check The Broker’s Mindset

In a conversation with another managing broker years ago, he was sharing with me his frustration that so many of his agents weren’t closing more than a few deals a year. I said, “Don’t you wish they would treat it like a full-time job?” He replied, “Full-time job? I’d even be happy if they treated it like a part-time job.” If they’re trying to have a successful career in real estate, a broker needs to “treat it like a job.” They should set themselves strict office hours during which they will always answer their phone and be available to potential clients. In our “last second economy,” clients expect instant response and instant service. They can procure a meal, an outfit and even a car at the touch of an app. Believe it or not, they also expect to be able to buy and sell a home this way. A few years ago, I had a broker take a request from a new client for a same-day showing on a 1.6 million-dollar home. She took the opportunity exuberantly, even though others in the office were doubtful that this was a “real” client. Not only did the client turn out to be real, they were highly qualified and they purchased that home after a single showing! Thank goodness this broker answered her phone, acted optimistically and didn’t rule the client out because of their unconventional, last minute request.

Measure Their Responsiveness

Many buyers and sellers begin their home search online and don’t enlist the help of a REALTOR® until they’re ready to write an offer or put a sign in their yard. They’ll then reach out to multiple brokers at the same time through various online channels and work with whoever responds first or makes the process the easiest. Brokers should strive to be the one to answer the phone call or reply the quickest. They should ask a few questions when they begin this relationship with a new client, but they shouldn’t make the process too hard or make the client jump through hoops to start touring homes together or meet for a listing consultation. Clients can and will take their business elsewhere. Buyers and sellers are less concerned with loyalty to their longtime “family agent,” and are more concerned with ease of process and immediate satisfaction. Therefore, it’s important to act swiftly and thoroughly with repeat and referred clients. These clients close at the highest rate but won’t stay with you if you take them for granted. If they’re treated as the valuable clients they are, a broker’s sphere of influence could represent forty percent of their closed deals and repeat clients could account for twenty percent. It’s worthwhile to spend some money in these areas.

Examine Their Tools for Relationship Success

Brokers should compile a database and use a good customer relationship management system. They should be constantly adding to that database and, at minimum, sending out quarterly postcards and monthly emails. Other ways to ingrain themselves and become “that real estate broker” are to sponsor local athletic teams and events, as well as attend neighborhood and school functions. Once things get rolling, a broker should invest around ten to 15 percent of their gross earnings back into marketing and lead generation.

Max Out Every Client’s Potential Value

As we’ve discussed, potential clients have both tangible and intangible value. They shouldn’t be ruled out even if they tell you they’re “just looking” or give some other statement to downplay their commitment to buying or selling. How many times have you, personally, experienced or heard stories from other brokers that a client was “just looking” or “our lease isn’t up for another six months,” and then three days later, they’re writing an offer? Keep in mind that if people reach out to the real estate community to see a home or find out the value of their current home, they are most likely serious buyers and sellers, no matter what they may actually say about their interest level. This phenomenon also happens in everyday life – after all, how many times have you responded with “I’m just looking” when you go into a store and the salesperson asks you “Can I help you?”

Encourage Brokers to Respect the Pipeline

What can a broker expect in return for outstanding customer service for their valuable contacts? The return on investment can vary. Sometimes, it’ll be fairly quick but at other times, the payback can take years. Relationships need to be nurtured and maintained – a lesson that may be the hardest thing for newer brokers to understand. It’s not until a dead-end FSBO lead refers a neighbor to them or a buyer that they haven’t heard from in a year pops back up wanting to make an offer on “the one” that many brokers will understand the value of a “pipeline.” Having a successful career in real estate means you can never let your foot off the gas in terms of building relationships and marketing your services, but your brokers can take comfort in the fact that the more years they’re in the business, the stronger their pipeline will be. If properly maintained, the value of their clients will yield strong dividends.