The Importance of Networking with Past Clients
Depending on who you believe, the average homeowner stays in their home about ten years and a condo about seven. Both numbers have been trending down since 2003. A previous customer is a potential new client provided you understand the horizon. Things happen, people move, you never know. Remember ten years is an average, and like the real estate pyramid, average might not mean that much. You need to stay in touch with your previous clients. You need to be remembered. You need them to refer you to their friends.
You should always keep in mind, that no matter how well you do your job, your clients do not owe you a referral. In fact, they won’t refer you unless you keep in touch with them and ask them to. Your past clients are experts on your abilities as an agent. They have first-hand experience. A referral from them is worth more than from any other lead source. Their experience will be relayed without prejudice. People listen to their friends.
It was once generally accepted that a satisfied client will tell one person about you. An unsatisfied customer will tell six. The internet has changed the metric. Think about the awesome potential both good and bad. A motivated, unsatisfied customer will set you back big time. Your customers believe that you make a ton of money in commissions. They have absolutely no idea how hard it is to do what you do, and many may think that you are overpaid. One of the most important things to learn as an agent is how to manage your client’s expectations. It is how you create happy customers.
What you want to do is to turn your customers into advocates. Bring your clients a closing gift, something unique, something that will last. I often see Cutco knives exhibiting at real estate conferences. They sell knives to agents with your name engraved on them. Remember the ten year average. Give your clients something they will use every day and that will last ten years.
If the house next door to the one you sold goes for less, let your client know. People are naturally curious about home prices. If you have a story to tell, by all means tell it. Keep in touch with your clients after the sale. Agents who take networking courses are always asking for referrals. It is printed on their cards, notes and emails. “I am never too busy for your referrals.” I would certainly encourage this but it is more important to motivate your clients a reason to refer you. Be excellent at what you do. Build a referral base of satisfied customers and never neglect it. It should be your most important asset. Your past clients should be a permanent part of your real estate business.
I recently worked on a Marketing folder for a former Super-agent. His office walls are covered with framed golf flags; his credenza is covered with trophies. He has two hole-in ones. He is a seriously good golfer. The town he covers has two distinct demographics. A large upper middle class base, and a smaller group of very wealthy professionals and business owners many of whom belong to a famous country club.
When he was a Super-agent he built a referral network from past clients that was almost not to be believed. It was entirely among the larger upper middle class group, his customers. In a cul-de-sac that contained eight custom built colonials, he sold five. All in an eighteen month period, four were referrals from previous customers. He would take his clients to the local municipal golf course where he would be introduced to more clients. He was working all the time, even when he wasn’t working. He had six different overlapping referral networks that were all feeding him leads simultaneously. His office ran like a well-oiled, lead generating machine.
He is a seriously nice guy and he became seriously wealthy. Because of his golf prowess, he was invited to play in the member-guest tournament at the local Country Club. A club with a course designed by a famous architect, with a fabulous clubhouse immaculately maintained. The kind of place that cost a fortune to join, and he could afford it. After winning the tournament his member friend suggested that he join the club. He was in heaven. He was put up and seconded for membership and his application approved. He had made it. All of his friends, past clients and everyone who knows him were very happy for him. He had made it big, and everyone felt he deserved it. He did deserve it.
Pretty soon, he became absorbed in club activities, playing golf at his new club every weekend, attending the dinners and parties. He began to neglect his past clients. His business began to shrink from its highs, but he maintained a respectable income. It went on that way for about a year, until 2008 when the bottom dropped out of the real estate market.
That is when he decided to go back to the basics. He began to contact his former clients. Many hadn’t heard from him in three years or more. Many had formed loyalties with other REALTORS®. One was surprised to hear from him, she had assumed he had retired, yipes that hurt, he is 45 years old. Poor market conditions combined with three years of neglect had taken its toll. The business he built up over thirteen years had been seriously diminished. The momentum was gone.
Four years ago, he resigned from the club. It was not because he could no longer afford the dues. He just decided that it was too much of a distraction. He is now playing golf again at the local municipal course. He invited me to play with him. He reminded me that if I ever hear about anyone moving to the area he is never too busy to handle a referral. He has once again built a strong business. He is a solid twenty-percenter on his way to regaining his Super-agent status. It like the old adage “Give a man a fish and he will eat for a day; teach him to fish and he will eat for a lifetime.” It is more important to know how to build a real estate business than it is to sell a house. Build your house on a solid foundation of past clients.
Before I left his office I asked him what he learned from it all. He said “Don’t forget to dance with the one who took you to the party.” I think that is pretty good advice for a real estate agent. It made me wish I had a referral for him. Always remember that the real estate pyramid has no middle, there is nothing holding you up at the top. But if you keep in touch with your past clients, they will be willing to help.
About the Contributor
Richard Latour is often available and willing to visit your Women's Council Network. He does a one hour presentation on real estate branding and networking.
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