Blog, Matt. Blog!

Do You Know Today’s Real Estate Customer?

Matt Jones — Thu, 16 May 2013 19:23:24 +0000

The National Association of Realtors® recently published its 2012 Profile of Home Buyers and Sellers — 120 pages of great information about our customers. If you haven’t taken time to read it I highly recommend you do.

But buried deep within those pages are what might be the two most important statements in the entire report. Not only are they critically important, but when taken together, should be a major wake-up call for every single real estate professional. Here they are:

Many of us think of today’s real estate customer and we project what we might do if we were shopping for a home, and that’s a huge mistake.

But why should we care? Because our most important job and our single largest expense is attracting today’s customers to work with us. If we are from Mars and they are from Venus, it should be no surprise if our real estate practice is in decline as is the case with many of us.

Today’s customers have grown up with computers and are more comfortable searching online than offline. Most don’t even have a phone book. Most use their smart phones interchangeably with their computers and tablets. Most have to look to even find a pen or piece of paper to write on. For them, online is a way of life.

That makes today’s real estate shopper a lot different from many of today’s agents. Just how different? Check out the following ten real estate marketing methods and see if you are guilty of any of these next generation marketing faux pas.

I rely on my yard signs to bring me business. Sure, for years that was the largest source of new customers, but today’s shopper has already engaged an agent he found online by the time he begins riding neighborhoods looking for houses.
My circle of influence is where my customers come from. Today’s customers network, but are statistically more independent than in times past. They are actively involved, first hand, in online research and they are sceptical of the opinions of others.
My website doesn’t bring me any business. Today’s customers are happy to use your free home search and feel no obligation to use you as their agent to list or buy a home. The typical real estate website is not designed with this in mind.
I use open houses because they are free. Most of today’s customers don’t read the local newspaper (the place we have typically publicized our open houses) and they are typically committed to another agent by the time they actually begin previewing homes.
I use homes magazines to find shoppers. Today’s customer searches online because it is a better, and more comprehensive source of information, pictures, virtual tours, etc. A snapshot in a magazine that contains less than 5% of the current inventory is of little value to them.
I like to sit new construction model homes. Today’s customers are still working when you’re leaving the long day in the model home. It is much easier for them to look at new construction virtual tours online where they have access to subdivision covenants, upgrades, and no pressure from a hungry agent.
I have always relied on direct mail. Today’s customers sort their mail over the trash can and are very unlikely to contact a stranger from a postcard or newsletter. Instead, they are quick to use the internet to find what they are looking for when the time is right.
My broker tells me I should have a geographic farm. You broker clearly doesn’t realize the demographic shift over the last 10 years. Today’s shoppers would much sooner trust an internet search than a stranger who showed up at their door with a refrigerator magnet.
I get my business from floor duty. There was a time when customers had to call the office listed on the ad or the yard sign to get information. Today’s customer can have more and better information using the internet and not have to talk to a pushy agent on the phone.

My customers like my newsletter. No they don’t. They much prefer following you using online social media like Facebook and Twitter. Today’s real estate shopper rarely looks at direct mail pieces. Your time would be much better spent posting personal pictures and comments on Facebook.

So if your old-school marketing is not having the same effect it once did, the reason is simple. As the old song said, “The times they are a changin’.” The demographic shift and the technology revolution have forever changed our business.

Today’s customers want an agent who can send them a text message. Who sends emails and instant messages instead of leaving voice mails. Today’s customer is comfortable with technology and uses it non-stop — almost like breathing. And most importantly, today’s customer wants to work with someone like him — someone online.

But thankfully, it’s not hard to be that agent. Most of us are already part-way there. According to the latest statistics, though, most of us are not generating much if any business from online sources. Instead, we are hanging onto what feels comfortable to us and not making the effort to meet our customers where they’re comfortable — online.

So if you feel like you need to improve your online marketing, why don’t you check out my LCM technology. This simple system can take you from no online business to mostly online business almost overnight, and best of all it includes all the hand-holding required to get you up to speed and comfortable using it.

The cost has never been lower and with no long-term contract you can give it a try to see if it is right for you. Start working smarter and not harder. Start being that agent who gets new customers while you’re sleeping instead of wasting weekend after weekend hoping to pick up a customer from an open house.

Does the thought of making this transition seem overwhelming? Believe me, it’s not. But check out my interactive demo and see for yourself. And feel free to call me if you have any questions. I’m always happy to help. This could be the year you reinvent your practice, and with all your new online business it could easily be your best year ever!

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Have you ever wondered what the best system for creating new business from the internet looks like? Want to see it in action? Finally, an interactive demo that allows you to sit in the driver's seat and check out the system that has revolutionized single agent lead generation for the real estate industry. Begin the Test Drive

Get Ready for the Next Big Housing Boom!

Matt Jones — Thu, 09 May 2013 20:32:51 +0000

What if I told you the next five years in real estate could set you up for a massive retirement — much bigger than you probably ever considered? Why? Because real estate is coming back and it’s coming back huge!

Every day there’s another news report that real estate is finally beginning to make a huge comeback. Many believe that the current recovery will be just as big as the crash — bigger than any real estate boom in history.

Like most booms, though, it will happen fast, and many will be left sitting on the sidelines and miss a huge opportunity. How will they miss it? Because they won’t realize it’s happening until it’s too late, because they are still looking for customers where there are no customers.

And just like most booms, you can bet the 80/20 rule applies: In other words, 80% of the agents will miss out while 20% catch and ride the biggest real estate wave ever, making massive incomes and setting themselves up for life in only a few short years. And I’m not just talking about millionaire real estate investors; I’m talking about regular agents selling residential real estate. Don’t believe me? Okay, well just sit back and watch while some of your peers get rich.

The secret to taking advantage of this next housing boom is being the agent who knows how to find the customers. There are plenty of customers, but most agents using all the old-school methods are grabbing only a fraction of the potential business. Why? Duh! If you want to catch fish, you have to go where the fish are biting. And real estate is no different.

According to the latest data from the National Association of Realtors all but 5% of today’s homebuyers are starting online. That means if you aren’t effectively fishing online, then don’t be surprised if you don’t catch many fish. And I don’t mean having a website. I mean having a website that brings in customers. A website that actually works.

Most agents — the 80% — spend tons of money on marketing and have very little to show for it. It doesn’t have to be that way. On the other hand, a few agents — the other 20% who know the secret to finding customers online, are doing better and spending less than ever before. Every day they get up to find 2-3 new customers in their inbox and many don’t spend a dime on advertising.

What makes this possible is three little letters: L-C-M. Remember these letters — they stand for Lead… Capture… Module. Now, you probably have no idea what an LCM is and that’s okay. But know this: Using this simple and yet incredible tool many agents had business even when the bottom fell out, and now as the boom is starting, they’re starting to close transactions like never before.

Better yet, they don’t have to invest tons on advertising. I can tell you that I personally don’t spend a dime on advertising and yet I’m getting 2-3 new, inbound leads every single day, day in and day out, because I use my LCM.

An LCM gateway is a simple website designed to either stand alone or work with another website, and its sole purpose is capturing online shoppers. Take a typical website that brings in no business, and add an LCM and some free advertising and you have 2-3 inbound customers every day, day in and day out.

Better yet, our geeks hold your hand to help you get it up and running so you’re not on your own like with so many technology tools you’ve tried before. Instead of spending hours every single day fishing where the fish aren’t biting, you set up your LCM and watch as fish jump right into your boat — or inbox. The first time you see it happen you’ll be amazed… and then the light will come on.

Listen, I know that many of you watching this video are thinking this sounds too good to be true. It is too good to be true, but it IS true. The LCM is the holy grail of online lead generation. Nothing else even comes close. I used to tell agents that my LCM is not a magic bullet, but one day I realized it IS a magic bullet. Let me give you a couple of examples:

Take Kevin, a truck driver and part-time agent that wanted to make some extra money. We helped him set up his LCM and in three months he had a choice to make: Should he quit driving his truck and start doing real estate full-time? After all, his part-time income was more than his full-time job. He decided to go for it!

That first year Kevin made $351,623 and the next year he earned $541,298! Having a never ending supply of business changed his life. Made him rich too. He bought a brand new SUV, a brand new convertible, and a 6,000 square foot mansion with a 5 car garage, a detached office, and an olympic sized pool. And that was while the market was still tanking.

Or there’s Charlyn, a single mom and new full-time agent who wrote:

But don’t take their word for it. Give it a try. Unlike most technology, there’s no long term contract, and there’s no activation fee. In fact, the cost of having the very best online technology for gathering business is a lot less than you might think. It’s less than a cup of Starbucks a day. That’s right, less than a cup of Starbucks a day!

Listen, I want you to imagine what it would be like to be in that 20% that catches this next incredible real estate boom. Wouldn’t it be nice to work hard for the next five years and make enough money to never work another day? With my LCM that can be a reality. It can be YOUR reality.

This could be the moment you’ve been waiting for. The key to turning things around. In fact, if you’re currently doing traditional real estate, this IS your key to turning things around. So give it a try. I mean really, what do you have to lose except maybe some advertising bills. Give it a try and you’ll see… you’ll have more business than you can handle starting your very first day.

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How Many Homebuyers Are In Your Market?

Matt Jones — Thu, 02 May 2013 21:31:38 +0000

Ever wonder how many people are buying and selling homes in your market today? Take a wild guess! Wilder. Now double it. You’re probably still low. I’ll show you exactly how to find your own accurate number.

First you need to log into your MLS and find out how many transactions closed in the last twelve months. Write that number down. In my MLS, the total number of closed sales in the last twelve months was 5,425. For each closed transaction, there was, by definition, one buyer and one seller.

Now divide that number by 4 and you have the approximate number of buyers and sellers in your market right now. Okay, Matt, so why divide by 4? Easy enough: The average buying cycle right now is 13 weeks. A year has 52 weeks, so divide 52 by 13 and you get 4.

In other words, at any given time one fourth of those buyers and one fourth of those sellers are in the process of buying or selling. For my market that is 1356 buyers and 1356 sellers that will actually close. That’s 2,712 customers that will close. That’s a lot!

But it’s really higher than that. Here’s why. This year will be bigger than last year in almost every city, simply from demographics and population growth. So in all likelihood, your number is actually higher than what you just calculated.

And remember, those are closings, not just clients. Statistically, only about 80% of buyers who write contracts ultimately close, and only 50% of listings actually close, so the total number of customers is even that much higher.

Next check your board roster and see how many agents are in your market. Now do the math. Are you getting your fair share of all that business? If you’re not, is it because you are not trying? Or is it because you need to try something different? Odds are, if you’re reading this it’s because you need to try something different.

Think about it logically for a minute. Where are nearly all (94%) of our customers looking in their search for homes? Online. And yet according to the latest data from the National Association of Realtors® over three-fourths (76%) of all agents received less than one inquiry per month from their website last year. That’s a huge disconnect.

And that explains why a lot of agents are not getting their fair share of the available business. Today, unlike any time before, it is the “haves” and the “have-nots”. Feast or famine. You are either making a killing or you are getting killed.

When I started real estate 11 years ago, I was a “have-not”. My website was just like everyone elses and I was getting less than one inquiry a month. But I set out to fix that problem and I ultimately invented a technology called an LCM gateway that turned my practice around — so much so that I was featured on CNN.

If you’re not familiar with this technology, an LCM gateway is a simple website designed to either stand alone or work with another website, and its sole purpose is capturing online shoppers. And it works phenomenally well at capturing business. Just how well?

Take a typical website (like mine was) that brings in no business, and add an LCM and some free advertising and you have 2-3 inbound customers every single day, day in and day out. And that’s using free advertising. Some brokers generate as many as 50-60 leads a day using my LCM. Think of it as a turbocharger for your website.

You may be thinking this sounds too simple to be true. It does sound simple. Under the hood, it’s not simple at all, but from the agent’s perspective, it is very simple. In fact, I’ve been told that my LCM is the holy grail of online lead generation. I don’t know about holy grail, but I can tell you this: In eleven years nothing else even comes close. No other website. No other technology. Nothing.

I used to tell agents that my LCM is not a magic bullet, but one day I realized it IS a magic bullet, at least it is for anyone struggling to have enough business, and that means the majority of agents today. I could relate hundreds of stories but let me give you a couple of my favorites:

Or there’s Charlyn, a single mom and new full-time agent who wrote:

But don’t just take their word for it. Give it a try. Unlike most technology, there’s no long term contract, and there’s no activation fee. In fact, the cost of having the very best online technology for gathering business is a lot less than you might think. It’s less than a cup of Starbucks a day. That’s right, less than a cup of Starbucks a day!

Listen, I want you to imagine what it would be like to have your fair share of the business currently closing in your market. Or maybe more than your fair share. Wouldn’t it be nice to have so many customers you could cherry pick the ones you wanted to work with and hand the others out and collect a referral fee? One referral fee could pay for your LCM for a year!

So give it a try. I mean really, what do you have to lose except maybe some advertising bills. Give it a try and you’ll see… you’ll have more business than you can handle starting your very first day.

Take The Test Drive!

Where Is Easy Street?

Matt Jones — Wed, 27 Mar 2013 01:46:50 +0000

I want to share with you a true story — not second hand or hearsay but real life. It is the story of how I discovered one tiny thing that had a huge effect in my business, and for that matter, my life in general.

From time to time I hear agents talk about how their work feels like being on a treadmill — that they are unable to take a break because if they do, their work dries up and they spend months getting it back up to speed. I can tell you from first hand experience, that’s how I felt.

I felt “not in control” of my own practice, a passenger if you will, when I wanted to be the driver. I was terrified of the thought of stopping for even a day or two because it would set me back weeks or even months. My typical day went something like this:

I would get out of bed at 4:30AM, have my quiet time, exercise, shower and get dressed, eat breakfast, and be at the office by about 7. That would give me a couple of hours to be productive before the other agents and staff arrived and interruptions seemed to be non-stop.

I spent those times working on maintaining my database, sending out postcards, writing content for my monthly newsletter, and the hundreds of other non-people and administrative functions of life in real estate. The vast majority of it was mind-numbing.

After 9AM I would finally be able to start calling my sphere of influence, keeping up with them and always remembering to end every call asking them if they knew anyone who was thinking about buying or selling real estate.

Depending on the office schedule, I may have had floor duty, where I could be a free secretary for the office for half a day while hoping that maybe I would have somebody call into the office who wanted help with buying a home.

Or I might have been scheduled to man one of our company’s new home open houses, and perhaps be lucky enough to scoop up a new client who was out looking at new homes. Most of the time was wasted but there were always those occasional shoppers.

When I wasn’t doing any of that, I would go out to my “farm” and walk the neighborhoods handing out business cards and hanging listing fliers on doors, hoping to meet the homeowners and chat them up and maybe drum up some business.

Hopefully, if all that activity generated a customer, I would be spending large blocks of time in a full-court-press showing house after house until I got them under contract. Then there were the inspections, and the million little fires that had to be put out so we could close.

Oh, and let’s not forget all the time-wasters like sales meetings, office meetings, caravan, meetings with advertising reps and phone calls with the million salesmen that wanted to sell me some magic formula to real estate riches. Talk about a treadmill. It never stopped.

One day I sat down for a minute and realized I was killing myself, working from 7AM until 9PM seven days a week, and that it was not all that much fun. I couldn’t afford to take any time off or it would result in a big gap while I got it all going again. I felt trapped. Out of control. A passenger in my own business.

So I analyzed all that I was doing and I realized that less than 10% was actually practicing real estate while the vast majority — over 80% of my time — was spent in the never-ending rat-race of finding that next customer. And with every single closing I was unemployed again until I could find the next customer.

That’s when it hit me that I needed to figure out a way to put the customer acquisition part of my business on autopilot. That would give me over 80% of my time back. But could I even do that? And if I could, how? Time to do some serious analysis. Here’s what I figured out:

I was spending much of my time on activities that were not the highest and best use of my time. I was doing lots of traditional customer acquisition activities that worked marginally, if at all, even though they were the supposed “tried and true” methods of years gone by. And if that were true, then times must have changed. Where were the customers now?

I speculated that since the internet had already changed many industries, like the travel industry, the car industry, the book industry, to name only a few, then maybe it was changing the real estate industry. I set out on a mission to crack the code — to attract online customers real estate customers in a different way. I already had a typical website but it brought me zero business.

I needed a website that actually brought in business. After looking extensively, I still couldn’t find one, so I decided I would have to create one. I built a tool to work with my website that was designed specifically for capturing online customers and when I did that everything changed.

I went from spending all my time trying to attract and gather customers to having that huge part of my business on autopilot. Let me give you an example of what I mean, because everyone should want to experience what came next.

I would wake up every morning to new customers in my email inbox. I would take a few minutes to call and engage them and all of a sudden I had more business than I could even handle. Instead of spending 60+ hours every week just trying to drum up business, I could focus on just the real estate part of my practice.

I mean, let’s face it: If you spend a total of 10 hours of actual real estate practice with each transaction, then you can close a deal every week and still have lots of free time. I don’t know about you, but I like the idea of being able to have some time free to do the things I love. More time with family and friends. More time for outside interests and hobbies. Time to take a vacation.

In fact, I still remember after making the decision to take control of my practice, going to the beach with my family for a week. While I was laying in the sun reading a book and listening to the waves crash in, my practice was still bringing in 2-3 new customers a day, and I even sold a listing! Sure, I spent an hour or so each day, keeping things running, but I was no longer a slave to my practice. I could finally relax.

As someone who has retired twice already, I can tell you that I don’t ever want to retire again. I want to remain active. I don’t want to sit around in my rocking chair and wait until my health fails. I want to enjoy life and I want to enjoy my work. Any by working smart instead of working hard, I can do just that.

But it all comes down to having the customer acquisition on autopilot. That is what robs us of all our time and freedom, always wondering where that next transaction is coming from. Now instead of wondering, I know that every day, with a very minimal input on my part, I will have 2-3 new inbound customers, day in and day out.

And because I have 60-90 new opportunities every single month, I spend most of my time eliminating those I don’t want to work with and not desperately trying to turn every single suspect into a prospect like I did back in those early days. Now, if I want to take off Friday to drive to Florida for a mountain bike race, I can do it and not think twice.

If I want to take the afternoon off and go see a matinee with a friend, I just do it. If I want to go to the beach or the mountains, or just sleep in, I can. Instead of being in the passenger seat, I am now driving my own practice. And believe me, that makes all the difference.

You know, it’s funny how such a huge difference can be caused by one simple thing. But if you analyze it, it makes perfect sense. If you are spending 50-60 hours of every week just trying to drum up business and you can put that on autopilot and instead spend less than an hour a day, suddenly you have a newfound freedom!

So as you read this, let me ask you a question: Is your life and practice more like the first example or the second. If yours is like the first, what would you do with an extra 40-60 hours every week? What kind of difference would it make to have 2-3 new customers every single day, day in, and day out?

If the first example seems more like your life, it’s not too late to change. I saw everything change for me in a month. From no business to more than I can handle, allowing me to pick and choose the clients I want to work with. I know it sounds simplistic, but it is absolutely true. I challenge you to think of any problem in our business that can’t be solved with more customers. You can’t.

So let me help you put your customer acquisition on autopilot. Check out my LCM Success system. The cost is very low and the return on investment is huge. More importantly, this one tool can turn it all around for you without breaking the bank. So check out my LCM Success today and have 2 new customers tomorrow!

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Old Dogs and New Tricks

Matt Jones — Wed, 13 Mar 2013 15:13:56 +0000

It’s been said that you can’t teach an old dog new tricks. But I say it might be easier to teach an old dog a new trick than to teach a new dog an old trick. What do I mean?

Most of you know that I encourage my readers to contact me. In fact, I publish my phone number and email address and welcome the opportunity to talk with other agents from around the country. It is my favorite part of the job.

Well, last week I was at my desk working when my phone rang and I answered it. On the line was an agent who’d been following my blog for years and had even read several of my books. He was very kind in his comments and I was glad he had enjoyed them.

Then he went on to tell me the purpose of his call. He had been thinking about using our LCM technology to generate online business for quite some time — several years — but every time he got ready to do it, he had the same nagging thought:

“I am just not technical enough to learn an entirely new way of doing business. I’m sure that internet business is the way of the future but I’ve been doing real estate the same way for twenty plus years and I am comfortable with that. I don’t feel like making the huge time investment to learn an entirely new and highly technical way of doing things.”

He decided to call me and just openly share his reluctance, and I’m glad he did. When I asked him some questions it became apparent that he had made some assumptions about doing internet business that were just not true.

For example, he thought that everything he’d spent years building was out the window if he embraced a new technology-based lead generation approach. In reality, most of the skills he’d spent his entire practice honing were just as important, if not more so, when doing online business.

He also assumed that it would take weeks, if not months, of frustration trying to learn how to work complicated software. Wrong again. I told him that if he could work email, he could work our LCM system. I told him that, although I was sad to say it, many of our agents never even use most of the entire toolbox we give them. They just use the parts they need.

Then I shared with him how I had come to invent the system in the first place. I was a frustrated agent that needed a tool but after looking quite extensively realized it didn’t exist. I needed a way to actually get business from my website. When I couldn’t find it, I had no choice but to build it.

We laughed as I told him about my frustrating trips to Barnes & Noble to buy books like “Building Websites for Dummies”. Slowly I learned just enough to build a system to capture online business and when I did, it changed everything for me.

Soon my practice was exploding and I had to hire other agents to work all the business I was bringing in. As my business grew, I got asked to speak and share my story with other agents and when I did, they wanted me to help them replicate my success.

I reluctantly decided to launch our technology company to do just that. But unlike most technology companies, it would be one agent helping other agents. I hated having to learn all the technical stuff because I am a people person, but I knew what I wanted. Don’t worry, it wasn’t long before I hired geeks to take the initial concept and build on it.

But I insisted that our system would have a 5-minute learning curve or we wouldn’t do it. I also determined to keep our prices affordable, having personally experienced spending over a thousand dollars every month buying leads from House Values (now Market Leader). In other words, I wanted it to be just an agent helping other agents.

After we talked for 10-15 minutes, my new friend was very relieved and decided to go ahead and give our LCM a try. I reminded him that his risk was tiny since there was no long term contract, or big activation fee to pay, and that if he had any problems whatsoever he could call me and we’d figure it out. I promised him that our coaching staff would hold his hand getting him up to speed, but that it wouldn’t take us long because it’s that easy.

This morning while out for my morning run, I remembered that somewhere in our conversation he had made the comment that he’d been doing things the same way for years and that you can’t teach an old dog new tricks. It occurred to me that, learning our LCM system is actually very easy. What’s hard for some new agents is learning all the old skills that many seasoned agents have been using for years.

Unfortunately, I don’t have a system I can sell them to fix that problem. So if you’ve been thinking about moving into the technology revolution and start taking advantage of the huge boom of internet business, why don’t you give my LCM system a try. You’ll be amazed at just how simple it is, and please don’t hesitate to call me and let me know what you think.

Take The Test Drive!

Finding the Best Leads

Matt Jones — Thu, 10 Jan 2013 20:20:29 +0000

To someone who makes a living in sales — any kind of sales — finding the best leads is the most important thing to their success. And it is particularly important if you make a living practicing real estate during a very tough economy. It’s more important than being good with customers. It’s more important than being knowledgeable about real estate. It’s more important than working hard for long hours, although all of those are important.

Why is finding the best leads so important? Because you can be the very best agent in the industry, but if you don’t have customers, you’re out of business. You can be willing to work long hours, but if you have nobody to work with, you are out of business. On the other hand, you can be a mediocre agent that’s too lazy to work hard, and still make a lot of money in real estate… if you have the best leads. (I don’t recommend that model, but I’ve seen it happen more than once!)

“Okay Matt… I’m interested. So how do I find the best leads? Better yet, what are the best leads?” Now we’re getting to the heart of the issue. First, let’s define “best leads”. The best leads are the ones that result in closings, wouldn’t you agree? But the fact is that all leads are not those “best leads” — the ones that close.

In fact, statistically speaking, only one in twenty-four real estate leads will actually result in a closing. In other words, finding real estate leads is much like eating ribs: lots of work and lots of mess for a single bite of great food! The work is hard, but the payoff is great! So let’s look at that sad fact for a minute. There are basically two schools of thought when it comes to generating business in your real estate practice.

School of Thought 1: Turning Bad Leads into Good Leads. For about the last decade there has been a steady shift in our industry. Real estate is still the same. Our customers are still the same. What’s changed is their shopping habits, and with it the way we have to market our services in order to attract our share of business.

Unfortunately, many of us are reluctant to change so we continue to do the same things we’ve always done to attract our clients. The results of using those same marketing strategies, however, have steadily gone from great, to good, to not-too-good, to pretty bad, to very bad. Maybe this is not your experience, but it is the experience of many agents practicing today.

And because those old methods of attracting clients are yielding fewer and fewer leads, there is a natural tendency to try to somehow turn those few “suspects” into prospects. It is the natural progression when leads are few and far between — leads are scarce so we must try to rehabilitate each one. My grandfather used to refer to this as “trying to turn chicken manure into chicken salad”. Now I don’t know about you, but that doesn’t sound like any chicken salad I want to eat!

School of Thought 2: Make Plenty of Leads and Flush the Bad Ones. Another school of thought is to generate many more leads than you need and rapidly eliminate the lower quality leads. Like the old Doritos commercial said, “eat all you want, we’ll make more”, I say “flush all you want, and just make more”. But for many agents today that is easier said than done.

For those agents who are using their old marketing methods to generate business they don’t have the luxury of discarding leads. Over 90% of today’s agents are relying on circle of influence marketing, open houses, print advertising, and referrals for their customers, and for those agents, there are just too few leads produced to allow them to “flush” any bad ones. The reason is really simple if you think about it.

Imagine you’re fishing. Where is the best spot to fish? Duh! It’s where the fish are biting. The latest research from the National Association of Realtors® says that 93% of all of today’s real estate customers are now beginning their search online. The funny thing is that over 90% of today’s agents are still looking for customers where the other 7% are “biting”. That explains why there is such a shortage of business for those agents.

The other ten percent of today’s agents are getting to divide up 93% of the business while the remaining 7% (the offline business) is being divvied up by those other 90% of the agents. In other words, if we want to be successful at fishing we need to go where the fish are biting, whether we are comfortable there or not. And if the fish are biting online, then that’s where our marketing must be if we want to be successful.

That does not mean we simply need to have a website. The fact is that most of agents who comprise that 90% already have websites. What they need is a way to capture customers from their websites and that’s something else altogether. That’s totally different. Most real estate websites don’t have an effective LCM or “lead capture module” at all, resulting in little to no business coming from the website. In fact, most agents have a website already but did no business from that website last year.

On the other hand, if that website has an effective LCM, it can capture the name, phone number, and email address of between a fourth and a third of the site’s visitors, or about 30 times as many leads as a typical real estate website. And with effective lead capture technology on the website the agent is now able to bring in many more opportunities, and that allows him or her to toss the bad leads and only work with the good ones.

According to NAR, only a very few agents do much of their business from online sources, but for those agents who do, their results are phenomenal. They bring in lots of leads — the good, the bad, and the ugly — but the difference is that they have the option of flushing the poor leads because they’ve generated so many leads to begin with.

If you find yourself trying to turn bad leads into good ones, I want you to take a step back and see if the reason is because you have a shortage of leads. If you do, today is the day to fix that. You can be like those agents who’ve cracked the online business. You can add your own LCM technology and immediately have more opportunities than you can handle on the first day. Skeptical? Then try it. Check out LCM technology today and tomorrow you can start flushing the bad ones.

Take The Test Drive!

Okay Re/Max… Enough is Enough!

Matt Jones — Tue, 06 Nov 2012 16:04:56 +0000

Most of you who are regular readers know that I’m a pretty easy going guy. I don’t get on many rants, and it is pretty hard to ruffle my feathers. That said, if you happen to be one of my readers who is also a Re/Max agent, I want you to know that, in what I am about to write, I have no ill will toward you. To Re/Max? That’s another story. But if you are a Re/Max agent, I actually feel sorry for you because in all likelihood you have no knowledge of something your corporate office is currently doing. I didn’t know about it either until I got a letter from them in the mail. Before I tell you about the letter, I’d like to share a true story that will help me set the stage and ultimately make my point.

Back in 1969, I was a fourteen-year-old junior high school kid in Alamogordo, New Mexico. Now I don’t know about you, but I should probably tell you upfront that I can’t stand a bully. And because I was very small for my age, there was this one bigger kid who used to bully me on pretty much a daily basis. I hated it, but he was a lot bigger, so what could I do? Finally one day I told my dad what was happening to me, and my dad said that while he didn’t condone violence, occasionally violence was all some people understood.

He told me, “Son, you need to stand up to that bully, and when you do, there’s a good chance he is going to beat you up. But if he beats you up, you just make damn sure he knows he was in a fight.” I thought to myself, “Thanks a lot, dad. Thanks for nothing.” I was terrified. I certainly didn’t want to get beat up, so I continued to endure the daily bullying assuming that he would eventually lose interest in me and stop.

Well one day during our lunch period, the bully approached me and demanded that I let him have a drink of my Coke. I came from a poor family and I had just spent my very limited lunch money on a soda at the concession stand and was planning on nursing that Coke, making it last through my entire lunch. Well he demanded, so as much as I hated to, I handed him my cup. He took one sip, and then promptly hawked up a loogie and spit it into my Coke! Nasty!

I was furious… so furious that I was shaking. But he was 6 inches taller and 50 pounds heavier than me. I walked away in shame as my dad’s words continued to burn in my mind. And as I burned I also quietly followed him outside, and as I followed him, something in me just snapped. I couldn’t stand it any longer. I walked up behind him quietly, and then I called his name while at the same time I swung my fist at his face with every ounce of effort I possessed. It was like something out of a cartoon.

The bully turned to face me just in time to receive my fist directly on his jaw. I hit him so hard that it knocked him backward about six feet and he was stunned. As he recovered we circled each other with fists up and I prepared for the inevitable beating I was sure I was about to receive. But strangely, it never came. He kept circling, threatening and swearing, while I continued to face him down. Soon some teachers came running and the fight was over. One punch, and I threw it.

The moral of the story is that my dad was right. That bully never bothered me again. And more importantly I learned a valuable lesson that day. As much as you would prefer not to, you have to stand up to bullies. Is it fun? No. Is it scary? Absolutely. But it is just plain the right thing to do. Not only because it stops the bullying behavior, but because it often emboldens others who are also being bullied to stand up as well.

So why am I telling you this story from my childhood? Here’s why. Forty-three years later, I am once again being bullied. It seems that Re/Max corporate suddenly has me in their crosshairs. “Why?” you ask. It seems that they don’t like my company’s yard signs. Many of you will recall that two years ago I was served with the first of a series of cease and desist letters demanding that I immediately stop all use of red-over-white-over-blue in my yard signs. Seriously. Stop laughing.

It seems Re/Max claims to own a trademark on all uses of red-over-white-over-blue and that anyone else who also uses red-over-white-over-blue is infringing on their trademark. More importantly, they have embarked on a very aggressive campaign to enforce that “trademark”. But do they have the trademark they claim? Well upon reading their official trademark filing, it seems that Re/Max does, in fact, own a trademark on one very specific use of red-over-white-over-blue in a yard sign. Not on all uses, but one, very narrowly defined by an included drawing, use of red-over-white-over-blue.

If you don’t know and are interested in the history, please feel free to read the entire saga at the following locations on my blog: Part 1 | Part 2 | Part 3 To date, I have received four separate “final notices” from both Re/Max legal department. First they said they were serious. Then that they were really serious. Then they were really, really serious. Finally they have retained an independent law firm, who tells me they are really, really, really serious. They have also prepared a civil complaint they have threatened to file against my company in US District Court. To read their latest letter and the complaint click here: Letter | Complaint

Of course, my position still remains the same. FavoriteAgent.com also uses red and blue on a white background for our logo and has since its founding. It looks nothing like the Re/Max logo, other than being red and blue. The proportions of red and white and blue are also different. The shades of red and blue are different. The relative placement of the company logo is different. In other words, they two are completely different.

While I certainly respect their (or any other company’s) legitimate trademark or trademarks, I absolutely oppose their expansion of those trademarks by what can only be described as bullying and intimidating other smaller companies. When I say bullying I mean any activity of repeated, aggressive behavior intended to harm another party, whether physically, financially, or emotionally. Re/Max is a bully, plain and simple. Why do I say that?

As a result of my publishing the prior three articles about my Re/Max saga, I have been contacted by numerous other company owners who have similarly been threatened by Re/Max, many of whom have already abandoned perfectly legitimate sign designs and replaced perfectly good signs in order to avoid extremely expensive litigation. And the more cases of this I discover, the madder I get. I have decided that it’s time to stand up to this bully, not only for my sake, but for the sake of those others who are unwilling or unable to fight.

Here is what I intend to do. First, I have posted my answer to their latest threat. My Answer Next, I would like to discover as many different cases of their “expansion by intimidation” business practice as I can find. Third, if you haven’t previously weighed in, I would like to solicit your opinion as to whether or not you find our two signs to be the least bit confusing. You can vote by clicking this link to our Facebook Survey.

Finally, I would love to hear your feedback, your suggestions, names of any media personnel who might be interested in this story, and even your recommendations of a law firm specializing in trademark law. I feel certain that there are some who might like to explore the possibility of a class action against Re/Max, particularly given the extent to which they have used this practice and the type of national publicity this lawsuit will bring.

The simple fact is that my company is tiny compared to Re/Max, but I still remember my dad telling me that it’s not the size of the dog in the fight, but the size of the fight in the dog. I hope that I don’t ultimately have to punch this bully in the mouth like I did in junior high, but I’m prepared to fight as long as I can. If I don’t stand up to them, I won’t be able to look at myself in the mirror. I say it’s time to stop this bully and I am just crazy enough to give it a shot. So please vote, comment, and stay tuned…

Take The Test Drive!

Supply and Demand

Matt Jones — Mon, 22 Oct 2012 18:24:16 +0000

In the last chapter, we compared the traditional, or Price approach with the Traffic approach. We contrasted the two listing approaches as well as their different results. Now let’s take a little closer look at my Traffic approach. Up until now, I’ve shown you how it works, but I realize that because it’s so different from the traditional approach we’ve all learned and used for years, you still might be reluctant to give it a try.

Instead, you’re no doubt having thoughts like, “Maybe it works in your market, but I’m not so sure it will work in mine.” Or, “What if I’m in a Buyer’s Market?” Or, “Prices have declined in my market.” Or, “What if my client is underwater?” Or, “What if the economy is bad and we have lots of inventory?” The fact is it’s not easy going against the norm, so let me convince you.

I’ve taught my Traffic approach to more than 100,000 agents over the last eight years, many in person and many more from one of my books, series of articles, or online seminars. Because of that, I regularly receive email from agents who are either using, or are considering using, my Traffic approach in their own practices.

The emails I get generally fall into one of two categories. The ones I like best are those that go like this: “I tried your listing approach, and I can’t believe how well it worked!” These agents actually tried it and found out for themselves that not only does my approach work well, but it’s also easy to present, and their clients love it.

The other emails are more like this: “I love your approach, but I’m afraid it just wouldn’t work here in my market because… blank.” Some agents may fill in that blank with their local inventory levels, others with home prices, others the economy, and so on. In other words, their email is, “I love your approach, but…”

One day I just happened to receive two emails, and coincidentally, they were both from agents in the very same market. One said, “Your approach is great! I can’t believe how the clients get it and choose it over the traditional approach every time!” The other email said, “I really like your approach a lot and I’d love to use it but, unfortunately, it won’t work in my market.”

The sad thing is that both of those agents who sent me the two opposite emails were right. Huh?! Yeah… the one who actually tried it and discovered for himself just how well it worked and how easy it was to present, was exactly right — it is the best listing approach ever. But sadly, that agent who didn’t try it was also right — it will not work in his market. He won’t try it, so it will never work for him. Ironically, both agents are correct.

But rather than just give you examples from different markets — hot markets and cold markets, buyer’s markets and seller’s markets, good economies and bad economies, high inventory and low inventory — I think it’s just better to show you why it works. You already know how it works, but after you learn why it works, you will understand that it truly is an approach that will work anywhere, anytime.

Okay, so why does it work? Because it is based on the economic law of supply and demand. Here is the “textbook definition*” of the law of supply and demand:

Yawn! I know. But now let’s define supply and demand in a more “down home” practical way. The first two laws deal with a fixed supply and changes in demand, while the last two laws deal with fixed demand and changes in supply. Another yawn!

Okay, another way of looking at it is that laws one and two are “micro” or small picture while laws three and four are “macro” or big picture. Why? Look at what’s fixed or unchanging. The only way to have an unchanging supply is when we are discussing only one home (micro). The only way we can have an unchanging demand is when we look at the entire market (macro). In light of that, let’s apply that explanation and look at the four laws of supply and demand:

If you have increased demand, or more buyers, and you have a fixed supply, or only one house to sell, then you can command a higher price. Law one. Think of times when you’ve had multiple offers on a home. They had to bid against one another, and the home got top dollar.

On the other hand, if you have less demand and a fixed supply you may have to lower the price to attract a buyer. Law two. Think of the traditional approach when the listing doesn’t sell for a period and you then ask the seller for a price reduction to attract buyer interest. If it doesn’t sell, you reduce the price again and again until you finally attract a buyer.

Since the Traffic approach to listing is all about selling only one home, then by definition, supply is fixed. In other words, laws one and two directly apply to the Traffic approach. On the other hand, the third and fourth laws don’t directly apply since they deal with changes in supply. But, they do indirectly apply when looking at the entire market as a whole. Now let’s take a look at laws three and four.

If you consider the larger market, it’s clear that we cannot affect demand. The total aggregate number of buyers for any given market at any given time is fixed. It is what it is. So, if demand remains constant, and the supply of homes increases, then there are more sellers who are competing for the same pool of buyers and prices will fall. Think of neighborhoods where many sellers put their homes on the market at once. That’s law three.

By the same token, if demand remains constant and there are fewer homes available in the market, buyers will then have to compete for the limited inventory and prices will tend to increase. Think of very desirable neighborhoods with limited inventory. The homes fetch top dollar. This is law four in a nutshell.

Most of the time we think about laws three and four but we often forget about laws one and two, probably because most of our training comes from a “big picture” perspective and not a “sell one home” perspective. Think about it. Where do we get our market information? Typically we get market data from our local boards or from the National Association of Realtors®, and both are big picture. But when it comes to listing and selling real estate, the first two laws are the ones that most directly apply.

Now that we have examined supply and demand, let’s apply it to my listing approach. Because supply and demand is an economic law, it works the same everywhere. Just like the law of gravity, it is not market specific. Just like gravity that works the same in a buyer’s market and a seller’s market because it is a law of physics, supply and demand works the same everywhere because it is a law of economics. That’s why they are called laws and not theories… because they work the same everywhere.

Now think about my Traffic approach. When we use it what are we actually doing? We are taking the fixed supply of one house and we are increasing the effective number of buyers for it by doing what? By bribing agents to show it to their clients. Simple. Are there still the same number of buyers in the overall market? Yes. But most of those buyers were never going to see your listing. Only a small number were.

By paying agents to show it, we have effectively increased the number of buyers who will ultimately see the home we are trying to sell. In other words, effective demand is increased, and that will support a higher price because there are more buyers competing for the home. And in your seller’s world, that is real demand. It’s not about how many buyers are in the broad market, but how many are in the market for their home. Fixed supply, increased demand. Law one.

Now let’s look at some specific instances where you might consider using the Traffic approach and examine the “why” for each of them. In each instance I will demonstrate why the Traffic approach is the best approach when it comes to selling in the least time and netting your client the most money in the process.

Buyer’s Market. In a Buyer’s Market, the buyers are in control. There is a larger supply of homes to meet the fixed demand of customers. In other words, there are more properties than buyers — any buyer will have his choice of homes. Law Three. So how do you enhance your seller’s chances of ultimately closing? By increasing demand for his home using the Traffic approach.

Recession. A recession is generally understood to be a widespread decline in economic activity. In practical real estate terms, that means a reduction in demand chasing a fixed supply. Law Two. In a recession, you can use the Traffic approach to effectively increase demand for your client’s home and help your seller to overcome the underlying economic conditions while still netting him top dollar.

Negative Equity. When a seller, for whatever reason, has little to no equity or worse yet, negative equity, the only way to help him sell his home is using the Traffic approach. Instead of selling at the lowest possible price, the Traffic approach sells the home at the high end of the reasonable range of value or approximately 10% more than the Price or traditional approach. In other words, you’ve effectively raised the price by 10%. Then you spend a portion of that higher price to buy additional demand. That will allow a seller with negative equity to get out of a home with the least amount of pain.

Pre-foreclosure. When a seller is having a hard time making the payments on his home, he needs relief quickly — often there are only a few months remaining before the home goes into foreclosure. For that reason, the Traffic approach is the perfect solution because it sells the home in half the time required by the Price or traditional approach. If the seller is to salvage any of his equity, he needs an immediate sale.

Expired. This seller is frustrated. He is looking for a fresh idea, and has already spent at least one listing term with his home on the market. Using the Traffic approach you will not only be offering your seller a fresh idea that is different from what he has already tried, but more importantly, you will sell the home in half the time of the Price approach while netting your seller more money.

FSBO. A client who has failed at selling his home FSBO, is a perfect candidate for the Traffic approach for two reasons. First, it addresses the reason he tried to sell his home FSBO in the first place — more money in his pocket. It also shows him a way to reduce his time to sell by increasing effective demand for his property. Using the Traffic approach he will net more and sell quickly.

Stigmatized. When a home is stigmatized, by being on the market for too long, it will have an artificially low demand meeting a fixed supply. Law Two. The best way to overcome this situation is to increase the demand by bribing buyer’s agents to show the home — my Traffic approach. The result will be the highest possible price and the least time on the market.

Price Reduction. Whenever you have a seller who is wanting to reduce the price of his home, what is happening is that you are attempting to increase demand by lowering the price. The downside is that the client will net less money in the process. Demand is low and the supply is fixed. Law Two. A better solution might be to raise the price to the high end of the reasonable range, while designating part of that increase to raising the commission to effectively buy more demand. This is my Traffic approach.

Dog house. This is similar to the Stigmatized example earlier. A “dog house” is in poor condition and tends to repel buyers. In other words, you have an artificially low demand and a fixed supply. Law Two. Using my Traffic approach you can raise demand and command a higher price while selling the home quicker than would ordinarily be possible..

High inventory. High inventory, often caused by a recession, is the classic case of high supply meeting fixed demand. Law Three. The best way to set your client’s home apart is using the Traffic approach. It will ensure the home is on the most show lists possible by having motivated buyer’s agents trying hard to match their buyers to your client’s property.

Seller’s Market. For every rule there is an exception and the same is true with the Traffic approach always being the best way to sell a home. There is one instance where the Traffic approach (and any brokerage approach for that matter) is not needed. That instance is a seller’s market. In a Seller’s Market, the sellers are in control. There is a smaller supply of homes to meet the fixed demand of customers — not enough inventory to go around. Law Four.

In a seller’s market, the seller may not even need us. Fortunately, seller’s markets are few and far between. Sure, they may hire us anyway, but the fact is that, if the average days on market is less than a month or so, the seller could very easily sell it FSBO. In a seller’s market the homeowner should be able to command top dollar for his home without even listing it, and if he does list it, he doesn’t need to offer much in the way of agent compensation. If we get the listing anyway, we should count it a blessing.

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Let me sum up by saying this: In the competitive market of real estate, supply and demand really is everything. Understanding and using my Traffic approach to effectively adjust that supply and demand relationship to the advantage of your client, will provide your clients with the ultimate in real estate brokerage service. And you’ll set yourself so far above your competition that nobody will be able to compete. You’ll become the go-to agent when it comes to selling a home, and you’ll serve your clients better and you’ll make more money doing it. Now how cool is that?!

Take The Test Drive!

Bonus Podcast: Cindy Young Interview

Matt Jones — Fri, 05 Oct 2012 21:14:58 +0000

In this exclusive podcast Cindy Young explains how, after several unsuccessful tries, she mastered technology-based real estate and went on to become a top producer generating the vast majority of her business online. Her success is clearly no fluke, but rather a string of seven consistent RE/MAX award-winning years, including five back to back years earning over $100,000 in the small town of Beaufort, South Carolina.

Click Image for Podcast

Cindy credits nearly all of her success to the remarkable opportunity she found in doing online business, after setting her mind to learning the secrets that ultimately turned her practice around. It wasn’t easy, but after cracking the code to doing real internet business, her career has been steady and growing even during the worst period of real estate in history.

Cindy Young

After years of success as a RE/MAX agent, in June of 2012 Cindy and a friend and colleague opened Point South Realty. Cindy continually strives for excellence through education. She has earned a BA through Indiana University and is currently finishing a Masters in Business Management. She has earned numerous Realtor designations: ABR, ASR, CRS, and GRI.

An ex-Marine herself, Cindy is married to a retired Marine and has two adult children who also reside in Beaufort. Her family also consists of two energetic boxer dogs. Although, Cindy and Jeff are originally from Ithaca, NY and St. Louis, Missouri, their plan is to make Beaufort their permanent home. If you have a client who needs help in buying or selling a home, Cindy is ready to assist and welcomes your referrals.

I think you will find her success story to be both inspiring and educational. and it is one you truly won’t want to miss.

Take The Test Drive!

Which Approach: Price or Traffic?

Matt Jones — Wed, 03 Oct 2012 14:35:47 +0000

According to the 2011 National Association of REALTORS® Member Profile there were a total of 1,024,669 Realtors® as of Oct. 31, 2011. Add to that the other half of the licensed real estate agents who are non-members and you have roughly two million agents who are practicing residential real estate today. You know what that means?

Click Image for Podcast

It means that there are potentially about two million different ways to sell a house. That is a lot. But the truth is there are really only two: the Price approach and the Traffic approach. In fact, nearly every single agent practicing today uses a version of one of those two approaches. Sure, each might put his or her own spin on the approach they choose, but at the end of the day, it’s still one of those two approaches. But here is something you might not suspect:

The vast majority of agents today use the Price (or traditional) approach, while only a very small number — probably less than one percent — use the Traffic approach. And if you think about it, the crowd is almost always wrong. That fact alone should help you decide which approach you should master. Nevertheless, if you’re still not convinced, how about this: The Traffic approach actually sells homes in about half the time and nets the seller more money in the process, or at least that’s what the numbers indicate.

Oddly, since it clearly produces better results, you would expect that every agent would use the Traffic approach, but unfortunately the vast majority don’t. And they don’t for a variety of reasons: Some have never heard of it. Others who have are uncomfortable using an approach that is not like everyone elses. A few know about it, but still don’t use it because they are afraid of what sellers might think, or worse, afraid of what their brokers or their colleagues might think.

As someone who’s personally shared both approaches with hundreds of sellers, I can tell you that most sellers, when given the choice, actually prefer the Traffic approach. I’ll go out on a limb and predict that if you present it properly, you will prefer it as well. After all, it will serve your clients better, get you paid faster, and it will put more money in your pocket. But wait — I am getting ahead of myself.

Here’s what I’d like to do: First, I’d like to review both approaches, explain them both in detail, and then contrast and compare the two. After fully understanding how they work, you’ll be able to make your own informed decision as to which approach is better for you and your practice, and you’ll have the added benefit of being able to better explain both approaches to your clients when you go on listing appointments.

The Price Approach. The Price approach, also known as the traditional approach, is a listing approach you probably know like the back of your hand. Nevertheless, stay with me, because there are parts of it you probably never thought about. Let’s take a minute to examine it in detail.

As you probably know, the centerpiece of the Price approach is the CMA, or Comparative Market Analysis. Coming up with a competitive price is essential to using this approach. In fact, the CMA is the most important part of the traditional listing presentation. Have you ever wondered why? Why is it so paramount? Why do agents who use the Price approach for their listing presentation spend hours tweaking their CMAs and then use just the right paper and printer to make them look just right?

The reason is simple if you think about it — in fact, it should be self-evident: Using the Price or traditional approach, the price is how you are actually selling the house. And because you are using price to sell the house, the CMA is the most important part of the presentation. If you get the CMA wrong, you might scare the seller and not get the listing, or even worse, you might “buy the listing”, or over price the house and have a listing that will never result in a sale.

The traditional or Price approach uses just one thing to sell the house: a competitive price. But how does it go about that? Easy enough. Although most agents have never really thought about it, the Price approach uses a CMA methodology that ultimately leads to a low or competitive price. Think about it. Even the very use of closed comparables (selling prices) to arrive at a listing price (asking price) by its very design skews the value to the low side by at least the list-to-sale ratio.

We’ll cover the CMA in greater detail soon enough, but suffice it to say, the traditional method of doing a CMA will allow you to place the value exactly where you want it — at a price that will make the house sell. Why is a competitive price so all important? Because if the price is low enough, it will attract buyers to the home, and if that is all you are relying on to sell the house, you better make sure your price is competitive.

So when we list a home using the Price approach, we either start or attempt to start at a low or competitive price. Then if we are lucky enough to ultimately list the home, we put the new listing into the MLS and hope for the best. If the house doesn’t sell in a month or so, we ask the seller to reduce the price and the cycle starts over. And if it doesn’t sell in another month, we ask for another reduction. We incrementally move from a price that is already low, to even lower, and lower still, until we eventually attract a buyer for the home.

The good news about using this approach is that it works every single time, assuming it’s executed just that way. The seller continues to drop the price until it gets so attractive that some buyers can’t pass it up. But if we’re really being honest, we have to wonder whether or not the seller’s primary objectives are being met. Let’s think about what the seller wants. He wants to net top dollar for his home and to sell in the least amount of time. And this approach almost guarantees he won’t do either one.

The Price approach, by its very design, yields a price that is at the low end of the market and a selling timeframe that is longer than necessary because it prolongs the sale, while waiting for the reductions to incrementally lower the price. So why has it been used throughout the years? Because it will result in a sale every single time if it’s executed according to the plan. And more importantly, it requires very little skill on the part of the listing agent, because price is doing all the selling.

The Traffic Approach. Unlike the Price approach, the Traffic approach uses a different, and much more accurate valuation method — a method that prevents the agent from underpricing or overpricing the home. It starts by identifying a property’s reasonable range of value, and then, depending on a choice made by the seller, prices the home accordingly .

The Traffic approach, and its valuation method, are based on an economics principle known as price elasticity. The concept of price elasticity says that real estate and other unique goods don’t tend to indicate one specific value, but rather a range of value, inside of which there will be little resistance to price. In other words, a reasonable range of value.

Actually, if you think about it, it’s a matter of common sense. What any particular home is worth depends on many factors, from location, to features, to size, to motivation, to the number of buyers in the market, to the prices of competing properties, to the mood swings of the appraiser, to the results of the home inspection, and frankly, to a certain extent, luck.

That flexibility of the value, or that elasticity of pricing for residential real estate tends to be approximately 10%. Or in other words it can best be understood in terms of a range of value plus or minus 5% from a central or average value. And that 10% range of value is what is known as the “reasonable range of value”. Here is what happens:

If you were to increase the price above that reasonable range, there will be some push back as to the property being over priced. By the same token, if you were to decrease the price below that reasonable range, most people would consider the price to be “a deal”. But anywhere within that reasonable range of value the price is typically received without much resistance. And that reality is what’s known as price elasticity.

Here’s an example: Let’s say a home is theoretically valued at $200,000. It not actually worth $200,000, but rather it’s worth somewhere between $190,000 and $210,000, depending on any number of factors, like whether the buyer or the seller is more motivated, how many other competing properties are currently on the market, the number of competing buyers for the home, and so on. And as long as the house is priced somewhere within that range, there is little price resistance.

Since the Traffic approach doesn’t use the price to sell the home, the CMA is no longer the centerpiece of the listing presentation. Instead, what becomes most important in the Traffic approach is generating additional traffic to the listing. That’s where the name the Traffic approach comes from. It is typical for listings using this approach to have several times as many showings over the same period of time, as homes listed using the Price approach.

So how do we generate the additional traffic? Easy. We do it the old-fashioned way — we buy it! Here’s what I mean. Remember how we priced the home at the high end of the range instead of the low end? That difference between the low and high ends of the range is typically about 10% of the price — remember price elasticity?. So when we price the home on the opposite end of the reasonable range, we’ve effectively raised the price by 10%. Now, we take 2% of that increase and use it as additional commission.

It may not seem like much, but those two percentage points mean that for a typical listing at 6% that is now raised to 8% then we have raised the commission by a third — 2% is a third of 6%. And since we’re no longer relying on price to sell the home, instead of asking for a reduction when the home doesn’t sell, we simply raise the commission again.

If you think about it, the initial increased net to the seller is 8% (10% increase less 2% additional commission paid), and if the approach requires increasing the commission further, there is plenty of room to raise it while still netting the client more money at closing. We can still raise the commission 8 more percent and still net the client the same money.

And what is really nice about this approach is that as long as we’ve properly identified the reasonable range of value, the price will almost never become an issue. And finding the reasonable range of value for a property is easy and extremely accurate using the CMA methodology we will cover in detail in an upcoming segment.

But is “bribing” agents like that okay? I believe it is. Obviously, my use of the “B” word is for effect, but our entire economic system of free market capitalism is based on providing monetary incentives. It is as basic to our system as supply and demand. Monetary incentives is the very cornerstone of capitalism. And this method has been used in commercial real estate and in new home sales for years. Offering a monetary incentive to a buyer’s agent only increases the traffic; it doesn’t sell the home.

I suppose it’s possible for an agent to steer a client into a home just for the money, but I don’t know of a single agent who would knowingly put his clients into a home that was not right for them. However, by the same token, I don’t know of a single agent who will knowingly throw away money. If he can do the same work and make a third more money, he will be glad to do it. He may not push the clients to buy, but you can bet that houses with higher commissions will be on every show list when available.

So let’s take a second to look at the scoreboard and compare the two approaches:

Comparison	Price	Traffic
Days required to sell (DOM)	Nearly twice as long	Nearly half as long
Net dollars to client	7-8% less money	7-8% more money
Agent compensation	A third less commission	A third more commission

Which one do you like better? I thought so. Me too. And besides it being just a better approach, you will soon discover that it is easier to present, your clients will like it much better, and it will set you apart to sellers in your community as someone who is able to sell homes more quickly than other agents, and to other agents as someone whose listings to always look for first.

I can’t tell you how many times I’ve gotten a call from an agent asking me if I had a listing in such and such a price range or in a particular part of town. Word gets around. If you consistently use this approach, your life will be easier, your listings will sell quickly, and you will earn more money. How cool is that?!

Well, now you know the basic underlying theory to my Traffic approach and how it differs from the Price or traditional approach. Next we’ll go into a lot more detail — we’ll take a very close look at the Traffic approach, and I’ll show you why it works and I’ll show you when it works. Only then will you completely understand it, and once you understand it, you will almost surely use it in your own practice. You’ll see.

Take The Test Drive!

2012 State of the Industry Agent Survey

Matt Jones — Mon, 01 Oct 2012 19:07:02 +0000

Click image to begin survey.

So it’s been a year since we last surveyed our readers and that means it’s that time again. I want to invite you to participate in this “state of the industry” agent survey.

The survey is only two minutes long, and of course I’ll be sharing the results of the survey with my readers and with the National Association of Realtors®, so the more participants we have, the more reliable our data is.

In the past we have discovered some remarkable statistics that no one else has, and I suspect we will receive some surprising answers this time around too. Thanks!

Take The Test Drive!

Bonus Podcast: Gary Thompson Interview

Matt Jones — Mon, 24 Sep 2012 14:38:47 +0000

Click Image for Podcast

Podcast interview reveals how one agent and broker transformed his business during one of the toughest economic times in recent history. Listen in as Gary Thompson shares how he was able to crack the code and now does about 80% of his business from the largest of all sources today — the internet.

Gary isn’t new to real estate. In fact, he got his real estate license in 1978 but had put real estate on the back burner for years as he focused on his computer consulting business. Until recently, according to Gary, when he discovered this blog and my approach to real estate and “got excited” about the residential business again.

Gary Thompson

Now using simple, user-friendly LCM technology he captures 2-3 new customers, on his own, every day, spending only about $2 per lead, he says. Contrast that to his earlier days when he bought leads from companies like Zillow, Market Leader, and others and spent hundreds and hundreds of dollars and generated nearly no real business.

In this podcast, Gary shares exactly what he did to start getting warm buyers every day — without spending more money in advertising — and how any agent can do the same thing in their market. This one is a must hear interview. Sorry, but we don’t have a transcript.

Take The Test Drive!

Starting at the Beginning

Matt Jones — Mon, 24 Sep 2012 12:00:21 +0000

Before we start getting into the details of my listing approach — what I’ve named the Traffic Approach — it is important to give you some background. The reason this approach is so different is that it didn’t come through one of the usual sources. I didn’t learn it at the feet of a guru, or coach, or trainer, and I didn’t steal it up from another book or seminar and put my own spin on it.

The truth is, I discovered it by accident almost ten years before I ever came into the real estate business — back when I was a seller. A desperate seller. And it worked so well that I filed it away until the next time I needed to sell a home. Little did I know at the time that a decade later I would be selling homes for clients and using this very same method to do it. Here is the story of how I discovered it:

In the spring of 1994 I found myself in a tough spot. I had purchased my dream home just a year earlier — the perfect home in the perfect location. It was a beautiful 2,500 square foot ranch house, on the 11th fairway of one of our area’s finest golf courses. The floor plan was perfect for entertaining, the paint was like new, as were the hardwoods and carpet. The kitchen was magnificent.

Looking out the back windows of the house was like browsing through a golf magazine. Sitting on the rear deck as the sun came over the fairway, I had views of three ponds, complete with ducks, geese, turtles and frogs all making their morning sounds. It was unbelievably beautiful. The landscaping was impeccable in every direction and best of all, I didn’t have to maintain it! Sounds perfect, right?

Well, nearly perfect. There was one small problem. Being 12 miles outside of town, it was 20-30 minutes from everything, and for my wife, my dream house turned out to be a nightmare. Her days found her at the wheel of the minivan for hours at a time, taking children to private school, lessons, practices, shopping and errands. And after trying hard for about a year she was ready to move from our beautiful home back to the center of town.

There is an old saying: “Happy wife, happy life.” I’m not sure who first coined that expression, but it’s certainly true. Well, my wife was unhappy in paradise and being the wise man that I am, we began looking for a new home more centrally located than our golf home twenty minutes from town. Before long we found just the home we wanted, we made a full offer, and bought it.

Like many sellers, I got it backwards. We started looking for the replacement home before ever thinking about selling our existing home. It was only after moving in and getting settled into the new home, that we began thoroughly cleaning, doing minor repairs, and touching up the paint on the old dream home, until it was like new. Because it was like a new home, in a pristine setting, I assumed it would sell quickly.

I called up a Realtor® friend and asked him to meet to discuss his helping me put my house on the market. I didn’t know any better, so I had the home pre-appraised, and with that appraisal in hand I sat down to meet with my friend Jack. I needed to sell it as quickly as possible because I was facing two mortgage payments every month until it sold.

Jack was a Re/Max agent and was, as he was quick to point out, one of the top-producing agents in our community. Needless to say, I was relieved when he assured me that the market was “hot” and that he felt he could sell the home quickly… possibly in only a week or two. I thought, “Well that’s good — I’m certainly not too excited by the thought of making two mortgage payments.”

He brought out a stack of paper that I later learned was what agents call a CMA. In it he had compared my home with several other homes that had recently sold and he had also arrived at a an “asking price” of $165,000. He was taken back a bit when I told him that it had just had it appraised for $170,000, but he dismissed the appraisal and assured me that he was on top of the very latest market data and that his number was no doubt more accurate than the appraisal.

Well, because Jack was a top-producing Re/Max agent, and because I had bought the home a year earlier for only $135,000, I reluctantly agreed to list the house at his number.. After all, he was the expert, and I wasn’t, and he was my friend and I knew he wouldn’t steer me wrong. So I put the listing in his capable hands and forgot about it. I assumed I would be closing the sale in a matter of days, or at the most, a few weeks.

A month later as I was paying my bills and writing out two mortgage checks, I thought about my sale and decided to give Jack a call. It was a rather odd call, in hindsight. I was simply calling to check on our progress, but he seemed kind of defensive. He told me that the market had cooled off quite a bit since last month but that he still felt certain we’d sell it soon.

Then he told me that he had looked at the latest market data and he felt like we were a little overpriced. He suggested that we lower the price down to $162,000 to try and attract a buyer. I reminded him that the appraisal said the home was worth $170,000, and he reminded me that he was in the market every day and that we really needed to reduce the price. Fair enough.

I thought about the prospects of making the next two payments and thought, what’s the difference. If I could sell it immediately at $162,000 it would be no different than if it sat on the market for two more months and sold it for $165,000, having by that time spent $3,000 on two more mortgage payments. More importantly, I had to think about what if it didn’t sell in two months or at that price? So I went ahead and agreed to reduce the price.

A month later, when I was writing my mortgage check, I called Jack again. I was starting to get worried. His response was that “the market had spoken” and that we were still over-priced. I particularly remember him telling me that WE were overpriced and that WE needed to reduce the price even further, and I thought, “WE aren’t reducing anything — I am!” His new suggestion was $160,000, only this time I balked and I balked hard.

I asked him how many people had actually viewed the house. He said, “None, the price is too high.” I said, “How do we know the price is too high? Nobody has even seen it yet!” Being my friend, Jack was very direct with me as I was with him, and I still remember his response nearly twenty years later. He said, “Okay, well if you’re so smart, what do you think we should do to sell it?”

Now I was on the spot. I started thinking fast and forming a plan as I spoke. I said, “Jack, we don’t have a price problem, we have a traffic problem. And we’re trying to solve a traffic problem with a price decrease. The walls could be made of pure gold and yet nobody has bought the house because nobody has seen it! If anyone would see it, I have no doubt they’d buy it.” I was frustrated.

And then it came to me. I said, “Here’s what I want to do, Jack: I want to raise the price to $170,000 and I want to put a copy of the appraisal on the kitchen counter for everyone to see. Then they can’t argue it’s not worth my price. Next, I want to raise the commission from 6% to 8% so we can bribe some agents to bring their buyers out to see my house. I know that if they see it, they will buy it.”

Jack immediately said, “It’ll never work.” I told him, “Well humor me, since we tried it your way for nearly three months, and that way certainly isn’t working.” He said, “Fine,” in that same tone that you’ve no doubt heard from a frustrated spouse when you knew it was anything but fine. And that was our new marketing plan. Now it was time to wait and see.

Seven days later, Jack called me to tell me we had received a full offer. I accepted the offer and we waited on a new appraisal. Sure enough, it appraised for $170,000 again, and we closed a few weeks later. I thought, if I ever needed to sell a house again, I knew exactly what I would do. Little did I know at the time that I would become a Realtor® eight years later.

Well, when I became an agent in 2002, I immediately wanted a USP or Unique Selling Proposition for my practice — something that would make me stand out from over a thousand other agents. I thought about my method of selling houses by effectively “bribing agents” and decided it was perfect. I became a listing agent and this same approach worked so well that I went on to list 114 homes my first year in the business, and all but two at 8% or more in a market of 6% or less. The other two were at 7%.

Did they all sell? Of course not. But a lot more of my listings sold than the national average, and they sold in about half (55%) of the average days on market. But just as important as selling quickly, they sold for a higher price, which, in turn, netted my clients more money in the process. By using this approach I was able to get my clients top dollar for their homes, even though it was a buyers’ market.

How much more were we able to sell for? I don’t know for sure. My best estimate is that my clients netted 7-8% more money when it was all said and done. Here is what I can prove. The average markdown (the discount when applying the list/sale ratio) for our community was 5.4% while my clients’ average discount was only 2.7%. That is a minimum of a 2.7% higher net, but what that fails to take into account is that it’s a discount off a higher starting price — often as much as 10% higher starting price.

And trust me, netting more money in half the time makes for happy clients. Very happy clients. More importantly, it pays you more money, gets you paid quicker, and increases the likelihood of your even getting paid at all on your listings. That makes my approach the ultimate win-win listing approach. The seller nets more money, and I do too.

So now you know the basic concept. Simple enough, right? But presenting it in a compelling way is not quite so easy. After taking hundreds of listings and talking to hundreds of sellers, I’ve eventually figured out what works — exactly what to say and how to say it. In the early days, I’ll admit that a few of my presentations were a little rough, but as I learned what worked and what didn’t, I eventually refined it to the point where I won the listing nearly every single time.

My listing presentation has evolved. It’s evolved from using the traditional CMA to a much better CMA. It’s evolved from sitting at the client’s kitchen table, to the living room, to over the phone anywhere that I’m comfortable. It has gone from spending the bulk of my time simply hustling potential sellers, to now having more sellers than I can possibly service automatically coming to me. It has gone from a low-tech, in person, paper presentation to a high-tech, electronic, over the phone presentation.

As you begin to learn my approach I believe you’ll concede that it is a truly unique approach, and one that is almost too easy to use. In fact, agents from all over the country who’ve tried it have told me as much. Agents in good markets and bad markets. In small markets and large markets. In buyers’ markets and in sellers’ markets. Everywhere it has been tried, it’s had the same results. Here is a letter I received from one agent:

So how would you like to be the next agent sending me that letter or one just like it? You can be. My approach is easy to learn, and I will guarantee you that if you take the time to learn it you will have something truly different to offer your clients. Something that will make you stand out in a sea of sameness. But best of all, using my Traffic approach as your listing presentation, you’ll make more money and at the same time do an even better job serving your clients. Now how cool is that?!

Take The Test Drive!

A Tale of Two Listings

Matt Jones — Fri, 14 Sep 2012 15:09:38 +0000

I am about to tell you two true stories. I’m embarrassed to admit it, but both are actual detailed accounts of real listing presentations made by none other than yours truly. They are as different as night and day, and they illustrate just how much easier this business can be, if you do it the right way or on the other hand, just how much harder it can be if you do it wrong.

When you read my accounts of these two listings, I want you to picture yourself as the listing agent in the stories, and I want you to imagine that you’re the one making the presentations and taking the listings. I also want you to think about which one more closely resembles your last listing appointment, and then I want you to ask yourself which one you would like to be your next.

Listing Presentation # 1 — The Listing Presentation From Hell

Before you decide that this listing is just sour grapes on my part, I should tell you that I did land the listing, that the clients were very happy and couldn’t have been any nicer, and they were even so pleased with the way that we sold their home quickly that they recommended me to their neighbor who was also selling.

I believe that in the story I’m about to share, the sellers were not the problem. I was not the problem. The presentation was the problem, but I’m getting ahead of myself. Go ahead and check it out and see what you think.

Okay, one February evening in 2003 — or maybe it was March or April — I had a listing appointment. I really don’t remember the exact date, but I do remember that I didn’t want to waste my entire evening so I had set the appointment at 6pm. My sellers had agreed to that time, although, in retrospect, it was probably earlier than they would have preferred.

Like a good agent, I arrived at the home a few minutes early, and as I waited in front of the house in my car I spent the time returning some phone calls. Soon it was 6. No sellers. 6:05. Still no sellers. I started to think I was going to be stood up. I decided I’d wait until quarter after. I knew I didn’t want to wait too long lest I be thought of as desperate.

Finally at about 6:10 I looked up as a Ford F-150 truck came flying past me and turned into the driveway. As the vehicle nearly skid to a stop, the door flew open and Mr. Seller jumped out and nearly ran to the front door. He was still in uniform and being a vet I knew that the first thing he’d want to do is change into something comfortable, so I waited.

At about 6:11 or 6:12 I looked up as mom came whizzing by me in her Dodge Caravan and also turned into the driveway, practically on two wheels. As she came to a stop, all the doors flew open simultaneously, and mom and kids went flying out of the minivan and toward the front door in a mob. I decided to give them a few minutes to get settled before knocking on the door.

Eventually I came to the door and was greeted by mom. She brought me in and invited me to sit on the couch in the living room. A dog was excitedly barking and the kids (it seemed like 20 of them but in reality it was only 4) were bouncing off the walls and racing up and down the hall, taking laps through the living room, with the dog on their heels, all trying to work off their sugar highs from their after school daycare.

Over all this flurry of activity and racket I became aware of a base level of noise somewhere north of 100 decibels and realized that the television was blaring in the background, although nobody was watching it. It felt like I was at a carnival, only everything was crammed into this tiny home. I started feeling a headache coming on.

Dad eventually came in to greet me and we began small-talking while waiting for mom to join us. About that time, mom put her head around the corner and bellowed in the general direction of the children, “What do you want on your pizza?” Apparently Little Caesar’s was cooking dinner.

As I tried to block out the sensory overload I was experiencing, I suddenly became aware that the dog had abandoned his chase of the children and had now become at least momentarily attracted to me and was (let me be delicate here) expressing his very amorous feelings in a very embarrassing way to my left leg.

That did it. Somehow that was the icing on the cake. That final detail in this unbelievable scene gave me an out-of-body experience. In my mind’s eye I was at the ceiling looking down at this “circus” and I remember thinking to myself, “How am I supposed to give a listing presentation in the midst of this tornado?”

It seemed as futile as trying to stack greased BBs in a stiff wind. And it was then that it came to me. It started as a very quiet, almost inaudible voice, but it rapidly grew into a full-throated scream. “THERE HAS TO BE A BETTER WAY!” I tried my best to collect myself and press on, but that voice was still screaming in my ear.

Most of the rest of the evening went by in a fog because “THERE HAS TO BE A BETTER WAY!” continued to ring in my ears. Yes, I made my presentation, took the listing, and we ultimately sold the house. Best of all, and in spite of it all, I eventually got paid for my work. Fantastic! But that out-of-body moment was a turning point in my practice. I vowed that even if I lost a lot of listings while trying to find a better way, I would not be a participant in another circus like that one. I was resolute.

But life is funny sometimes. As it turns out, I never lost a single listing, but I did figure out a better way. And eventually, that better way, got even better and better. Since then, I continue to develop what I believe to be the very best way to list a home in the history of real estate! I know that’s a bold statement, but I think it’s true. Next I’ll share with you the story of my most recent listing and see if you don’t agree.

Listing Presentation # 2 — The Listing Presentation from Heaven

A lot has changed since those early days: I am no longer an agent, my practice has grown, and I am now the broker of my own company. I decided when I opened my company that I would be a non-competing broker, or in other words, I would not work directly with clients unless I just plain couldn’t get out of it. This is one of those times when I couldn’t get out of it.

One morning not long ago I was having my usual breakfast at Chick-fil-a and one of the employees told me that a co-worker needed to sell her home. I spoke to the woman briefly and told her I would bring her a book to read that I thought would help her sell her home quickly and net her top dollar. She told me she would be glad to read it and was open to anything that would help her sell the house.

The book I was referring to is called Traffic: How to Sell Fast and Net More. I wrote it to be a companion piece for another of my books, The Ultimate Listing Presentation. After having been embarrassed a couple of days because I forgot to bring her the book, I finally remembered to bring a copy to breakfast and give it to her. I told her that I thought it might be the perfect strategy and I asked her to read it and to let me know what she thought.

The next morning when I came in for breakfast, I was surprised when she approached me and said she had already finished it. She said she loved the idea and wanted to use the “Traffic Approach” to sell her home. (The Traffic approach is the approach I discussed in the book and the same approach I am going to share with you here.) I told her I was glad,and asked her to come by my office later in the day and we could get it on the market.

As promised, when she got off work later, she came to my office. I reviewed the Traffic strategy with her, mainly to make sure she fully understood it. Then we reviewed the CMA I had completed earlier that day, and I directed her to my List-EZ website where she filled out a simple form, reviewed the contracts, and electronically authorized the listing. Done. How easy was that?!

But because I was out of signs, I told her it would take me a few days to get everything ready. We needed to put her home in the MLS, get it uploaded to all the other hundreds of websites on the internet, build her own website, and announce the listing to all the area agents. I asked her to come by in a few days to pick up the yard sign and lockbox. I also asked her to take some good photos of all the rooms in her home as well as some exterior shots, and email them to me so we could use them for her virtual tour and website.

A few days later, she stopped by the office, picked up her sign and lockbox, and took them home and installed them as I had instructed her. She had already emailed me the photos and I put the best ones on her listing, her virtual tour and her website. Although the home showed many times, I never saw the home in person until the night I brought an offer to purchase and contract by for her signature.

***

Think about it: Two completely different listing presentations, but both homes were just as listed and both clients were just as happy. Both listings were ethical and both were legally binding. So now let me ask you a question: Which presentation would you prefer to make? Duh! That’s a no-brainer! Okay, let me ask you another: Which one is closer to your current presentation? I thought so.

Over the next ten installments I am going to share with you, step by step, how I developed my listing presentation — the Traffic approach — and then, how it evolved from that first listing presentation — the listing presentation from hell — to that second heavenly listing presentation.

We will cover a lot of ground. We’ll discuss and contrast my approach with the traditional approach, and explore why it works so well. We’ll also discuss what motivates the seller and explore the ethics of charging the client a higher commission. Then we will examine the traditional CMA and I’ll show you a better and more accurate way.

Finally, I’ll share with you exactly how I make my listing presentations — I’ll give you the actual words to say, and I’ll give you three different variations to use depending on your comfort level and the individual situation you find yourself in. I’ll even show you the tools I use to make this approach so simple, and last but not least, I will show you how to find plenty of seller leads.

My approach is comprehensive but yet it is simple, and I will promise you that If you take the time to learn it, you will find that it is very easy present. And more than that, you will net your clients more money and sell their homes in less time. Just watch, you’re going to love it!

Take The Test Drive!

Four Steps to the Perfect Ad (Step 4)

Matt Jones — Mon, 30 Jul 2012 15:38:12 +0000

In our three previous steps, we discussed knowing the purpose and audience of your advertising, then we moved on to actually crafting the advertising message. That brings us to the fourth and final step in creating the perfect advertisement: monitoring your results.

Step Four: Monitor Your Results

You may very well have the best advertising campaign ever, but if you can’t measure your results, you would never know. But what if you could actually know exactly where every single customer came from? And what if you knew the cost of each lead from each individual source?

Better yet, what if you could precisely measure the effectiveness of each ad — of each subtle variation — and then compare and test one version against another until you had refined your ad to perfection? I have great news: You can!

Today, by using a few simple and yet powerful tools you can do all of that. You can have the hard information you need to keep from wasting a large part of your advertising budget. When it comes to tracking your advertising, there are only three things you need to be concerned with: how many views your ad received, how many responses to those views, and the conversion rate. Let’s take a look at each of these in more depth.

Number of Views. The best ad in the world is useless if it is never viewed. On the other hand, a lot of views directed at a poor ad will also have limited results. Think of the Naked Cowboy in Time Square. How famous would he be if he were standing on a street corner in La Luz, New Mexico? Advertising is the same way.

You might have the best advertising message in the world, but if nobody sees it you are out of business. But if you craft the right message, designed to make a strong value proposition to your target market (think of the previous steps we’ve covered) and then get that message to be seen by enough of your target market, your results will be great. And knowing the number of views your ad receives tells you a lot about where you are advertising.

Number of Responses. If you you have plenty of traffic, and you have a well-crafted ad that speaks to your target audience, you will get a high number of responses to the ad. This is critical to having a successful advertising campaign. On the other hand, if you have lots of views and not many responses (people clicking on your ad) you have a messaging problem.

The problem might be a poor value proposition, or it might be a great value proposition but targeted at the wrong audience. Either way, if only a few visitors click on your ad or your click-through rate (CTR) is low, it really doesn’t help you. How many people respond to your message tells you a lot about the message itself and allows you to continue to tweak your message until you get it dialed in. Once you have refined your message, there remains only one step to ensuring a good return on your advertising investment.

Conversion Rate. Let’s assume you’ve chosen a good location to place your ad so it is receiving lots of views. Let’s also assume that because you have carefully crafted and tweaked your message, the target audience likes it and your ad’s click-through rate is high. So far, so good. All that remains is capturing the leads. But how can you determine or measure how well you’re doing at capturing those visitors?

If you divide your total number of leads received by the number of responses to your advertisement, you have your conversion rate or capture rate (CR). This is probably the most important measurement of all website metrics because it gauges the effectiveness of your website. It is possible to have lots of responses but if you fail to capture them, you are still nowhere. And that is where most real estate agents are today.

Let me give you an example. I was just starting to post this article when I received the following email from a really top-notch agent in my blog community:

Here was my response to John:

I hadn’t planned on including an example, but when one came in that was such a clear case, I really felt it would be helpful to share it. And John’s case is very typical. John is doing great, even without my LCM technology, because he has been actively following much of my training for over a year. But imagine what a better capture rate would do for him, all other things being equal.

Real estate websites, just like John’s, are notoriously poor at conversion or “lead capture”. Why? Because they are not designed to capture customers but rather to dispense information. They do a great job at giving out information, but on average capture less than 1% of the responses. In fact, the latest number from the National Association of Realtors® pins that average conversion rate at only 0.87%. Less than 1% — John’s was 5.2%.

That means that if you are using a typical real estate website you need 115 responses to capture a single lead. Even the very best and most expensive websites capture only 6-8% of respondents meaning that you will need 13-17 responses just to capture one lead. As you can see, the capture rate is very critical. The better the capture rate, the more customers you will have, all other things being equal.

But how will you know your conversion rate? Your website should allow you to track where your various ads are coming from. If it doesn’t, you have the wrong website. Our solution to this problem was to design a stand-alone lead capture module (LCM) that focuses on one thing: efficient lead capture.

Our LCM Gateway captures as much as 25-35% of all responses or between one fourth and one third of all those who click on your advertising message. That’s huge! And by using LCM technology, it’s also possible to see exactly where each lead came from. For example, you could have different ads running in the Google search network, the Yahoo! network, and Craigslist all at the same time.

In a given week you might receive 12 leads from Google, 9 from Yahoo and 10 from Craigslist, and instantly be able to identify the source of each lead, the conversion rate, and most importantly, the cost of lead. How cool is that?

For example, if you divide the total number of leads from each source by the number of ad responses you had from that source you have the conversion rate for that source. For example, if you had 12 leads from your Google ad, and you 40 people click on that ad, you would have a conversion rate of 30%. (12 / 40 = .3 or 30%)

You may have invested a total of $20 in Google advertising to receive those 12 leads and you could then calculate that your leads were costing you $1.67 each. ($20 / 12 = $1.67) In other words, having the right tool not only helps you do a better job of capturing leads but it also guides you as you try to decide which advertising ideas to spend your money on.

Tracking your advertising may seem difficult at first, particularly if you don’t have the right tools to track it properly. But after you begin to track your ad results, it will become second nature and you will always know what works and what doesn’t. Remember, it’s not how much money you make, but how much you keep that’s important.

Final thoughts. I would like to challenge you to take a look at your current marketing — all of it. Now I want you to ask yourself a few honest questions: Does each advertising idea you are pursuing have a specific purpose and if so, what is that purpose? Who are you trying to attract with your advertising? What is the demographic of your ideal customer? What are their hot buttons? Needs and wants?

Does each advertising message have a very definite value proposition that is in alignment with the purpose and customer you’ve chosen? Is it simple and clear and tied directly to the needs and wants of your ideal customer? Do you have the tools in place to track your results for each of your advertising ideas? If not, why not?

Finally, I’d like to invite you to check out our LCM Success system. It will give you the tools you need to effectively capture customers, and organize your follow-up both on your computer and on your mobile devices. More importantly, my coaching staff and I are dedicated to staying with you, holding your hand, while you learn how to implement these tools and training into your own business.

Take The Test Drive!

Four Steps to the Perfect Ad (Part 3)

Matt Jones — Thu, 05 Jul 2012 20:59:26 +0000

In our first two steps, we discussed how important it is to nail down the purpose of your advertising and then to understand who you are advertising to. Think of these previous two steps as the information gathering for your ad… the prep work, if you will.

Step Three: Crafting Your Message

Now it’s time to actually craft your advertisement. Of course, when I speak of your “advertisement” I am referring to the message you might put on a search engine like a Google pay-per-click ad, or a classified-type ad you might run on Craigslist. It could even be the message you use in an online display ad.

But I’m also talking about the message your visitor sees on the “landing page” of your website. In fact, it is important that your advertisement matches the message on your landing page if you want to maximize your results. The closer your ad message is to your landing page’s message, the higher your conversion rate will be. If your customer clicks on your ad, and then comes to a page that is so different that it gives them whiplash, don’t be surprised when they leave your site without registering.

All that being said, there are only three things your message must accomplish: 1) state what’s in it for your customer; 2) offer a simple exchange of value; and 3) give your visitor a choice of two yeses. If you limit yourself to these three fundamentals, your advertising will be very effective, and your results will be much better than you have likely experienced before. So, let’s look at each of these in more detail.

State what’s in it for them. There is an old adage in sales: Telling ain’t selling. Most people focus on features when they should be focusing on benefits. ”Features” is all about your product or service. ”Benefits”, on the other hand, is all about your customer. Your ad should make an appeal to the customer’s needs or wants so use benefits in writing your ad.

For example, having studied customer preferences when using a real estate website, we know that real estate shoppers are looking for one primary thing: a good home search. So we’ve crafted our message to say, “Use the most powerful home search in the Fayetteville, NC area!” The customer wants a home search so we focus our message on providing the most powerful home search in our market. Simple.

In other words, the ad is customer-centric. We’ve also discovered that the more specific we can be, the better the results. We tested, “Use the most powerful home search available!” and “Use the most powerful home search in North Carolina!” We learned through testing that the more specific to the needs and desires of our customer, the better the ad works.

Our customers don’t care that much about home searches in general, nor about North Carolina home searches. Why? Because they are not moving just anywhere, nor are they moving to North Carolina in general. They are moving to Fayetteville, North Carolina, and so the ad that focuses on their specific need wins the day.

Make a simple exchange of value. I’ve heard countless “experts” and website designers tell agents not to put registration forms on their websites. They say, “If you require your visitors to complete a registration form, most will leave your website.” And, that is partially true. Many will leave your website, but what good were those anonymous visitors to you anyway?

On the other hand, many will also register if you present them with a simple exchange of value. What do I mean by an exchange of value? You offer them something of value in exchange for something of value in return. And it works. Why? The principle of reciprocity. I’ll explain.

Most people understand the idea that you get what you pay for…that there is no free lunch, so to speak. People expect to pay for anything of value. Make it free and they will stay away in droves. Make it a fair exchange, and they will take your offer. It really is that simple.

On our LCM gateway website, the exchange of value is very simple: “Register only once and use it forever!” Exchange of value. They give us something of value: their registration. And in exchange we give them something of value in return. They get to use of the most powerful home search in the Fayetteville, NC area forever.

Keep your message clear and concise. Ours is seven words long. When presented the way we did, it seems like a real bargain. And it is a real bargain. But getting them to see it as a bargain is what is important. When you craft your appeal, focus on presenting a very clear exchange of value.

Give them a choice of two yeses. This is a principle that is often overlooked. What do I mean by a choice of two yeses? Instead of offering them a choice between a “yes” and a “no” decision, give them a choice between a “yes” decision and another “yes” decision. Giving the customer a choice is important because it makes them comfortable because they are in control.

You’ve probably seen this principle in action thousands of times and didn’t even recognize it. Here are some common uses of a choice between two yeses: “Would you like to pay cash or would credit card be more convenient?” “Would you like this delivered or would you prefer to take it home yourself?” “Do you want just the suit or would you like the tie as well?” All are uses of a choice between two yeses.

Here is how powerful this principle is: When I added a choice between two yeses to my LCM gateway, my conversion rate doubled! Before, they’d chosen between a “yes” (to register) and a “no” (to not register and leave my website). Many of them chose the “yes”, but many others chose the “no”.

When I added two “yes” choices (and zero “no” options), my site conversion doubled. Here are the choices I offer them now: “Yes” (use the search with the help of an agent) or “yes” (use the search without any help). Of course, there is still the unmentioned choice of “no” (leaving my website without registering), but since I’ve added the second “yes” option, many more of them choose a “yes” option. Here is another example:

Early in my practice, I was on a listing appointment and I offered a seller the choice between a “yes” and a “no’. Listing with me or not listing with me. Although I’d never been turned down up until then, this seller politely told me, “No thanks.” I was stunned. Mortified. I went back to my office in a daze. How had I missed this listing? I never missed a listing!

Then it struck me: I’d offered the seller a choice between a “yes” and a “no’. I changed my listing presentation that very day. Never again did I offer a choice between “yes” and “no’. Instead, I offered them a choice of using my approach (the Traffic approach) or the traditional approach (the Price approach), both yeses. And from that point forward every single seller chose one or the other.

What’s next? In the next and final step, we will discuss how you can track and monitor your results so that you can actually know whether you are wasting marketing dollars on an ad. As agents, our single largest expenditure is marketing and by tracking your results, you will likely be able to cut your marketing budget in half while producing better results than you’ve ever produced. You definitely won’t want to miss it!

Take The Test Drive!

Four Steps to the Perfect Ad (Part 2)

Matt Jones — Thu, 21 Jun 2012 19:42:33 +0000

In the previous step we discussed the importance of determining the purpose of your advertising before placing your advertising. Now that you have decided on a purpose, the next step before spending money on an ad buy is knowing your audience.

Step Two: Know Your Audience

Why is it important to know your target audience? Because in order to attract them you need to understand what they want. Think about it like this: Advertising is like fishing. If all of the fish are biting on green jelly worms, then that is what you need to use to catch them. Just because you got a good deal on a yellow spinner doesn’t mean you will be successful fishing with that as bait.

So what is today’s real estate customer looking for? According to all the latest data, today’s real estate shopper is looking for “a deal”, probably driven by the focus of the national news media on foreclosures and the record levels of housing inventory. This focus on getting “a deal” is borne out statistically as well.

According to the latest (2011) Survey of Home Buyers and Sellers conducted by the National Association of Realtors®, despite lower interest rates, the median price paid by repeat buyers was 2.1% higher than in the 2010 study, and yet their income was 11% greater. It wasn’t just repeat buyers though. First-time buyers paid 1.9% more, while their incomes were 4.2% higher.

In other words, today more than ever, buyers are in control and they know it. There is a lot of attention on short sale and foreclosure properties because they have become so prevalent. Many buyers believe this is the best way to ‘get a deal’. That means that nearly all of today’s buyers are at least looking at foreclosures and short sales.

But although most buyers today check out foreclosures and short sale properties, well over half those who considered purchasing a foreclosure didn’t buy one. Why? A full 29% couldn’t find the right house; another 15% reported that the poor condition of the foreclosures they looked at as being the reason; and another 15% decided against buying a foreclosure simply because of the long and difficult process.

Okay, so what is the takeaway from knowing your customer? If today’s customer is looking for “a deal” and they think that means a foreclosure or a short sale, then foreclosures and short sales are what you should advertise. Not because that is what you will ultimately sell them, but because that is what the customer wants (or thinks he wants).

I can tell you from my own testing and experience that, in today’s economy, foreclosure ads are getting a much greater response than any other type of ad. Why? Because today’s customer wants a deal. So advertise what the customer wants and generate more business even though you know that ultimately the client may never purchase a foreclosure.

Summary. It really comes down to making your advertising messages match up to what the customer wants (or thinks he wants). If you do that, you will see that your advertising will produce great results. And to do that, you’ll need to know your customer.

In step three we’ll discuss the art of crafting the advertising message. Do it right and you will have great results. Do it wrong and you’ll get little to no return for your advertising dollar. Crafting your message is crucial, so you won’t want to miss step three.

Take The Test Drive!

Four Steps to the Perfect Ad (Part 1)

Matt Jones — Thu, 14 Jun 2012 16:48:32 +0000

Let’s face it: The largest single expense we have as real estate agents is advertising. How large? Many of the experts tell us we need to invest as much as twenty percent of our gross commission income into our marketing. Twenty percent!

While it is my contention that the experts have it way wrong as to their twenty percent budget, and I believe that you should be able to run your practice on less than half that amount, the fact remains that whether you spend ten or twenty percent, we are still talking about a lot of money. For an agent grossing $100,000 per year, that’s ten to twenty thousand dollars!

The problem that most agents encounter, and frankly, why most experts recommend spending so much money on advertising to begin with, is that nearly all agents have an advertising strategy that amounts to throwing lots of money at lots of things and hoping some business comes in. In other words, “Ready – Fire – Aim” as opposed to “Ready – Aim – Fire”.

What if I told you that you could design an advertising campaign that worked, and worked well. Not only would it produce results, but it would be predictable, duplicatable, scalable, and affordable. Sounds too good to be true, doesn’t it? It’s not. You’ll see.

In the following four articles, I am going to share with you four simple steps to designing the perfect advertisement. Four steps that you can apply to any advertising campaign, for any product or service. Four steps that will bring your advertising costs to a minimum and bring your results to an all-time high.

And I’ll make you a promise. If you will apply these four steps to your advertising, you’ll never again have to wonder where your next transaction is coming from. And you’ll be able to generate as much business as you want, when you want it, in a totally predictable manner. So stick with me through all four steps, and let’s revolutionize the way you look at your advertising.

Step One: Determine the Purpose

When we think about the purpose of advertising, it really comes down to only two things: Do you want to focus your efforts on brand awareness or on lead generation? Why? Because they are totally different directions and your approach would be different depending on the direction you choose. But let me help you with your decision.

Brand Awareness Advertising. When it comes to brand awareness advertising, nobody has more expertise than Jack Trout and Al Ries, co-authors of many books on the topic of advertising. Jack and Al are the gurus when it comes to this sort of advertising.

In their national bestseller, Positioning: The Battle for Your Mind, they describe the way the mind of the consumer works (in terms of brand awareness) as being akin to rungs on a ladder. Each ladder is a product or service category, and the top rung is the brand that has the highest “mind-share” for that particular category.

The number of rungs for the ladder depends on the relative interest level of the category. Think cars or sports teams as high-interest categories and laundry soap or toothpaste as low-interest categories. High-interest categories have approximately seven rungs and low interest categories as few as three.

In other words, the consumer can typically recall their top seven or so choices in a category that is interesting to them, but otherwise, only two or three. Here is where it gets interesting. The top rung in any category is typically occupied by the brand that was first into the space and subsequent entries compete for the lower rungs.

Surveys show that each rung has typically twice the mind-share of the rung below it, and this two-to-one ratio seems to remain consistent across all product and service categories. In other words, the first brand into the space, at least in a major way, has a huge advantage in terms of maintaining mindshare.

They give an example of the Budweiser beer brand. Because the Budweiser brand had become the first big name in the space, they were easily able to fend off the attacks of Miller who spent millions of dollars in advertising trying to overtake them. For many years Miller outspent Budweiser many times over and yet were unable to capture that top spot.

One day, out of frustration, they decided to erect another ladder — their own ladder. They introduced Miller Lite, the first light beer. Since that time they have remained on top in the light beer space, although many others have outspent them in their quests for king of the light beer realm.

So what is the take-away from this principle? Be first, or prepare to spend tons of money in what may ultimately be a futile attempt to gain your position on the top rung of your real estate ladder. Another takeaway is that this principle underscores the importance of having a unique selling proposition (USP). Your USP is effectively your new ladder and by getting it up first, you make it difficult for your fellow agents to compete in that same space.

Lead Generation Advertising. The alternative to using a market saturation strategy to build your brand is to simply focus on generating new business — in other words, a lead generation strategy. If your focus is on generating business you can have the best of both worlds. You will spend far less money and do far more business, and your personal production volume will build your brand over time and you won’t ever have to spend a dime on brand-building advertising.

So how do you do effective lead generation advertising? It’s easier than you might think. You’ll need only two things: direct response advertising and effective lead capture. Both are easy to implement and relatively inexpensive when compared with brand awareness advertising.

Let’s look at direct response advertising first. It is called direct response because unlike brand advertising, it offers something specific that the customer wants and then it requires the customer to respond to get it. Direct. Response. For example, unlike brand advertising that talks in a general way about how great an agent you are, a direct response advertisement might offer use of an MLS home search and require a registration to access it.

In over ten years of direct response real estate advertising, we’ve learned a few things about maximizing the responses. The most important thing is to remember that direct response advertising is all about the customer. If you recall, branding is all about you. Many agents fail at direct response advertising because they are in “branding mode” and forget to make the ad about the customer.

You should know your customer (more on that in the next step) and use that information to make the ad about him. Your offering should align itself with his wants and/or needs. You should also make your value proposition very straightforward and easy to understand. Here is an example of an offering that has tested well (more on testing in the fourth step): “Use the most powerful online home search in the greater Fayetteville area…”

You should notice that the appeal is straightforward and unambiguous. It is exactly what 91% of all homebuyers are looking for in a website, and it is market specific. It even makes you want to use it, doesn’t it? That is the appeal, but remember, it’s only the first part of direct response advertising.

Next is the exchange of value. I offer the homebuyer something of value (the most powerful online home search in the greater Fayetteville area) and then I require them to provide me with their contact information to use it. Exchange of value. If your offering is good, most people will be willing to pay you the small price of admission — their registration.

There is one more important thing that will nearly double your response rate: Give them a choice of two yeses. Typical direct response advertising gives the customer the choice between a yes and a no. Click to respond or don’t click. (A choice between a yes and no.) If you offer a choice between two yeses you’ll see a huge increase in responses.

Here is an example of a choice between two yeses: Click to search homes with an agent or click to search homes by yourself. Giving the customer the option of two yeses makes him feel in control. This simple technique lowers the buyer’s sales resistance and results in many more responses for the same traffic.

That brings me to effective lead capture. Many agents attempt to do direct response advertising only to send that traffic to an ineffective website and hope for the best. The result? None or very little business. Direct response advertising is only effective when the responses are effectively captured.

The typical real estate website captures about 1% of its unique visitors. Even the very best, and most expensive websites only capture 6-8%. Certainly, 6% is better than 1% — it’s six times better — but for very little money (less than most websites today) you can capture 25-30% of your direct responses. By using an LCM gateway, either with a website or instead of a website, you should capture between one-fourth and one-third of all your responses.

The reason efficiency of your lead capture is important is that website traffic costs money. The more efficient the capture, the lower the cost per lead. Using a traditional real estate website, the cost per lead will likely be over $100, simply because the capture efficiency is so low.

On the other hand, by using an LCM gateway, the cost per lead will be a fraction of that — often lower than $3 per lead — simply because the capture efficiency is so much greater. And when you can afford to generate new customers for under $5 each, needless to say, that is a game-changer.

Summary. So your first step is determining the purpose of your advertising. Do you want to build your brand by market saturation advertising? If so, I hope you have some really deep pockets. I also hope you are first in your space. If you are like most of today’s mega-producing agents, you will instead choose direct response advertising. And by choosing direct response advertising and generating lots of low cost business, you will still ultimately build your brand simply by your production volume.

In the next step we will discuss knowing your customer and why that is a critical part of developing the perfect ad. In the meantime, if you haven’t had a chance to check out LCM gateway technology, I invite you to check out ours. Here is a link.

Take The Test Drive!

Become a Relocation Partner

Matt Jones — Mon, 07 May 2012 19:59:18 +0000

Ever get tired of endlessly riding in cars with buyers? Do you ever just feel like you need to be working smarter instead of working harder? Well maybe you can be. Partner with me and let’s open a FavoriteAgent.com relocation office together. Really. If we do it together, we can both add value and provide what the other can’t, and best of all, we can make a lot of money.

But before we get into all that, let’s think about what a relocation company is at its very core. It is a company that attracts people who are relocating, engages those clients, and then places them with real estate professionals. Finally, a relocation company oversees the process to ensure the client is happy and that the agents pay them the agreed upon referral fee.

The largest relocation company today is Cartus Mobility (originally part of what is now Realogy, the parent company of Century 21, ERA, Coldwell Banker, Sotheby’s International, and Better Homes & Garden real estate brands). In all likelihood, the company in your market who handles their relocation is the busiest company in your market. Sounds good, right? It gets better.

The agents who work those relocation clients are accustomed to paying as much as 40% of the gross commission for each side of a transaction, and since it is a relocation, over half the time there are two agents for one client — one helping them buy and another helping them sell their existing home. But even if there are not two transactions, there is always one.

Now, imagine if you could identify those relocation clients early in the buying cycle, engage them, and then refer those clients to an agent you’ve pre-screened on the client’s behalf. You could make 40% of the gross commission on each end as a referral, and you could run the entire operation from the comfort of your home. Simple right?

All you would need is a system to attract relocation clients, and then client management that allowed you to oversee the progress your referral agents were making on your relocation business. That’s where we come in. We’ll supply the clients but we need you to oversee the relocation operation in your local market. To be our eyes on the ground, so to speak. Let me walk you through an example:

Using our proprietary system, we would place online advertising in your market and attract a new relocation client and seamlessly forward that lead to your client manager. For purposes of this example, let’s say the client has a $200,000 home to sell where they currently reside, and they need to buy a similar but more expensive home in your market, let’s say $250,000.

First, you refer the listing to an agent you’ve pre-interviewed and collect a referral fee of 40% of a $6,000 gross commission from the listing side. That’s an easy $2,400, and believe me, the listing agent is thrilled to get the easy listing and will be happy to pay your referral fee.

Then on the buyer side, there’s a 3% commission on the new purchase price of $250,000 (assuming no bonuses or higher commission offered by builders or agents). That is another 40% of $7,500 gross commission, or $3,000 for the buyer side. Not bad.

Now think about it: You’ve not burned a dime of gas. You’ve not wasted a week of your life riding around town showing houses. You’ve not wasted your weekends holding open houses or canvassing neighborhoods. You’ve not had to place advertising, yard signs, lock boxes, or any of the other hassles of doing traditional real estate business.

Together we have provided the valuable service of identifying, engaging, and referring our client, and we’ve made $5,400 in referral fees. And because we are partners, we would split that fee — $2,700 for you and $2,700 for us. Neither of us has any legal requirement for record keeping, because we are not the agent or the broker, but rather simply collecting a referral fee. We also have no transactional liability and pay no franchise fees. Okay, so what’s the catch?

Here it is: If we decided to partner with you to open a FavoriteAgent.com relocation office in your market, we would have several requirements of you. First we would require that you attend regular training and accountability conference calls. Because we will be making a big investment in your market, we also require a very specific sequence of customer engagement action steps.

Remember, there are several steps in this process: Identify, engage, refer, and service. We would handle identifying the clients. You would then engage them and refer them to your relocation team, who would provide the brokerage service to the client.

You would be required to recruit a minimum of two agents for your relocation team and get them to sign a blanket referral agreement with our company. Of course, depending on your transaction volume, you may recruit as many referral agents as you deem necessary to handle your volume of business.

We also require a one-year commitment, renewable by both parties every year. And we would require you to continue to license our LCM Success virtual office software so that you will have the client management platform needed to interface with your own relocation team and with our system.

As we advertise and grow in your market, we will periodically evaluate the relocation customer count and may adjust the number of relocation partners so as to maximize our volume of business. (If you would like to discuss entering an exclusive agreement, please contact us and we will be happy to discuss it with you.)

Imagine…

What if instead of going into the office to begin the traditional real estate grind, you tried something brand new? You decide to take the thirty-second commute to your home office. You check your email and there are two brand new relocation leads that have come in overnight. You sit back in your chair, sip your coffee and begin to plan your day.

You pull together some stats for your relocation team training and accountability call in half an hour. Then you open your client manager and look through the 18 relocation leads that have come in over the last month. Of those, there are only 7 people you need to touch base with today and then you are done. After that, you need to call your three referral agents and check in to make sure no balls are being dropped. How easy is that?!

You should be able to make it to an early lunch at the club and then take the afternoon shopping for a new convertible. Hmmm. Tennis anyone? Catch that afternoon matinee? Actually you can do whatever you want. No sales meetings. No caravan. No time wasted by other agents in the office. No everyday real estate grind.

Your new job is the very picture of simplicity. All you have to do is engage your relocation buyers and hand them to waiting referral agents. No endless showing appointments. No dinner time listing appointments. No dread of constantly having to drum up the next deal. Oh, and let’s not forget — no weekends. No nights. No gruelling hours. No marathon closings. Just making friends and placing them with great agents. How cool is that?!

So let me ask you a question. What if we were to close only two transactions per month together? You’d pocket an extra $5,400* with no expenses and no liability. What if we closed four? Or ten? Do the math. How many agents can you recruit and how much business can they do? That could be a lot of money with virtually no risk.

Does this sound like something you would enjoy? Are you willing to learn some very specific engagement strategies? Are you willing to do it our way and not try to reinvent the wheel? Are you able to recruit at least two agents who can handle referral business professionally? It doesn’t even matter what company they are with as long as they are licensed and they are good with our customers. Are you prepared to make a one-year commitment? If so, contact us and let’s talk.

Maybe a relocation partnership makes sense. Or maybe it doesn’t. It can’t hurt to talk and once we find our partner agent for your market it could be too late for you. Thank you for taking the time to consider this proposal. I look forward to talking soon.

*Projection based on the sample transaction in the example above. Your market may vary.

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The Re/Max Saga Continues…

Matt Jones — Mon, 19 Mar 2012 14:30:04 +0000

Many of you may recall that two years ago Re/Max legal department sent me a cease and desist letter demanding that I redesign our company’s yard signs. It was their contention that they own a trademark on all uses of red over white over blue on yard signs. Seriously — I’m not kidding — they honestly do!

Okay, you can stop laughing. There’s more. You may recall that I then asked you, my readers, if I was missing something. Was I being unreasonable in defending our company’s own yard sign design? I wrote an article and another followup asking for your feedback. And did you ever give it. Never, in the history of my blog, had I received as many comments — 146 in all!

SEE BOTH SIGNS AT EITHER LINK ABOVE!

Unlike many stories, however, your opinions were very one-sided. Nearly all of you agreed that Re/Max was overreaching. Of course, I basically told them to get lost, that I wasn’t violating their trademark and that there was no evidence of confusion in the marketplace (a key element in any trademark action).

They wrote back and effectively said, “No, we’re really, really serious. You must cease and desist all uses of your yard signs immediately.” to which I responded, “I’m really, really serious — I am not violating your trademark, but I am reasonable. If you feel that strongly about my signs, I will be happy to redesign them as long as you pay for the replacements.” That was it. Not another word for two years.

Then a few days ago, I received another FedEx package from Re/Max. This one included yet a third cease and desist letter that said, “No, we’re really, really, really serious.” I responded and said that my position hadn’t changed but reiterated that if they felt strongly about our sign, we were still willing to change it, but at their expense.

But, an interesting thing happened, during that interim: We started hearing from other companies who had also received nearly identical threatening letters from Re/Max and had found our story on the internet. Many of them had signs that were not remotely similar to Re/Max’s and one was from an entirely different industry. All ranged from very concerned to terrified by the prospect of being involved in federal trademark litigation and were seriously considering abandoning what appeared to be perfectly legitimate marks.

After hearing so many nearly identical stories from so many unrelated sources, it is hard not to get the impression that the Re/Max legal department has an actual business practice that seeks to leverage its rather vague trademark into something greater than it is by this tactic of bullying smaller companies into acquiescing to their overreaching demands, whether or not there is any legal basis for it, out of fear of litigation expense, negative publicity, and/or other negative consequences.

Obviously, Re/Max International has substantial market power and financial resources with which to bring frivolous complaints against much smaller companies that are financially unable to defend themselves due to the prohibitively high cost of federal trademark litigation. (The expense of a single trademark lawsuit could easily exceed $100,000 per party, enough to make many smaller companies simply walk away from their hard earned brands.)

It is our opinion that this use of the threat of impending legal action to unlawfully limit competition and financially intimidate much smaller companies, if true, constitutes a textbook coercive monopolistic violation of the Sherman Antitrust Act and thereby an unfair and deceptive trade practice under the Uniform Commercial Code. But maybe it is a coincidence.

Maybe I am too close to this to have an objective point of view. For that reason, I would like to hear from you, my readers. Have you or do you personally know of any other companies that have received similar threats from Re/Max? If so, what was their outcome? Do you think this is fair play? What would you do if you were to receive a similar threat from Re/Max? Thank you for weighing in with your opinion — it means a lot to me.

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Blog, Matt. Blog!

Do You Know Today’s Real Estate Customer?

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Get Ready for the Next Big Housing Boom!

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How Many Homebuyers Are In Your Market?

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Where Is Easy Street?

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Old Dogs and New Tricks

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Finding the Best Leads

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Okay Re/Max… Enough is Enough!

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Supply and Demand

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Bonus Podcast: Cindy Young Interview

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Which Approach: Price or Traffic?

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2012 State of the Industry Agent Survey

State of the Industry Survey

Thank you for taking your valuable time completing this survey.

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Bonus Podcast: Gary Thompson Interview

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Starting at the Beginning

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A Tale of Two Listings

Listing Presentation # 1 — The Listing Presentation From Hell

Listing Presentation # 2 — The Listing Presentation from Heaven

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Four Steps to the Perfect Ad (Step 4)

Step Four: Monitor Your Results

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Four Steps to the Perfect Ad (Part 3)

Step Three: Crafting Your Message

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Four Steps to the Perfect Ad (Part 2)

Step Two: Know Your Audience

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Four Steps to the Perfect Ad (Part 1)

Step One: Determine the Purpose

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Become a Relocation Partner

Imagine…

If you would like to be contacted regarding a relocation partnership for your market, please fill out the form below.

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The Re/Max Saga Continues…

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