We’ve all heard the quote attributed to either Einstein or Oprah, “To do the same thing over and over again and expect different results is the definition of insanity” or something to that effect. Well, as you look at your business this last year, what are you planning to do differently in order to get different results?
This was the topic of discussion with my coach this last week: in order to know what to do differently, we need to first look at what we’re doing now. As we’ve been reviewing my sources of business from the last few years, we see a solid trend. Around 50% of my business in 2018–many of which were past clients–came directly from my database (some call it their “sphere of influence”). Another third of my business came from referrals sent to me by my database. So, over 80% of my business was a direct result of my database.
Now that I know my database contributes to more than 80% of my business, I then have to look at my opportunities for change.
One option is to improve on the return I get from my database. I currently get around a 10:1 return. This means, for every 10 people in my database, I get 1 piece of business. Gary Keller, in his book “The Millionaire Real Estate Agent” (MREA), says that you should receive a 12:2 return on your database if you manage it correctly. What this means is that for every 12 people in your database, you should receive 2 pieces of business. Ultimately, I have some room to grow here! The best way we can do that is by becoming more intentional about adding value to the lives of everyone in my database. This is our driving question for everything we’re planning for 2019 in how we connect with our database.
Another option is to increase the number of referrals we receive. As I mentioned before, MREA says we should have a 12:2 ratio. 1 of the 2 will be a direct piece of business and the other will be a referral. We should be getting an equal number of referrals as we do direct business. If I look at what we’ve done in the past, I can see that we don’t always do a good job asking for referrals. So, another place we can improve is by creating better systems around asking for referrals! And by being more intentional about adding value to their lives, as I talked about above, we will also, in turn, receive more referrals.
A third option is to add another source of business. Since such a large percentage of our business depends on my database, this isn’t a bad idea. After all, they say you shouldn’t put all your eggs into one basket. There are lots of choices here and I could go through a whole list of possibilities and options. And while this will eventually be a route I will go in growing my business, I’m not yet convinced this is my best choice for change right now. By diving into a new source of business, we would have to create new systems and new processes which takes time, money, and has a significant learning curve. As it stands, my database is the most solid source of business, so it’s a very safe bet to depend on it performing.
A 4th option is actually the simplest. That is to grow my database! If I want to double my business next year, then I can do that by simply doubling my database and making no other changes. It doesn’t require us to change systems or recreate the wheel because I already have a database that’s performing quite well!
As we’re finishing the year, we are looking for sources to help grow my database. We’re digging through Facebook and other social media to see who we are leaving out. We’re looking at all of the groups we are involved in to see who we can add. We’re talking to businesses and service providers to see who we can build a better win-win relationship. And we’re working on doubling our database as quickly as possible! As we add each person, we are asking them, “How can we add value to your life over the next year? How can we earn the opportunity to be your family Realtor?”
Tell me, what are you doing differently next year in order to see different results?
Your Real Estate Consultant
REALTOR®, BOLD, EcoBroker, CNE, CHRE, ILHM, KW Luxury
Professional Denver Real Estate for the Urban at Heart