For all sorts of reasons, many commercial real estate agents struggle with direct marketing. In most cases they will do the simplest form of this direct marketing and then stop at that level. Unfortunately they then miss out on all the opportunities that can evolve if only they had taken a few more steps in the process.
Commercial real estate is an individual practice and most if not all of your quality listings and clients will come from personal relationships and connections. The better that you know people, the easier it is to win new business. Most real estate agents should know several hundred prospects, including tenants, landlords, solicitors, accountants, and developers.
Build New Relationships
It takes time to build these relationships and for that reason, personal effort is required in directly marketing yourself to your prospects on a daily basis. This requires skill, consistency, and persistence. These 3 simple words are so understandable, and yet overlooked when it comes to real estate agents taking time to build their database of contacts. Given that most agents don’t do the processes very well or regularly enough, it does ‘leave the door wide open’ for those agents that really do get their act together in personal marketing and prospecting.
The Direct Approach
Here are some ideas on direct marketing that can help your commission and listing results significantly.
- At the simplest level, this process of marketing is sending a letter or email directly to a selected person. That is where most agents stop. Not following up is the greatest reason for poor results from any contact campaign or marketing effort. If you send an email or letter, you must make the telephone call to follow up on the first message sent. The ‘success hit rate’ on sending a letter or email is about 1% or 2%. It is noted that letters work better than emails today, simply because letters are less common. When you make a follow up telephone call to the people that you sent the initial correspondence to, the ‘success rate’ in getting a meeting lifts to about 5% to 10%. Personal skills in making the call will have a big impact here. Practice is required to help you improve your ‘follow-up’ processes.
- In the commercial real estate industry, the object in making the call is to see if the prospect will meet with you. If you look at the chain of events in simple terms, the letter sells your telephone call, and the telephone call sells the meeting. When you get to the meeting you can sell your services. Some agents try to shorten the process by using a letter to ‘sell their services’; that is where everything goes wrong (and nothing much happens). Our industry is built on relationships and trust. You cannot do any of that without a meeting. If you are sending out a letter to ‘sell your services’ and you are doing nothing else in follow-up, you are wasting your precious time and money. You will not win much business that way.
- There is another process here that you can also use in prospecting called ‘response compression’. It involves contacting a prospect a number of times over a given time frame so that you can build your relevance and image. From that relevant approach and response you can get more meetings. It has been found that most prospects take about 3 or 4 approaches before they will agree to a meeting with you. If you use the process of ‘response compression’ you can contact those people once per month over a 6 month period. If you do so with relevance, there is a reasonable chance of getting a meeting.
As you can see from this strategy, you really do need to stay organised and systemised. Having a ‘system’ to your prospecting will help you keep on track and focused on the right people.
Get to know your market and the people that you should be talking to. Start the connection process with these prospect targets and build the relationships. Over time you will build a great business for yourself. Remember that relationships are a key part of our industry.