I am writing this as I am on a train on my way to Washington, D.C. for the National Association of Realtors® annual Midyear Conference & Expo. I am fortunate enough to be speaking at a few events while I am in town but I can remember a time when I came to events like Midyear before anyone ever wanted to hire me or even knew my name. There were some people around me that would question me about why I would go to a place where I didn’t know many people. They wanted to know, “What is the point?”
I believe this line of questioning comes from short-term mindset. In the short term, I could see where they were coming from because it didn’t appear that I would gain anything except for some good times and tax deductions, but I didn’t see it that way. I have always been able to look farther down the road for what I wanted out of my business and life and have been willing to do things that would get me closer to where I wanted to be, even if it didn’t look like it made immediate sense to others. I had a plan.
Before I left for this trip, I decided to look at my past years’ events and see how many of them that I was hired for were a direct result of relationships with people that I had been proactive in creating. When I say I was proactive in creating them I don’t mean that I singled out specific people to become friendly with. What I mean is that the relationships were formed in places and at events that I was proactive about going to, even if at the time, I wasn’t going to receive immediate gratification in the form of payment. I don’t think that you will be surprised to know that over 60% of my speaking events last year were from these types of relationships, with the rest of them coming from word of mouth from past events and other similar occasions.
Now this 60% number has gone down from the prior year where almost 90% of my events came from my willingness to be proactive. It is only natural that more and more of my business comes from referrals and word of mouth as I do more and more events but I had to start somewhere and I knew that sitting around in my office simply telling people I was a “speaker” was not a marketing plan. No more than waiting for someone to ask what you do for a living is a viable plan either.
So the real question is how does this apply to you? I have noticed after working with thousands of salespeople that we have this innate trait to pursue those potential leads that look like they will give us the most immediate gratification and put off those that look like they may not be able to bring us any immediate benefit. In fact, it is not just a matter of me noticing it, the facts back me up.
According to a recent study by a popular sales website followupsuccess.com only 48% of sales people ever even follow up with a potential lead. 25% follow up a second time and stop and only 12% make more than three contacts. This is shocking because 2% of sales are made on the first contact, 3% of sales are made on the second contact, 5% of sales are made on the third contact, 10% of sales are made on the fourth contact and are you ready for this? – 80% of sales are made on the fifth to 12th contact. That means that too many sales people are putting in over 90% of their effort for a less than 5% return.
How did this happen? We are taught as sales people to ask qualifying questions. The point of these questions is to make sure that the person we are working with is qualified and, let’s face it, is not wasting our time! Sometimes what happens though is that we fall into this trap where we ask qualifying questions, not just to see if someone is qualified, but also subconsciously because if they are not ready to buy or sell in the next 60 days we are going to move onto someone who is. Then we engage in this continual rat race trying to find closings from month to month to pay our bills when many of the leads we were in contact with six months ago, who may not have been ready when we first met them, are now ready to move forward but unfortunately they are using a different agent now because we couldn’t see the bigger picture at the time.
The sad thing is that we are living in a world of technology where we have databases and other tools that allow us to use systems in a way that were never available to us in the past. I am not going to write about systems here because that is not the point of this article, but we can literally stay in touch with these past leads and keep the lines of communication open until they are ready to make a decision, with almost no time investment. So the issue is not our lack of resources. The issue is our mindset that we have grown up with and the culture that has been engrained into our way of thinking. Our short-term mentality that knows that sales has and always will be about relationships, but thinks it will take too much time to see a tangible result to be worth investing any time or energy.
I will tell you this though. If you ever want to drive yourself a little crazy write down how many people you have met that went on to buy or sell with a different agent six or 12 months after your first contact with them, and then put a dollar figure on it. For some of you it is in the tens of thousands of dollars. For some of you it is in the hundreds of thousands of dollars. Either way, it is too much!
So if you ask me why I went to Midyear those years when I knew no one, I will tell you it is because I believed in the power of long-term business, but even long-term business has to start somewhere. If you are going to take away anything from reading this I would hope that you would be more conscious of the people that you come in contact with that you would normally blow off or forget about because, regardless of when they finally close, the process started somewhere and if you came across their path at any time you should also be the one to shake their hand at the end of the process. Because in the end, delayed gratification still ends in gratification.
Jared James is the CEO and Founder of Jared James Enterprises, an internationally sought-after speaker and trainer. James built one of the fastest-growing real estate teams in the country, was inducted into the International Hall of Fame for one of the world’s largest real estate companies and wrote a best-selling book—all before the age of 28. As an acclaimed speaker, James keynotes events for major real estate organizations and conducts regular webinars and training for nationally known organizations like NAR, CRS, Yahoo Real Estate, Trulia and Zillow Academy and blogs regularly for RISMedia.