By Joe Cooke
RISMEDIA, October 2008-Are you having trouble getting referrals? Do you experience difficult clients, tough closings and sporadic paychecks? Some of that is just the nature of the business, but some of that trouble might be avoidable. How? Take a hard look at your underlying business paradigm-what exactly do you believe you are being paid to do?If you believe that you are a salesperson and that your job is to provide information, outline features and benefits, close the sale and facilitate the transaction, then it might be time for you to develop a new “value-added proposition.” Something that will set you apart from your competition.
Sales strategist Jill Konrath defines a value-added proposition as, “a clear statement of the tangible results a customer gets from using your products or services. The more specific your value proposition is, the better.”
A New Value-Added Proposition
In the past few years, the real estate industry has changed radically. The old information cartel is broken. According to Daniel Pink, author of A Whole New Mind, the era of the “knowledge worker” (i.e. manipulating information and deploying expertise) is over.
Websites like Zillow.com and FSBO.com are providing all kinds of agent functions, from establishing a listing price to filling out a purchase agreement and even parts of the closing process.
What this means for you is that you have to add value to the real estate transaction that transcends the traditional “information” service. Many people think that the term “value-added” indicates something extra that you bring to the transaction, above and beyond your competition. In fact, in today’s market, with consumers wondering more and more if they even need an agent, you have to start from a zero-base and add from there. For instance, if you are the listing agent on a $200,000 home and you are charging a 6% commission, you have to add $12,000 in value to the transaction. In other words, if you spend 100 hours of your time directly on that client, your hourly rate will be $120-a professional rate. If that thought feels a bit intimidating to you, then you understand completely.
Pink asserts that a new kind of creative entrepreneur will replace the obsolete “knowledge worker” (a term attributed to organizational guru Peter Drucker). This “creative empathizer” will be someone who adds value to each transaction through a combination of talents, experience, skills and knowledge, applied to each transaction creatively.
Assessing Your TESK
Every person is a unique combination of these four core attributes: Talents, Experience, Skills and Knowledge (TESK). Your talents are innate-you are born with them. Experience is a hard-earned intangible attribute that can only be acquired by time and practice. You acquire skills over the course of time by applying your knowledge. Knowledge is broader and more theoretical than skills, but just as valuable.
You can use these four attributes as a way to develop and establish a “value-added proposition” that will serve as the basis for your real estate business.
You may have an outgoing personality, or you may be more of a one-on-one communicator. Either end of the spectrum, and everything in between, can help you be successful. Talents include your inner-giftedness-those unique abilities that you bring to your community. For instance, Tiger Woods can hit a golf ball-that is a skill, but his ability to connect with young people, to be a role model, that is a talent-part of his inner-giftedness. Tapping into your own uniqueness adds value to each transaction and creates a powerful way for you to differentiate yourself from other agents.
Be a source of referrals for lenders, inspectors, contractors and other specialists that a homeowner or buyer might need. Even in today’s Internet-driven market, most buyers are represented by a real estate agent. Show your prospects how well connected and respected you are in your local real estate market. Hold a position with your local association, collect testimonials from other agents (start sending out thank you cards to your co-op agents, eventually you will get some sent to you) and collect and create statistics that show your ability to work successfully with the other agents and brokerages.
You can develop skills, such as the ability to teach a first-time home buyer class, the ability to testify at local urban growth hearings, the ability to speak on the radio and TV, the ability to create and lead a team, the ability to create customized marketing plans and the ability to listen authentically. All of these things can help you add value to each transaction. Skills are knowledge transformed into consistent action through practice. Honesty is also a skill-it is a habit you can develop. According to Delta Realty agent Glenn Ginsburg of Naples, Florida, being “….open and honest is a value added service-it goes back to an old saying-real estate agents don’t sell homes, homes sell themselves-providing honesty even if it costs you the sale builds loyalty.”
One of the most important value-added skills you can bring to your clients is the ability to listen authentically. That means, first of all, clearing your mind of all your pre-conceived notions and second, opening yourself to your client’s wants and needs. In other words, empathy-a key component of the “creative empathizer.”
Provide information on the things that matter, like how to decipher a Good Faith Estimate and Truth In Lending Statement, put on classes for first-time home buyers and become an expert in local, regional and national real estate issues-from growth management to short sales. Start a blog to provide and collect information and stories.
Be careful though. No matter how much knowledge you gain, keep WIFM (What’s In it For Me) in mind. Whenever you are making a presentation to a seller, or to a buyer, remember what they are most interested in-themselves. When it comes down to it, we all listen to the same radio station-WIFM. For every statement you make, follow it up with a “so what?” statement. For instance, if you state that you have a GRI designation, you have to quickly get to a follow-up statement that answers the unstated question from your prospect- “So what? What’s in it for me?” Your answer has to be honest and personal; you might say, “Last year I earned a GRI designation-that means that I have taken highly specialized courses in home sales and marketing, and that I am up-to-date on the latest trends and issues in real estate-in other words, when you hire me, you are getting the highest level of expertise and professionalism.” Of course, you have to work out these “so what” statements to suit your own style and background.
Using Your Value-Added Proposition
Selling yourself is just like selling a house-your talents, experience, skills and knowledge are the features. The “so what?” statements are the benefits. However, you must show your added-value, not just claim it. Your actions must be in perfect alignment with your words-this goes beyond mere honesty, you must have perfect integrity. That is the true secret to your value-added proposition. It has to be real.
Also, Konrath suggests using tangible data to communicate your value-added proposition. For instance, you could show your list-to-sales price percentage against the average market list-to-sale price percentage. Even better would be to convert that to a dollar amount. If your average list-to-sales price was 98% and the average market list-to-sale price was 95%, on a $200,000 home, the dollar advantage would be $6,000.
When you are marketing yourself in any venue, whether it be one-on-one, to a group or on the radio or TV, think in terms of these four core attributes: Talents, Experience, Skills and Knowledge. And always answer the most important question that will be on the listener’s mind: “So what?” That is the ultimate question that will lead you to the value-added proposition you seek.
Joe Cooke is a professional freelance writer and speaker with over 25 years of experience in real estate, business and marketing. Visit www.joecooke.com for more information.
Jill Konrath, president of Selling to Big Companies and Leapfrog-Strategies Inc., helps sellers create value, differentiation and demand in competitive markets. For info on speaking, training or consulting services, please call (651) 429-1922 or e-mail email@example.com.