Today’s Ask the Expert column features Arthur Darmanin, CEO of Sellstate Realty Systems Network, Inc.
Q: I’m working hard, but not making enough money. How can I turn this around?
A: If you’re falling into this category, you’re not alone. Thousands of agents wake up every day trying to figure out how they can make more money.
They’re working hard and investing in their marketing/lead generation, doing what seem to be the right things, but the desired results aren’t there.
I recently sat down with a $9.7 million a year producer that was having these same challenges. After analyzing his business, we came to the following conclusions:
He didn’t have a clear understanding of the return on his marketing costs (ROI). Leads were coming in from various sources, some of which were being converted into sales, but he had no idea what these leads were costing, which marketing sources made him the most money and which were costing more than they were worth.
By analyzing his past business and the ROI, he was able to move some of his marketing dollars to the sources that produced the best leads at the lowest cost per lead.
In other words, if leads from source A cost 33 percent of the commission earned and those from source B cost 20 percent of the commission earned, shifting marketing dollars from source A to source B will result in a higher return. The extra savings may be invested into generating more leads, and ultimately, more closed deals. Even if he chose not to reinvest the difference, at the very least, at the end of the day, he would net more money.
He was losing a lot of business because he wasn’t using a CRM. Unfortunately, most agents don’t know how much business they’re losing by not staying in touch with their sphere of influence.
In this particular case, he found out the hard way when he ran into a past client who had just sold his home and bought another.
This happens to agents every day, but because they don’t know it’s happening, they don’t do anything about it. In life, sometimes what you don’t know won’t hurt; however, in this case, what you don’t know can be very costly.
An experienced agent might be working very hard trying to close deals, but at the same time, he/she could be losing tens of thousands of dollars every year from referrals. What really hurts is that the ROI on referrals is the greatest because a CRM costs very little for what you get in return.
Having the right tools is vital. We talked about a CRM, but equally important is a good website with full IDX integration. If someone refers you to a friend, that friend will most likely look you up online, and if you don’t have a website, you don’t exist. Today’s consumer is sophisticated. They will not deal with an agent who doesn’t have a strong web presence.
This is yet another example of not knowing the amount of business you could be losing every year.
To summarize, with the right tools in place, you can increase your bottom line by analyzing your business and finding out your ROI on your marketing dollars.
For more information, please visit www.JoinSellstate.com.
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