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Don’t celebrate closing a sale, celebrate opening a relationship.
In the last two editions, I discussed the importance of changing the mentality in the residential real estate industry and having the correct organizational structure for effective results. But, as we all know, having a well-structured organization alone does not guarantee revenue generation. Sales make or break businesses in any industry, which is why every organization requires a sound sales department.
The Importance of Sales Funnelling
To understand this better, let's take the example of Apple. Despite their products not being the most budget-friendly and entering the Asian market only a few years ago, they have managed to establish a strong foothold in the region. The key to their success lies in their ability to convey the utility of their product to the customer. They create demand in the consumer's mind instead of pushing their product. Similarly, in my scenario, I had built a sound organization with processes in place, and it was time to get the ball rolling by installing a Sales Funnelling Process.
Sales funnelling falls under the umbrella of Sales Governance and is arguably its most important feature, but notably not the only one. The sales funnel typically consists of four stages: awareness, interest, decision, and action. Instead of giving you the cookie-cutter information on these stages, I’m going to focus on the nuances around these.
The Early Stages of the Sales Process
Remember, the process of selling a product to your client begins before meeting them. Prior to contacting the client, we did our due diligence on the property we were ready to sell. This led to us rejecting multiple real estate projects as they did not meet our due diligence standards. While some thought this was a dumb move, the clients appreciated our sincerity. We did not want to spend hours generating leads, so we invested heavily in performance marketing, generated useful leads, and deployed a sound funnelling technique to convert these leads.
The Importance of In-Person Meetings
Back in 2012, I was spending around a crore a month on performance marketing, which was huge! But it paid off! The useful leads combined with a fully functioning sales funnelling procedure ensured a conversion rate of around 10%. For every 1000 leads we generated, we ended up selling around 100 homes.
The key tweak in our sales funnelling process was that, unlike our competitors, we insisted on meeting our clients face-to-face at the early stage itself. While others looked to converse over the phone and follow up with an e-mail, our strategy was to initiate contact and then meet in person almost immediately. The reason behind this was that the average middle-class person in this country puts over 60% of their wealth in real estate, and they need someone to trust before making such a big decision. When you meet someone in person, they tend to associate your face with the task at hand, which helps build trust.
The Wealth Manager Mentality
We also adopted the Wealth Manager Mentality, where our sales representatives were trained to profile the client they met. This meant understanding whether they were a conservative customer, moderate, or an avid risk-taker. Other factors included whether they were making this purchase for end use or investment purposes. Once we had this information, we provided them with options accordingly. These early in-person interactions built a healthy rapport, which ensured that clients no longer looked to contact other real estate personnel as they were assured by our personalized service.
Customizing the Sales Approach
A key aspect of sales funnelling is that it allows the seller to customize their approach towards the customer depending on the stage of the funnel they are currently in. This also allows the seller to tailor their service offerings according to the client's needs. This positive relationship now built accelerated the later stages of the sales process, including site visits and eventual negotiations. Due to the significant investment required in real estate, the buying cycle typically spans over 3-12 months. During this period, it was crucial for me to ensure that my clients did not turn to other brokers, especially after having gone through our sales funnel process. To achieve this, I focused on making a positive impression on them from the very beginning.
Client Tracking - A Further Attribute of Sales Governance
As mentioned earlier, the real estate sector is highly unorganized, making it easy for clients to close deals with other brokers even after going through the sales funnel process. To address this issue, I established an additional department under Sales Governance whose function was to track these clients.
This further attribute of Sales Governance Function was responsible for tracking leads and communicating with clients who had already met with our sales representatives. By doing so, we were able to keep a close eye on their progress through the funnel and provide them with personalized service, which in turn helped us to retain them as clients.
In addition, this added layer was responsible for ensuring that our sales representatives were following the correct processes and procedures throughout the sales funnel. It helped us to maintain consistency in our sales process and ensure that all clients received the same level of service.
By establishing this extra feature, we were able to improve our conversion rate and retain clients in the long run. This also helped us to build a strong reputation in the market, which further helped us to generate more leads and grow our business.
Key Takeaways
I hope this article has provided you with some valuable insights into how a sound sales funnel process can help generate revenue in the real estate industry. Here’s a quick summary:
- Prioritize due diligence and reject projects that don't meet your standards
- Invest in performance marketing to generate useful leads
- Use a sales funnel process and meet clients in person to build trust
- Profile your clients to customize your approach and offerings
- Establish a Sales Governance Function to track leads and communicate with clients
- Networking is crucial to enter and succeed in the real estate industry
- Always focus on making a positive impression on your clients from the very beginning
You can have everything in life you want if you will just help enough other people get what they want.
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