Demonstrating Your Professional Value
by Dirk Zeller
Friday, August 17, 2012
1. We don't sell properties
We are salespeople, but we are really selling something other than a property. What we really sell to the marketplace is our knowledge. Our knowledge is better and more complete than our competitor's, which enables us to charge a higher fee for our service. Why is one Attorney $500 an hour and another is only $100 an hour? It's an hour for both. Assuming they can accomplish a similar volume of work, why pay the higher price? The answer is obvious – greater knowledge and skill. Why are we any different?
We also sell our time. Just as a Doctor, Dentist, Attorney, or Accountant sells their time, we also sell our time. Because our fees are in a general range, the real variable to profitability is the amount of time required to earn our fees. If we can accomplish our client's goal to their satisfaction in less time, we can increase our revenue and net profit.
We are in a service business. The purpose of a service business is to provide service... for compensation. We often forget that last part - for compensation. We won't be in business long-term without the ability to charge enough compensation to cover our business expenses, personal living expenses, recreation expenses, retirement saving expenses, taxes, children's college funds, and investment savings. We often barely cover some of our costs and come up very short when we discount our fees.
We really "broker" transactions, not sell homes. We represent the interests of another by advocating for their position in the marketplace or a particular transaction.
2. Key "service" business requirements
The fact that we provide service and receive compensation is certainly the most important thing. A good service business goes beyond that level, though. They check back after the sale. They might even survey their clients to see how they did and how to improve their service.
3. Sell yourself first
Sell your services, benefits, and value first. The first step is really believing in your value. If you don't believe it, you can't sell it. I often ask Agents what knowledge, skill, or production level they need to acquire or achieve before they will achieve an unshakeable belief in their service or value. The more you can quantify that, the easier it will be to attain. You have to know the target before you have any chance of hitting it.
Then, once you believe it, it becomes easier to communicate your value as compared to other Agents in the marketplace.
4. Deal with the competition challenge
The real estate business is an extremely competitive business. With new competitors entering and advancing daily, we need to be prepared for competition. Some of these competitors will try to attract customers through discounted fees. Some will over-promise sales price and marketing exposure but will then, ultimately, under-deliver.
A. Who are key competitors?
- Who has more market share than you?
- Who has more name recognition than you?
- Who has similar market share to you?
- Who has equal or better statistics of results?
This evaluation should be made based on company statistics, as well as individual statistics and analysis.
B. Understand what your competitors are offering
Before every listing presentation, you should know exactly who you are up against; what that Agent and company offers and what their stats are in the marketplace. If you can acquire your competitions' pre-listing package, marketing brochures, or anything that will clue you in on how they promote and communicate their value and service, those items will raise your preparedness for the appointment.
C. Be competitive: Competition creates success
By checking out your competition, you will be able to present an offer that is in direct competition for the business. If, for example, you are charging 9% to sell a home when the market average is 6%, you are not competitive enough to secure business. A 1%, as a premium service fee, above the competition moves your competitive position to a point where you can prove the value. You don't necessarily have to match the price another will charge if the service is different. You will make a more effective presentation when you are competitive. If you are not, it's easy to have the attitude of why bother.
Most people don't want to engage in a competitive environment because they are uncomfortable. They also recognize that it's harder. They will have to work harder to improve their skills, activities, knowledge, mental focus, and mental attitude. Most people don't want to work that hard.
My response is always the same, "Don't wish it were easier; make yourself better." Take on the challenge that most won't in order to make yourself a more skillful Real Estate Agent. Work through the short-term challenges to access the long-term opportunities.
5. Beating the competition
Champion Agents have figured out that being specific and deliberate in terms of what they offer, the benefits the clients receive only from them, and the value they bring to the marketplace, allows them to beat the competition. If we offer "generic" services, we must compete on price. Webster's dictionary defines generic as "nonproprietary, any product or service that can be sold without a brand name." It's something that anyone can do or provide. An example would be the fact that any Agent could put the home in MLS. When we move away from generic to unique, we can now compete on value and service and avoid price.
By clearly knowing our competitive points of difference and effectively communicating those differences, we are able to draw a stronger separation from the competition. In essence, we can beat the competition. We can then communicate the quantity and the quality of our benefits.
Through the use of personal commitments and personal guarantees, we can also create a higher level of comfort for them, reduce their risk, and separate ourselves from the crowd of competitors.
6. There is a professional difference
We need to sum up the differences, so the prospects can see the clear distinction. Then the prospect knows clearly that:
- All companies are not the same
- All salespeople are not the same
- Your differences create advantages for your clients
- Significant or beneficial difference creates greater value
- Here are my beneficial differences
A Champion Agent follows these five steps to convey, without question, that they are a different type of Agent than this prospect has ever seen. They, in a nice way, are saying, "Don't be foolish by taking the risk of achieving a worse result by using another Agent."
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