How Do You Think Your Current (and Future) Clients Might Feel About Your 80/20 Plan?

By
Education & Training with Sell with Soul
http://actvra.in/nTQ

There was a featured blog here in the Rain a few weeks ago advising agents to devote 80% of their time prospecting for new business and 20% dealing with current business (i.e. active buyers and sellers). This isn't the first time we've seen this advice and it won't be the last; in fact, most Big Name training programs proclaim that a real estate agent's primary job is to prospect; that agents should vigorously resist the temptation to abandon their daily prospecting when clients call with pesky, administrative, non-income-producing problems to solve. Salesperson

But I can't help but wonder... If a real estate agent's primary job is to prospect... and if the job our clients have hired us to perform for them can be done in a few hours a week... how on earth do we justify charging fees in the thousands and thousands of dollars?

Hold that thought while we return to the advice to devote far more time to prospecting than to serving...

Let's say that all this focused prospecting is paying off, and an agent is gathering an impressive book of real estate business - 5, 10, 20, 40 active buyers and sellers. Bravo! 

But, hmmmmm, just because the agent now has more clients to serve doesn't add hours to the day, so if he insists (as he's advised to do) on sticking to his 80/20 plan (because it's working so well!), his current clients are obviously going to be receiving smaller and smaller slices of his care and attention.

"But," the Power Prospector protests, "if I don't make prospecting a priority in my business and I do focus on my current clients, down the road I'll find myself with an empty pipeline and I can't have THAT! So, even if I'd like to do the job I promised to do I'd prefer to provide great service to my clients, I can't because I need to ensure that I always have new business coming in."

Well, um...

I'm guessing your current clients wouldn't think much of this argument, especially as they're feeling more and more neglected by the agent who promised them the world in service - and isn't delivering. I'm guessing they aren't singing his praises around the water cooler or at yoga class. I'm thinking that if they knew his business model was predicated on spending the vast majority of his time searching for, preparing for and pitching to his future clients instead of taking care of THEM, his current clients, they might have thought twice about hiring him in the first place.

Here's the thing. Taking proper care of your clients takes time. Your need for a full pipeline doesn't change the fact that you made promises and commitments to the buyers and sellers who believed you would take great care of them and their real estate needs. Believe me, they did NOT hire you because they were impressed by your prospecting prowess; they hired you because you assured them you'd take better care of them than any of the other agents they considered honoring with their business.

The bottom line is that if you can't handle more than X number of active buyers and sellers without sacrificing your service to them, then I guess you shouldn't be looking for more business when you already have as much as you can properly take care of.

Now let's go back to the first concept in this blog - if you're only devoting a few hours or even a few minutes a week to your clients, don't you think they might start to wonder what on earth they're paying you so much money for? And IF WHAT WE DO FOR OUR CLIENTS IS SO EASY THAT IT ONLY TAKES 20% OF OUR TIME OR WE CAN HAND IT OFF TO A $12/HOUR ASSISTANT, are our services really worth the fees we charge?

You can't have it both ways. You can't say, on one hand, that client care is simply a collection of administrative tasks that can be handled in your spare time or by an assistant, and THEN in the next breath declare that your client-care services are extremely valuable and should be well-compensated.

For the record, I don't believe that what we do is easy and I do believe we deserve to be well-compensated... as long as... we're doing the job we were HIRED to do and giving it our full attention.

I'll continue this soon, but please share your thoughts with me!

RELATED RANT
If Real Estate is So Easy, How Do You Justify Your Fee? 

 

 

 

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Re-Blogged 6 times:

Re-Blogged By Re-Blogged At
  1. Wallace S. Gibson, CPM 11/29/2011 07:17 AM
  2. Tim Hill 11/29/2011 03:26 PM
  3. Gene Riemenschneider 11/30/2011 12:43 PM
  4. Maria Gilda Racelis 11/30/2011 04:59 PM
  5. Denise Dutson 11/30/2011 07:25 PM
  6. Kate Elim 11/30/2011 08:54 PM
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Rainer
97,246
Karen Salmon
Royal LePage Benchmark - Okotoks, AB
Okotoks Real Estate Agent

I'm too busy looking after my current clients to prospect, but my phone always rings. Maybe it should be 80% client service/20% prospecting and prospect AFTER you've looked after your clients...

 

Nov 30, 2011 02:22 PM #77
Rainmaker
164,927
Elisa Uribe Realtor #01427070
Wells and Bennett Realtors - Oakland, CA
California Homes for Sale in the East Bay

I just can't see how it would be possible to give your current client s20% of your time and no more. They would have an awful experience and never refer you to anyone they know. Especially if you are working with first time home buyers who need a lot more hand holding. I didn't see the blog you were referring to but can't imagine anyone can do this unless they have a full time partner in real estate and that person is spending 80% on the current clients and 20% prospecting.

Nov 30, 2011 03:06 PM #78
Rainmaker
434,496
Jennifer Allan-Hagedorn
Sell with Soul - Pensacola Beach, FL
Author of Sell with Soul

So many good comments, and I'm being 100% sincere when I say that all the support I'm reading here for making client service a priority over prospecting has restored my faith in our industry, which, frankly has been shaken lately by featured blog after featured blog that celebrates everything the general public already finds distasteful about us... And more discouraging than the blogs themselves were the dozens and dozens of enthusiastic comments that followed, many of which virtually oozed disdain for the people who make our careers possible, our clients.

Hey, everyone is entitled to their opinion... anyone is welcome to run their business the way they see fit... and there ARE many paths to success... but it makes me very happy to see so many here choosing the path that puts our clients where they belong - our top priority. Not only is it the RIGHT thing to do, it's also a dandy business model for success!

 

Nov 30, 2011 03:33 PM #79
Rainmaker
524,459
Jill Sackler
Charles Rutenberg Realty Inc. "Said and Done!" - Merrick, NY
Long Island's South Shore Real Estate Agent

If the majority of the time I was engaged in "sales" then I would be in another field. I devote a lot of effort and energy into making my clients happy and sometimes I feel like I'm in the counseling business, but this works out well for me and my clients.

Nov 30, 2011 04:03 PM #80
Rainmaker
214,050
RealSupport, Inc.
RealSupport Inc. - Palatine, IL
- Virtual Real Estate Marketing

Hi Jennifer,

This is a GREAT blog. Prospecting is important in any business, but so is client care and reputation. If your clients feel neglected, then they absolutely won't recommend you to anyone they know who needs a real estate agent. Business through referrals is a powerful tool, and if you're good enough at pleasing your current clients, then you can bet that you'll get even more business because of their recommendations! Prospecting is a priority, but it shouldn't be above your dedication and commitment to your current client base and home sales. The administrative tasks that assistants do is only part of the effort...the rest comes from your communicating with the client and making them feel taken care of. Thanks for posting this! It sheds a light on what you should be focusing on as a real estate agent.

Nov 30, 2011 04:44 PM #81
Rainer
162,803
The Derrick Team - Indy Metro Realtors
Carpenter Realtors - Avon, IN
You Pet Friendly Realtors

I think the 80/20 rule is pushed to those who want to be selling machines. I'm in this business because I enjoy taking care of my clients. In some ways that counts towards prospecting based on future referrals. But clients first is always my goal.

Nov 30, 2011 05:08 PM #82
Rainmaker
434,496
Jennifer Allan-Hagedorn
Sell with Soul - Pensacola Beach, FL
Author of Sell with Soul

Jill - y'know - you really nailed the essence of the debate. Someone who has any desire to prospect 80% of the time is a true salesperson who probably should be working in an industry that doesn't require so much "service after the sale." I got into real estate because I truly enjoyed the process of managing a real estate transaction, not because I wanted to look for buyers and sellers all the time. I wanted to SERVE buyers and sellers, and the time I had to spend finding those buyers and sellers was an inconvenience, not what I got up in the morning rarin' to do!

I, like you, would have quit after a month if, to make a decent living, you had to sell, sell, sell 80% of the time!

Nov 30, 2011 05:21 PM #83
Rainer
213,215
Akerly Real Estate Team Manhattan & Brooklyn Real Estate
Akerly Real Estate Team - Brooklyn, NY

In my humble opinion, 80/20 is too slanted towards prospecting.  But, I think that agents expecting to build a big business should spend more time prospecting than servicing.  Roles change.  When you get to the point that you have more business than you can handle, you need more agents.  Competent ones at that.  You become the rainmaker.  You pass off deals and take a smaller cut and continue to prospect.   That's the way to grow a very substantial business.  If you want to work with the clients forever, you won't be growing a seven figure business (at least in most cases).  

Nov 30, 2011 06:33 PM #84
Rainmaker
638,192
Stephanie/Bob The Ruiz/Miller Team
Keller Williams Cornerstone Realty - Ocala, FL
The Ocala Dream Team

Whoa Jennifer,  Excellent post and question.  I thin the 80/20 also boils down to dealing with the 20% that must be done and NOT the 80% of just holding a customer's hand who for example is a chatterbox.

Nov 30, 2011 07:41 PM #85
Ambassador
475,587
Kate Elim
Dockside Realty - Spotsylvania, VA
Realtor 540-226-1964, Selling Homes & Land at LA

Hi Jennifer...I'd hate to think I paid money to hear that kind of advice.  For someone is just starting out with only one or two clients this might make some sense.  For the rest of us, no way.  I don't work hard to get clients only to shortchange them.

Re-blogging.

Kate

Nov 30, 2011 09:11 PM #86
Rainmaker
127,063
Allyson Hoffman
RE/MAX Villager (Chicago North and North Suburbs Real Estate) - Northbrook, IL
Making Today's Dreams Tomorrow's Reality!

Jennifer, I'm not surprised that this post engendered so many thoughtful comments.  I am more in the 20/80 camp with you, however, if one views providing the exceptional service to our current clients that so many have referenced in their comments here as a form of prospecting in and of itself (really, aren't happy satisfied clients the source of new ones through referrals?) then much of the time devoted to that exemplary service could be somewhat attributed to time devoted to prospecting too.  And if that were the case, then much more time would be prospecting since we'd be viewing servicing current clients especially well as prospecting!  Does that make sense to anyone but me?

Dec 01, 2011 01:40 AM #87
Rainmaker
828,232
Marte Cliff
Marte Cliff Copywriting - Priest River, ID
your real estate writer

It's hard for me to fathom how anyone could disagree with you. I missed the post(s) recommending that agents spend the majority of their time looking for new business instead of taking care of current business.

It's true that many real estate tasks, such as posting a listing to MLS or putting up a sign, can be delegated, but so can many prospecting tasks. In fact, much of an agent's prospecting can be automated.

Meanwhile, a client who has chosen you deserves your attention.

Meanwhile, to Allyson (#88)... Yes, that makes sense. Customer service IS a form of prospecting.

Dec 01, 2011 02:48 AM #88
Rainmaker
434,496
Jennifer Allan-Hagedorn
Sell with Soul - Pensacola Beach, FL
Author of Sell with Soul

Ann, comment #70 - here's a blog I wrote my first year on AR back in 2007 about how we compare ourselves to doctors and lawyers, but... um... http://activerain.com/blogsview/115060/doctors-and-lawyers-and-real-estate-agents-

Marte - Now THAT made me laugh - so much of traditional real estate "salesmanship" is really a series of administrative tasks that can be automated and definitely delegated! And it's also hard for me to see how anyone could disagree that taking care of clients as a first priority is a bad idea, but trust me, agents and trainers say that EVERY DAY, out loud even! Blows my mind.

Allyson - I did a teleseminar show a few years back about providing exceptional client service and I made the statement that I worked 60 hours a week sometimes taking care of my clients, but "you know how many of those hours were spent prospecting? NONE. Or, maybe I should say, ALL." Because it's true - if you devote your full attention to your current clients and thrill them with your service, they WILL notice and they WILL take care of you.

Mike - I believe that it might be a respectable business model to have a rainmaker on the team who is solely focused on finding clients that his or her partner then services. But the partner is just that - a PARTNER, not an assistant or transaction coordinator. It's the notion that what we do aside from prospecting is somehow insignificant and inferior to the activities of the rainmaker that really bewilders me.

 

Dec 01, 2011 07:16 AM #89
Rainmaker
362,422
Sylvie Stuart
Keller Williams Check Realty 928-600-2765 - Flagstaff, AZ
Home Buying, Home Selling and Investment - Flagstaff, AZ

I understand how important prospecting is, and I spend a lot of time doing it, but you have to balance that time to meet the needs of your clients and do a good job for them. Afterall, we get a lot of referrals from past clients, too!

Dec 01, 2011 09:24 AM #90
Anonymous
Anonymous
Rick John

First let me say that a client is someone your firm and you represent, whether seller or buyer. Then and only then, do you have the fiduciary responsibility to take care of the Clients best interest. Having said that I couldn't agree more with Jennifer on all points. The reasons for the "Industry Mind Set" are too many to list but the Business Model is broken and needs "front end alignment" with today's Marketplace. Ya think? Under the Old model getting the Listings was the key to doing business. I believe that is changing. There are many options for sellers and they all offer choices on services and fees. What a novel idea! The concept of REPRESENTATION has never been defined, taught or enforced by real estate commissions, principal brokers or NAR. The emphasis is on DOING BUSINESS (PROSPECTING/LISTING ETC. CONTROL) The how and why is not important. However, todays consumer is more educated (not just formally) and knowledgeable and sees the ROLE OF AGENTS as assistants to make appointments, show houses etc. Most buyers think the agent they are working with is representing them and therefore expect too much from the agent. When I taught real estate I clearly defined the difference between Representation and Compenstion. this is something that should be taught/promoted/enforced. Back in the Day, the one who paid you was who you represented. NOT ANYMORE. The Client relationship is much more serious than most agents are taught to believe. this is a people business not selling real estate. the better the agent takes care of their Clients and assists other consumers the better their business will be in the long run. A good analogy is the CEO who makes decisions today to look good this quarter to please Wall ST and does not consider the effect on the company's future position or the stockholders. first you have to under stand what you are really doing and why you do it. I blame the industry in its entirety for the Mind Set of most agents and the only way to fix it is for each person to start from scratch and rebuild from the bottom up. My grandfather taught me a long time ago that if you really care about people and take care of them the business will succeed. Maybe we need to look back to go forward. Education and Training is only good if people want to do the right thing for the right reasons. thanks

Dec 01, 2011 10:17 AM #91
Rainmaker
133,298
Liane Thomas - Corona & Riverside Real Estate
The Jet Team, Allison James Estates & Homes - Corona, CA
Bringing you Home!

My clients know we give great service, and they also know they might hear from me or my assistant throughout the transaction. Many times they will call me, and I will have my assistant call back with the answer. She always asks if she has answered their questions fully, and would they like me to call them when I am free. 99% of the time, clients are satisfied with her calling them back. Frees me up to prospect!

Dec 01, 2011 08:36 PM #92
Rainer
205,153
Marge Piwowarski
Phoenix AZ Horse Property - Phoenix, AZ
Phoenix AZ Horse Property, LLC

The most effective prospecting I have ever done was to take of the client at hand.  I try to make every client believe they are the only one.  It works for me.

Dec 02, 2011 08:54 PM #93
Rainmaker
434,496
Jennifer Allan-Hagedorn
Sell with Soul - Pensacola Beach, FL
Author of Sell with Soul
Rainmaker
129,388
Matt Robinson
Professional Investors Guild - Pensacola, FL
www.professionalinvestorsguild.com

You will have a tough time growing a successful business with that mentality.  Just about every large, successful business has 80% of it's activities handled by $12 an hour clerks, while they make billions in profits.  You act as if there is no way to provide examplary service that is worth a premium commission without being hands on 40 hours per week.  You are missing the boat big time, and need to go read Gary Keller's Millionaire Real Estate Agent. 

An inventor may spend hundreds of hours on his invention, but once it's done and gone to market...he may never work another day in his life, yet his invention is still worth lots of money to the consumer because of the service it provides, regardless of whether he is handmaking them himself any longer.

As an agent, I could spend weeks on an unbelievable marketing plan, the best in the business, one that produces a flood of buyers for my sellers, and top dollar for their home.  I could spend thousands paying for copywriters to write compelling ad copy that I use in my marketing, and train an assistant to implement my strategy on every listing.  If it produces RESULTS, then it's worth the commission...regardless of whether I am hands-on with the process any longer.

My job, now that I have created this incredible process/system that produces results and demands a premium commission, is to spend 80% (or more) of my time getting the word out (prospecting) so that others can experience the same success that I have created for other customers, and feel passionately about helping others with as well.

Jun 07, 2012 09:44 AM #96
Rainmaker
262,667
Wayne B. Pruner
Oregon First - Tigard, OR
Tigard Oregon Homes for Sale, Realtor, GRI

I appreciate your point. It is very hard to maintain prospecting activities when you actually have business to complete.

Jun 19, 2012 09:55 AM #97
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Rainmaker
434,496

Jennifer Allan-Hagedorn

Author of Sell with Soul
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