Leveraging Your Sphere of Influence (SOI)
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- Marlene Barrett
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1 Leveraging Your Sphere of Influence (SOI) Sphere of Influence Your Sphere of Influence, or SOI, is one of the best sources for generating business and should be a foundational element of business development for all real estate agents. Most buyers and sellers choose an agent based on a personal relationship or a referral. If an SOI is properly managed, it can provide an agent a significant source of income over their career. However, if contact with your sphere is left to chance, much of that opportunity goes unrealized. As a new agent, we recommend that you strive for 200 people in your Sphere of Influence. That may seem like a large number starting out, but for most of us, it truly isn t that difficult with a bit of effort. If after dedicating time to building your sphere, you still fall short of this number, you may need to prioritize specific activities to grow your sphere in your business plan. If you ask someone Your Sphere of Influence consists of people you know. Given the opportunity, they likely would choose to do business with you. who their doctor, lawyer, accountant, financial advisor or hairdresser is, they would be able to state a name. Is the same true if you ask who their real estate agent is? You want your SOI to think about you when it comes to real estate and recognize you as their source for all of their real estate needs. We can t emphasize enough the impact a solid sphere can have on your business. Contacts with your SOI yield the highest return on effort, and give you greater control with whom and how you work. Further, this is one business asset that is completely unique to you. Other agents can pay for advertisements or buy leads from third-party aggregators. These are commodities. Only YOU possess your unique voice, experiences, and relationships. Only YOU can leverage your Sphere of Influence. 1 As an independent contractor sales associate affiliated with a Coldwell Banker franchised office, you have a variety of resources, tools, technologies and educational opportunities available to you. The Coldwell Banker educational materials, programs, or meetings are not mandatory. Nothing in this document is intended to create an employment relationship. Any participation in this offering is entirely voluntary. Note: This document may contain suggestions and best practices with regard to specific issues you may encounter. These suggestions and best practices are completely voluntary for you to use at your discretion.
2 Building Your SOI Database The first thing you need to do is compile a list of those who may be part of your Sphere of Influence so you can build your database. Here are some tips: Start with your personal address book. Focus on people who live in your targeted geographic market. If you have a spouse or partner, don t forget their SOI as well but use discretion. Go through your checkbook register or online bill pay. Add names of people you do business with. Do not add someone s name for the sake of adding names. These should be people that you and your family know and where there is some name recognition. Add your doctor, lawyer, accountant, and other professionals. Add contacts from schools, houses of worship, clubs and organizations, volunteer work, sports and recreational activities, political groups. Add neighbors and previous business associates. Add referral agents within your company and agents who left the business. not to move at this time. (Expired and FSBO) Strive to add a minimum of one new name per day. Use of a Customer Relationship Management system like the one integrated in Zap TM is strongly recommended. You need to systematize your SOI database so you are more organized and have the ability to create contact campaigns and schedule regular interactions with your sphere with relative ease. Don t overlook everyday opportunities to build your sphere! You will find it s easy to make new connections if you push yourself just a bit out of your routine or comfort zone. For example, if you re a golfer, why not sign up for the league substitute list at a club in your targeted geographic area instead of playing with the same foursome you ve been playing with for years? Each time you re called to sub, you have the chance to make a connection with three new people who share a common interest! The 2% Rule Over time your Sphere of Influence will include leads from open houses and your brokerage s lead management system, former clients, and others. These should be kept in your Sphere of Influence as they will be a source of referrals and repeat business. As they arise, include old leads from prospecting activities that have decided What is the 2% rule? When an agent goes through their SOI database just one time, on average, 2% of their list will do business with them or refer them over the next 12 months. So, if an agent has 100 names, approximately 2 transactions will come from their SOI in year one. 2
3 The 10% Rule What is the 10% rule? When an agent contacts their database by phone or in person four times a year and remains in monthly contact via , mail, or newsletter in year one, and continues these activities in year two, approximately 10% of their list will do business with them or refer them in year two. So, if an agent has 100 names, approximately 10 transactions will come from their SOI in year two. Can you imagine if this system is consistently worked, how much business an agent could generate when their database gets up to 200 or 300 or 400 names? Communication Consistent communication is critical to the success of this program. Mailings and supplement the phone contacts and personal visits you make and should be scheduled a year in advance in your calendar. This gives you plenty of lead time to prepare and takes the stress out of trying to figure out what to send at the last minute. Don t rely on just electronic delivery however, because deleting is too easy. Mix in direct mail as well. Direct mail is stickier and may stay in the house longer. Many agents don t know what to send, so here are some ideas: Just Listed/Sold Cards Most agents make the mistake of just sending these mailings geographically around their listings. That s fine, but your SOI needs to see you are busy and successful too. Sellers like to work with active agents. Open House Invitations Send invites to your SOI. They may come to see you, bring a friend, or be thinking about moving in the future. This gives them a gentle reminder that you can help them. Newsletters/eNewsletters You can easily customize these using the Coldwell Banker emarketing Tool. Social Media Find indirect ways to remind your contacts that you work in real estate. If you re on your way to show a home, update your status. Market Updates Sellers love information. Everybody is curious about the real estate market, especially in their own town. Many market updates can be easily created straight out of your local MLS. 3
4 Town Information If you can re-package a summary once a month or once a quarter of what s going on in a particular town: new developments, market/economic data, school info, tax assessment or tax rate data, zoning changes, local improvements, restaurant guide, new businesses, etc,. people will recognize you as their source of information. Mortgage Information Refinance updates, rates, new programs, reverse mortgage information Holiday Cards/eCards St. Patrick s Day, 4 th of July, Halloween, Thanksgiving, Happy New Year, etc. Testimonial Letters When a client sends you an awesome testimonial letter or survey leverage it! Send a copy to your SOI. Compliments always sound better coming from someone else. Handwritten Notes They are a dying art. People love personal notes. Use high quality personal stationery, not company letterhead or envelopes. Personal notes will be opened! Personal Brochure It should be high quality and trust me our consumers would rather see pictures of houses than pictures of you! Relocation Design a mailing that lets your SOI know that you can help them or a family member relocate or buy a vacation home anywhere in the world! Introduction Cards When you start your real estate career, you must send announcement cards to your SOI. Note: When sending mail, first class postage is preferred. This way you are guaranteed the returns. Bulk mail is not always received. If you use bulk mail, send one mailing a year by first class so it will help you purge incorrect addresses from your database. Remember: whether regular or jumbo size, postcards give you the most bang for the buck. If something smells like junk mail and it s in an envelope, it may never get opened. 4
5 Capitalize on Your Contacts Don t put people on your SOI list that you don t like or you are stressed out about calling. Make it easy on yourself. If you are not sure of what to say, review your dialogues. Do not hammer your SOI for business every time you call. Alternate by giving them information with May I ask you who you know at work or in the neighborhood that might be thinking of buying or selling in the next days? Never be afraid to ask for business. We are salespeople, remember? Our SOI isn t afraid to call us when they need or want something, are they? Make sure you make contact by phone, inperson, , direct mail, and social media. When someone on your SOI is very receptive to your call or expresses a willingness to refer people to you, send them a personal thank you note. The Do-Not-Call Law does not apply to your SOI, as long as you have had contact with them over the past 18 months. If you have neglected your SOI for years, send a few mailings first before making your calls. Get them warmed up. Your SOI is not waiting for you to call them. You have to be proactive. How would you feel if someone you knew just listed their home with one of your competitors and would have gladly listed with you, if they knew you were in real estate? Everyone currently in your SOI does not know what you do or where you work. You can fix that. Practice the Art of Reciprocation. If someone on your SOI list is a plumber, ask him for some of his business cards. Ask him if he would be okay if you gave his name to your clients. Ask him to do the same for you. Make sure you are enthusiastic when you call and don t sound desperate! Since these are people that you know and they know you, it s okay to leave a message on their answering machine or voic . There are approximately 60 working days in 3 months. If you wanted to call 250 people four times a year, you would only have to make approximately four calls per day. Who doesn t have time to make four calls per day? Note: A once-per-month mailing for 100 people will cost less than $50 per month in first class postage, plus the cost of the mailer. If money is an issue, you are better off cutting your mailing list down to a size that is manageable and gradually build it up as you collect commission checks. Do not cut down on the size of your list for phone/personal contacts. 5
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