Dear realtor, why aren’t you asking for real estate referrals?
Is it because you don’t know who to ask for referrals? Do you not know when to ask for them? Or is it simply a case of not knowing how to ask for them?
You’ve come to the right place. We’ve put together the whos, whens, and hows of real estate referral-asking.
So… let’s get growing!
Why are real estate referrals important?
Let’s talk numbers.
- 92% of consumers trust word-of-mouth from peers and friends over advertising.
- 82% of all real estate transactions came through word-of-mouth referrals and repeat business.
- 21% of agents earn over 50% of their business through referrals.
- The average agent generates 42% of their revenue through repeat and referral business.
🔎 Source: Become a Local Leader
You need to leverage the benefits of a robust relationship with past clients and use those connections to generate more leads for your real estate business.
It’s the easiest and the fastest way to generate more sales and grow. Real estate agents, realtors - whatever you want to call them - depend on real estate referral to keep the lights on.
How to generate real estate referrals.
Obviously, referral outreach is doomed to fail if you have no idea about what you’re doing. But you can’t let this stop you from growing your real estate clientele. You just need to understand the peculiarities of the post-purchase real estate referral process and develop a reliable strategy to generate some yourself.
It’s a process, aimed at embedding a culture of referrals around your business. You need to get used to asking for them, so next time you need one… it won’t feel so weird.
The process looks like this...
Prepare to ask for referrals
Even the most experienced real estate professionals, in the game for years and years and seen it all, still need to have a plan in place to get new referrals. While human psychology doesn’t change too drastically, technology does. Realtors need to regularly review their strategy and adjust for any changes that technological advancement brings. Of course, that implies having a strategy to begin with.
For your plan to be successful, you need to carry out some preliminary preparations. If you’re unprepared to ask, you risk coming across as pushy, salesy and very awkward.
So let’s start with you.
You need to make sure that your business lives up to customer expectations and industry standards before you start applying any other referral generation strategies. Think about it from a customers’ perspective.
Would you recommend your friend a service that isn’t very helpful and difficult to use? Would you vouch for a company that’s difficult to reach? Would you refer your colleague to a business that didn’t bring you too much value?
Most likely, that’s a triple no.
Well. Your customers obviously feel the same way! They aren’t going to give referrals to a meh business. Here are some resources that are going to help you provide smarter, more personal customer service...
- The top 5 best ways to provide excellent customer service.
- The biggest sales trends in 2021.
- How to implement a customer success strategy.
And once you’ve upped your service game, make sure that you know your value.
NetHunt’s Hot Tip
You need to restrain yourself from using meek and overly humble ‘maybe, if it isn’t too much trouble, you could possibly’ phrases. Remember that you offer a service of a high level, and act accordingly.
Ask for referrals
Once you’ve prepped the soil, it’s time to start planting your referral seeds. Who do you ask and when do you do it? To maximise the effectiveness of your ‘ask’, you need to put all of your sources of referrals into separate categories.
There are three levels of real estate referral sources.
- Level 1 Sources
Relatives, friends, and other contacts who send leads regularly. While we’re talking about post-purchase real estate referrals, it would be a crime to omit to mention the easiest way of obtaining referrals in the real estate industry. These are people you have a robust personal relationship with, that don’t need any additional convincing to recommend your business to their networks. Top drawer.
- Level 2 Sources
These are past and present clients who will likely send real estate referrals to you because they were extremely satisfied with the service they received. These customers are very responsive and don’t need any additional courting as they are willing to help you grow your business regardless. They’re good.
- Level 3 Sources
People who will probably send referrals to you but require additional work, such as repeat requests or additional interaction. These sources are also characterised by placing certain limitations on their referrals to you. They’re not the most reliable referees, but they all count!
From there, the idea is simple. Start off from Level 1 and move further down as you run out of members of each category to reach out to. It’s important not to think that customers from Level 3 are impossible to get a referral from. At the end of the day, you’ve already convinced them to buy a house with your help, which is a commitment much larger than simply sending a lead your way.
There isn’t a specific moment when you should ask for a referral, but it probably shouldn’t happen the moment you pass them the keys to their new house. They can express their gratitude at different points of your relationship - after a long day of viewings, when an offer has been accepted, or after a follow-up a year into their life at the new home you sold them.
People tend to be more willing to help and have a positive reaction to requests when they’re in a good mood. How can you tell if your clients are happy with you and your service? Easy! The most reliable indicator is a simple “thank you”.
NetHunt’s Hot Tip
Just look for the times when your customers say ‘thank you’, and use those moments to ask for a favour in return.
Stay relevant by offering value
Let’s talk about the different ways in which real estate agents can approach their post-purchase relationships with clients. We have two real estate agents, Alex and John, who have recently sold houses. Here’s how their deals went.
Case Study A: Alex & John
Alex helped a client to find their first home for the price they set in a month. There were a couple of problems, but they were promptly solved by Alex. Eventually, the clients moved in. Alex stayed in touch and regularly sends newsletters with useful information regarding the local area. She partners with the local furniture store so often sends her past clients coupons.
John has excellent knowledge of the market, a vast network, and a keen eye for a deal in the local area. He helped a client to find their first home in under two weeks and offered a very good price for the house. The client ended up loving the house and the sweet price it was being sold for. They bought it immediately and moved in not long after. John went back to the office and put the kettle on.
So, who’s more likely to get a referral from their client?
While both agents delivered excellent service and helped their clients buy a home, Alex's chances of getting a referral are significantly higher. The reason is she didn’t call it a day immediately after the purchase was made, disappearing from their client’s life. Instead, she stuck around in their thoughts.
The newsletters and coupons she sent to her client were the added value that made the client more satisfied with their experience. Therefore, they were more likely to remember the business when someone asked them if they knew a trustworthy and reliable real estate agent to turn to for help.
Here’s what Alex likes to include in her monthly client newsletter…
- Quarterly market update. These can help prompt a customers to turn to you for help again, either to sell their house or to buy a new one.
- Educational content. Everything there is to know about the real estate industry, such as mortgage application and rate reports, saving-up tips, home insurance advice, etc.
- Information about new locations. Educational institutions, markets, new restaurants, etc. in the local area.
- Evergreen content. Home-buying advice, explanatory content (e.g. The Different Types of Credits for First-Time Home-buyers), reviews of different home products, etc.
NetHunt’s Hot Tip
Use email marketing automation software to make sure you keep the good content coming. We’ve got a bonza guide to email marketing, giving you all the tips, tools, and templates you need for a successful post-purchase newsletter email campaign!
Email marketing is the easiest way to stay in touch with your clients and send them valuable content. You can set up an automated email sequence using NetHunt CRM’s Workflows feature. That way, you won’t have to worry about missing an email because you were too busy and forgot to arrange the email campaign. The system automatically does it for you!
Build relationships with customers
You can take post-client outreach a step further by communicating with your clients outside of a monthly newsletter. You need to invest in a genuine relationship and show it. Be a friend to your clients, this way you can always ask them for a friendly favour.
If you don’t have a consistent relationship with a customer who you want to ask for a referral, don’t panic. It’s not the best, but it isn’t the end of the world either. You just need to make sure that you kick start it some time in advance so that it doesn’t seem that you only treat them as a source of new leads.
Here are some ideas for deepening the bond with your clients…
- Host a house-warming party.
- Hold client appreciation events.
- Regularly reach out to them to make sure everything is fine with the house.
If you don’t fancy the idea of meeting up with your past clients in real life , you can always resort to sending emails and physical mail.
- Home-purchase anniversary email.
- A birthday card.
- Seasonal greeting cards.
CRM helps maintain important client data.
Real friends never miss each other’s birthdays. If you want to build a relationship strong enough to comfortably ask for a referral, you need to be a real friend to your customers. But as the workload’s getting bigger, it can be easy to forget the important date. Make sure you never make a mistake like that and have all your customer records in your CRM system to keep track of everything effectively yet effortlessly.
Regularly attend networking events.
Now that the coronavirus pandemic is finally coming to an end, the real-world gatherings are coming back to life! As a real estate professional, it’s likely that you already know quite a few people in your local area. That’s great, but the sky’s the limit when it comes to expanding your network!
Don’t shy away from getting out there and attending networking events - it’s likely that you’ll meet your clients at some of them. A social gathering like that is a perfect opportunity to ask your clients for an introduction. If you’re used to online events, the webinar opportunities are pretty much endless these days.Look for them, or host them yourself.
Here are some real estate webinar ideas.
- First-Time Buyers 101
- How to evaluate a home properly.
- Everything to know about real estate mortgages
If you’re looking for an offline gathering to network, the options are more limited. Join local communities and LinkedIn groups for real estate professionals in your area and watch out for event updates. Butter them up online, and they won’t turn down your referral request.
Develop branded materials.
Our John, the real estate agent, has come unstuck yet again. Yet again, he made the mistake of not promoting himself well enough to get a referral that counts. Even though his name was brought up in a conversation and he got a sweet testimonial, it didn’t generate a new lead. Loser.
Case Study B: John strikes again
A: "Hey pal, do you know someone to help me sell my house? I got a promotion, so my wife and I are planning to relocate to New York City soon - woo!
B: "Yeah, lemme think for a second. This guy John helped me buy this flat and got me a banging deal. I don’t remember what his last name was. I think I saved it in my Contacts, let’s see.’
A: "Sick! I remember you told me he was amazing at finding the property. That would be awesome if you could give me his number!’
B: "Oh crap, I’ve just bought a new phone and I don’t have his number saved anymore… Sorry.’
Gosh dangit, John!
Let's be more like Alex! Make it easy for referees to give you a referral by creating branded materials. Something as simple as a business card gets the job done. Being the superwoman she is, Alex gives her real estate customers free stuff.
She's got boxes of branded stuff in her office!
- Tote bags.
- Fridge magnets.
- Teddy bears.
Into it? Just make sure your merch has got all its branding spot on and contact information clearly visible!
Incentivize and reward referrals
Benjamin Franklin once said we tend to like people more after we help them. According to this rule, it’s very rewarding for clients to help you out and introduce your real estate business to their network. They feel good about themselves and it’s the best feeling there is.
If you want to maximise reach and generate as many leads from referrals as possible, double up the rewarding part. Add some real benefits of referring you to your clients. For example, you can give discounts and gifts for every friend they bring and every listing you make from that recommendation.
The nature of these gifts can vary depending on your position in the market, your brand values and lots of other factors. Some examples of what you could ‘bribe’ your referees with include.
- 1%, 3% or even 5% discount on their next listing for every referral that converts to a customer.
- Trips and vacations for referrals that make a purchase over a particular sum of money.
- Spa, or other local institution vouchers.
Use scripts when reaching out to your customers.
Don’t beat around the bush when it comes to asking for referrals. It’s easier than you think - instead of wasting your client’s time mumbling about what you’re calling for, be sincere in your ask.
To make your task concise, use a script! Often, real estate agents shy away from using scripts to aid their referral calls in a fear of their speech sounding too staged. But scripts aren’t meant to make your conversation flow set in stone. Instead, they act as guidance for what to say and how to say it.
Besides, if you know your clients well, which we hope you do, you can personalise your scripts and make them sound easy, friendly and informal.Generally, you’re the one to decide on what goes into your script. But there are a few tips to help you make it.
- Leverage the power of an out. Funnily enough, giving your customers an option to not respond makes them want to respond more. Adding a little “no need to respond” or “no pressure” you seal the deal.
- The pattern interrupt ask. Don’t choose the ‘do you know anyone who is looking to buy or sell real estate?’. It’s the real estate equivalent of the store clerk’s ‘can I help you to find anything’. The natural response to that is always ‘no thanks, I’m just browsing.’ It won’t get you any referrals. Instead, you should ask the same thing using a little more unconventional phrasing to get your client to stop for a second and really think about your ask. Some good examples of effective phrasing are ‘Do you know anyone who could use some real estate advice?’ and ‘Do you know anyone who would want to know what homes are selling for in their neighbourhood?’
- Use magic words. ‘Please’ and ‘It would help a lot’ go a long way. But you should also try using the word ‘introduction’ over ‘referral.’ This will give your clients a clearer direction of what you want them to do.
After you write a couple of scripts yourself, this should come naturally. However, if you’re stuck and not sure where to start, check out our hero Alex's referral chat up lines for some inspiration.
Case Study C: Alex referral request scripts.
- "I’m not sure if I’ve mentioned this but a huge part of my business is powered by word-of-mouth from past clients. So if you know anyone that is looking to buy or sell a home this year, would you mind introducing them to me?’
- "I’ve enjoyed working with you loads, and would like to have more clients like you. After years of working in real estate, I’ve found that people looking to move know others in the same position. How would you feel about introducing my services to them?’
- "It’s been a pleasure working with you, and I’m so grateful to Helen for sending you my way. Getting introduced by past clients is really the best way to find new connections interested in cooperation. After all, if it wasn’t for them, I’d never have met you! So, if you know someone who’d be interested in my services, would you be comfortable introducing them to me?’
- "Do you know anyone who’s trying to move right now? It would be cool if you could share my contact with them!’
- "Now that you’re in the process of moving, I know that you’re interacting with lots of people in the same position, chatting about their options and looking for houses. When you do meet someone looking to buy a house, would you mind mentioning my services to them?’
Use all the resources available to you and sell more houses - you have all you need to lead your real estate business to success.
It’s your move!
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