Building a farm and dominating it is simple but not easy. The ingredients are effort and time. Money can replace your effort with the effort of another person and accelerate the time.
First, build awareness
Effort goes toward first building awareness. Consider what would happen if you knocked on the door of each home in your area. If you told the owner your name, would they know you are a realtor? If someone said to them, “Name a realtor,” would they say your name?
For almost all of the 1.8 million agents in the US, the answer is no. That horde has no chance of being a Celebrity Agent – the agent in their farm with a market share between 10% and 60%. If your goal is to be a Celebrity Agent, your first task is to build awareness.
Find the right frequency
Frequency refers to how often you will message your farm to build awareness. In deciding, The Rule of 7 is helpful. The Rule of 7 isn’t a rule but a helpful guide. It states it will take approximately 7 impressions on a consumer before the consumer will consider contacting you for your product or service.
We see The Rule of 7 play out across our clients. Two agents can send identical messaging to their respective farms. If one of the agents already has a high awareness in their farm, the response rates are sharply higher. That is bad news when you are starting in a farm. But it’s great news as your business matures. You gain a competitive advantage over time.
Establish the right farming budget
As you define your farm, you need to be sure it is the right size for you to frequently message it.
If you have no money, your messaging can be in the form of knocking on doors and introducing yourself as a local agent. Or printing flyers and putting them in mailboxes. Introduce yourself to people you see in front of their homes. Volunteer at a local organization and let everyone there know you are a realtor.
If you have money, you have a world of more efficient options that we explore in other posts. You can hire a team like ours to build awareness for you.
That said, no agent has an unlimited budget. Ask yourself how big of a farm can you realistically handle if you must message your farm at least 4 to 24 times per year? For most agents we work with, the range will be between 500 and 10,000 homes.
Work with 4 to 24 frequency
You might say, “4 to 24 times per year is a giant range! Why so large?”
The answer is it depends on your circumstances. If you are already well-known in your farm and with little competition from other listing agents, you may be able to get away with messaging each owner in your farm only once a quarter.
By contrast, if you are brand new in a highly competitive farm full of listing agents bombarding the same owners, you might need to hit them twice per month to raise or maintain your awareness therein.
We know one agent in a competitive neighborhood in San Jose who contacts her farm once per week. She has a market share between 50% and 60%.
There is no one-size-fits-all answer. If you want us to assess your situation, email me at firstname.lastname@example.org.
Consider these final details
As we work with agents on defining the right farm for them, we first establish a geofence. Thereafter, depending on their budget, we may exclude owners who purchased in the last 12 months, owners of low-priced homes, or condo owners. The reasons for excluding these groups are they are less likely to transact soon or transact at lower price points.
Lastly, we ask our clients to consider:
- Home prices
- Turnover; and
- Where they live
All other things being equal, agents will earn more:
- in an expensive area
- in an area with higher turnover
- where they live
It’s easier to build awareness if they live in their farm because they will organically gain awareness just by being part of the community:
“What do you do for a living?”
“I’m a real estate agent.”
Remember your farm is dynamic
The above describes the initial farm. Your farm is dynamic.
I loved hearing the story of an agent who began with a farm that was just the 100 owners in his apartment complex. From that group, he built a thriving business that today includes approximately 5,000 surrounding homeowners. The agent followed the principles above. It wasn’t fast, and it wasn’t easy. But it was simple.