First, the average income for a Real Estate Agent working between 21 and 39 hours a week is $46,458.
The average income of real estate agents who have been full-time in the real estate business between four and 10 years is $63,595.
The average real estate agent in the U.S. closes 12 deals per year.
Not trying to be average?
We don't blame you.
Did you know 92% of consumers trust referrals from people they know and people are 4 times more likely to buy when they are referred by a friend? (this is according to a Nielsen study)
Would a few more referral sources in your camp make an impact?
And before you say "Yeah, but according to the NAR, I can't pay non-licensed people for referrals"...we're not talking about referrals in the agent-to-agent sense, but rather personal referrals or "leads" that come from your existing network.
Remember, you can pay/reward anyone for any leads or marketing services that you want, as long as it's not contingent on a transaction happening.
Feel free to check out THIS ARTICLE for more on the NAR referral rules.
Personal referrals are obviously crucial for Real Estate Agents, but less than 3% actually setup a repeatable system that consistently delivers them.
This is what we intend to change for you with this guide.
*Or if you'd rather just jump in and start your own referral campaign, we have you covered HERE.
Sure, you can bring in some leads with a $100K marketing budget, develop a robust SEO strategy, research PPC google ads, buy some random billboards and pull your hair out trying to master Facebook advertising.
You are more than welcome to compete in that rat race.
But is that why you got into this business?
Will those approaches even work?
Despite all the other channels, when we ask agents "How do you find your real estate clients right now?" 9 out of 10 will respond with things like “it’s all word of mouth” or “pretty much through referrals”.
And the funny thing is - that's SO true!
Because we all know referrals are hands down the most reliable channel for new clients.
The problem? Without an organized approach, referrals are hard to come by.
They may have had a word-of-mouth hot streak and now they're left hoping more referrals will magically keep flowing.
But that doesn't always happen.
So they turn towards something they can put a strategy behind.
They look at online ads, brochure ads, ads on benches, Zillow leads, list buying, and on and on.
They almost completely forget about the power of their own personal network.
The personal connections they enjoy and the value of their relationships (which is probably what convinced them they'd be successful in real estate in the first place!).
Now, as we get started, think about all the people you know who would be an advocate for your business.
They might be family, friends, neighbors, acquaintances or past clients.
Next, think about all the people that would be advocates for your business if they were properly motivated.
You would be surprised at how many stellar advocates are out there who would be ready and willing to join forces with you in making your business ultra successful, and share in the rewards along the way.
The idea behind this is very simple, but the message needs to be crystal clear. You have thought of them as a person you would like to represent your brand and you are going to make it worth their while.
You have a massive opportunity when it comes to referrals, and a proper referral program can not only lead to explosive short-term growth, but will lay the foundation for a long-term referral-generating machine that you never thought possible.
Have a way to easily remind your Ambassadors that you are in business to help people with their real estate needs. This can be done via email, text, by phone or whatever makes the most sense for you. The important thing is to get in the habit of reminding your Ambassadors about your offers and what’s in it for them.
Make your referral program easy to understand. You need it to be customized for your business, but you also need it to be very easy to deploy, manage, and most importantly… be headache free for your Ambassadors.
Confirm that the incentive you are offering is going to motivate your referral sources. This is imperative and the detail that is tragically lost on most Realtors. Many people think that they can throw out any old offer and it will WOW people into referring them business. Nobody cares about a Starbuck’s gift card. NOBODY. Make your reward compelling enough for your ambassadors to send you more and more.
Any Real Estate Agent can have a referral program.
It’s really not that difficult.
The main differentiator is whether or not the program actually delivers referrals.
You’ve probably received countless emails from all kinds of businesses asking for referrals or reviews on google, Yelp, Angie’s List, etc..
The problem with that is you probably didn’t ask to be emailed about it, you probably don’t have time, and there’s certainly no WIIFM (what’s in it for me?) involved.
If you’re taking your referral program seriously, your referral sources should know that they’ve agreed to participate to earn rewards or benefit in a significant way.
When you put real focus into a professional referral program, you do a number of things to set yourself up for success and apart from the masses.
And this is why we put this guide together.
Because referrals work very well for Realtors.
Think about how many clients you could bring in if you had a system to generate 5x, 20x, 100x more of them!
The great news for you is that you already have the raw materials, you just need to organize and streamline your system.
***Before we get into the steps, it's important to remember that this system involves having two landing pages (one for your sphere and one for your prospects). This is where you create your reward and offer and this is where you will drive your traffic. Knowing that up front will help put these steps in context for you.***
How to create your reward
A = $15,000
You can input this on your own as it will vary depending on your market/location and the structure of your business.
B = 12 (1 per month)
This will vary depending on your current stream of clients, availability and market. But let's assume you can handle at least 1 more client per month.
C = $500
That sounds like a lot to a lot of you.
But this is what separates the Realtors who get referrals from the ones wondering why they're not.
Once you get your referral engine up and running you may not need to spend ANY other money on marketing.
You should be more than happy to spend on rewards, because this is a client you would not have had otherwise.
Word of mouth is crucial to your business and there is a serious snowball effect when it comes to how to get real estate clients.
Don’t be afraid to provide extra motivation when profit margins are high.
*If you are concerned about breaking any rules for rewarding people for referrals, just remember, you are only rewarding people for promoting your business (sharing your referral link), and none of your rewards are contingent on a transaction happening.
**BUT if you are STILL concerned, you can always structure your rewards in a contest format OR simply make your "reward" a donation to your ambassador's favorite charity.
How to craft your offer
Your offer does not need to cost you anything.
Your offer simply needs to convey enough value to make your prospect want to have a conversation with you.
This can be a:
-Free Home Estimate
-Free Market Consultation
-Free Home Sale Checklist
or any other type of value-based offer.
The goal here is to give something tangible for your ambassadors to "hook up" their friends, all while making sure you get to meet the prospect.
So make your offer something that necessitates a phone call, and make the offer easy to access for your ambassadors.
This means a special link or a special landing page that you can easily send their way (we'll get to the "distribution" part later).
The point here is to provide something that only referred clients have access to.
When you introduce scarcity with your offers, your prospects have a much harder time passing it up.
Make them feel silly if they were to say "no" to your offer, and your calendar will start filling up.
How to compile your sphere
If you're not using some sort of email sending tool, start now.
CRMs are great, but even a basic email sending tool like Mailchimp, Aweber or Convertkit will do the trick and are very reasonably priced.
If you don't have anything yet but want to get started out of Gmail or Outlook or whatever email platform you're using, just create a spreadsheet.
What we want to do here is list out and segment your family, friends, acquaintances and clients.
You just need their first name and email.
These are all potential ambassadors.
Don’t miss anyone - you’ll be surprised at where referrals come from.
Your goal is to come up with at least 100 people that might possibly refer you a new client if it crossed their mind.
And it IS going to cross their mind - we'll get into that next.
How to distribute your campaign
Most Realtors wait until they get a referral and then awkwardly have a conversation with their referral source about how appreciative they are and what can they do to say thank you and blah blah blah...
We're not doing that.
We're going to be proactive.
Here's what you do...
Send an email to welcome your family, friends, acquaintances and previous clients as people you want representing your business because of the respect you have for them.
There is nothing wrong with a little flattery here.
Most importantly, make it clear that it is your policy as someone who runs a business to give rewards for promoting your services.
Take the awkwardness right out of it.
You want referrals and you want to reward people for them.
Come out and say it. It’s refreshing and it’s good business.
And this should become part of your regular cadence.
You can always include other value adds to these emails, but start running a referral campaign NOW.
Post about it on social media, regularly.
Let past clients know about it and tell current clients about it.
Whatever it entails, make it your mantra, your purpose.
See your referral campaign does a few things to separate yourself from the herd.
First, it reminds people that you are indeed actively working in real estate and looking to serve more clients.
Second, it positions you as the top person to send referrals to, because now you've given them a reason to refer clients your way.
And third, it gives your business a reason to exist. A purpose for people looking to do good business and refer good business.
Even if they don't consciously think about it, you will be on the map in their brain when referral opportunities arise.
Now it's just about making the act of referring easy for everyone in your sphere...
How to keep generating referrals
Half of the battle here is having a motivating reward and offer (STEPS 1 & 2).
The other half is keeping your services top of mind.
You need to be the first person that everyone you know thinks about when the words “real estate” or “looking at houses” or “I need a realtor” comes up in their day to day conversations.
Your messaging should include the new offers you are running to keep them actively engaged and motivated to send referrals your way.
Switch up your offers to keep things fresh and remind your potential ambassadors about the reward you’re offering.
Consistency is key here.
Your goal is to get as many people as possible in your sphere to take a very simple action - introduce you to a prospect.
Remember, you just need a foot in the door, that simple personal introduction, and that’s something your ambassadors can help you with very easily.
But you need to provide an easy way to make those introductions.
That's where a referral landing page can help with the ease and scalability of your referral campaign.
You put all the information in one place and then drive your sphere there.
They land on your rewards page where you give them the details of the reward they can earn along with instructions on how to send a referral your way.
Then you provide a link to your offer page which is where you want your prospects to land.
You can do this with a number of website platforms if you're on the techy side and (shameless plug) we provide your own referral website with our referral campaigns.
But seriously, when you provide the motivation for your sphere AND make it so that a quick intro can be done in a few clicks, you'll be unstoppable with referrals.
Want more tips on referral marketing?