Leads are the most important number you need to know. You must know how many leads you must generate to meet your other goals (e.g., seller listings taken, contracts written, contracts closed, etc.). Every time you receive an e-mail, or your phone rings and it’s business, you should be keeping a record of how many leads you’re receiving. We hope you’ll be finding out where the leads are coming from as well. Tracking these two things will help you make better decisions about how to invest your lead-generation dollars. Eventually, you’ll be able to work backward and work out which forms of lead generation are the most dollar productive.
One of the most important things you can learn from tracking your leads is the conversion rates for you and your staff. You’ll be working to get at two key conversion rates:
1. Conversion rate for converting calls into buyer appointments
2. Conversion rate for converting calls into seller appointments Over time, you’ll also get a sense of how many buyer appointments and seller appointments you’ll need to net a certain number of buyer listings (agency agreements) and seller listings.
From there you’ll be able to track how many buyer and seller listings you’ll need to net a certain number of closed sales. Once you have a good understanding of these numbers, you’ll be able more accurately to predict the relationship between the leads coming to your business and how they translate to closed sales and gross income. You can break it down and go into even more detail if you choose, but the ultimate goal is for you to be able reliably to predict the number of leads you will need to generate in order to meet any production goal.
This is the second most important number a Millionaire Real Estate Agent needs to know. Your entire business model should be built around obtaining a certain number of seller listings each month and year. Seller listings, as we have mentioned, are the high-leverage, maximum-earning opportunity in this industry. Seller listings properly marketed will generate more leads and buyer contracts. If you don’t get them, your model can quickly begin to break down. In Earn a Million, we will prescribe a certain number of seller listings you should strive to get each month and year. Your conversion rates will then dictate how much lead generation is necessary to get you the right number of seller agreements to net your listing goals. If you choose to track only two areas of your business, track your leads and your listings.
Even if you do not currently have any people needs, it is important that you keep this placeholder in your goals. Begin with the end in mind, right? If you’re tracking the other aspects of your business properly, you’ll probably begin setting goals in this category long before you actually need to make a hire. You will see that your leads are increasing, and, with them, you’ll be seeing a corresponding increase in listings taken and contracts written and closed. Eventually, you’ll be looking to the future and saying, “If this continues for much longer, I’ll need to have help.” Having the placeholder on your goal sheet at all times helps prompt you to ask this question early instead of late. The advantage to you is that you’ll have the opportunity to take your time and look for an outstanding candidate. Because you’re tracking your growth in specific areas, you’ll also have a head start on creating a job description that fits your current and future needs.