Content Marketing 102: Understanding the real estate decision making cycle
As we all know, successful real estate agents don’t wait until vendors and landlords walk through the door. At any one time, roughly five per cent of property owners are actively transacting in the market. And as we know, they didn’t make the decision to buy or sell on impulse. They will often spend months, sometimes years, before taking that step.
>The challenge for agents looking to sustain and increase their business, has long been understood – how do you capture this tiny percentage of the active market. As a result agents have become experts in tracking and engaging with people actively thinking about buying or selling property.
But is focusing on people’s immediate needs the right strategy in today’s crowded marketplace? After all, by the time clients have made the decision to enter the market, the great majority will have already made a decision about which agents they would like to work with.
So, the key to becoming their preferred agent, is to begin to influence and add value to clients before they even actively want to sell their property.
To do this, there are two things every agent needs to understand. Firstly, the property decision making cycle that every owner goes through and secondly, how to approach and connect with people at different stages of that cycle.
Know the decision making cycle:
When it comes to selling or buying property, the decision making cycle can be broken down into six phases. While the actual sale does not take place until towards the end of the cycle, each phase offers an opportunity to reach, engage and ultimately convert clients.1.
The first stage of the decision making cycle, the Inactive Phase, is where a potential client is not actively seeking to sell or buy a property but is nonetheless exposed to information about local communities and businesses, via social media and traditional channels. 2.
The second stage is the Initial Research Phase, where the prospective client is considering entering the market and starts to do preliminary digital detective work and researching their options based on their needs. This early research is almost exclusively conducted online, and perhaps through speaking to friends, colleagues and family – many of whom live in their community and have had experiences with local agents. 3.
Next, the potential buyer enters the Face-to-face Phase of the decision making cycle, where they start to engage with, and “interview” agents that have made a good impression during the research phase, or have been referred by friends, colleagues and family. At this phase potential vendors and landlords are often found mixing with the crowds at OFIs to experience exactly how you might sell or manage their property.4.
The fourth stage - the Authentication Phase - is crucial in any decision. Just before you make the final decision you want to do a final check with you friends and family, and more commonly in today’s socially connected world, and check social media. Research has shown that two areas they want to check is how trustworthy you are considered and how good your local knowledge. Many a sale has fallen over at this stage, so managing your wider reputation is crucial.5.
At the fifth stage of the decision making cycle, the Sales Phase, the client has selected the sales agent, or found the house that suits their needs and expectations, and they are ready to take the plunge and buy.6.
The final stage is the Advocacy Phase, where people choose to share their positive or negative experiences, based on the kind of service they have received from their agent. This phase continues on and overlaps into the inactive phase – as (hopefully satisfied) clients become your advocates in the community, and to their friends and family asking them for their advice and recommendations.
Speaking the right language:
The decision making cycle typically unfolds over the course of many months. While most agents have become experts at reaching out to clients in the later phases of the cycle, the reality is that it is during inactive phase – and bear in mind that’s around 95 percent of property owners - that the foundations for potential client relationships are laid. And at the advocacy phase that your great service translates into the “repeat and referral” business that drives the revenue for the successful agents and property managers.
In a past blog post
I discussed strategies for providing customers with the right content to position yourself as the ‘go to’ agent in your local market. This approach takes on even greater importance for agents positioning themselves with the 95% of the market that is in the inactive phase of the decision making cycle.
When it comes to converting this 95 per cent, knowing what to say is just as essential as knowing when to say it. The good news is that there are an increasing number of tools to help agents to effectively market to inactive home owners and those in the early stage of their research, to turn them into advocates and eventually, clients. More on that in my next blog!
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