Reward the Behavior, Not the Result

Last time on the Playbook we wrote about Brian Buffini’s suggested strategy of our getting three referrals from each of our current clients during the time of an active transaction, and how we can fine-tune their reticular activator so they’re alert to opportunities to tell folks about us. So, now that you’re thinking about referrals—thanks to that reticular activator—let’s dig into one of the best tactics for delivering on that strategy.

We all no doubt say at least a quick thanks to the person who gives us a referral—and then often times we’re off to contact that potential new client and we maybe even start calculating the potential commission dollars that may roll in. Oh, sure, if a deal comes from the referral, we figure we’ll remember the referral source and do something nice for them. Maybe something even really, really, nice!

But here’s the problem—and the opportunity!

Brian Buffini, in his Peak Producer training, often brings in a guest speaker, a very successful broker/owner from Chicago named Joe Niego. Niego tells the story of how, years ago as he was improving and growing his business, his brother called him up and gave him a solid referral. Five or six months later, that new client closed on a house and Joe, remembering and appreciating his brother’s referral, sent him a nice gift basket. But here’s the rub: his brother called Niego the next day and said “What’s the gift basket for?” He of course made no connection with the referral he’d given months ago and may have even forgotten about it. Talk about a wilted reticular activator! And a missed opportunity.

Niego and Buffini use this example to make the point that, when someone gives us a referral, we need to reward the behavior, not the result!

First of all, if we reward the result, that is, commission dollars in our pocket, our thanks to our referral source may start to feel like part of a transaction instead of part of a relationship. Buffini warns us to avoid making such rewards feel like quid pro quo and instead make them something unexpected as opposed to earned. He also recommends the “reward” be a token or symbol of our appreciation—and something the recipient will enjoy—rather than a significant financial incentive. So would the tax man!

Second, and more importantly, Buffini points out that by immediately rewarding the behavior with that token gift of appreciation, we keep our friends’ reticular activator up and seeking new targets! Niego, in fact, tracked statistics on his referrals once he figured out this approach, and he found that 76% of the people who gave him a referral, and were immediately shown his appreciation of their behavior, gave him a second referral within 90 days!

Now, that sounds like a great way to grow a business!

So remember, growing your business through proactively seeking referrals is the surest way to a steady and growing business, and a major step is to remember to reward our advocates’ referral behavior immediately! Then be ready when they call you up again with another!

David M. Hassler

VP, Director of Business Development

The Reticular Activator!

Late last summer, my car expired after 107,000 miles! I had intended to put another 20,000 or so miles on it but the cost of the needed repairs was more than the car was worth, so I threw in the towel and decided to buy a new one. For a variety of reasons, I decided to consider that ultimate practical vehicle, a Subaru Outback. As soon as I started to think about them, Outback’s seemed to magically appear EVERYWHERE! They even showed up in almost every driveway in my neighborhood. Who knew! Of course, we’ve all experienced this phenomenon, as I had just tuned my attention so that I began to actually notice the Subi’s that had been there all along, because now I was interested in them.

Thank you, Reticular Activator!

Whether it’s a new pair of boots, a new laptop, or a vacation to New Mexico, our brain heightens our awareness of things we are considering and we suddenly discover that nearly everyone we meet has just returned from Santa Fe with a new pair of rattlesnake-skin cowboy boots and the latest MacBook Air!

So, what’s this have to do with Real Estate?

We all know the key to long term success in our business is through relationships with folks—our sphere of influence—who can give us referrals to others who may be considering buying or selling. And who among our sphere would have their Reticular Activator most finely tuned to thinking about buying or selling? Our current clients, of course!

Brian Buffini, in his Peak Producer training, talks about the Reticular Activator and how he uses this awareness with current clients to get three—yes, THREE—referrals from each of them during the period of their active buying/selling process! Again, who knew? Buffini makes the point that, of course that current client is far more immersed in real estate than the average person, and is probably chatting about it with friends, family, neighbors, co-workers, and pals at the gym, ad infinitum. Our current clients’ Reticular Activator for real estate is on high alert.

Thus, Buffini tells us that we need to help our current clients a wee bit by more finely tuning their Reticular Activator since no doubt in all their chatting about the process, they will surely meet other people who might be considering buying or selling, right? Buffini suggest that we REMIND our current clients to think about helping us by being aware in their conversations (that Reticular Activator) and proactively getting someone’s name or giving out our information when appropriate, ie, giving us a referral.

How three? Buffini suggests we should have three separate phases of client satisfaction during our active buy/sell process, and that with each one, our client is highly likely to be happy to do their best to help us in our business by thinking about referring someone.

First, as we begin the process and have maybe done a first buyer tour or a first open house, we’ve impressed our new client with our expertise, our proactive communication, and of course our charm, so, boom, remind them they can help us with a referral.

Second, once we have an accepted purchase agreement, usually our clients are again delighted and excited, so, boom, we can once more remind them how they can help us with a referral.

Finally, of course, as we walk out after the closing and hand them the wine or chocolates or flowers, boom, a third time we can remind them.

Since our clients are always perfectly delighted with our service, that little tweak to their Reticular Activator should yield a referral or two, if not more!

Thank you, Reticular Activator!

David M. Hassler

VP, Director of Business Development

The Larger Questions

This time of year, our coaching and the Playbook focus a lot on numbers as we encourage folks to master their stats and create their roadmap for 2015 as part of an annual business plan. We look beyond sales volume and GCI to things like average DOM and average side price and even average commission rates, so agents can both differentiate themselves and set target areas for improvement. The details are the key to this analysis and planning work.

But this time of year, when transaction activity is typically at a lower pace, is also a great time to step back and look at the bigger picture, to ask some larger questions.

First of all, as you review your business for 2014, you might want to consider what event or experience with a client or transaction was the most rewarding for you. Not in terms of dollars, but in terms of gratification for a job well done, a difficult problem solved, or a client’s perhaps unexpected gratitude. Think about that situation or experience and see if there is some key element or pattern that can be grasped and learned and repeated in your own actions and attitude. Wouldn’t it be great if we could achieve that kind of satisfaction in our business regularly?

Next, think about the opposite, the most challenging situation or event or relationship in your business last year. What went wrong? Who did it impact beyond yourself? What role did your own actions and attitude play in creating the issue? And most importantly, of course, what might you have done differently to prevent or minimize the negative impact, and how can you integrate that learning into your approach to similar situations in the future?

Finally, the most important of these questions: what do you want from the business in 2015 for yourself and your family? How is your business integrated with your overall goals as a person and member of the community, and what is it, beyond any monetary considerations, that drives and encourages you?

Simple questions, really, but ones we all too often forget to contemplate. Let’s all take some time before the snow melts to incorporate these larger questions into our business planning so 2015 can truly be our best year in all respects.

David M. Hassler

VP, Director of Business Development