Despite all of the wonderful opportunities that lie within your hands of being a Realtor®, we sure do have a tough business when it comes to building a real estate contact database.
A traditional long tail* business rules don’t easily apply to us—we sell someone a house, and then wait seven years until they're ready to buy again.
Other than being in a perpetual state of prospecting, marketing, advertising, and otherwise begging for business, what can an agent do to escape the missing long tail of the real estate industry? How can you sustain your business?
You need to build a portfolio of people (a.k.a real estate contact database). It's more personalized to call it "People Portfolio".
Here are two simple steps on how to start building your people portfolio!
1) How many people should be in my portfolio?
We recommend you make it your objective to build a portfolio of 1000 people.
A portfolio of that size can generate approximately 60 to 120 transactions a year, reliably, in nearly any market conditions.
If your daily activities revolve around meeting new people and building rewarding relationships, in about three years you’ll have a substantive portfolio and a healthy real estate business.
2) Who should be in my portfolio?
A member of your portfolio is anyone who:
- Loves what you do. The person understands your ‘why’ (your purpose for being in this business) and knows about your life, your family, your favorite things, your community connections, and your hobbies.
- Engages. If you reach out to the person (via phone, text, email, or Facebook), you’ll eventually hear back.
- Relates. You can have a comfortable lunch with the person. (I’m not mandating you have to have lunch with each person in your portfolio—although you should try. I’m just saying you would genuinely enjoy each other’s company.)
In short, your portfolio is full of people who want to be associated with you, stay in touch with you, and advocate for you. When anyone in your portfolio thinks about real estate, he or she thinks of you and sings your praises to others.
Not Everyone Enters Your People Portfolio
So, how do you ensure that you don’t just collect a bunch of lukewarm dabblers?
How do you find people who are willing to take up arms for your cause, and who will vehemently support your work and connect with your ‘why?’
There are two keys: relevance and positive context.
Your work in real estate isn’t enough (that’s just the baseline requirement). People need to identify with you as a human being and see you engaged in community and growth.
Orginally posted June 30th, 2016. Updated October 2nd, 2017.
*"Long tail" refers to the ability to sell additional products and services once client trust is earned (in other words, repeat buying). Car dealerships, for example, can take advantage of the long tail model: when you buy a car at a dealership, you may not purchase another car from them for years...but you'll likely need service, floor mats, tires, etc., so the dealership has additional ways to earn revenue from that purchase. This is not a model that real estate agents can follow, because an agent only has one product to sell.