Love the answers.
Asking for referrals is not tacky. It can be done in a tacky way, and that will drive away potential business more than build it. The referring individual, when they really believe in you, sees themselves as the hero, the conduit who brought their friend and you, the great agent together. Donâ€™t deny these people the opportunity to be a hero. Working to facilitate this winning hand is a very good thing for all.
The people who responded that they thought it was tacky were probably thinking in terms of the agent who pounces on any suspect with aggression. There are lots of ways to ask without crossing the line.
The same goes for agent-to-agent referrals. I'm constantly growing that as a source of business from other agents through relocation, investments, etc. Check out the Millionaire Real Estate Agent as the principals are built around referral business and the book Raving Fans.
I truly believed when I first got into the business that asking for referrals was tacky and that I would never do it. I believed it came off like a desperate act and I was petrified of coming off like a THAT kind of REALTOR. I figured if I provided great service that my clients would KNOW to refer to me.
Then, I realized something profound....that my family, friends, past clients and our sphere didn't think about real estate every day like I did! :) I realized that they had to be 'reminded' that I was in the business and that I WANTED referrals.
Now, I use a soft approach to ask for referrals, but I DO ask for them. Gary Keller in his book, "The Millionaire Real Estate Agent" outlines his approach when it comes to referrals. You must "Educate, Ask and Reward"...meaning, you must on a consistent basis educate your core group (or he calls it your "allied resources" including family, friends, past clients etc.) about what you do, then you must ASK for referrals, then you must REWARD them every time they refer a client to you.
One last point about referrals that I got from that book that I thought was SO important. He says that all too often we only reward (send a thank you, flowers, gift card) when a referral results in a sale. This is really missing the whole point of a referral- which is, the ACT of the referral. He says that it is important to reward the ACT of referring, not reward the fact that the client closed escrow....I thought this was a great point and I have completely changed the way I thank those that refer to me.
The consumer that you are asking a referral from wants to feel they are providing a service to both the Realtor * and the referred customer. This works best when they have knowledge of the skill of the Realtor and the genuineness of the referred customer.
You will get some referrals, merely by doing your primary job well. Value in a campaign like Patti's is that she will produce incremental leads by reminding people to do something that they are predisposed to do. That is why I gave her a thumbs up, in spite of her contradiction.
The broader you throw your net, the more incremental referrals, leads, sales, you will pick up. I will try to keep broadening my efforts in lead generation from all sources until I reach the point of diminishing returns in quantity and / or quality of leads.
When attempting to inform your client(s) that you are more than happy to be referred to friends and family and acquaintances and co-workers and church pals and book club members, etc. etc. etc. - you must read the personality of the person you are connecting with.
One pal may only be open to the subtle approach - where another may need a swift kick in the pants to see you would like them to refer you to whomever! If you overstep your boundary - client, family, or friend - you may never see a referral from that person, EVER. No matter how great you were on their transaction.
So - the skinny of it is that it depends on the receiver - for me anyway
I too know agents who do come out directly and ask for referrals--and this, amazingly (to me), seems to work well for them. Like you, I think it sounds like desperation. But that's just you, Jennifer, Patti, and me right now. That is our style. Individual personality differences can make a huge influence when clients are choosing between several good REALTORs. I always tell the consumers here to go with their instincts on questionable issues where their comfort level with the agent is in question. This is a huge industry, serving clients as diverse as the population of the earth itself. There is room for all personality types, as long as we remain loyal to the ethics of our industry. Okay, I apologize, that did go quite a bit off topic--almost a rant--but I'll let it stand. Thumbs away!
I give and receive referrals all the time. I am fiercely loyal to people who do a good job.
There are many agents I know who swear the best way to get referrals is to ask for them. That is just not my style and thought perhaps I am in the minority...just kind of wanted to take a poll and get the opinions of others. I can tell by reading some of the Q&A strings that there are some fantastic agents on Trulia.
Jennifer is absolutely right. Great service will get you referrals without the need to ask directly; but some clients do need a subtle reminder that referrals are vital to our business... But could you please clarify: were you asking about referrals from clients, other REALTORs, or both?
My strategy is to be an amazing broker and provide service continuously, even after the sale is closed. I get plenty of referrals from delighted clients. I think asking for referrals is TACKY and makes one appear desperate and unprofessional.
There are many who will tell me that I am probably not doing enough to reach out to people on a more frequent basis - and I have to confess that I am not a high volume producer. But when I do contact former clients - these days via email for the most part - I will provide information of value to them. I am not talking about email spam blast. For example, I will send information regarding recent changes in a local law pertaining to their property or I might send property value updates if there are changes in the market.
When you add real value to a contact, it speaks volumes about how you work.
I also prospect by regularly calling my "sphere" and always ask who they know that is planning to sell. I learned my lesson years ago, about not "asking" for business, when a friend said,"Oh, I just figured you were so busy, that I didn't even think to give your name to my sister when she was selling!" The opposite of desperate----- people assume you may have TOO MUCH business!
I am also in numerous networking groups and community groups. I recieive good srong referrals through my BNI Group (Business Network International), but I am also involved in some women's networking roups, Kiwanis, National Charity League and others. Depending on the organization, I am more open in some than in others letting people know what I do, but referrals come from all of those venues.
If you are a "secret agent" you don't do yourself any favors, nor do you do your clients any favors. The more people who know what you do, the more likely you might have a buyer for that next listing!
As the President of Women's Council of Realtor's this year my chapter pays for my state and national travel. Many of us are VERY aggressive at our meetings, looking for people from around the country we can refer to. I am sure at every meeting to take something to pass out that will make me stand out in the crowd, so that I am remembered. Afterwards I follow up with a handwritten note to everyone whose card I have, then put them on a mailing campaign. My feeling was, if I am going to spend time away from my family and business- I am going to make it worth my time! It has resulted in a number of referrals for me!
Sarah had another point about thanking people for referrals. I thank EVERYONE who has passed my name on. I have a woman who makes extraordinary handmade cards that are works of art- especially designed for referrals, new home, etc. I send the card the very day someone tells me they referred me- with a Starbucks card, gift certificate or something. People don't forget! One friend was so disappointed that the referral didn't result in anything, he kept saying, "I HAVE to find you a client! I used your 15.00 card!" Since that, he has referred me 4 seperate clients, resulting in over $2,000,000 in listings and sales!
In line with the 80 /20 rule. 80% of my (non-corporate ) inbound referrals have come from just a dozen clients, who have referred me to more than one new client. - up to six subsequent referrals.
One trainer described this type of client as an "advocate" - I used to do more mailings in years past, but have been irregular in the frequency of communicatiions with my database over the past few years, and this has cost me in a reduction of new business. I never did much in the way of catch up phone calls and am now frightened of the "Do not call List" Laws. The people that want to sell us stuff say that you can get in trouble for calling an old client out of the blue if you don't have any current business with them. -
Problem #1: your clients think you are too busy or perhaps too successful and donâ€™t think you need nor want more business. Think about it. Do you actually come across as if you donâ€™t have enough to do? Your clients actually qualify for you. My friend from Miami herd things likeâ€¦ â€œwe didnâ€™t think youâ€™d take a listing that wasnâ€™t on the waterâ€¦ we didnâ€™t know you worked the condo marketâ€¦ we thought you only worked in the high endâ€¦ we didnâ€™t think you did business in Coral Gablesâ€¦ we didnâ€™t know you worked with buyersâ€¦ I didnâ€™t think my brother was serious enough for youâ€¦â€
Again, if every person that you know simply knows at least one person each year that buys or sells a home, there MUST be a reason you didnâ€™t get these referrals. The key is to get them thinking you are open for business. How do you do that?
Problem #2: you are â€œout of sight, out of mind.â€ There is a â€œwindow of memoryâ€ where a person hears about someone with a real estate need before they forget about the referral. Many times. They will actually think about passing along your name or even calling you but by that timeâ€¦ life gets in the way, it is too late. The key is triggering their memory. How do you do that?
Problem #3: you DO get referrals that you never knew about! Many times people that you know will tell a potential buyer or seller about you or even give the person your business card. The problem is all too often, you never get a call from that lead because they donâ€™t know you personally or lose the business card. The key is to get the contact information on the lead from your COI and contact them yourself! How do you do that?
Problem #4: you only think of referrals in terms of direct repeat business. By this, I mean that you are always ready to help your past clients or center of influence with a real estate need. You may have a great income because of it BUT what about the two or three people each year that your COI will know about. What about all the â€œreferrals!â€ If we donâ€™t thinkâ€¦ â€œWho do they know?â€ then we donâ€™t communicate â€œwho do you know?â€â€¦ The key is getting them talking about people they know. How do you do that?
Problem #5: you are not a â€œprofessionalâ€ in the eyes of your center of influence. By this, I mean that you have developed a relationship with many people that was outside of the real estate world. For example, you may play golf with a group of friends and one of them has a boss or co-worker that has to sell their home. You never get the referral. Why not? In many cases, your golf partner sees you on the golf course all the time and doesnâ€™t know how serious you are about selling homes. They will work with you because of their relationship with you but never tell anyone else about you or your service. This is very common. How are you view in the eyes of the people that you know?
For my FREE report called REFERRALS NOW 2008 and my REFERRALS NOW SCRIPT visit my web site or e-mail me at Bobfitz@tmail.com
Though, if you want to get into semantics, I answered the question understanding that Erin was asking us if we *directly* ask for referrals -- as in, "Hey Jim, do you know anybody who is looking to buy or sell? You do? Can you refer them to me?" In that sense - no, I don't *ask* for referrals.
So, as I answered, it's not a direct ask, it's more of a "staying present" in my past clients'/prospects' minds so that when real estate comes to mind, I come to mind. And, so as not to seem "stalkerish" or desperate, I always try to keep my contacts with my database with purpose: Information they can use or would find valuable.
And yes, of course the hoped-for outcome is to grow my business. No denyin' that.
Curious, since your answers are so well thought out, what do you do?
I do work referrals with agents i know thru CRS and that I have met over the years in Northern California by sending something to them of value.