Elements of a Proposition that Will Wow Customers

Posted by David Bennett Mon, 05 Jun 2006 20:37:00 GMT

People don’t buy good service. They buy help for their problems.
Calm the Fears
The two biggest fears people have when making a buying decision are:
(1) they’re wasting their money by not getting the solution they really need, and
(2) they’re not going to get the kind of results they want.
The successful sales associate will address these fears at the outset and calm them by demonstrating the specific value of the proposed solution.
The problem is value propositions often view services with an internal focus. Tired of seeing credentials and histories, one customer tossed out an interesting challenge. "If you want to sell to me, address the things I wake up worrying about: Am I getting the best price or a good deal? This is a huge purchase. How can I be certain I’m not getting stuck with a dog? If you can help me with concerns and solve my problems, I’ll buy from you or let you sell my home."
The closer you can come to answering the customer/client’s concerns before they even ask about them, the more carefully they’ll consider your value proposition.
Show Me the Payback
A value proposition is the message that differentiates you from the competition and tells why your solution will help solve the customer’s problem. There are two principles to follow when crafting your value proposition.
  • Focus on what the customer cares about. Suppose you have some data showing that your listings are sold with the fewest days on market and that they close on time. That’s only valuable if the customer wants a quick sale. If what they really care about is getting top dollar, you need to present the data that supports your claim you are the one that can get it for them.
  • Quantify the value proposition with numbers. For some reason, they’re more persuasive than words. Even if the consumer doesn’t really buy into your analysis, the fact that it’s quantified tends to give it impact.
In trying to show value to customers, don’t mistake features for benefits. A common example of this tendency is to focus on your listings, your sales, your great service as a reason for the customer to buy from you.
Let’s say you have twenty years experience and hold the GRI, CRS, ABR designations. Their response may be, "So what?" Unless you can demonstrate you can find them the home that is perfect for them to buy, it’s meaningless. And even worse, a lot of other people can claim the same thing.
Stand Above the Rest
To stand out, you need to focus on your  differentiators—things you do differently or that nobody else does—but always show how those differentiators deliver value to the customer. Differences based on processes or systems or methodologies are generally longer lasting and harder to overcome than your technology tools, your education or your experience.

Draw Them a Picture
Help them see how you are different.  Pictures, charts, success stories can strengthen your image in your customer’s mind.
  • Documented success stories make you believable and that leads to a more compelling value proposition.  
  • When you can present your data graphically in charts, you’ll add punch.
  • Pictures talk even louder than numbers.  

Finding the Payback

  • Show the impact on revenue:  The difference between selling with your assistance and FSBO sales.  (The median selling price of FSBO homes was $210,000 compared with $255,000 for agent-assisted home sales.) or the effect on value of unrealistically priced homes
  • Show what costs they will not incur by using your services – advertising, marketing, holding open houses, etc.

Quantifying the payback is more persuasive than just claiming your services are a good thing. If baseline measurements aren’t available, that’s okay. Offer an estimate or a projection based on market averages. Even if they dispute your numbers, you’re still discussing the overall value of your unique offering.

By connecting your payback analysis to what really differentiates you from competitors, you’re in a much stronger position: They can’t use the easy "Me, too" comeback.

 

 

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Explain why you are worth your commission

Posted by David Bennett Sat, 17 Jun 2006 16:50:00 GMT

Create Value In The Eyes Of Your Consumers:
 
Most home buyers and sellers throughout the country believe that real estate agents and brokers do little to earn their commissions. This is our fault because we should be educating them about how hard we work before ever accepting them as clients or customers.
 
Keeping my commission firm was a problem until 1983 when I started tracking of all the different duties required to earn my commissions. Then, I developed four separate lists of over 100 activities I do to close transactions for sellers, buyers, expired listings and FSBO’s. This literally astounds clients because most have no idea how complicated a real estate transaction really is.
My list for sellers runs 120 items and makes it clear that it takes a lot more than just putting a sign on the lawn and an ad in the paper to sell a house. It includes such activities as:
 
  • Order and review a property profile.
  • Develop a targeted marketing campaign that maximizes your home’s value.
  • Tour your property from the "buyer’s standpoint."
  • Develop "just listed" postcards.
  • Reduce your liability by providing appropriate disclosure forms.
  • Implement marketing activities.
  • Respond to buyer questions about the property.
  • Screen-out unqualified buyers.
  • Negotiate on your behalf with agents and potential buyers.
  • 111 other activities to get your house sold.
 
My list of value-building activities to help buyers purchase the home of their dreams is even longer because it’s more complicated than selling. This list includes:
 
  • Explain the benefits of a Buyer-Broker Agreement to you.
  • Provide a list of loan brokers who can get you qualified for a loan.
  • Explain all the steps in the home buying process.
  • Save you time by helping to narrow your search parameters.
  • Locate appropriate properties for you to view.
  • Act as a "sounding board" in your decision-making process.
  • Write an offer which meets your needs and protects your interests.
  • Negotiate on your behalf with listing agents and sellers.
  • Obtaining the inspections you want and need for your home.
  • 116 other activities to help you own the home of your dreams.
  •  
My FSBO list shows owners the many things agents do that would be difficult for them to do themselves. My list for owners whose listings have expired shows them how to get their home sold faster and at a higher price.
 
When you create your own list, if a seller or buyer asks for a discount, simply show them the appropriate list and say, "Here are just some of the activities I must complete to earn my money. Why don’t you point out the things that you’d be willing to do instead of me. If you save me time then we can talk about saving you money because I earn every penny I get."
 
When confronted with a list that runs nearly ten pages long their eyes glaze over and they usually respond with something like, "You’re the real estate professional I expect you to do this work!" To which I simply say, "If you want me to do all of these activities on your behalf then you need to pay me what I’m worth. If you want to pay less, I’ll see if I can find someone who will do less and maybe they can save you some money."

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What is a key message?

Posted by David Bennett Wed, 14 Jun 2006 17:51:00 GMT

Your key message is what grabs your prospect’s attention and tells them:
 
·         how you can solve their problem,
·         why they should trust you, and
·         why they should choose to do business with you over and above any and all other choices they might have.

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