If I could review your database, I could confidently predict the future health of your business. The following are the steps you can take to make sure your database is on lock.
Why is a database important?
Any tool we consider implementing in our business should be run through one filter: does this help me serve my past, present and future clients at a higher level? Without question, a properly organized and optimized database is instrumental in serving our clients in a more professional manner.
The ability to store client information, automate communication and prompt reminders for contact on important dates are just a few of the reasons every agent should be all-in when it comes to their database.
Who should be in our database?
The short answer is anyone you know that owns real estate or that may be buying in the future. Simply put, as many people as you can add value to as possible.
A healthy database is a growing database, so you should be consistently adding more people. These new people can come through online lead generation, people you meet, or general lead generation practices like referrals, open houses, or circle prospecting.
As a prompt, don’t forget to include all your past clients and anyone you spend money or time with — any service provider like doctors, restaurant owners, the person who sold you your car, your insurance provider, places you frequent, and anyone else that you have spent money with in the past.
Make sure all your friends and family members are in your database as well. This group, along with your past clients, is the most likely group to send you referrals. By having them in your database and receiving consistent communication, your referral pipeline should stay full.
How to categorize people
The ability to segment outreach to specific groups in your database allows you to personalize communication, increasing the value of the content you send to your groups. The first major categorization is that each person should be categorized as a seller, a buyer, or both. This gives you the ability to send seller-specific emails to only sellers, or buyer-specific content to only buyers.
We also categorize people by where they are in the buying/selling process. We utilize BoomTown and they break them down like the following, but nearly every CRM will have the ability to segment based on similar criteria. Where they are in the process is broken down into several categories, but here are the main ones for this example.
Hot (ready to buy or sell in the next three months)
Qualify (new leads we are qualifying)
Nurture (future buyers/sellers with a timeframe over three months)
Watch (people that we will watch to see if activity changes, but no immediate need)
Pending (under contract)
Closed (past clients)
Most CRMs also provide the ability to segment people by categorizing them in more detail as well. BoomTown calls these tags, but whatever your CRM calls them, make sure you are using them to your full advantage.
Here are a few tag examples to help you optimize your categorization.
- Price Range (of their home or the home they are looking to buy)
- Area/Neighborhood (if they live or are looking to buy in a specific area or neighborhood)
- First-Time Homebuyer
- Specific Amenity Desired (Pool, Golf Course, View, etc.)
- Referred someone in the past (Referral Partner)
The list can go on and on, but the more detailed your categorization, the easier it will be to communicate value to specific segments of your database.
Documentation creates value
Document everything. As your business grows it becomes harder to remember personal details and past communication. Record their spouse’s name, how long they’ve been married, the names and ages of their children, what they do for a living, and any other details that will assist you in remembering personal details the next time you reach out to them.
Make sure you document every interaction you have with them as well, whether that’s running into them at a grocery store, a phone call, a text, or an email. The documentation of what was discussed adds depth to your ability to serve them more professionally and in a personalized manner in the future.
Automation leads to optimization
An optimized database will have automated communication that adds value to every person in the database. Past buyer clients should have properties that come on the market, go under contract, or that are sold that will affect their home’s value being automatically emailed to them. Every buyer prospect should have properties that come on the market or have price reductions that meet their search criteria being automatically emailed to them .
You should have, at a minimum, a monthly newsletter that is emailed to your entire database, keeping you top of mind and adding consistent value.
Drip campaigns are another great way to automate your communication. They can be defined as automated emails, texts, or call promptings that are sent in a sequence and delivered at a specific time. These campaigns can vary from follow-up with new online leads to nurturing campaigns for future clients. The key is to have campaigns that are as specific as possible to the prospect/client’s needs.
When a CRM is truly optimized, the automated communication that goes out daily should provide opportunities for valuable conversations and appointments.
Your database is an exit plan
What is the value of your real estate business if you wanted to sell it now? With the exclusion of structured and well-run teams, most real estate agents have businesses that have zero value if they stop selling. The exception to this scenario is the agent that has a detailed and fully optimized database.
A database with the client’s/prospect’s personal details, that is broken down into easily understood categories with a documentation of all communication and optimized where every person has an automated plan of follow-up is an extremely valuable and saleable asset.
I’ve seen databases sold and the only criteria was a few video intros by the selling agent to the database. I’ve seen sales that included a one-year plan of introductions, database instruction, and phasing out of the business. I’ve seen referral agreements for any business that comes from the database for a specific time frame. And lastly, I’ve seen mature agents bring on a newer agent that they phase into ownership of the business over a specific time frame as the retiring agent phases out.
Optimizing your database isn’t just the best thing for your business today; it could also be a part of your exit plan from the business. No matter what direction you decide, if your database is optimized, you have a sellable asset.
If you’re looking for your business to grow in the future, the answer is in your database. A growing database that is organized and set to serve your clients at the highest level possible will produce a steady flow of new and repeat business.