Do you rely on real estate referrals to grow your business?
Referrals are treated like gold in the real estate community.
There’s this tendency to wear a badge of honor if you’ve built your entire real estate business based on referrals.
And don’t get me wrong – happy clients sure are nice.
But at the same time, there’s a downside to relying too heavily on referrals in order to market your business.
Here’s a bold statement …If you’re relying on real estate referrals to grow, you’re not treating your business like a real business.
Here are five of the biggest reasons why I believe you need to expand your business beyond word-of-mouth marketing if you want a truly scalable real estate business.
You’ll Always Be in A State of Stress
I want you to think about it this way.
When you rely on real estate referrals for your marketing, you’re not in control.
You’re always going to be in a state of panic and stress because you never know where your next lead is coming from, or if it’s coming in at all.
Eventually, you may find yourself in a cyclical flow where one month you’re booked and busy and the next month your leads have completely dried up.
When you build your business 100% on referrals, you’re essentially relying on other people to do your marketing for you.
You have no control over how much business comes in or the quality of business that comes in.
So rather than depending on referrals from past clients and your network, instead I want you to think of them as the icing on the cake.
But your marketing, your predictable lead flow…that’s the cake.
The referrals are always going to be there if you’re doing a good job for your clients.
The bottom line?
If you’re not taking control of your lead generation and making sure that every single month, you have appointments coming in, your revenue will always be unpredictable and you’ll never feel at ease and comfortable with your business.
Real Estate Referrals Eventually Dry Up
If you think you can run a sustainable business for years with just your referral sources never drying up, here’s the hard truth, it won’t work.
People only want to be asked to help build your business for so long.
It might be a bit of tough love for you, but it’s true. While they’ll lend support in the beginning, eventually you need to step it up and get things moving on your own.
And when it comes to your clients, you have to realize, you’re not going to please everyone. You could be an incredibly talented real estate agent who’s absolutely dominating your marketplace, and you’re still going to have the odd client who’s unhappy with your services.
If you have leads coming in from elsewhere, one unhappy client here and there won’t be detrimental to your business. But if you’re relying on every client you work with to spread the word about your services, you could quickly find yourself scrambling to fill your calendar.
Referrals Aren’t Scalable
Whether or not you rely on real estate referrals to grow your business ultimately depends on your long-term vision.
If your ultimate goal is to build a small business, you might be able to get away with using mostly word-of-mouth marketing.
But if you know you want more than a small business, if you want a scalable business, it’s time to start taking your marketing seriously.
Coca-Cola, Apple, and the most successful real estate firms worldwide all have referrals.
But at the end of the day, are they relying on their sphere of influence to do their marketing?
It’s time we stop treating building a referral-based business like it’s a badge of honor.
We have to come to terms with the fact it’s unproductive to rely on others to do your marketing…especially if you have a team.
You can’t scale anything without predictability.
If you aren’t able to predict what’s coming in every month, how can you possibly hire? How can you pay salaries to employees, employees who are putting their livelihood in your hands?
It’s time to say goodbye to the unpredictability of referral-based marketing and instead focus on building a lead-generation machine.
Are you ready to take control of your marketing so you never have to worry about where your next lead is coming from?
Learn all about The Listings Lab Method to help you sustainably scale to seven figures and beyond.