Thanks for the wonderful feedback regarding the International Builders Show in Vegas in February, which was the highest-attended show in 15 years with over 75,000 attendees. Last month I shared my top five out of ten takeaways, now it is time to complete the other Five. So strap yourself in, for some profoundly entertaining and beneficial tips.
So many times I hear that either ownership or management are clashing with their very own salespeople and that they don’t seem to have the same vision or goals in mind. From my experience this onion can be peeled all the way back to the way we are recruiting, and who we are hiring.
At the builder show I shared the story of Sir Ernest Shackleton, who famously led an expedition in 1914 to cross Antarctica via the South Pole. His ship “The Endurance” became trapped in ice for 10 months until it was finally crushed and sank. His crew floated on ice flows for five months, finally arriving at Elephant Island, where they existed on eating seal, and (brace for it), their dog’s meat. Shackleton and five of his crew left and traveled 800 miles to find help, before finally coming back four months later to rescue his team. Incredibly, all 28 men, including Shackleton survived. Shackelton and his crew returned to a hero’s welcome and had turned a failed expedition into a noble story of survival, that captured the nation’s imagination.
So how did this first miracle on the ice take place, how did so many people beat the odds and survive subzero- Artic conditions for so long? All becomes clearer when you look at Shackleton’s ad that he placed in the London Times, to help recruit and build the Endurance crew.
When Shackleton assembled his crew he made sure he had the right people on his boat, who weren’t just salaried sailors, but instead saw themselves as rugged explorers; who wanted to leave a legacy and become part of history. Most importantly, they shared their leaders' vision and mission, and when a crisis hit they all pitched in and rowed in unison, metaphorically, with each other.
Relating this to new home sales, when we build a sales team, we should hire for potential and shared values, and then ensure that we train these people, to become top of their profession. “ABR” means ”Always be Recruiting”; so let’s fill our boats with people we connect with, can count on to follow the best sales processes, and believe in our culture, principles, and mission. When you hire someone as an associate and train them, when you have a sales position available, you can then promote from your bench, and train them to become a sales superstar.
John Lee owner and CEO of Anewgo was on a panel of industry experts who discussed how AI is impacting our wonderful industry. There were many amazing takeaways, however one nugget that stuck out for me was the idea that the future is here and that we humans have already become Cyborgs.
I would imagine that we are probably thinking of mythical movie characters such as RoboCop, however, which piece of technology has now become a ubiquitous extension of almost every human being in the USA, and other first-world countries? Exactly, our cell phones, we hold them, we wear them and some even sleep with their devices attached to them.
We now have access to more information and technology at our fingertips than our parents had with a whole room full of supercomputers! John recommended continuing to leverage this huge opportunity with the way you present your homes and connect with potential buyers.
One of the concepts I shared during my Negotiation program was the concept, that since “Buying is Emotion backed by logic”, and we make buying decisions with our limbic brain, we have to stop emailing prices before a sale is made. This may seem logical; however, it is full of risk and usually doesn’t move the sale forward. Typically this has the opposite effect, as the prices are not tethered to anything tangible that the customer can relate to, there is no connection to their future dream home, and instead, the customers have no choice but to start questioning all of the pricing, lengthening the time frame, and reducing the potential of making a sale. Plus, we don’t want them taking our pricing and shopping the competition.
Where does the magic take place for our customers during their homebuying journey? Exactly, in our model or showcase homes.
Instead, we have to bring the customers back for a heightened emotional experience that will maximize the potential for connection and sale. Here is an example of a courageous conversation, that is proven to work.
Sales Genius
“I would love to send you that information, however, we have found that it can be confusing. To prevent any confusion, we need to meet in person. Is tomorrow at 10:45 good or would the next day at 3:30 work better for you.”
When you are going through a negotiation, what do you think is the benefit of coming back with an odd number, as opposed to an even number? Well done you are correct, it will feel more credible, as though your team of accountants have poured over the numbers and come back with this exact price to help make the sale, and also protect profits and margin.
If you think about it, what possible accountant after analyzing the cost of every piece of material and all costs of construction to arrive at a specific gross profit to ensure the smooth running of a whole company, would then suddenly scrap their plans based on an arbitrary offer from a buyer and magically suggest splitting the difference down the middle.
Dewie Cheatham
(ABC Homes Accountant / Bean Counter Extraordinaire)
Thank you for bringing in me this fine offer. Even though we have this home on the market for $650,000, your customer offered us $550,000. So let’s ignore the market study and my 12 years of education in advanced accounting, and our intended net profit margin of 12% per home to help keep our company profitable, and just split this down the middle and come back at $600,000. We will lose a bunch of money, but hey it sure feels good, and should make the customers happy!
Too much, did I go a little too far with my British sarcastic humor? I just wanted to get your attention and illustrate the foolishness of what may be considered the norm in our industry. Inadvertently, we are emboldening our customers to feel entitled, by suggesting that we split the difference, instead of building proper value when we do need to counter, coming back with a specific odd number.
Clients need to understand that we are a business and that we have to remain profitable to build a home, and for most builders maintain it after closing with our expensive proactive warranty and customer care. So when you come back with an odd number, it looks as if your accounting team has really studied these numbers, and are looking to protect profits, as well as arrive at a fair value for the customer.
If you were involved in either a protracted negotiation or any lengthy conversation about a reduced price or concession, and then you suddenly announce that you feel confident that your builder will accept this reduced price, how can that make your customers feel? That’s right, manipulated, as though the whole pricing conversation was a game, and that the salesperson was making the decisions the whole time.
Instead, it is far more helpful if you can utilize the higher authority of your sales manager. That way the customer will continue to trust the salesperson and if there is any kind of a concession, will feel grateful and stop looking for continued incentives. It would sound something like this:
Sales Genius
Let’s put this in writing and I will be happy to present to my manager. That way she will review and make sure that everything looks good and that there are no surprises; and I will get back to you in the morning, sound good.
Key # 1 - Team Building Retreat
Key # 2 – Construction & Sales Collaboration Meetings
Key # 3 – Don’t be A Lawnmower Manager
Key # 4 - Educate your Realtors ®.
Key # - 5 Sales Leaders Provide & Require the use of an effective Sales Process
Key # 6 - Sales Leaders Are Always Building a Bench
Key # 7 - We are All Cyborg’s VS Robots – The Future of Ai in New Homes Sales and Marketing
Key # 8 - Pricing Strategy Number 1 - Always In person
Key # 9 - Negotiation Concept – Use an Odd Number
Key # 10 - Higher Authority
I hope these top ten key takeaways have been helpful for you. Please feel free to reach out with any questions, and let me know how I can help in any way.
Truly,
Roland Nairnsey
Roland@newhomesalesplus.com | 561-236-2400