Simon Payn's Effective Customer Newsletters

Why Real Estate Agents (and Others) Need to Be Publishers not Advertisers

Once again, Seth Godin is speaking my language.

In a post today he draws our attention to the difference between renting eyeballs (the old media way, where you buy an ad that is shown to the readers of, for example, a magazine) and actually owning the platform - owning the magazine or other media.

He gives an example of the local real estate agent:

She can spend to run ads every week in the local paper, or she can use the same money to start a legitimate media channel, a digital magazine, say, one that cheers on the school and gives the local paper a run for its money. And oh yes, the only houses listed for sale are hers. It might take a lot of work and even some money. But what does she get? A platform forever.

This is what I've been urging my real estate (and other) clients to do. Make their newsletter into their own magazine...be a community hub (like this hypothetical bar or this funeral home). 

It's the route to owning the market.

Seth wraps up with this:

Compared to the cost of renting eyeballs, buying a platform is cheap. Filling it with people eager to hear from you... that's the expensive part. But if you don't invest in the platform, you'll be at a disadvantage, now and forever. The smart way to build a brand today is to invest in the elements of the platform... the product, the technology, the websites (plural) and the systems you need to make it easy for people to show up at your very own trade show. And then embrace these people and shoot for 90% conversion, not .5%.

Like most good investments, it's expensive and worth more than it costs.

Be a publisher, not an advertiser.

(P.S. When I last wrote on this theme, someone emailed me to say that yes, it's a good idea, but not practical. No real estate agent (or other) is going to do this. That's almost true. But I said in reply that the one that does do this - that does invest the time, energy and money - will clean up.)

Why I’m Not Making 'Newsletters' Anymore

Listen up. I’m not making "newsletters" anymore.

Let me tell you why.

I guess I was bored. And I was boring.

I was embarrassed when people asked me what I did for a living. “I make newsletters for real estate agents and other people,” I would tell the ground.

Then silence.

Well, there isn’t anything else to say, is there? Except maybe a sigh of disappointment. This guy used to work on big-name newspapers. Why the heck is he wasting himself on newsletters?

Was he fired or something?

I was beginning to feel the same. Newsletters. What a snore!

* * *

Then one day I read some blog or something – can’t remember where. And it talked about looking at your business a whole new way.

More metaphysical, lawofattraction, naïve claptrap, I thought. Sheesh!

But I read it anyway, and this is what it said – more or less.

We’re all here to make some kind of contribution to the world. And if you’re running a business, that includes you, mister.

You’re not here just to sell a bunch of stuff (so you can buy a bunch more stuff).

You’re here to make a contribution. To help people.

So when I’d done reading. I took a shower…and started pondering.

Yes. I can do that too.

I can make people’s lives better.

I can be on a mission too.

And this is what I came up with:

I will make thousands of business owners’ lives better by giving them the tools to create real relationships with their clients, to bring in more money…and therefore to make their businesses more successful.

Because when their business is more successful, they will be happier, their families and friends will be happier – and the world will be a better place.

So my mission became: A Newsletter for Every Business (Even Funeral Homes).

And tell you what? Without a doubt, from that day onward, I felt good about my business again.

I wasn’t just making newsletters; I was making a valuable contribution.

And here’s where it gets strange. When I started to think like that, my business started to grow rapidly.

My enthusiasm and my desire to help must have rubbed off on the people I emailed and spoke with. I didn’t try to sell…I just tried to help. And so I made more money.

* * *

So how does that relate to you?

Easy really.

Whatever business you are in, you can discover what kind of contribution you can make.

If you are in real estate, you are helping people find environments that will allow them and their families to thrive.

If you are in insurance, you are protecting people from disaster, making them happier because they have the peace of mind that insurance coverage provides.

If you are in the mortgage business, you are making it possible for people to achieve their dreams and put a roof over their heads.

If you are a financial planner, you are taking the fear out of old age poverty by ensuring that people have adequate savings and investments.

If you are an accountant, you are helping people live more fruitful lives because you are saving them money that they can spend on things that really mean something.

And so it goes on.

And with your newsletter, you are sharing that contribution by showing how you can make people’s lives letter, proving that you are there for them and building a real relationship based on service, not on sales.

Your newsletter becomes part of your contribution. It's content is something you really want to share...because it makes you feel good.

When you think of it that way, every act of marketing, every transaction is a way to make the world better.

And when you’re making the world better, you’re making yourself feel better too.

And the money comes.


[Picture by acbo]

Real Estate Agents: How to Make 4x as Much Commission

Here's another of my little charts. This one applies to real estate agents and mortgage brokers in particular - but the general idea applies to any business.

It makes a compelling economic case for keeping in touch with clients over the long term.

 

The chart shows the difference in commission earned by a real estate agent (or mortgage broker) who keeps clients for life compared to one who just does a single transaction with a client.

The difference results in four times as much earned in commissions.

How is it worked out?

Consider that a real estate career lasts 30 years.

The average time a family spends in one house is said to be 7 years.

So, over that 30 years, the family will move 4 times (4x7=28).

Instead of earning one commission over your career from one client, you earn four commissions.

Let's put some numbers on those bones.

If the median home price in the US is $180,000 and commission is 5%, the commission earned would be $9,000. 

So four times that sum is $36,000 - a difference of $27,000.

Of course, this doesn't account for commissions shared, and portions paid to the broker and your costs...but the result is the same. You earn a lot more money by keeping a client for your career.

Of course, keeping in touch with clients through newsletters is the best way to be top of mind so that they call you when they're ready to move.

So how much will it cost to keep in touch with them?

If you do it by email, the cost is practically zero, as emails cost nothing to send.

If you do it by mail, and you send newsletters every month, you are looking at an approximate lifetime spend of $576 per client. (That's made up of $1 per month to print the newsletter for 360 issues, plus 60 cents per month for postage.)

Of course, that doesn't include membership to a newsletter program, running at around $49 per month - but that program can be used for multiple clients. And - of course - results will vary, postage and printing costs will go up, and not everyone will get every client to come back every time.

But still...the economics are pretty compelling:

Commissions earned over lifetime per client: $36,000

Cost to keep in touch with client over lifetime: $576

Total commissions minus cost: $35,424

versus..

Commission earned with one transaction: $9,000

Cost to keep in touch with client over lifetime: $0

Total commission minus cost: $9,000

Difference: $26,424

Now, multiply that by the number of clients you might have, and the math is truly astonishing.

As I say, not everyone will get the same results - you could not do as well. Or, with rising house prices, you could do better.

But when you look at it, the investment in keeping in touch is so low and the benefits are so high that it's something you must consider.

Find out more about newsletters for real estate agents and mortgage brokers.

How Repeat Customers Add Thousands in Income

Here is a chart that every business owner should print out and paste above their desk.

What does this chart show?

The bottom line shows the cumulative income of a business that has zero repeat customers.

The higher line shows the cumulative income of a business that has 20% of its customers returning.

Interesting, isn't it? That top line continues going up and up - like compound interest in a bank account.

Yet here's the funny thing: most businesses do NOTHING to encourage customers to come back. Instead, they're continually going after new customers.

That's why most businesses have incomes that look like the lower line in this chart.

At the least this strategy is shortsighted; at worst it's negligent. What would the investors, partners and spouses of these business owners say if they knew so much money was being left on the table?

What's even more crazy is previous customers are the easiest to sell to. After all, they already know and trust you.

When you look at this chart, there's only one conclusion: can you afford NOT to at least spend a few bucks a month sending a newsletter?

Just sayin'.

Give Before You Take: the Art of Nurturing Leads

So much of business is common sense, it pains me to write about it.

Yet so much that business owners do goes against simple common sense that...well... I guess I just have to point out the obvious.

Here's today's topic: give before you take.

Imagine you meet someone for the first time and they say, "can you lend me a hundred bucks?" or "can you write me a character reference?"

You'd think they were crazy, right? And, frankly, you'd think they were...to say the least... lacking social skills. Lacking finesse.

After all, these kind of favors should only be asked once the two of you have some kind of relationship.

Psychologists have a concept known as the emotional bank account. The idea is to make  deposits into this bank account before you start to make withdrawals.

That means people give first...before they start to take. (After all, we all know where getting into debt leads us...)

So why do so many business owners think they can take BEFORE they give?

Why is the first communication they have with prospects a solicitation asking for business?

Why do so many real estate agents ask for work (that could be maybe $10,000 in commission) without first providing some kind of value to their prospects?

Why do so many insurance brokers expect you are going to trust them to find you good insurance at a reasonable price without first demonstrating that they are willing to do something for you?

The Art of Nurturing Leads

Relationships with prospects need to be cultivated carefully. The emotional bank account needs to be full before you start making withdrawals.

That means you need to offer value before you start selling.

• When, for example, you send a newsletter, make most of it valuable content.
• Provide value in your communications before you start selling.
• When you ask people to sign up for your newsletter, show that you will give them something of value.

Give before you take. 

[Picture by John Nettleship]