What's the Key in Becoming A Millionaire Agent?
When my wife and I co-founded an independent brokerage, Momentum Realty, earlier this year, our motivating mission was simple. We had done very well as real estate agents, but along the way we had met many other agents who worked so hard, putting in ridiculous hours, only to net virtually nothing.
Their profit pie was getting eaten away by high lead costs, high brokerage and team splits, and a failure to understand the basics of a business plan. It was depressing to see.
Using our finance and accounting backgrounds, and the lessons we had learned ourselves, we opened Momentum Realty in January 2020.
Enough was enough, we decided.
Along the way we had met many other agents who worked so hard, putting in ridiculous hours, only to net virtually nothing.
We were going to help other agents become profitable.
We were going to teach them how to treat their work as a business, and to see themselves as entrepreneurs.
Sadly, only a tiny fraction of brokerages train their agents to be business owners. And it was clear from the overwhelmingly positive initial response to Momentum, that the vast majority of agents were hungry for that knowledge.
So, we established a business and growth curriculum, combined with in-depth individual advice, to change that. And…problem solved?
Well, interestingly, no.
The Profitability Problem is More Basic than a Lack of Business Plan.
What we came to realize, as we got to know our agents and their businesses better, was that, for many of them, the problem wasn't just not having a profit and loss statement, or a business plan. It was that they didn’t fully understand what the role of a real estate agent really is. And without that fundamental understanding, they could not build a sustainable, profitable business.
Brittany and I had learned this essential before we even got into real estate. When buying our first home, we had a lousy experience with agents who were non-responsive. I mean submitting a contract and then hearing crickets non-responsive. Ultimately, I ended up bypassing the agents to contact the Seller directly after 2 days of being ignored -- only to learn the Seller’s agent had not even presented our contract!
It all worked out: The Seller and I struck a deal without our agents, and I recognized an opportunity for leaving the corporate world and starting my own business. But it left a lasting impression on both of us.
So, my motivation for getting into real estate was to improve the way the industry works. I knew I could do better than the agents I had worked with. And I knew, as a customer, how important it was to have an agent who cared enough to ensure the home buying process was not stressful.
Therefore, for Brittany and me, being an agent has always meant more than making money. Yes, the money is good; Momentum is a very profitable business. But we also know that our work as agents has been all about being responsive, communicating, listening, and building systems to create a WOW factor.
It means providing 5-star service to everyone we meet, so that people will want to continue working with us. It means that, by the end of the transaction, we have customers who feel like good friends and family. And this is what we built – our customers are now part of our lives and we are part of theirs, from weddings to funerals. We love this dynamic, and are so grateful for these relationships. And we understand that this mindset, this approach to our profession, is what fueled the profitability of our business.
Teaching More than Sales Techniques.
Don’t get me wrong. Sales techniques have value, and good brokerages will emphasize scripting designed to get the customer and make the sale. But the vast majority leave it there, all about the money and not the mission. They fail to also focus on the bigger, more essential picture, of how to give your customer a 5-star experience.
They fail to define what good service looks like, and, since they had no service standards for their agents, they tend to allow basically anyone with a pulse to join their ranks.
There really is a disconnect between the agent, the brokerage, and the customers that we serve on a day-to-day basis.
Requiring Agents Meet Standards.
There really is a disconnect between the agent, the brokerage, and the customers that we serve on a day-to-day basis.
We created Momentum with a different approach. Of course, we are not the only ones in the industry to provide good customer service. But we are among the very few (possibly the only?) that set standards for an agent to become an associate.
And, what we've learned from running a brokerage on pace to do $350,000,000 in sales volume over the next twelve months, is that Momentum stands for something: obsession with its customers.
It requires its agents recognize and internalize that a non-stop, laser focus on providing the highest level of service is the most important role for a real estate agent … and that this passion translates to running a profitable business.
Why? Because when your overriding goal is to give your customers what they want, you end up with a “Repeat, Referral, and Review” business:
§ “Repeat business” means that the customer comes back to you again to do business. No business can operate long-term without repeat business.
§ “Referral business” means you did such a great job that your customers pass your information along to others.
§ “Review business” means that you asked for, and received, online reviews that allow potential new customers to find you where they shop most (the Internet) and see that other customers loved your service. (Stay connected to see next week’s post on how to build a Review Business!)
This Repeat, Referral, and Review business approach costs you literally nothing to generate.
You become increasingly profitable simply by consistently providing 5-star service and developing relationships with your customers.
So, you make more money just by doing your job well, you ask?
That's right.
The Pitfalls of Relying on a Transactional Approach.
What we realized was that these brokerages and massive teams our agents were leaving were mostly transactional – not relational – in nature.
That meant they had to keep buying new leads and hiring new people. And, with that leadership model, their agents also became transactional. But once their agents realized the constraints on building a sustainable and profitable business with this business approach, they would outgrow the team. And that left these brokerages and teams to become a revolving door for agents who had a shelf-life of one-to-two years.
That short-sighted, quick money approach may work fine for some brokerages and teams, but it usually does not work well for the individual agents who try to build a business, realize it lacks a strong foundation, and have to walk away from it and start over.
Nor is it ideal for the customers who never really get to know their agent as a person because follow-up to strengthen the relationship did not occur, and sometimes there was so much rotation at the brokerage that they did not even close with the original agent, never mind bond with them.
The Key to Becoming a Millionaire Real Estate Agent: Customer Obsession
In stark contrast to the traditional, transactional business model of most brokerages, Momentum knows that its agents are becoming highly profitable through customer obsession. No, we aren’t a group of creepers; what this means is staying focused on, passionate about, creating the optimal customer experience and building strong and lasting relationships with those customers, both as a matter of respect for them, and as the foundation for building a profitable, sustainable business.
To that end, Momentum’s training includes:
§ Defining for agents what 5-star service means for a customer.
§ Teaching agents what they must do to create the 5-star experience customers want.
§ Training agents on how to build the systems necessary to create that experience in a sustainable, efficient way.
Using this relational approach, Brittany and I have been very successful as real estate agents. We have taught seminars on how to become a “Millionaire Agent,” and many people ask us how they can also make that happen.
Our simple answer is this:
“Be customer obsessed. Understand that it's not about you. Don't focus on becoming a millionaire; focus on your customers. And when you do that, you also will be on your way to becoming a Millionaire Agent.”
If you want to learn more about Momentum and its values, service, and communication standards, click below.
