A Brief History of The Mike Ferry Organization ... From the Beginning
It may be a little more information than you need to know, but my basic business belief has always been … “The more you know about the product or service you’re working with … the better you can do your job for the prospect or customers you’re in conversations with.”
I started the company in June of 1975. Between June 1975 and December of that year, I would go into various communities around Southern California and do a brief 15-20-minute talk at Real Estate company sales meetings … demonstrating the beliefs I had in regards to being a productive agent. Then, I’d ask the attendees to buy a ticket for $25 to attend a seminar. I’d put on five to ten days later. I was doing six to eight of these short seminars per month and most of my time was spent in prospecting and selling tickets.
In the calendar year 1976, I did three things to build the company. First, I continued doing meetings … selling tickets … and doing two 3-hour seminars per month. Second, I made the decision to record two 4-hour cassette programs … one on how to list property and one on how to sell property and these were then sold at the seminars I was doing. Third, I made the decision in early 1976 to start calling Real Estate-related organizations that would hire me to speak on a fee basis versus selling tickets.
I started by accumulating a list of potential organizations that could hire me to speak including the Boards of Realtors throughout California … all the major independent Real Estate companies (mostly new and start up franchise organizations and I would basically call any Real Estate brokerage firm that had more than 25 agents and try to sell them my services.
From 1976 to mid-1985, I was either speaking at an event where I was hired or prospecting for an organization to hire me. During this time, each week I would call 20-25 organizations per day and make a presentation on the phone with the purpose of getting hired to speak. My original speaking fee in 1976 was $300 for three hours and by 1985 I had raised the fee to $5000 for three hours. Through aggressively prospecting every day between 1976 and 1985, I was doing between 125 and 150 fee-based seminars per year and I moved from using solely California as a location for our programs to virtually all of North America. I dramatically expanded the areas that I would speak in, which at the same time expanded my base of business and my reputation as a speaker … all of which created more opportunities.
By the early 1980’s, in addition to a variety of cassette programs I produced and was selling, I also produced video-based sales training programs for Brokers to use in the training of their agents. The Mike Ferry Organization income sources boiled down to … speaking fees, cassette programs sold at seminars and video-based training sold to Brokers.
In early 1985, I realized I was in what I called, “a dead-end business model.” By this I mean … I had little to no control over most facets of the business I was involved in. I was dependent upon somebody hiring me to speak … where I had no control over anything more than being hired. It was in early 1985 that I made the decision to create two programs that I would then sell tickets for and market myself. Again, “marketing” meant selling tickets directly to agents and Brokers.
During the span of time from ’75 to ’85 while doing speaking engagements, I would collect business cards daily from the audience … asking anybody who had an interest in future information to give me their cards. I collected tens of thousands of cards which became our original database that we then sold our seminars to.
In mid-1985 I started hiring a sales force and I created what we called the Action Workshop. This was a direct sales four-day seminar designed 100% to increase the productivity of a Real Estate salesperson. These were sold into various markets throughout North America by a small sales force that I put together within the company.
At the same time, I recognized that the majority of the training being done by not only my competitors, but also by most of the major Real Estate organizations, was designed for newer agents to the business, from medium to low producers. There didn’t seem to be any training for people who were top producers or people who had the desire to become highly productive. I then created the first Superstar Retreat in early 1985 and for the next four to five years these events allowed me to control more than 50% of the speaking that I was doing and allowed me to cut back on speaking for outside organizations. In 1987, I created the three-day Management Retreat and then I had three events to sell. Let’s stop for a minute and re-state that we were now doing:
1 to 15 Action Workshops per year … both a West Coast and East Coast Superstar Retreat … and a West Coast and East Coast Management Retreat.
In October 1988, I created what I believe was the first Real Estate sales coaching program … it was called “Business Planning” and we would do a 20-minute weekly phone call through one of the Business Planners/Coaches I’d hired. With the Real Estate slowdown that occurred around 1989-1990 … I quickly reduced the cost of the program and put two agents on the call with the Business Planner/Coach to keep the program alive and growing.
Between January and June of 1995, I became disappointed with the quality of the coaching we were doing. This was due to the lack of quality Coaches I had within my company. In June of 1995, I created a second program … the original Business Planning was still in place … and I introduced what was called One-On-One Coaching, where we charged $1000 per month on a 12-month contract, with a strong list of benefits the client would receive in addition to the Coaching Calls themselves.
I also made an important decision in June of 1995 to replace the employee Business Planners/Coaches with successful agents who were using the Mike Ferry Sales System. They became part-time Coaches and the quality of our coaching improved dramatically … immediately. The success of MFO Coaching increased because our clients were now being coached by active agents within the marketplace. By 1996-1997, because of the success of our One-On-One Coaching … more and more competitors came into the marketspace and now today we probably have 600-700 competitive companies doing Real Estate coaching, of which a good portion are either former Coaches of The Mike Ferry Organization or have been Coached by The Mike Ferry Organization.
Between 1975 and 1995, I continued to create hundreds of different sales training cassette programs and video-based training programs for the industry. Because we were doing at this time 15-20 seminars a year … the sales of the cassettes, the videos and the coaching became a large income source for the company. The sales of the products became our greatest marketing tool because we sold tens of thousands of cassette and video programs which sat on agent’s desks in offices throughout North America. In essence, the visual effect of our products with Mike Ferry’s name on them became our strongest marketing tool. With the advent and popularity of CDs and DVDs, our products remained the same and we still sold them in huge quantities, but the marketing effect disappeared because the product size disappeared. We also recognized that in that period of time, faxes (which were physically picked up from machines and read) had a higher contact rate than we would have with email campaigns.
From1995 to 2005 I kept creating new four-day seminars primarily because the name Mike Ferry was becoming strong enough and the results we were getting were strong enough and, as importantly, most of our competitors were not able to compete in this arena. At the same time, the marketplace for hiring speakers was decreasing at a fast pace. By 2005, we were doing more than 25 four-day seminars per year including the Superstar Retreat, the Management Retreats, the Action Workshops, the Productivity School and Sales Talk Workshops.
As you can see, I converted the entire process of being hired by outside companies … to running 40 events of my own in North America. I was personally doing 12-14 of the four-day events per year and coaching 40-50 agents at the same time.
As we’re all aware, from mid-2006 to mid-2011 the entire world Real Estate market collapsed, which both helped and hurt MFO. It hurt because a lot of people who could previously afford tickets to a seminar or afford to be involved in our Coaching, simply could no longer afford it. Not only did the sales of Coaching contracts fall off, but also the number of people buying tickets to our seminars was dropping. We created a series of sub-coaching programs at lower prices. Throughout the recession this kept us in a good position until the recovery.
When the market started to recover in early 2011, the number of speakers/trainers/coaches in the Real Estate industry exploded throughout North America. At this point, we had 5-6 speakers doing our seminars, which allowed me the time to create stronger programs for our clients and prospects, and dramatically expand the services we were offering and create additional revenue sources.
When the recession hit, our Coaching numbers dropped to about 750 clients and, like most other good businesses, we made the necessary financial changes to keep the company open, operating, productive and profitable. During this period of time, I also recognized that the Real Estate industry was changing in a fashion that most people simply did not understand. For 30 to 40 years, the Real Estate market was about 10% top producers … 20% low producers … and the balance in the middle were in various stages of productivity and failure.
Today, the market is 10% to 12% Superstar producers … and 80% to 90% either new to the industry or continuous low producers who are doing four to five transactions per year … or 20-year veterans who are doing seven to ten transactions a year and living off their database. This giant group of people is the target today of the hundreds of coaching companies in the marketplace. These companies are all offering magic formulas at very low prices where agents don’t have to work or, in essence, selling a coaching contract that is almost meaningless but affordable. Therefore, people are jumping into them instead of understanding what it takes to succeed and working with MFO. Thus, I’m continually expanding our revenue sources to offset the fact that we have so many competitors in the marketplace today.
I was asked recently this question … “What is the most important function that Mike Ferry has within his company?”
I know the answer will sound somewhat unusual to many of you, but my primary job within the company is to enhance and help create all the services we offer to Real Estate professionals and to keep creating new quality services at a faster pace than our competitors can steal them from us. Quite honestly … we are the best … and then there is the rest. Stick with the best … take advantage of it … and continue learning and growing so we can all succeed at a higher level together.