Customer Service And A Shifting Market

Welcome to Mike Ferry TV. Tony Smith here, Vice President of The Mike Ferry Organization. We are here on the week of July 4th. Happy second half of 2022. So as we get into the second half, there's something that's coming along with the market changes. Most of North America has started to see some shift in the market. You know, a cooling down, a little normalization, you know, getting out of the crazy frenzy and maybe turning into an actual market cycle, which it looks like it's stacking up to be. And I know Mike has been delivering messages here about what to do and how to do it and how to behave in the changing market. I wanted to point out a specific spot within that, okay? When a market starts to change in maybe a not upward way, in a little bit of a stabilizing or a downward way. One of the places that we have to revert back to immediately is the quality of our customer service. Ok. And let's face it, for the last two or three or four years, you take a listing, you put it on the market, it sells in a few minutes, and the sale is customer service. Many people are happy when they sell their home and they have multiple offers and over asking price and all those things. Was it frenzied? Yes. Was it chaotic? Yes. Was it tough for the Buyers? Absolutely, yes. All those things come. And a lot of times that is moving us away from the thoughts about customer service when working with the Seller.

 

So it's a great time. Part of a transition is you need to refocus and recommit and maybe sharpen the tool a little bit. When it comes to the quality of the customer service you have to deliver. So let's look at a few points straight from Mike Ferry about delivering great customer service. I put this spot first to set it up, okay? So normal a normal market. Do you know what the interest rates have been since back in the mid-sixties? On average, interest rates have been on average somewhere at the seven, seven and a half range since the mid-sixties. Mike has talked to you about times when it was at 18% in the eighties, right? But if you look since the mid-sixties through today, the average interest rate 7%, okay? That is normal, okay? What is normal time to be on the market 30, 60 days, 90 days? Maybe that is not uncommon to be on the market for a couple of months before you sell. What is not normal is to be on the market for a couple of minutes before you sell, okay? So as we get into this, let's look at this. This is shifting to a normal market which is a normal market cycle, okay? Where does customer service fit in? Here are some points. First, there is a direct correlation between the income we receive and the level of service that we offer. If you want to improve income, improve service, okay? So the first thing we look at is as we go into this normalizing or shifting market, are you providing an improved quality customer service for the clients you communicate with? If you want more money, you have to focus in on customer service and there's a lot of things that start to take place here.

 

There's a lot of things that come with customer service in a changing market, for example. Number two, great customer service requires regular, consistent communication. All right? What we know is for the last two or three or four years, an agent's regular communication with the Seller was all centered around the immediate offer, negotiating that offer, putting the offer together, and then immediately into escrow. How good are you at communicating with the Seller for two, three, four, five, six weeks without an offer? Are you good at communicating to the Seller about price, the right price and a price adjustment if it's needed? Are you willing to call your Seller every single week when there is no offer? Okay? We know out in the world that that many agents are going to flat stop talking to Sellers if they don't have good news. You know, there are agents that have never done a price reduction. There are agents that have never experienced a market where it took 30, 60 days to sell a house. So how good could they possibly be in communicating to a Seller if they've never experienced it? We've got to practice and rehearse these things, right? I wrote down the Seller expectations.

 

You know, we've got to learn to communicate in a very effective way with the Seller and help them set and understand the expectations today. Right? The Seller has been hearing from all their friends and everybody else that sold. “Don't worry, put it on the market. You're going to get 50 offers and you're going to have the bidding war going on.” Well, it's natural for a Seller today to expect that if their friends did it. So how good are you at communicating the proper expectations to a Seller if they're going to put their home on the market today, there's going to be a fair amount of unhappy Sellers going on in the world because nobody communicates with them. And nobody set the expectation. They didn't know. Right? It's a trait that we have to work on. How about how can you connect the Seller every single week without a sale? Are you prepared to talk to a Seller week in and week out when there's not all great news every week? Some of the news is not so good. You have to adjust the price. There were no showings in the last five days. Right? Communicating the condition of the property. Right? You know, we could get away with the condition that wasn't that great and the house would still sell. Now, we may have to straight up communicate better about stains on the carpet. It needs paint. It needs the yard cleaned up. Right? Can we communicate those things to a Seller? That is good customer service, right? It's easy to provide great customer service when you push their sign in the ground and it's sold before the sign sets in.

 

It's a little harder to provide great customer service when you have to work with a client in normal conditions where it takes a little while to sell. How about delivering price and price reductions? When it comes to communicating, how many price reductions have you gotten in the last year or two? How many will you have to get in the second half of this year? Probably quite a few. Are you good at communicating that? How about that initial pricing? Can we just go up, up, up, up, up anymore? We can't do that. So are you good? And do you understand what the right value is? And can you communicate that to the Seller to get it priced right from the beginning? It's good customer service. How about this? The market stats. Are you able to communicate the market stats to your prospects, to your current clients and to your Past Clients? Right? Delivering those market stats is one way to deliver good quality customer service. You know, it's been said that “Opinions can lie, but stats can't.” So, you know, there's all these opinions floating around about the market, all these opinions, you know, “This is not going to change. It's going to keep going up every year. This is only going to last two months. This is going to be the worst recession ever.” You're going to hear all of those various opinions.

 

Your job is to be able to deliver the stats. How long is it taking a home to sell? How many homes are on the market? How many are coming onto the market each week or each month? How many are failing to sell? What is happening to the average sales price? That is good customer service and it's what our clients pay for, okay? Past Client and Center of Influence. Communicating with them. You know, it is easier to contact your database when there's nothing but good news prices. The value of your home has gone through the roof. That's pretty easy conversation to have. It's interesting because even when there was great news, a lot of Real Estate Agents still dramatically struggled with their ability to call all their Past Client and Center of Influence. Now what happens when there's not so great news? Interest rates are on the rise. Prices are flattening out. Now I don't have good news. What we do know is there is a mass of Past Clients and Center of Influence out there in the world that the agent is simply not going to call them right now. “I don't have anything to say that's good. I don't want to talk about it. I don't want to deal with it.” How about those people that bought a house a year ago for top dollar and let's say the market does dip a little bit? Are you still going to communicate with them? I think you should. Right? I mean, it's the right thing to do, but it's not such great news.

 

Pretty easy when you say, oh, you made 30% on your house in the last two years. A little tougher to be able to say the value of your home is declining, but you still have to communicate. Customer service is what pays, alright? In customer service, I wrote this point. This is actually point number three. Remember the qualities of reliability, dependability and honesty? Great customer service is about reliability. Do you show up when you say you're going to show up? Do you call when you say you're going to call? Do you return calls promptly? Right? Dependability. Can they depend on you for the answers? Can they depend on you for solutions to the problem? And are you willing to be completely honest with them about price and condition and everything in between? That is good customer service. How about point number four? Great customer service more than ever today will provide more incoming referrals. You know, for quite some time, the public perception out there is you just have to pick an agent. You pick an agent, you're going to sell your house, right? Well, when things tighten up or get a little softer, it gets a little more flat out there. The world starts appreciating great customer service. Right? And they are more than happy to refer an agent. When you got good customer service, you're going to refer that agent to somebody else. If you provide good customer service, your referrals go up, don't they? We have to look at it, okay? Our job to provide good customer service is to remove the drama of the transaction by having solutions to the common problems before they come up.

 

There's going to be some common problems, right? We're seeing some properties fall out of escrow. Buyers are not accepting the fact that you won't fix every little thing in the house. They're starting to get a little tougher when it comes to the physical inspection and the repairs. We have to have solutions to those problems in advance for our Sellers. It's good customer service. How about next on the list, six. When listing a home for sale, tell the client exactly what steps you're going to go through to sell their home. Connect them to the Plan of Action. In MFO, we have a very defined Plan of Action. Hopefully you have yours, right? As an agent, have we really had to dig deep into that Plan of Action for the last couple of years? Put a sign out front, put it in the market and sell it. I mean, that's it, right? So now we've got to start connecting and really being able to set the expectation and share with the Seller the exact steps we're going to take to get their home sold. We've got to be willing to do that. How about seven? Talk to them every week. Let them know that you care. But don't focus on the problems they have. Solve the problems. Are you willing to contact that Seller or that Buyer, that escrow every single week throughout the process? Good, bad or ugly? We can't start skipping the conversation or the communication, can we?

 

And then eight. The last one I wrote on this good customer service is sometimes learning to say, “No”. You know, as a market levels out or stabilizes or shifts, more motivated Sellers are required. Having an unmotivated Seller, all it's going to do is get you bogged down, take up all your time and energy, and it's not going to give you space to go find another Seller. So our ability to prequalify 100%, our ability to really understand the client's motivation and sometimes good customer service is stepping away and saying, “No.” If you say, “Yes” to everybody and you list a bunch of unmotivated Sellers and you say, “Yes” to them, can you provide them good customer service? It's pretty hard to do because the circumstances, “they're not motivated” means they don't allow good customer service. They're not going to hear it. So sometimes you're going to have to learn to say, “No” at a higher level. This goes with Buyers, too. If they're not highly motivated and ready to do everything that they need to do to buy a home, we have to say, “No.” Okay? So some simple thoughts this week here at Mike Ferry TV about customer service. I'd like you to do a little deep dive for yourself on what good quality customer service means for you and your business, and see if you take a few steps to improve it, you'll get paid more for the for the effort. Thanks again. Talk to you soon.