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Good Afternoon,
I have recently had a number of conversations with my clients that expressed frusteration with their buyers, saying things like "I wish they would just make up their minds!" or "I have spent the last 3 weekends with these buyers but I cant get them off the fence". I came across this article which I think is very timely to our market. I hope you enjoy it, I did. Great Realtors and Lenders not only know how to listen but they also know how to sell. If you feel that you could use some "tweaking" of your own sales skills, Mike Ferry will be here in Scottsdale on June 3rd. If you would like more information on how to register for this FREE seminar feel free to call or email me. Stephen.
Overcoming the Impact of Too Many Choices In the Decision-Making Process
By: Sandy Geroux
I recently read an article in Fast Company magazine about the impact of too many choices-in essence, too many decisions-in our lives. While choices sound like a good thing, in reality too many choices can paralyze customers in their decision-making efforts.
Case in point: When I was a REALTOR®, if buyers were presented with too many homes at one time (on paper or in person), their decision to buy was hampered at mult iple points, and by several factors: - Information overload. With too many choices, buyers couldn't decide where to begin or how to limit visits to the most appropriate homes. Of course, I could help them by highlighting price, features, convenience for work or school, etc. However, if too many choices still existed that fit all those criteria, it remained difficult for buyers to limit what they saw... and their ability to decide to buy.
How to overcome this issue: Listen carefully to your buyers' needs, selecting several great options based on those needs, and holding other options in reserve - to be brought out only if the first set of options doesn't work for them. This is accomplished in several ways: - If they arrive at your doorstep with handfuls of printouts from Internet searches ("helping" you by doing lots of research up front, but usually d oing more hindering than helping, overwhelming everyone with great-looking choices, most of which are completely inappropriate-or gone by the time they arrive), you must pare down the stack without having to look up every MLS number they bring to you. Instead, have them select their top 5, then the next 5 (keep going in groups of 5, as needed) that they'd like you to check.
- Ask plenty of qualifying questions up front, to narrow down their choices to the desired area and price range. In many cases, you can just eyeball their printouts and know which are too far away, too small for their needs, or out of their budget.
- Once you know what they're looking for, do a targeted MLS search yourself, based on their specific criteria, then present a limited number of options from your personalized search. Many of their printouts may actually be the same as yours, wh ich also limits the extra work you have to do in order to either include or eliminate their pre-printed options.
- What if there's something better out there? No matter how many options a buyer is shown, something nicer, bigger or better will always come along. This doesn't mean that they could (or should) buy it, but the possibility of buyer's regret often rears its ugly head and paralyzes buyers because they're afraid of buying the wrong home-or that the perfect home will appear the day after they close on their chosen one.
A buyer's decision-making ability can be stifled because they're convinced that the "best deal" is always right around the corner ("If there are this many great homes now, just imagine what's coming!"), causing them to lose out on a great deal right in front of them.
How to overcome this issue: We must help customers u nderstand that simply because something nicer/newer/better may come along later, it doesn't mean they're not getting a great deal now. There are several ways to accomplish this, as well: - Draw parallels to similar situations, using stories they can relate to, in order to demonstrate this phenomenon's occurrence in other areas of their lives. One great example is that of advances in technology, which occur so quickly that our new, cool laptop is obsolete and overpriced about three months (sometimes three minutes!) after we purchased it!
- The grass is always greener... No matter how great something looks on the surface, there are usually items that need "tweaking" once it's actually purchased. People often find that they buy (or even build!) their dream home, only to see a futuristic new feature they wish they could have included, but wasn't on the market until six months after they moved in; or they believe they've thought of everything, but after living in the home for a while they realize their idea was great in theory, but not in practice. Remind them that no matter how perfect something seems, everything needs tweaking-and that their home today can always be tweaked to suit them more perfectly tomorrow.
- I shouldn't buy the first thing I see. While it is prudent to do your homework and research your purchases, sometimes the first home a buyer sees (or the first offer a seller receives) is the best one and should be acted upon.
When options are limited, whether due to the current market (such as when real estate is booming), high demand (such as when everyone must buy a "Tickle Me Elmo" doll for their child or grandchild at Christmas) or when a product is new (as with the iPhone last ye ar), buyers have no problem making quick decisions-whether it's the first thing they see... or even the ONLY option available.
When options are plentiful, inventory is high, or time is not of the essence, buyers and sellers are sometimes stifled, allowing great deals to slip through their hands, simply because it's the first one they see.
How to overcome this issue: Be sure to highlight the benefits of acting on the purchase being considered now. Again, several options are listed below: - Asking buyers or sellers what their current situation is costing them helps them put a value on the solution being offered (a seller may be stuck with two mortgages and need to "stop the bleeding" by getting out from under the home they're trying to sell, or the market may be quickly changing, which will cause a customer to lose money by waiting too long to buy or sell).
- Putting a time limit on an offer helps buyers make the decision to buy now. Many options are available to help you limit the offer, inform customers that time is of the essence, or limit inventory in order to take advantage of the principles of supply and demand that will help you prosper and your customers win. Offering a lower price (or a higher offer) until a certain date, paying closing costs only until a certain date or time, or even offering a bonus to another agent if a property closes by a certain date (which helps agents quickly decide to bring more buyers to your listing) are all viable options.
- Again, asking questions up front helps. If there is only one home available in the specific area a buyer desires, you will know this and be better able to advise your customer regarding inventory in that area, helping him decide to visit it and make an offer quickly, if the home is also desirable.
- Tell stories to illustrate your points. I often used the story of a seller who received a $275,000 offer on their home within the first week of listing it. Since the offer came too quickly, they refused it (against their REALTOR®'s advice). The market then changed and they did not receive another offer for almost a year, this one for $175,000-which they accepted because they then had two mortgages and were desperate.
Obviously, we should never limit a customer's choices based on our needs and desires, nor can we make decisions for them. But when we focus on and offer appropriate choices, clearly articulate the value and benefits of acting in a timely manner and communicate those benefits through stories and parallels that customers can understand and relate to, we create a win-win situation... and make the decision-making process easier, quicker and more profitable for all involved. |
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