Know Thy Customer

As my spouse and I go through the process of concurrently buying a new home and selling two others, I have been thinking a fair amount about customer relationship management [CRM].  Admittedly, I have been a devotee of CRM platforms from my first experience with ACT! decades ago.  “You mean I don’t need to maintain and manipulate either/both Access databases and Excel spreadsheets, run mail merges constantly, and manually manipulate target lists almost daily—where do I sign up?”  That was pretty much my initial thinking, and as the platforms have improved dramatically (I am looking at you, along with my proficiency in leveraging them, my affinity for CRM has been described by some as borderline unhealthy at times!

With that confession as context, I have a hypothesis I am beginning to test on some of realtor friends and acquaintances and would love to hear from some of our readers with their experiences in this area as well.  Despite living in one of the fastest-growing areas of the country and by extension, one of the more lucrative and competitive real estate markets, I question whether the vast majority of real estate agents have embraced—or even understand—the value of CRM.  A proliferation of open houses, property-specific ads in local magazines that come out every two months, postcards blanketing entire zip codes….  These are just a few examples of the practices that have given me pause during this process.  Aside from the enormous value of long-term relationships developed with customers they have worked with on multiple transactions over time, doesn’t it often feel like each new listing from an agent is like their very first listing all over again?  Like they have to create a new audience from scratch and like every listing is potentially interesting to every single person in that scattershot audience?  Wouldn’t it be more valuable and more efficient for these agents to employ a more focused approach, maintaining information on prospective customers and segmenting them accordingly?  If I live in a neighborhood of condos valued in the $300s and/or have visited an open house or three of yours in a nearby neighborhood of single family homes in the $500-600s, wouldn’t it make more sense for you to communicate more specifically and personally with me about a new detached home going on the market for $550,000 than to tell me about the 3 new listings for coach homes selling for $400K down the street?

Clearly, there is an aspect of a volume game in the real estate business, and you do not want to over assume things about potential buyers (maybe I am going to jump up to a $1.5 million dollar home from that condo due to life changes?) at risk of missing out on a potential sale.  However, doesn’t playing that volume game almost exclusively also reduce your ability to differentiate yourself from your competitors?  Doesn’t it also make it more difficult to find the right match of buyer and seller with the optimal investment of time and effort? 

Are you thinking about the best way to reach and serve your (potential) customers?  Would you benefit from a better understanding of your audience and more strategic segmentation (and resulting sales and marketing campaigns)?