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Prospecting - What do you use?

There are so many types of prospecting - What form do you use primarily in order to achieve your results in Business Development? - by Snowboy
I think that moving with the times calls for using the most up to date technology. What is more up to date then Email in order to correspond.

Good Pollthmbp2; - by Gunner
Referrals and Cold Calling have worked great in our market for years. :) - by AZBroker
Referals without a doubt.

Good pollthmbp2; - by EmmaC
I think that moving with the times calls for using the most up to date technology. What is more up to date then Email in order to correspond.

Good Pollthmbp2;
Gunner - Agreed. Email is certainly a way of making sure you reach the client but it worries me that it is palmed off like Junk Email (any thoughts on that?) - by Snowboy
Referrals and Cold Calling have worked great in our market for years. :)
Thanks for your Reply AZBroker. I agree with Referrals however IMO Cold Calling is dead - Does this really work for you? What industry are you in and what sought of Cold Calling do you do?

Cheers. - by Snowboy
Referals without a doubt.

Good pollthmbp2;
I agree with you EmmaC - by Snowboy
Thanks for your Reply AZBroker. I agree with Referrals however IMO Cold Calling is dead - Does this really work for you? What industry are you in and what sought of Cold Calling do you do?
I work in real estate, cold call sellers and yes cold calling really does work for me. What has lead you to decide that cold calling is dead? - by AZBroker
I work in real estate, cold call sellers and yes cold calling really does work for me. What has lead you to decide that cold calling is dead?
With most of the salespeople I train and certainly with the vast majority of my coaching clients, the complaint about cold calling isn't that it doesn't work, it's that the return in investment is so small that it isn't viable long-term.

In most industries if you sit on the phone long enough, you'll find people to have appointments with. The problem is if you have to sit on the phone 5 hours a day, 5 days a week to get 5 or 6 or 7 appointments, you're spending a huge amount of time to acquire one prospect. If you generate 7 appointments during that week, it has taken 4 hours to generate one appointment. If your time is worth say $20 an hour at a minimum, that lead has cost you $80. If you only get 5 leads, then each lead is costing $100. That's an expensive lead.

If your closing ratio is 50%, that customer cost $160 if you get 7 appointments (assuming, of course, there are no cancellations, no-shows, etc and that you actually get to meet with all 7 prospects). Plus you have to factor in the time to meet with the prospect, the costs associated with your marketing materials, gas, etc. That new customer may cost $250 to $300 or more, maybe much more. If your commission on that new customer is say $600, you've actually made $300. And that's assuming your time is only worth $20 per hour (that works out to an income of about $40,000 per year). If your time is more valuable, the cost per lead is more expensive. And we haven't taken into consideration the time to find the people to call. Another expense, more hours invested.

If it isn't a one-time sale and you have to make multiple contacts and trips, the costs continue to increase.

Cold calling isn't dead. It is simply inefficient for most, not all, salespeople. You can certainly get prospects and eventually clients. There are simply more efficient ways to get them than cold calling. - by pmccord
I use direct mail, cold calling and referrals. All three round out my marketing plan.

In my industry, which is a one call telephone sale, direct mail has been the standard and I have managed a healthy 2.2% national avg. return. These in my hand, hot leads, cost me approx. $40 each.

This past month I hired on a telemarketing company to cold call my targeted prospects for my lead generation. The results have been astronomical! Even with jobbing out the calls, the cost is 1/3 of what I spend on my mailing and the return is almost 8x what my dm yields me.

I still mail to prospects with annual sales of more than 5 million and cold call the small guys.

Direct mail- 2.2% return. $40 per lead. 30-50% sales closing ratio.

Cold calling- 15% return. $1.60 per lead. 15-20% sales closing ratio.

I shoot for referrals from everyone I talk with (I usually get at least one - sometimes up to three). These referrals do not cost me a dime and yield me approximately the same sales closing ratio as my direct mail does.

I'm still ironing out the details as I've just begun the cold calling campaign but it has proven very successful thus far.

I strongly suggest outsourcing your cold calling as I have. I simply supply them with the calling list, the script and cut them the check. One week later I've got several hundred leads in my hand and not taking a minute of my time.

This new cold calling campaign is so cost effective that it has allowed me to plan my expansion of building a sales team.

In the past year and a half I have taken my start up company from a spare bedroom home office to my present small 140 sq. ft. executive suite to now looking at a 1600 sq. ft office condo with plans of an 8 person sales staff. I project to have these reps hired, trained and selling by the end of September.

Direct mail works, cold calling works, referrals work etc... you need to find what balance works best for your task at hand.

Bottom line... Get your name out there, get in front of your prospects and close 'em msnwnk; - by bluenote
Cheers Keith.

Good posts guys - by EmmaC
I choose Emails - by Jabber
There are so many types of prospecting - What form do you use primarily in order to achieve your results in Business Development?
Good poll Snowboy, for me it's definately Referals. That is more then likely over 75% of my business. - by SexSells
For me it is defantely Referal's. - by SexSells
Good poll Snowboy, for me it's definately Referals. That is more then likely over 75% of my business.
Hi Victoria,
Thanks for your reply,
I don't quite understand in your position how you go about referrals. I believe you though I am just wondering how this works? What do you to gain referrals and how has your success been in the past?

Cheers
Keith - by Snowboy
I agree with you EmmaC
NOt a problem Keith - by EmmaC
Great Post Keith,
For me it's Referal - by dodobird
thmbp2; For me I don't use any of them as my clients come to me however if I did I would say Cold Calling. - by Wowsap
Great Post Keith,
For me it's Referal
As you can See William - As it is for many - Thanks for the comment - by Snowboy
thmbp2; For me I don't use any of them as my clients come to me however if I did I would say Cold Calling.
Thanks for your comment Wowsap - by Snowboy
Damn,
It looks like I am the only one that Selected Door Knocking.

Seriously though - I was sitting in my dealership one day and it was a typical weekday (when I was just a salemen) - I approached my sales manager and asked if I could go door knocking with mybusiness cards. He thought I was just going home so he said yes cause it was dead. Anyway the following week I signed up 2 people a day - the people I signed up were from handing out business cards and giving a little speel like - My name is Gerry - I have just jioned ABC Cars and if you or any of our family or friends are looking for a new car please give me the opportunity help you. I kept a tally and every 100 business cards/doors I knocked on I sold 20 so 1 in five is not bad when you think of the little effort it takes to knock on someones door - The sales manager made it a regular thing - Every day someone had to be out knocking from 4 pm til 6 pm. - by Wanderer
I think there are several chance for any of the tool to work - Nice experience Wanderer - by John Hughes
My experience has been that there is no easy answer when it comes to what type of prospecting works. I don't think you can simply decide what methods you will use for your business and stick with those.

The business world is always changing, and it requires testing prospecting methods on a consistent basis. What works for you now may not work in a month or two. What worked for you last year and quit working, may now work again.

Testing different methods of prospecting, tracking results, and planning campaigns is something you should do for the rest of your working life. Use what is working at the present time, drop what isn't working, and continue to test new angles on old methods.

When you find a method that works for you...run with it. Hit it hard and fast. Track the results. As long as it continues to produce results you continue to work it.

Never rely on one prospecting method to supply you with leads. Always have 'many irons in the fire' when it comes to prospecting. Some will work better than others, but if one methods brings you results on a consistent basis, continue to use it. It may only be small results, but if it's steady there is no reason to discontinue it.

I believe the 'home run' of prospecting is referrals. You simply cannot buy a good referral no matter how much money you have. It has to come as a result of a customer becoming a 'raving fan' of your product or service, and you.

When I sold floor coverings and a customer spent $10,000 on new floors I made damn sure everything went smoothly and they were happy as a lark. I called them after the job was done and made sure they were happy. I stayed in touch with them, and made sure they knew I was available for anything they needed after the sale.

And I asked them straight out if they would help me with referrals to their family and friends when they discovered they needed new flooring. And every time I received a referral that resulted in a new sale I sent the original customer a gift certificate for a good restaurant as my thank you.

If you go out of you way to 'cultivate' a referral network, you will rise above average very quickly. Referrals are powerful.

When you go to a great restaurant or see a super movie what do you do? You tell your family and friends how good it was. That's the reaction you want your customers to have when they do business with you, no matter what you sell.

Work on referrals, first and foremost...Coach Doug - by Dougd55
Cold Calling has always workd for me. thmbp2; - by Ray47
The brokerage lets salespeople take phone ups and walk-ins but those are usually buyers. For sellers I drive around looking for homes with for sale by owner signs and call the number on the sign. If there is a better way I'd like to know about it. - by Thomas
For me I picked Cold Calling - by Indep Rep
I picked Referal - by Auctioneer
Hi Thomas:

Not a bad idea to call on FSBO's (for sale by owner). If they have been trying to sell their home by themselves to avoid the realtor commission and haven't had much luck, you could step in and make a deal with them that if you brought a cash (mortgage) buyer they would give you the regular commission. Or if they are really getting desperate, you may get the regular listing.

Why don't you check the ads in your local newspaper, chamber of commerce newsletter, and local business associations. Look for people offering mortgage loan services. Call them up, tell them you are a realtor, and ask if you can take them to lunch and talk about a business 'partnership.'

This person is spending advertising dollars to increase their loan business. Offer to become their 'partner.' When you find buyers who have not qualified themselves for a loan yet, you send these people to your new 'partner' and get them qualified. You will be helping build their mortgage business. And in return, when the loan broker meets people who are trying to qualify for a home loan but don't have a realtor yet, they send these people to you. This makes perfect sense for the both of you and you will help each other build your businesses.

I've read your posts Thomas, and you write well. Why not put together some articles about how a realtor helps people buy or sell their home and submit them to your local newspaper, or chamber of commerce newsletter, or to business association publications in your area. By getting a couple articles published you will become known as an 'expert' in your field and the exposure can be substantial. And the more people who know about what you do the more your business will increase.

If you don't want to write articles, create a simple 4-panel (one paper folded) brochure about your services and print them out on your computer and mail them to FSBO's. Visit mortgage broker offices, appraiser's offices, bank's, and other businesses related to your business and see if you can leave a stack of them in those offices.

Visit some floor covering stores in your area. These people run into home owners all the time who need to replace their flooring before selling their home because they've worn out the carpets. Any most of them don't have a realtor yet. Form a business 'partnership' with these salespeople and send each other customers. When you get a listing that needs the flooring replaced to make the home sell faster send them to your new flooring 'partner.'

Brainstorm and become creative in your prospecting for new business. There are many 'opportunites' out there if you look where you normally don't look.

...Coach Doug - by Dougd55
Any form of these will work, at the end of the day make sure that you are known by your locals and the people you would class as your demographic and go from there. You need to make sure you hit the ground when selling in order to rise above the rest. - by Salecanon
Well done wanderer, Thanks for sharing your experiences with us. - by Snowboy
My experience has been that there is no easy answer when it comes to what type of prospecting works. I don't think you can simply decide what methods you will use for your business and stick with those.

The business world is always changing, and it requires testing prospecting methods on a consistent basis. What works for you now may not work in a month or two. What worked for you last year and quit working, may now work again.

Testing different methods of prospecting, tracking results, and planning campaigns is something you should do for the rest of your working life. Use what is working at the present time, drop what isn't working, and continue to test new angles on old methods.

When you find a method that works for you...run with it. Hit it hard and fast. Track the results. As long as it continues to produce results you continue to work it.

Never rely on one prospecting method to supply you with leads. Always have 'many irons in the fire' when it comes to prospecting. Some will work better than others, but if one methods brings you results on a consistent basis, continue to use it. It may only be small results, but if it's steady there is no reason to discontinue it.

I believe the 'home run' of prospecting is referrals. You simply cannot buy a good referral no matter how much money you have. It has to come as a result of a customer becoming a 'raving fan' of your product or service, and you.

When I sold floor coverings and a customer spent $10,000 on new floors I made damn sure everything went smoothly and they were happy as a lark. I called them after the job was done and made sure they were happy. I stayed in touch with them, and made sure they knew I was available for anything they needed after the sale.

And I asked them straight out if they would help me with referrals to their family and friends when they discovered they needed new flooring. And every time I received a referral that resulted in a new sale I sent the original customer a gift certificate for a good restaurant as my thank you.

If you go out of you way to 'cultivate' a referral network, you will rise above average very quickly. Referrals are powerful.

When you go to a great restaurant or see a super movie what do you do? You tell your family and friends how good it was. That's the reaction you want your customers to have when they do business with you, no matter what you sell.

Work on referrals, first and foremost...Coach Doug
Thanks so much Coach Doug,
As always great post and I look forward to your next. - by Snowboy
I picked Referal
Referals is the way to go for me aswell - Thanks for your input. - by Snowboy
For me I picked Cold Calling
Thanks for your feedback Indep Rep - What sort of Cold Calling do you do and how have you found it effective? - by Snowboy
Any form of these will work, at the end of the day make sure that you are known by your locals and the people you would class as your demographic and go from there. You need to make sure you hit the ground when selling in order to rise above the rest.
I agree Mark,
By sitting on your bum and waiting for customers to come to you, you won't go anyhere - you need to get up and out there in order to be anything close to successful. - by Snowboy
Surely the best form of prospecting will be largely dependant on your target demographics? If my target prospects were small ticket sales to housewives then I think I'd be door knocking. If I were trying to sell to the CEO's of top 500 companies then I don't think I'd get very far door stepping them ;st - by Corona
Surely the best form of prospecting will be largely dependant on your target demographics? If my target prospects were small ticket sales to housewives then I think I'd be door knocking. If I were trying to sell to the CEO's of top 500 companies then I don't think I'd get very far door stepping them ;st
You're right that the demographics play a large part. But so does the product or service you're selling. The more sophisticated the product, the more sophisticated the prospecting method that needs to be used.

For large ticket, complex, or sophisticated products and services, prospects want to work with people they preceive to be experts. And prospects assume that experts aren't cold calling or faxing fliers.

They assume that true experts don't have to use less sophisticated prospecting methods. Unfortunately, whether their assumption is correct or not doesn't make any difference. The greatest expert in the world may be cold calling them, they still assume the person isn't an expert based on their preconceived ideas of what experts do. And as salespeople, we have to deal with the prospect as they are, not as we wish they were. - by pmccord
For large ticket, complex, or sophisticated products and services, prospects want to work with people they preceive to be experts. And prospects assume that experts aren't cold calling or faxing fliers.
You can say that again. thmbp2; - by BossMan
Surely the best form of prospecting will be largely dependant on your target demographics? If my target prospects were small ticket sales to housewives then I think I'd be door knocking. If I were trying to sell to the CEO's of top 500 companies then I don't think I'd get very far door stepping them ;st
Good point Corona, So what industry are you in and what do you use as your primary contact method? - by Snowboy
You're right that the demographics play a large part. But so does the product or service you're selling. The more sophisticated the product, the more sophisticated the prospecting method that needs to be used.

For large ticket, complex, or sophisticated products and services, prospects want to work with people they preceive to be experts. And prospects assume that experts aren't cold calling or faxing fliers.

They assume that true experts don't have to use less sophisticated prospecting methods. Unfortunately, whether their assumption is correct or not doesn't make any difference. The greatest expert in the world may be cold calling them, they still assume the person isn't an expert based on their preconceived ideas of what experts do. And as salespeople, we have to deal with the prospect as they are, not as we wish they were.
Great thought there Paul.

Thanks for the comments - by Snowboy
You can say that again. thmbp2;
I agree mate. - by Snowboy
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