As a real estate agent, you likely know the challenges of getting new referrals in the real estate industry. One of the most successful marketing strategies for how to get referrals in real estate is circle prospecting.
What is circle prospecting in real estate? Simply put, it’s a geographic marketing strategy centered around a new listing or recent home sale. By informing the neighborhood that a home near them is for sale or just sold, you can get referrals for friends and family who want to move into the neighborhood.
Below, our team at Become a Local Leader® outlines the most effective circle prospecting strategies from some of the top real estate professionals across the country. Keep reading to learn more about implementing these strategies in your real estate marketing.
Circle Prospecting Defined
What is circle prospecting in real estate? If you look at your new listing on a map and make it the center of your circle, then measure a radius, the homes within the circle will be your prospects to call directly.
The main thing to consider is how many phone calls you can make. If you’re the only one making calls, consider a smaller radius, maybe just a quarter mile. However, if you have several team members helping with prospecting, expand your radius to a half mile or even more. You may also need to adjust your radius to accommodate waterways, wooded areas, and population density.
Cold Calling for Real Estate Professionals
Once you know your radius, you will need to purchase a list of phone numbers from a neighborhood search phone list service. Before you call a single number, run the list against the national Do Not Call Registry. Remove any numbers from your list that appear on the registry, as calling these numbers could harm your reputation as a real estate agent.
After you’ve confirmed that your list of phone numbers is safe to call, schedule a day to manage your phone calls. Remember that timing is important. If you listed the property two days ago, other agents could already be showing the home to their buyers. You want to begin making phone calls as soon as possible to ensure that you’re the first agent in the area, informing these prospects about the news.
What To Tell Your Prospects
How do you talk to a cold lead when you make your first call? What should you tell them? Keep a short list of potential questions and answers available, but don’t rely too heavily on a script. While a script can be a useful tool, it can quickly become a crutch if you don’t prepare responses for any questions you may receive.
Instead, keep your call short and sweet. Remember that you will most likely get a prospect’s voicemail, as many people will not answer an unknown number. Leave a message! Something like:
“Hi, John! This is Chris Smith calling to let you know we just listed your neighbor’s property on Egret Street for sale. If you know anyone looking to move into your neighborhood or want some more information, I’d love to tell you more about it!”
Leave a return phone number and move on to your next call. If you get to speak with someone, give them the news and ask if they would mind answering a few questions. If they have time to talk, find out if they own their home or rent, and if they would want to buy or sell any time soon. Anyone you speak to is a potential lead.
When you get a return call from a message you left, that’s a lead. They listened to your message and decided they wanted to learn more. Or they’re calling to cuss you out for calling them, in which case, you can help them register for the national Do Not Call List. Sometimes those prospects remember that you helped them and will call you when they’re ready to sell.
What Do You Do When It Works?
When you get a lead from circle prospecting, add them to your Customer Relationship Management (CRM) software. Your CRM should let you add names, numbers, buying or selling status, and where they are in the process. Additionally, you can add notes like names for a spouse, children, and pets, as well as common interests, so you never run dry on things to talk about.
Follow up regularly with leads who refer you to new clients, even if they aren’t interested in buying or selling. When the time comes, they’ll call you.
What Do You Do If It Doesn’t Work?
Once you buy a list for a certain area, you have those phone numbers available to call the next time you list a home for sale or sell a home in that area. If you don’t hear a response after three news updates from certain phone numbers, consider removing those numbers from your list.
“But couldn’t those eventually become real leads?” Apathy is the enemy of progress. Whether someone returns your call to get more information or to demand that you never call them again, they’re invested in your message. If you don’t get a response from certain numbers after several new listing or sales campaigns, remove them from your list to reduce the number of calls you need to make.
Other Methods of Circle Prospecting
Phone calls aren’t the only method. Direct mail and brochure distribution can also help you spread the news to nearby neighbors. The USPS offers an effective Every Door Direct Mail postcard service that can help you reach entire routes with a few quick clicks. However, it will take you time to design the postcard, get enough postcards made, and deliver them to the post office. Phone calls are faster.
Stay Up to Date with the Latest in Real Estate Marketing
Now that you have the answer to “what is circle prospecting in real estate?” you can begin implementing these strategies and others in our guide to prospecting. If you want the latest information about marketing and prospecting for real estate professionals, subscribe to our Become a Local Leader® newsletter.