The economics of investing in a quarterly event for your sphere and past clients.
Suppose you have 100 people in your sphere and past clients database, and on average, you get 0.2 referrals per 100 people. That means in a year, you’ll get 20 referrals. At our brokerage, we convert around 16 (or 80%) of those referrals. With an average commission of $10,000 per transaction, that amounts to $160,000 in annual earnings.
Let’s say that we can increase the referral rate from 0.2 to 0.4 per 100 people. That means for 100 people in your database, you’re getting 40 referrals. If you convert 80% of those referrals into closings, that’s 32 closings at $10,000 per transaction, which equals $320,000 in annual revenue.
To increase the referral rate, stay in front of your sphere and past clients in a meaningful way. In other words, we invest in big, awesome events for them and help to support our community. If you take the initiative to double your referral rate for your existing client and sphere base, think of how much you could invest in a quarterly event to maintain a relationship with them and stay top of mind.
If you have any questions about holding events for your sphere and past clients or about doubling your referral rate, don’t hesitate to reach out to us by phone or email. We wish you great success in your real estate practice!