7 Touch Rule For New Home Sales Success

It’s a common rule in sales circles that a prospect does not become a customer until a seller reaches out at least seven times. Sometimes called the “seven touch rule,” it doesn’t refer to the kind of touching that will land you in jail or divorce court. Rather, it is a systematic way to develop a relationship with a client through careful attention to the buyer’s needs and where they are in the buying cycle.

Even in this new housing economy, buyers are going to select the builder who they feel the most comfortable with. This means that now more than ever, you have to create a dialogue with buyers long before you ever get to the design and building stages.

Guess what? Most builders stop reaching out after the second or third try. Why? It might be they are uncomfortable, they did not receive a very warm reception or they just simply don’t have a system in place. But you can increase your conversion rate of prospects with a few simple steps.

First Touch: Website Or Home Show
Buyers will likely visit your website long before they ever think of interacting with you. For starters, this means you will need a website (duh) and the content should encourage interaction. Visitors will remain invisible until you capture their email addresses. So offer free downloadable information they have to register for, such as “7 strategies for finding land” or similar content. You can also offer this information at a home show with the same requirement.

Second Touch: Sales Tracking Software
Once you have their name, email address and address, you can start your dialogue with your prospect. Fortunately, you can automate much of this with sales tracking software such as Goldmine or Act. These silent sales assistants can send out daily (not recommended) weekly or monthly emails, faxes, letters, newsletters or postcards, with reminders of open houses, free seminars on how to buy a home, specials (buy by November and receive a free snow blower!) that can help you determine where they are in the buying process. Using this software, you can tailor the messages they get—automatically. This simple addition to your operation can increase your closing ratio by as much as 40%.

A reminder: Once a prospect contacts you by email, phone or website visit, get back to them ASAP. Based on a survey conducted by Weichert Realtors, once customers submit their information online: 21% expect instantaneous response, 44% expect a response within 40 minutes, 100% expect a response within 24 hours. The typical agent only responds 48% of the time and the average response is two-and-a-half days. You can do better.

Third Touch: Face To Face
Don’t ever miss the opportunity to have prospects put a face with your name. Do they need a catalog of home designs? Hand deliver it with a smile and a business card. Do they need an evaluation of their building site? Meet them on a Saturday morning or whenever they won’t be rushed for time and bring along a portfolio of recently completed homes.

Fourth Touch: Focus On The Next Step
Yes, you’re impatient to close a deal so you can start doing that construction voodoo that you do. But this isn’t about you—it’s about the buyers and their needs. So concentrate on helping them accomplish that next step in the buying process. This includes determining a budget, finding land, deciding on a design—you know the drill. Work to get to the next step and before you know it, they’ll be at the closing table.

Fifth Touch: A Touch Of Green
Educate yourself on green building and energy efficiency, so you can offer your clients high-performance homes that outperform the competition. You may want to earn your Certified Green Professional status from the National Association of Home Builders. Then you have to alter your sales strategy to inform clients (without talking down to them) on the advantages of upgrading insulation, HVAC and sealing strategies. Not only will you be doing your clients a favor by offering a more comfortable home that’s less expensive to operate, you’ll likely see higher margins through upgraded operating systems.

Sixth Touch: Look To Past Clients
While you may have a budget for advertising and PR, most builders forget their past clients for earning tomorrow’s referrals. Use the example of Michelle and Eric LaBounty of Plattsburgh Housing Outlet (Plattsburgh, NY) who are especially creative. The LaBounty’s send out small gifts—such as batteries for smoke detectors on the one-year anniversary of owning the home or ornaments at Christmas—to thank their past clients and ask for referrals. Another proven tactic is to start a written referral program with a substantial reward for past customers who refer clients. How much is it worth to you right now to have someone sign a contract? Once you figure that out, you can devise the reward program. Some builders reward successful referrals with big screen TVs or cash--up to $1,000 once the new client signs a contract.

Seventh Touch: Keep Them Informed
Once you earn their business, keep your clients informed during every step of the design and building process. Send weekly emails that summarize what’s taken place and what’s planned for the next week. Include photos whenever possible. Spell out any challenges and the solutions you’ve adopted to overcome them.

Bonus Touch: Track, Measure & Manage
Keep in touch with your own business as well. While you may know to the last fastener what you need for your current project, most builders fail to track their financial performance and end up robbing Peter to pay Paul. Watch your hard and soft costs on every single project to improve your performance. Track how many trips you and your crew have made to the lumber yard and how many of them could have been combined. Only buy what you absolutely need. Forgo that new shiny toy (new truck, iPhone, GPS, etc.) in favor of keeping your finances strong.

Yes, the market is down 25%, 40% or even as high as 60% in some markets. But that means there’s 75%, 60% or 30% of new housing starts still going on. Another way of looking at the current economic situation? A full 88% of Americans are employed right now. Make sure you are the one winning business from that 88% that ARE employed.