Fostering Loyalty in Real Estate: Leads Matter But So Does Retention

While all realtors recognize the importance of generating leads and dedicate significant time to it, far fewer invest substantial efforts into customer retention. Consequently, despite achieving high levels of customer satisfaction, many struggle to secure repeat business. Research conducted by the NAR indicates that although approximately 90% of clients were happy with their realtors and expressed willingness to do business with them again, a mere 24% actually did. 

While some of this discrepancy may be attributed to clients no longer residing in that local market, after all many people selling a home do so because they are moving far away, those who used a realtor to buy a home could be expected to return when selling later down the road. Assuming that roughly half of the polled individuals were buyers, it’s evident that less than a third are actively seeking out their realtor for subsequent transactions. 

What to expect 

This essay aims to delve into the underlying reasons behind this phenomenon and propose strategies for realtors to bolster client retention. That said, let’s first discuss why so many realtors neglect client retention to the extent that they do.

Of course, new realtors become adept at finding leads; those who survive are those who succeeded at finding enough customers at the start of their career to continue: It is only as realtors become established that retention becomes a significant consideration. So, it makes sense that anyone following the dictum “If it ain’t broke, don’t fix it” would continue to pursue leads at the expense of investing in client retention; after all, it is the strategy that helped them last this long. However, without substantially changing the way you do business, you can continue to pursue leads and use low-cost, low-effort strategies to retain your connections with contacts and former clients.

Challenges in Client Retention:

Lack of Ongoing Engagement

Realtors often focus solely on completing the current transaction, neglecting ongoing communication and engagement with clients. This absence of continuous interaction can lead clients to seek alternative options for their future real estate needs.

Changing Needs and Preferences

Clients’ needs and preferences evolve over time, influenced by various factors such as changes in lifestyle, financial status, or market conditions. Even if a client was satisfied with a previous transaction, they may opt for a different realtor who better aligns with their current requirements.

Perception of Commoditization

In a market saturated with real estate professionals, clients may perceive realtors as interchangeable commodities rather than unique service providers. This perception undermines client loyalty and makes it easier for them to switch to a different realtor for their next transaction.

Limited Follow-Up

After completing a transaction, some realtors fail to follow up with clients to ensure satisfaction or provide ongoing support. This lack of post-sale communication can diminish the client-agent relationship and make clients more susceptible to switching to a competitor. Of course, Kukun’s tool makes it possible to engage in this follow up without embarrassment or feeling that one might come off as too needy—we simply provide them with home maintenance tips and market updates that any home owner would naturally be interested in.

Strategies for Client Retention

Build Personalized Relationships

Realtors should invest time in building personalized relationships with their clients, understanding their unique preferences, and maintaining regular communication even after the transaction is completed. This personal touch fosters trust and loyalty, making clients more likely to return for future transactions. Kukun’s agent portal provides both a point of contact as well as ready means of facilitating ongoing conversations with your clients.

Provide Ongoing Value

Offer value-added services beyond the transaction, such as market updates, home maintenance tips, or referrals to reputable service providers: All things Kukun’s Agent Portal is able to do for you in an automated, low-effort way. By demonstrating ongoing support and expertise, realtors can reinforce their value proposition and remain top-of-mind for clients.

Leverage Technology 

Utilize technology tools such as customer relationship management (CRM) systems to track client interactions, automate follow-up processes, and personalize communication. Technology can streamline client management tasks and enable realtors to provide a seamless and responsive experience, enhancing client satisfaction and retention.

Solicit Feedback and Act on It

Regularly seek feedback from clients about their experience working with the realtor and use this input to improve service delivery. Addressing concerns promptly and proactively demonstrates a commitment to client satisfaction and strengthens the client-agent relationship.

Offer Incentives for Repeat Business

Implement loyalty programs or incentives for clients who return for subsequent transactions or refer new business. By rewarding loyalty, realtors can encourage repeat business and referrals while fostering a sense of appreciation and reciprocity among clients.

Conclusion

Client retention is crucial for sustained success in the real estate industry. By understanding the challenges that contribute to client churn and implementing proactive strategies to enhance retention, realtors can cultivate long-term relationships with clients and position themselves as trusted advisors in their real estate journey. Through personalized service, ongoing value delivery, and effective communication, realtors can create a loyal client base that not only returns for future transactions but also advocates for their services within their network.

Please visit us at www.kukun.ai to see how we can help you maximize your sales. 

Franklin Carroll

Franklin Carroll is Kukun's VP of Modelling and Analytics; After finishing his studies at the University of Chicago, he worked at Fannie Mae where he helped build Collateral Underwriter, roll out the Value Verify initiative, and specialized in collateral related and credit related policy.

Published March 12, 2024