Database Turnover Formula
Whether you’re an independent agent or run a brokerage firm, you know that leads are the lifeblood of any real estate business. So, how do you make sure your leads don’t go cold and that you’re getting the highest return on your investments? The answer lies in a simple real estate formula: the database turnover formula.
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Finding the Magic Number
How many leads do I need in my database? Do I need more leads? What’s the magic number?
These are all questions real estate agents ask themselves on a regular basis. After all, you want to maximize your existing database and get the most return out of it.
The most important part of calculating your database turnover formula is determining how many people you can contact on a daily basis. It has less to do with lead count and more to do with how many conversations you can successfully engage in every day.
The Database Turnover Formula
Let’s say you have 1,000 leads in your database. Out of that number, you can talk to 100 people per month, which means you engage with 25 potential clients each week. When you do the math, it’ll show that you will need 10 months to go through your entire database, which is a long time.
Look at it this way — you contact Person 1 today and he doesn’t need your services yet. Of course, you decide to go through the rest of your database and contact Person 2, 3, 4, all the way to Person 1,000. When you go back to reaching out to Person 1, 10 months will have passed. It’s highly likely that Person 1 will have already found another realtor by then. There was too much time between capturing the lead and creating a relationship with them.
Ideally, the number of leads in your database should be the number of leads you can physically make contact with every 90 days. 90 days is the industry standard for the length of time a lead will remain in your database before being considered for long-term marketing.
What You Should Be Asking Instead
Instead of fixating on the number of leads you should have in your database, you must ask yourself how many contacts can you consistently reach out to from your database? If you can make five outbound contacts every day, the ideal number would be 300 leads since this is the number you can effectively reach out to in 90 days.
It’s best for you to contact everyone on your list every three months for better conversion. It will also help you nurture your relationship with your contacts and increase the chances of them responding to you.
For leads that are not yet interested in your services, you can move them to your long-term database. Use automation to keep in touch with them at regular intervals and give them updates about your services.
Additionally, if they’re no longer interested in buying or renting property, you can replace them with new leads who may be interested in your offering.
If you have 1,200 contacts in your database, make sure to engage with 20 per day to maximize your outreach and achieve better results. If you already have 5,000 leads, you must re-evaluate your strategy. Filter out those that are no longer interested in your services and focus on the ones who are.
Why You Should Use the Database Turnover Formula
The database turnover formula is a great way to keep your real estate business organized. It helps you to track the effectiveness of your marketing strategies. Determining the turnover rate of your database helps you avoid overspending and under-contacting. As such, you’ll be able to stay on top of your marketing efforts and maximize the return on your investment.
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