There is a prevailing notion in commercial real estate that a broker, like any sales professional, is a people person, not a numbers person. Data seems to be at odds with brokers’ natural strengths: the antithesis to their verbal skills, instincts and winning charm.
But commercial real estate brokers are thinking about data all wrong. It is simply information—and for brokers, it takes countless forms, from the names of landlords, owners and CEOs, to building sale prices, to the number of times they’ve reached out to a prospect. Sure, most brokers would rather be making pitches than crunching numbers, but if they can change the way they think about data, they can actually use their time more efficiently and improve performance in a way that doesn’t conflict with their natural love of the sales game.
There is not a salesperson out there who wouldn’t benefit from more organization, market knowledge, strategy and key performance indicator (KPI) tracking. If commercial real estate brokers can change their mindset and think of data as a powerful tool for growing their business, they will become even better at what they already do best: closing deals.
1. Data is a tool for nurturing relationships
Every relationship is composed of hundreds of data points that can be used to a broker’s advantage. The sooner brokers acknowledge this, the better. Once they do, they can begin to capture that data and use it to inform their prospecting and relationship-building strategies. Most brokers use a customer relationship management (CRM) system or software, ranging from Excel spreadsheets to sophisticated, cloud-based platforms. This tool can help organize clients and prospects (data) and all of the information that comes along with them (also data).
Taking a data-led approach to relationship building in no way cheapens or devalues the importance of relationships or personality. In fact, it makes it easier to develop those personal connections. For example, brokers can keep track of the steps needed to nurture a relationship over time, as well as the actions they have already taken, from introductory emails to in-person meetings. The database becomes an extension of one’s memory, and the data points can even comprise things like the name of a client’s spouse or child.
2. A people person has even more data points to draw on
Data helps brokers develop relationships and move deals along, but it goes both ways – relationships and deals also generate data. An exceptional people person who takes the time to really get to know clients and prospects most certainly has more data to draw on and, in turn, even more to gain from a systematic understanding of that data.
3. Data, and data analysis, are part of a broker’s value proposition
Data is knowledge, and in today’s competitive landscape, knowledge is an essential way for brokers to distinguish themselves from competitors and prove their value. There is a rise in technology solutions that aim to connect buyers and sellers and landlords and tenants directly, potentially disintermediating the middle man. Data is what makes those types of solutions possible. They provide the marketplace access to information that was previously harder to get, such as property listings, lease duration, comparables, and other market data.
But brokers know how to interpret that data. They know what it means in the context of real life. They can add a layer of analysis and anecdotal insights on top of the numbers to deliver unique value to their clients. Brokers have to see data as a tool for improving their business, because everyone else in the commercial real estate industry already does.
4. Data improves efficiency
There is sometimes a misguided sense that time spent collecting and interpreting data takes away from time brokers could spend doing more “human” things, whether it’s golfing with a prospect or canvassing. But it is not an either/or proposition. In fact, if brokers take an organized approach to managing relationships and running their deals, they will have more time to spend on prospecting and lead nurturing.
5. Data is a tool for hitting sales goals
One of the most challenging things about being a commercial real estate broker is the ups and downs—the uncertainty and earnings volatility that comes with a commission-based career. Data helps brokers add a level of predictability to their sales efforts. By calculating KPIs and conversion rates, such as calls-to-conversations (how many calls it takes to generate a discussion) and pitches-to-listings/assignments (what percentage of your pitches turn into assignments), brokers can work backwards toward a target and better understand how much work is needed to hit it.
So much about commercial real estate is out of your control, but you can control how hard you work, how many calls you make, how many pitches you deliver, etc. Tracking conversion rates and monitoring them over time also helps brokers evaluate their performance and identify areas that need improvement or extra effort.
If commercial real estate brokers can combine sales prowess, industry knowledge, business acumen and organizational skills, they’ll have a recipe for effectively running, and growing, their business. It’s crucial, though, that brokers get over any distaste for data and rethink what the word means to them. It’s a tool for approaching their business more systematically and maturely and a crucial component of their sales pitch to clients. Data is what fuels the technology advancements that are powering the economy forward. Brokers need to get onboard, too, and realize that data is one of their most valuable assets.