THE PSYCHOLOGY OF SALES

As real estate agents, we are in a service-based industry. Even though we get paid for selling homes, our business is built by the service we provide. Therefore, client representation is critical and is what most agents focus on. However, in order for your business to reach its maximum potential, you need to focus not only on service, but on sales. By learning and implementing the art of sales, you will be able to take your business to the next level, using sales to not only increase conversion rates, but to better improve service and grow your business to its greatest potential.

So how can we use sales tactics to improve our service? Remember that in order to gain business, you have to build value in yourself as an agent. Selling real estate is easy; selling yourself can be a much more difficult process. By learning the psychology around people’s willingness to make decisions, including purchases and hiring service professionals, your conversion rate will soar!

Conditional Phrases

Selling a product or a service is about creating emotion for your client. Use conditional situations to have your client envision their future. For example “Mr. Seller, how would you feel if I could sell your home for top dollar in the first weekend on the market, all while you and your family go out on a weekend getaway? No inconvenience to you, your family, or your daily schedules.” I’ve made a conditional statement using “How would you feel if I ______”. These are almost always loaded questions. They are questions that evoke happiness and excitement. To understand why these questions are effective, you have to understand the science behind them.

The feeling of happiness is a real and a somewhat measurable emotion. When a person envisions happiness for themselves, neuropeptides are released into the body that fight off stress. Serotonin and dopamine follow. Serotonin acts as an antidepressant, and dopamine gives us the feeling of pleasure or satisfaction. This pleasurable feeling is then related back to what caused that feeling - YOU.

Here is a real world example of how the psychology of sales presents itself in our lives on a daily basis. Have you ever noticed that all supermarkets are set up similarly? Essential items like bread, eggs and milk are located at the back of the store. Fresh foods, vegetables, fruits, deli, etc. are strategically placed around the perimeter of the store. All the other items, the boxed items, the food loaded with preservatives, and the foods with the highest profit margins are in the middle of the store - right in the aisles that you HAVE to pass through to get to the essentials and then back to check out. How about the most obvious psychological placement of product? Candy, chocolate and magazines are guilty pleasures of the majority, and they’re right there at the check out. It’s easy to skip the candy aisle if it’s at the end of the store; but not when it’s right there next to you, staring you in the eye while you wait to pay. Eating food that we crave (ie. chocolate) releases dopamine into our system which makes us feel good. When we think about how it makes us feel when we eat chocolate we are encouraged to purchase it. Millions of dollars are spent by companies every year on the research of product placement and its effect on sales. By understanding proven sales strategies such as the use of conditional phrases, we are better able to sell our services to clients.

Lexicon

When people are listening to a sales pitch (even if they don’t know it’s a pitch) there are trigger words that create either trust and excitement, or doubt and apprehensiveness. Positive words like “free” or “incentive” promote interest and tend to gain attention. Negative words like “contract” or “fees” turn the mood sour. People don’t like to be tied down by contracts. Try using the word “agreement” instead. A credit card company that charges a $40 annual fee should try charging $40 annual dues instead. Dues connote membership, fees are associated with penalty.

When using a word like free, I’m not necessarily talking about selling a person’s home at no charge or working for free. I’m talking about offering a portion of your service for free. For example “Mr. Seller, as part of my comprehensive listing program, I offer professional photography and a whole house cleaning absolutely free. I’ve found that it takes the stress out of getting your home ready to list if my clients know they don’t have to worry about cleaning their home prior to listing.”

Don’t use “buy,” use “own.” Don’t say “cheap,” say “great value.” Avoid “price,” and try “investment” instead. There are hundreds of trigger words, both good and bad. Take some time to research these words and practice using an alternative vocabulary. Train yourself to avoid the negative words, and improve your conversion rate!

Strategic Presentation

The order in which you present your value proposition is just as important as the content itself. Think about the following scenario. If I am a ski instructor offering lessons and the first thing I tell you is that instruction is $300/class, how likely are you to buy? Well, if you consider that your lift ticket is $150, and your ski rental is another $50 for the day, you may shy away from a $500 day. But what if ski instruction includes the lift ticket and the ski rental? Sounds like a much better deal now, doesn’t it? Maybe I should have led with that info. Giving your price up front will turn your audience off for the rest of your presentation. Make sure you’ve built your value before your price presentation. You want people to remark “Wow, I get everything you just told me for this investment?” not question “What do I get for that price?”

Ask the client questions to get minor agreements. Questions like, “Mr. Seller, wouldn’t you agree that showing your home is the most intrusive part of the home selling process?” We know the answer to this question is “Yes.” By having the client answer “Yes. Yes. Yes.” to our smaller questions, we are creating minor agreements. Minor agreements lead to major agreement, the big “YES” that we are looking for: “Mr. Seller, would you like to hire me to be your exclusive listing agent?”

The reality is that the psychology of sales goes much deeper than just a 5 or 10 minute read. In learning how to use sales in order to grow your business, there is no reason to reinvent the wheel. The research is out there are there are a lot of great books that have been written about the use of lexicon, body language, and strategic presentation and how these topics affect the way a person thinks about buying a product or a service. These are just a few of the topics regarding the psychology of sales. To dig deeper into the psychology of sales and improve your conversion rates check out a few of the many books on the topic: The Psychology of Selling by Brian Tracy, How to Win Friends and Influence People by Dale Carnegie, and more. Understanding the way the brain functions and how people think will have you closing more deals in no time at all!