DO THINGS THAT DON’T SCALE

DIGGING YOUR WELL IN 2022

Let’s get right into it! As the title suggests, it’s time to talk about some business building 101, 201, and 301 level stuff. The main impetus for writing this episode is to talk to my appraiser brethren and sistren, but I’m quite confident there is enough meat in these mindsets and activities to be valuable for anyone listening. The reason I’m focusing primarily on the appraisal industry with this episode is because of the market changes that are occurring. It’s been all rainbows and unicorns for appraisers for the last 10 years or so as the market has been on a rocket ship straight to boomtown. Appraisers have been spoiled for choice when it comes to orders and business relationships because, at least in a real estate transaction, the appraiser has been a hot commodity. Not only have there been too few appraisers for the amount of volume available in the market, but there is also a shortage of appraisers willing to be continuously abused by bad AMCs, which has just exacerbated the problem.

Like me and my appraisal company, most good appraisers simply opt out of that abuse and seek out clients who will treat them properly, value their work and work ethic, pay them what they believe their services are worth in the market, and are simply willing to have a reasonable relationship with their clients. This has caused something of a conundrum for the market since a lot of the lending work appraisers complete comes through an AMC relationship, even if it’s from one of the appraiser’s better relationships. Let’s also say for the record, there are some really good AMCs out there that have brought some value to the relationship. They’re not all bad. Nevertheless, things have been really good for appraisers for a long time and the vast majority of them have businesses built around that lending work. Afterall, two of the most common business triggering events for a real estate appraiser is the sale of a home requiring some kind of appraisal, or financing event like a refinance, a home equity line of credit, or some kind of financing change that requires an appraisal.

For most appraisers, the path into the business is through lending work, and why not? It’s been abundant, it’s easy to get on a lender panel and start getting business, there’s relatively little scrutiny of the reports, and there is almost zero extra work in the way of relationship building required on the appraiser’s part to get, keep, and manage that business. It’s like a dream come true. However, for every upside there is a downside, and the downside of building a business based off one segment of a market is that, if there is a change in that segment of the market, that change can affect your business exponentially. Having been in the real estate, lending, and appraisal industries for 30+ years now, I’ve experienced several market cycles, rule changes, forms changes, software changes, licensing requirement changes, and have seen what happens when all one’s eggs are placed in one basket.
For an appraisal business, that basket is the lending world. If all of your income is based on one segment of a market, there is an inherent risk that your business is exposed to and that risk is the chance that if something changes regarding regulations, the economy, interest rates, Fannie Mae and Freddie Mac rules, and half a dozen other factors, your business changes too. It’s one of the reasons to consider diversifying your business mix to mitigate some of that downside risk.

Now, I am well aware of all of the objections people have to diversifying their appraisal business into what we often refer to as ‘private’ work, and we’ll talk about some of those, but I just ask you to keep an open mind about today’s episode because what we’re talking about in this episode has more to do with mindsets and activities that can, and should, be used regardless of what segment of the market you focus on. I’m going to making a case for diversifying your business mix a bit more into the private side of the appraisal business, but I’m also going to making the case that, even if you say you want to stick with lending work only, you should still be doing all of these things. Why? Because when there are big market changes that affect the volume of potential business, there is still business being done somewhere. The ones who feel the negative effects of volume shifts in any business or industry are typically the businesses who have not done the vital work of grabbing market share.

Plain and simple, most appraisers, like most Realtors and Lenders, suck at business. They just do. They might be really good at doing the thing that gets them paid, although even that is often in question, but when it comes to following good ol’ fashioned business principles, most are simply winging it. You might be tempted to hear that and be really proud that you’ve been able to wing it and still make some money, but I’m going to suggest that your hubris in that regard is most definitely costing you money, time, life, and self-actualization opportunities. One of those good ol’ fashioned business principles is to always be digging your well and attracting new clients, new contacts, new opportunities, and to be doing the little things every day or week that helps you secure more market share, or new segments of a market, so that if and when there is a change, you’re positioned better than all the other providers of the same product or service as you to get more of less.

Getting more of less refers to volume decreasing so there are fewer orders, fewer listings, fewer buyers, or fewer whatevers, but you are better positioned to get a bigger piece of that shrinking pie. How does one get better positioned to get more of less? By doing the things I’m going to share right now.

As I mentioned a little earlier, although there are definitely things you need to do to dig that well and gain market share, it all begins and ends with having a particular mindset. The primary mindset in this regard is the mindset that the relationship is the thing! When it comes to relationships, we must do things that don’t scale. What that means is that, when it comes to building long lasting relationships, we often must force ourselves to look beyond our calendars, beyond our meeting schedules, beyond our busy days, beyond our workload, and make habitual the little things that probably can’t and shouldn’t be automated or delegated. For instance, many of you know that I tell all my coaching students they should be hand-writing thank you cards each week. Taking time to hand write a thank you card is different than creating an email template that can be sent to dozens, hundreds, or even millions of people. You likely can’t hand write a hundred thank you cards each week, nor should you have to, but you might be tempted to try an automate or delegate that kind of thing away, if you even think about it at all. That’s something that doesn’t scale, but you should be doing it anyways if you want to build more and better relationships with other human beings. Keeping in mind, of course, that it’s ultimately human beings that we do business with.

Appraisers tend to think they’re doing business with an email or a web portal, but there are human beings at all levels of those systems and when you don’t take any time to get to know the human beings involved in the operations of those systems, not only are you giving up one of the greatest gifts of life, the opportunity to be in relationship with another human being, you’re leaving your future to chance. Understand that, from an evolutionary perspective, building relationships is vital to our survival. We wouldn’t have come as far as we have over the last million years without an innate sense that without our fellow man and woman, we cannot survive and thrive on our own. You might be tempted to recite the common trope that ‘money makes the world go ‘round’, but you’d be wrong, relationships make the world go ‘round. Without relationships, money would have no real value.

In fact, the money you and I use to feed our families has no real value except that which we give it based on our trust that other people will accept it as a form of payment for things, and that the government that issues the currency will back it. It’s not backed by gold or any other commodity, so it relies on faith and relationships. It’s the relationship between two parties that makes a currency have some kind of value. One wants something, the other has something and the two make a deal and value is exchanged.

So, the mindset shift must be in the direction of relationship building over transactional exchanges. Please note, I didn’t say relationship instead of transactions, I said relationship over transaction as a mindset. Meaning the relationship comes first, the transactions come as a result. The reason this mindset isn’t as prevalent in business today is precisely because it is so misunderstood and because it doesn’t appear to scale. People say, ‘Blaine, I don’t have any time, or much interest, in developing relationships! I’m too busy and I need money now!” To which I say, ‘keep doing you, dude! You’re making it infinitely easier for a guy like me to win in the market’. If I had tons of competition in the relationship building arena, it would be much more difficult to stand out, but I don’t! It’s super easy to be really good in most industries by simply focusing on relationships over transactions. That means always looking for new ones, looking for creative ways to nurture them, giving more than you take, not asking for business, making deposits in the relationship bank account, and then making all those things a habit.

Don’t worry, I am going to talk some specifics regarding what has worked for us and what I believe people should be doing, I just wanted to make sure I spent extra time on how important the mindset part is. Without the mindset piece, you won’t be able to sustain the activity with any consistency or longevity. I’ve talked many times before about things like handwritten thanks you notes, having a gifting program to celebrate your VIP clients, and using video almost exclusively to communicate with your clients, so I won’t go deep on those, although I will highlight the last one because of how important it is. If you’re running a business in 2022 and not using video to communicate with your clients, customers, and prospects, you’re being selfish. That’s right! I said it! I didn’t say you’re missing out, I said you’re being selfish, and I’ll add lazy as well. Not only is it easier to quick record a video than think through and type out an email, it’s also 150% more effective at relaying your message. The only reason you’re not doing it is because you’re being lazy and selfish. “I’m too busy to download yet another app, Blaine! And I don’t like how I look and sound on video”. But you’re ok if they see you in person? What do you do when you have to go to the store and bump into one of your good clients? Do you giggle like a 13 year old girl and hide in the frozen foods aisle? “oh my gosh, they almost saw me, I’m so embarrassed.” Stop it! Grow up! This is real life and you’re a grown ass adult!

Download bombbomb, bonjouro, loom, or some other video sharing app and start connecting with your clients in the most human way possible right now! Think about how many emails and texts you get throughout your day, and now put yourself in the shoes of your clients. Do you think they feel like you do with 150 emails per day in their inbox from faceless people? Of course they do! Be different, be better, be the best, stand out, change the game, decommoditize your face and your message, put the messenger back in the message, and bring some humanity back to your clients and customers day by getting over your fears and showing them just how real you are with video. Don’t worry about your face, you can’t change it, it is what it is! Don’t worry about your voice, it is what it is and email isn’t saving people from hearing you, they’re just hearing you in whatever voice they use in their own head to approximate you. Don’t leave your face, your voice, and your message up to somebody else to manufacture, give them the real you by using video. I guarantee you’ll be one of the only ones doing it.

Ok, before we leave the mindset part of this, the three main mindsets building your business in 2022 should be gratitude, value, and consistency. Have gratitude for the abundance your clients shower upon you with business each week and month. Be the one who delivers more value than the cost of your product or service. This goes for you too Realtors. All of your social media looks and sounds the same: me, me, me! Look at me, I closed another deal! Look at me, I just listed a new house! Look at me, I just sold this one in under 6 seconds! Look at me, I got $50,000 over list price! No shit! Stop talking about yourselves and all your amazing exploits and deliver some real damn value to the market. It doesn’t take anything to sell a house in this market, the market is doing it for you, and everyone knows it! You’re not fooling anyone! Start a blog, start a podcast, do some seminars and webinars, teach something, add some damn value if you want to stay relevant. Your killer real estate coach told you you’ve got to be active on social media if you want to get business? Great! Add some damn value to your posts! Stop replicating what everybody else is doing. It’s called virtue signaling and it’s extremely transparent. We all know when we see somebody posting about how hard their working, how much money they give, or how many houses their selling that they’re begging for the world to give them a standing ovation for how virtuous they are. Stop it! Just add value for people and let them make up their own minds about whether or not they want to work with you.

Gratitude, value, and consistency, those are the three mindsets and filters to run everything through in 2022. I’m going to talk about social media and how to use it properly, in my opinion, instead of just virtue signaling. When people virtue signal, what they’re really trying to do is show the world their evidence of success. They post nice reviews about themselves that others have written, they call it ‘Review Thursday’, or something like that, and they’re trying to show the world that other human beings like them. We all want people to like us and we want the world to know, in some way, that we’re important to somebody. However, there’s a right way to do that and it primarily through the use of services like Google and Facebook reviews. Let people review you, for sure! Let them tell the world about how awesome you are, I’m all for it. Deliberately and intentionally ask for reviews, I support it. But it’s way more powerful when somebody else posts about you than when you post about yourself.

Reviews on Google and social media are powerful precisely because they appear to be honest, unsolicited, and they represent somebody else’s experience with you. But it’s most powerful when somebody seeks out those reviews on their own instead of having them thrown in their face all the time. The other most powerful way to use social media, in my opinion, is through the use of private groups. When you understand the needs of your market and what keeps them up at night, you can start to create content that solves some of those problems and concerns. If you have a place that they can be included in those solutions on a regular basis, now you’re adding value. Find out where your kinds of clients and customers are hanging out on social media, and then give them the opportunity to be part of your value add club. Then, and this is the most important part of all of this, add some damn value for them! Give them what they want, need, and are looking for in the way of help, answers, solutions, interesting insights, breaking news, and ways their lives can be better by using your information.

Those of you in the appraisal industry looking to increase the non-lender side of your business, this is one of the most effective ways to do it, in my experience. I see people in forums online asking all the time about what others are doing to increase their non-lender work with attorneys, with estate planners, financial planners, builders, architects, and with Realtors. They’ll ask, “how are you marketing to them? Are you sending postcards and mailers? Are you calling their offices? Are you buying ads somewhere?” Friends, this isn’t 1995! This is 2022 when we are all bombarded by a variety of forms of information pollution, both physical and digital. We are all overloaded with emails, texts, banners, billboards, lights, sirens, and the myriad of dings, pings, and tings vying for our attention. Our brains have become attuned and accustomed to all of it and have learned how to block almost all of the noise out. Lest you think this is the bad news, you’d be wrong, this is the great news! It’s great news because it means that those of us who understand the value and importance of building relationships, and are good at doing it, will win. Those of you hoping your postcard or unsolicited phone call will get some business coming in the door will lose.

I’m not sure how many times you need to hear it before you actually do something about it, but you must get out of your offices, homes, and caves and get out and in front of some of the people who have the ability to increase your business. So many appraisers have had it super easy for a long time because they haven’t had to do anything to differentiate themselves from everyone else doing the same thing in the market. The same could be said for agents and lenders as well. Those unwilling to put themselves into situations where they are building relationships are the first to be commoditized by the market. If this is you, it’s not too late, but it is going to be tougher to compete at the same level as those of us who have been relationship building and building our networks for many years. If you haven’t been doing monthly or quarterly events for the last couple years, if you haven’t been out in your market speaking on a monthly basis, if you haven’t been giving back to your clients and customers for the last few years, and if you haven’t bothered to become a connector of people because you’ve just been too busy, I hate to say it, but you’re behind folks. It’s a simple fact that all businesses are relationship businesses at some level. If you haven’t positioned yourself as a value-added resource for your market, you’re simply a commodity that can and will be replaced.

It may not be too late for you, but then again it might. We’re headed into the next big market cycle and nobody but the least aware among us can say it hasn’t been expected. This is the way markets work and this one is long overdue. The way the real estate business is being done is changing and you can either be part of that change, or the casualty of the change. If your excuse for not doing any of the things we’ve been talking about on this podcast for years now is that you’ve just been too busy working in your business to work on it, then maybe being in business truly isn’t for you, and there is nothing wrong with coming to that conclusion. Business is always easy when it’s just being thrown in every direction. When markets shift and all the free shit dries up, that’s when the real businesses rise to the top because they’ve established themselves as the A players in that market and the clients and customers know it. They’re the ones who have been doing all the things I mentioned in this episode. They’re the ones who have become so efficient in their systems and processes that they’ve scooped up more of the market share. And they’re the ones who have actually been operating their businesses like real businesses.

Until next week, my friends, I’m out…