You have had a great year, with a 20% growth in commission compared to the previous year. Was it due to luck from the property market upturn or was it because you ramped up your marketing efforts and got more leads?
To keep yourself on your toes and improve year-on-year, it is extremely important to know what is working and what is not.
These are some performance metrics that can help you to analyse your performance quantitatively year-on-year.
You can break down your annual commission and compare them year-on-year as follows:
Co-broking/Sole Agent – You may be brilliant at helping prospective tenants or buyers find their dream homes but less effective at getting sole agency for letting or selling properties
Commercial/Residential – You may have strong industry contacts useful for commercial leasing rather than residential leasing
Rental/Resale/New Launches – You may be a showflat maestro selling off-plan properties with ease
Districts – You may have built a reputation in certain districts over the years
Using these insights, you can then decide whether you want to focus on your weaknesses or double down on your strengths.
Your main expense is going to be marketing. You should assess the efficiency of each marketing channel, whether offline or online by using this ratio:
Channel Efficiency (Cost) = Spend per channel / Number of leads generated per channel
If your print ads are not giving you many leads for the amount spent, you should consider whether it is worthwhile spending more money on online ads which have a higher efficiency ratio.
Channel Efficiency (Time) = Time spent advertising on a certain channel before closing
This gives you an indication whether the leads from a certain channel are more reliable.
Channel Efficiency (Revenue) = Commission derived per channel / Spend per channel
This will clearly tell you which channels are working for you or whether they are just a waste of money.
After you have gotten the leads, you can use these 3 ratios to understand how well are you using them.
Lead Efficiency = Number of Viewings / Number of leads
This quantifies how well you are following up on your leads.
Viewing Efficiency = Number of closes / Number of Viewings
This quantifies how good you are at closing. If you have many viewings but are not closing, there might be an issue with your closing technique.
Referral Efficiency = Number of leads from existing clientele / Total Number of leads
It is important to assess if you are getting new leads from your existing clientele or fresh marketing. Referrals from existing clientele might cost almost nothing but fresh marketing leads may cost a lot.
If you are hardly getting any leads from existing clientele, you should assess whether there might be an issue with your service quality. Many top agents get their leads from existing clients.
Impress your clients with your service by using Rejig and increase your referrals!