Understanding and Leveraging Your Network to Grow Your Business

"Sphere of influence" has become a popular term in the real estate world, but it's more than just the latest buzzword. A sphere of influence defines your reach in the real estate market — through social, professional and community connections. This broad collection of congruent paths leading to your doorstep is where the majority of your leads will come from.

So, how do you use your sphere of influence to grow your business? First, it helps to understand the concept in greater depth.

What is a real estate sphere of influence?

The simple definition of a sphere of influence is a collection of people with similar buying habits, desires and lifestyle preferences. While it might seem like the answer is purely quantitative — e.g., number of Instagram or Twitter followers — your sphere is determined by the character traits, interests and behavioral tendencies of your contacts.

Knowing your sphere doesn't mean avoiding or ignoring those outside your sphere. Rather, it means you may simply have to put more effort into learning about new potential customers through things like networking events, paid advertising and email marketing. Past clients, family friends and colleagues are all excellent sources of real estate referrals, but don’t hesitate to reach beyond the local market to find more business.

Understanding your sphere of influence in the real estate business

A sphere of influence (or SOI) can seem like a vague and nebulous term to define. Luckily, there is a basic formula you can use to pin down your specific sphere:

• Demographic: As a real estate professional, you probably already have an idea of who your target market is. Some examples might be young professionals, first-time homebuyers or commercial investors.
• Distribution channels: A distribution channel is anywhere you sell or advertise. This includes social media platforms and advertising online or in local publications. Social media is essential for nurturing and expanding your SOI, as you can build an online presence and find new clients while staying top of mind with your former clients.
• Environment: Think about any external influences at work in your market. Broad social or economic factors can influence the real estate industry and your sphere — for example, the local job market behavior, inventory volume and infrastructure. Consider any factors in your local community affecting your own sphere of personal relationships and professional relationships.

Why is growing your SOI so important for real estate agents?

If you're in the business of real estate (selling/buying/renting), you can't do it all yourself. One of your greatest assets as a real estate agent is your sphere of influence because it includes potential for new business through existing relationships. Staying actively involved in nurturing your sphere will help you in more ways than just getting new leads, too. It can help you find and recruit other agents, build referral relationships with clients, keep the business cycle turning, and direct the flow of industry information to help you succeed in buying or selling homes.

Real estate is often described as a business built on who you know. It's a business involving considerable personal involvement — after all, you're not just selling a house, you're selling a home. Successful agents build rapport and trust with their clients, leading to repeat business, referral business and a broader sphere.

If real estate is all about who you know, it's essential to understand the individuals included in your personal sphere. When you start to think critically and strategically about your sphere of influence, you'll realize you know more people than you thought you did.

Growing your SOI is crucial, but so is nurturing your relationships!

Need assistance managing your SOI? Elm Street Technology is here to help!

Elm Street Technology offers customized solutions to assist agents in the growth and management of their business, no matter the stage they are in. Schedule a 1-on-1 conversation today to learn how a customized solution can help you grow and nurture your sphere of influence.

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