Pricing a Collaborative Discussion with Clients | Podcast

In this episode of the Million Dollar Playbook, Sharran shares the Five Strategies to Make Pricing a More Collaborative Discussion with Your Clients. A home is not the same thing as a house, and the listing price is not the same thing as a home’s worth, yet too often we make the mistake of using these terms (and others) interchangeably. That stops today. Tune it to learn how Sharran uses Discovery, Value Spectrum, and Disassociation (among other things) to make clients feel more comfortable around the touchy subject of price.

3 Key Points

1. House and Home. Price and Value. They might seem interchangeable, but they’re not.
2. More than anything, always over communicate your trustworthiness as an advisor.
3. Make sure your client owns a clear understanding of the difference between list price and sales price.

https://soundcloud.com/telesproperties/sharran-srivatsaas-million-dollar-playbook-series-march-1-2016?in=telesproperties/sets/milliondollarplaybook

Show Notes

• 01:04 – Peter and Sharran were able to track 161 listing appointments with their agents over an 18-month period and had 95% success rate
• 01:21 – After every appointment, they ask five questions to debrief
  • 02:06 – What did I do well?
  • 02:12 – What can I improve on?
  • 02:28 – What questions did the client asked me?
  • 02:51 – What ideas can I develop on?
  • 03:08 – What are the action items?
    • 03:40 – Pricing is the one topic that people said they can improve on
  • 05:21 – There is no reason for agents to feel pressured on the pricing recommendation
  • 05:44 – The three fundamentals of pricing
    • 06:05 – Verbal dexterity: Price means nothing in the entire pricing conversation
      • 07:51 – Be careful when using “value” and “worth” as these are emotional words
      • 08:17 – Use “home” versus “house”
    • 08:35 – Strategic thinking: Convince your client the word price means nothing without context
      • 08:52 – Shift the conversation to pricing
      • 09:06 – The ability to explain “pricing” and “pricing strategy” will always help you win over time
      • 09:23 – You should be able to create a strategic thinking mindset for you and your clients
    • 09:39 – Be a trusted adviser: The pricing discussion is one of the core components of being a s true adviser
      • 09:50 – Being a true adviser is the ability to combine your expertise, experience, and skills to address the needs of the client
    • 10:59 – Pricing gets the lowest score in how agents present their ideas while at the living room table
    • 11:08 – “We need to be more thoughtful and practiced in how we present the pricing conversation”
    • 12:01 – Discovery
      • 12:18 – Get a sense of their background and motivation related to price before offering a pricing strategy
      • 12:43 – Money and the value of a person’s home is personal
      • 13:04 – Have the utmost respect for the client and give them the ability to articulate the value they have for their home
      • 13:44 – To help you on the discovery process, you can say “I know you’ve already done the math, can you walk me through it so I am aligned with you?”
      • 14:14 – Another question is “In an ideal situation, can you walk me through the timeline of when this transaction will be completed and what the final sales price would be?”
        • 14:41 – Respect the client for giving you the information
      • 15:37 – You can also ask if they have been inside the other homes on the street – this will help you ascertain if they are in touch with reality
        • 16:10 – “If you could swap and pick any other home to live in this neighborhood, which home would you swap with?”
      • 16:34 – Discovery gives a foundation of respect for the client and gives you a sense of understanding
    • 17:06 – Value spectrum
      • 17:23 – Clients can have extremely aspirational pricing requirements
        • 18:01 – You want to establish the range of values
      • 19:21 – Establishing the value spectrum gives you the range for the rest of your discussions
    • 19:41 – Disassociation
      • 19:59 – The ability to take a client’s mind off the number and make them understand the process and strategy
      • 20:23 – Sellers tend to fixate on the selling price of their property
      • 20:38 – The agent’s responsibility is to disassociate the client to the list price
      • 21:01 – Clients are extremely collaborative when you have taken them off that one number fixation
      • 21:11 – You can create a strategy on why it would be listed for a certain price and how it would be able to get them the highest price possible given the current market conditions
    • 22:04 – Start to talk about sales price and list price ratios
    • 22:43 – Buyers will base their offer not on the list price but on their willingness to pay for the home and how much they want it
    • 23:01 – It is the agent’s responsibility to educate the client about the difference of list price and sales price
    • 23:47 – The list price is just a positioning tool
    • 24:17 – The three common strategies – perceived market value, fair market value, and event pricing
    • 25:13 – Clients often say that agents should be the one to place the worth of the home
      • 25:27 – Take the conversation back to the pricing and pricing strategy, not worth
    • 27:30 – Sharran will make a part 2 for this

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Show Notes provided by Mallard Creatives