How To Break Into The Luxury Market | REal Success Episode 7
- Go to (5:18) to learn how to break into the luxury market
- Go to (9:09) to discover the difference between selling the luxury market and selling the normal market
- Go to (24:35) to hear how to go after high end listings as a new agent in the luxury market
Today we have Wendy Walker to help pave the way for us, to give us some great strategies, some great ideas, in terms of what we can do in order to be able to grow at a high level, but more importantly, how to be able to sell in a luxury market.
Bill Pipes: So, it’s with great pleasure that I get to introduce a good friend of mine, great coaching client, and just a general kick-ass gal, Mrs. Wendy Walker. Hello, Wendy.
Wendy Walker: Hello, Bill, thank you. My gosh, that was quite an introduction.
BP: Well, you deserve it. So, tell ’em a little bit about who you are, about your background, your history. Um, you know, I mean, how many homes did you sell last year? Let’s just start there.
WW: Last year I sold almost 40. It was an up-year for me. My average sales price was around $1.7 million.
BP: Awesome. Great. And how many homes did you sell the previous year?
WW: 26. Thanks to your coaching.
BP: Thanks to all the great coaches at Tom Ferry that are around. Um, you work primarily in the luxury market, right? Tell us a little bit about the area that you sell in. Where do you sell and what is the average sales price inside that area?
WW: So, my primary focus is a town called Paradise Valley, and also in a city called Scottsdale. So, I have recently moved primarily into Scottsdale, but my primary focus for the last 15 years has been Paradise Valley. So, I’m actually starting to move a little bit with my inventory and my focus as well, so hopefully I’ll be able to share some good tips for everyone.
BP: Excellent. Well, and you know what, what I want to do today, Wendy, is I want to debunk some myths, you know? Like, I think there are some myths out there about selling the high-end, selling luxury property. One of them being that it takes a certain type of person to be able to do it. And my belief is anyone that makes up their mind to be able to do this could do it. Tell us about your background and what was the critical part to your growth process?
WW: So I’m from a small town in northeast Ohio. I moved to Phoenix about 20 years ago. I didn’t know a soul. I had 300 bucks in my pocket, and I said, “I love the weather here, um, at least during the winter months.” I started my career here in sales. I quickly became the number 1 sales rep and went to get my master’s degree in global management, and thought I would travel the world, when I was recruited into real estate by a close friend who said she thought I would be perfect for the business and asked me to partner with her.
So I did that for a year, and then went out on my own, and quickly realized that I thought I would really like to enter the luxury market, but I had no experience in luxury, no contacts in luxury, and I decided to step back for a few years and become an assistant to a wonderful mentor of mine, who had been in the business for 30 years. Now she’s been in the business for 45 and since retired, but I studied under her for about 5 years and eventually started working on her team and then ended up taking over her business about 7 years ago.
I think it was not only critical to the growth, but also to my success and the confidence that I have today. I’m the type of person, whenever I go into a listing appointment, I definitely want to approach it from a point, a standpoint of confidence, and from a place where I know that they need me, just as much as I may or may not want to list their home, and so I can be much more selective. And I think that that’s helpful, and beneficial in my success, but has been really instrumental in my growth process, is having someone that really I could mentor with I could ask questions, I could learn from, and, and really troubleshoot things that, you know, maybe I wouldn’t have had the experiences for years to come. So, I call it a very quick education.
BP: So, tell us a little bit about the difference between selling the high-end versus selling the normal market? And if so, what did you do to position yourself?
WW: Well, I do think that there is a difference. Obviously the fundamentals of real estate are all the same, but as far as working with the affluent, there are some specific differences that I’ve found, that I’ve had to overcome, coming from the background that I had one being working with top-level people. We’re working with executives, entrepreneurs, um, business managers, attorneys, financial advisers.
These folks come from a place where their lifestyle, and their emotion and convenience is much more the driver. And security, privacy, those are all differences, um, that I find in, you know, maybe a lower price range in my area would be under $400,000 where they’re looking for, for affordability and schools or things like that, where these folks are really, uh, much more emotion-driven, or lifestyle-driven, convenience-driven.
So, I do find that there is a difference. You’re oftentimes working with their attorneys, where, in the lower price ranges, not so much. And I find that they really want to study and work with people that they feel are also tops in their field, because they’re tops in their field, or they feel that they are. So, you know, you really have to dissect who they. Are they a doctor who, you know, has a big ego? Or are they an entrepreneur, who started a non-profit or something and sold it? Maybe an engineer who was in a tech field or you just has to really find out the personalities of these folks, like we do in any real estate transaction. But these, the motivators I find are a lot different.
BP: I love that, and in our conversations that we’ve had in the past, one of the things that you’ve stressed was how important the knowledge base that you have is, to be able to generate confidence for that person, and in fact, I think one of the things you had said is they, they want to feel comfortable. They want to trust that you know exactly what it is that you, you know, that you have that knowledge of the market.
If I’m gonna break into a little bit higher-end price range, or if I’m going to break into the luxury, what could I do to build that confidence for myself? Because obviously I want to exude that, right, as an agent that’s coming in there, to be able to compete. So, what could I do or what did you do to build that confidence for yourself?
WW: One of the main things I did was actually study the other luxury agents very closely. So, I went to our luxury home tours, which a lot of people call them ‘caravans’. I look at who the top players are in different areas. I wanted to really dissect. I have a psychology and a marketing background, so psychology is very important and, and I love to study it. It’s interesting to me, so, you know, I studied their personalities, who was selling what, in what price ranges, in what areas of my small, affluent area that I focus on.
And then, I really wanted to figure out how to best assess the value of homes. So, when you walk into a home, for instance, I went to a listing last week where, on the phone, I had already negotiated the price, because I knew the property, and I had the listing paperwork ready to go at that price, and then upon entering the property and really going through it, I had to tell my client, who was a long-time client, “You know what, actually, I think we should list it at 100,000 higher.”
Well, I know that because I know the value, and so there are some things that she had done that I hadn’t, you know, I didn’t realize that she had upgraded. And I said, “You know what? I’m really sorry, I think I’m off.” And she actually started crying, and said “I trust you so much that, um, whatever you say, if you think that’s the value,” she said, “but of course, I would love 100,000 more!” And we ended up selling it for another 45,000 in less than 10 days.
So, you know, they really, with those clients, they want to trust someone, and they want you to be a trusted advisor, and the only way you can do that is to really study the market, and know the value. I think that once they feel that you’re confident, and you can talk about the house down the street that you’ve seen, and you know the inventory, um, that really speaks to them.
BP: You know, one thing that I liked that you said as well, too, that I want everyone to pick up on is, it’s the fundamentals. You started this entire thing off, and you said, it’s still fundamental; sales is sales. You know, you’ve got to be able to read personality, and be versatile, et cetera.
So, let’s talk about differences, though. Let’s wrote down marketing. From a marketing component and a marketing perspective, I mean, we see some incredible marketing pieces at the Tom Ferry organization, from some of our, our great agents like yourself that do sell luxury. Um, is there a difference in marketing? And if so, um, what would I need to adjust myself to be able to actually to make that change, and to be able to market in the luxury?
WW: That’s a great question. That was one of the myths. Whenever I teach, um, a luxury class at the Arizona School of Real Estate, I often ask people, you know, why do you want to sell luxury? And they say, “I want to make more commission.” But at the end of the day, to earn that commission, it, it costs a lot more money. So, you really have to understand that these homes or the expectations of marketing in these homes are very high. It’s a very high-level, the design, the depth and breadth, and the reach.
You know, most of my clients, in my area, have second, third, and sometimes fourth homes. They travel the world, um. They really want to know that you can, can reach people globally. I know in areas like California, the Asian markets are very strong. In my area, the Canadian market’s very strong, so, you know, they really want to know that you have a way to reach these people, not just on the internet, but in other ways. Do you have the network of people, and agents? And do they have your respect?
And I often tell people you can spend $6-10,000 on these homes from photography to magazines, my designer, my marketing coordinator. I have all these people on my staff that work for me because I want to focus on negotiating and getting more business, but their expectation on marketing is so high.
BP: So, what are the, the three, four, five, without giving away like your trade secrets, right? I want to break in to this market. I want to do, I want to make sure that my marketing really speaks to this particular type of seller, particular type of buyer. What would you recommend? What, what type, what adjustments or what type of marketing should I be doing, or how should I adjust my normal marketing to have it fit the luxury, more of a luxury brand?
WW: Well, one of the things I personally did was went with, uh, my branding person and we looked at all the top sites of luxury. So, Prada, Gucci, Maserati, all of, all the marketing, the look. Um, I went to Donald Trump’s website and I, I look- … I thought, “Okay, Donald Trump. He’s in real estate. I want to see, which color background does he use? What kind of logo does he use? What kind of ad copy does he use? What is, what do the fonts look like?”
And, really want to, I wanted to create a luxury brand that fit in with the other brands that these folks are, are associated with or, or, or would use or would buy. And so, I think that’s very important, is the look. I’m very specific myself and my team on my look. Nothing goes out unless I’ve seen it first. Um, as far as actual, um, materials or things that I send out, I do send out a very high-level farming, um, brochure to, uh, a couple of key areas that, um, looks very nice.
It’s custom. It has my logo. It has my homes on the front cover. It looks like a magazine. And then on the back, I customize the back every month with something that I think is pertinent. It could be a letter from me. It could be a market update. It could be something that’s related to what’s happening in our area, but it’s, it’s very personalized and nobody else has that, uh, piece that looks like mine.
That’s number 1. Number 2, I also send out a newsletter that it, again, has the same branding look and feel, but it goes to all the agents that I have in my database, as well as clients and I find that that is actually a really great tool. I get a lot of feedback. Uh, it has statistics. It has a letter from me about what’s happening in the market. It has my, uh, my listings on it. It has, show listings outside of my own area so that my clients know that I, you know, I have agents in Florida, or Hawaii, or California that I work with so that they see that I have a referral network, uh, that works with me. SoI do send out a lot of things that are branded and look the same, like just listed/just sold cards, but they all are custom, um, and I’ve customized them over the years and continue to do so.
I purchased my fonts. I actually have several of them, but I purchased my W’s and then the rest of my logo’s all purchased. There’s actually three fonts that make up my logo, but it’s not a font that you get on your computer. It’s something that, you know, my branding person actually researched and I, I went through quite a few different ones because I was so specific about that look.
BP: I love it. So, I’m noticing this whole dialogue in terms of the, the conversation on marketing to the luxury, uh, to the luxury market is that, uh, they’re used to seeing that higher ends. They’re used to seeing a little bit sexier, a little bit more polished, right? And so because they’re used to that, if you’re not aligned with that, then it’s probably not gonna actually speak to them, the message, no matter how good the messaging is. Right?
WW: Well, I find that when I go in, I do not cut my commission. It’s just a rule of thumb, and so when I’m in, in a listing appointment and I’m presenting, number 1, tailors my presentation based on the personality of the person. I’ve taken a listing in 15 minutes and it’s sometimes taken me two or three different times to, to get the listing, but I’m very selective. I tell them that I don’t take every listing. I present myself in a way, and my company and my materials, in a way that’s very professional and if they want to hire the other person that wants to discount and, and not do the things and offer what I have, that’s okay. I’m not the person for them and I’m very, very okay to walk away. But I do spend a lot of time, effort, energy, money, creativity, staff on putting all these things together so, you know, with that comes, comes, you know, the, the expense, and so I have to recoup that somewhere and I think I really don’t have a problem with it to be quite honest because they normally can see the difference.
BP: Yeah. You know it’s, it’s interesting ’cause I’m sure that some of, some of our listeners right now are going, “Oh my gosh, this sounds like spending a lot of money.” Okay. Um, image. You and I’ve talked about this before, critical image that’s … Do you feel that dressing a certain way, presenting yourself a certain way, I mean, does that come into the decision-making process of, uh, of this higher-end buyer or seller?
WW: I think it does, but I think, again, in real estate, we sort of have to tailor our presentation to the personality. So, you know based on the, the type of person that I’m dealing with, some of them, you know their financiers, their financial advisors make their decisions. I have two athletes now that I’ve never met and I work with the financial advisor. So, when I’m dealing with a financial advisor, it’s all numbers-driven because that’s all the financial advisor cares about.
If I’m dealing with, you know, someone who’s been in their home, it’s old money, they’ve raised their kids there for years, but yet they just want to downsize and get out of 20,000 square feet to 5,000 square feet, uh, you know, that’s some, that’s a different presentation. Um, and so, yes, I do think it’s different in luxury. They are looking for someone who’s polished. They’re, they are, but you do have to tailor. Some of those folks aren’t as, uh, pretentious as others.
BP: Can you talk to us a little bit about how to generate leads? Let’s start with what it is now, and then we can hop over and how you first started generating leads?
WW: Well, now I followed a program where I do my farming. I work my sphere of influence, because I, now, you know, my sphere is much larger. I obviously network with other agents, especially the top agents that we, you know, work very similar. We have a lot of reciprocity here with California, so, you know I have a lot of close relationships with California agents. In fact, I’ve got two referrals from California agents today. So I use a lot of different marketing strategies now, um. Of course advertising works, referrals.
Most of my business is referral-based, um, at this point, which I’m fortunate to say. But when I started in the market, luxury market, even though I was working under the tutelage and mentorship of another agent, it was very important that I be seen at certain events, charity events or local events that were going on. We, we co-sponsored things. The country clubs we were at, I frequent the clubs that are in my area very often, um, even if it’s just to have lunch there. So, just to be out and about in the community is important for those people, you know, to see you, especially at the events where a lot of the other, my competitors would be as well.
So, I do think if you’re wanting to break in to the market, the luxury market, number 1 is to really focus on some of those events. They don’t all, they’re not all super-expensive to attend, but to be seen at them is important. Number 2 would be sitting open houses in the area that you’re really fo-, focusing on. I think it’s important. A lot of times I see new agents and they’re so excited to have a million dollar plus listing that they really don’t understand exactly what they have.
They don’t understand the area. They don’t understand the value, and so they just start doing all these things and, you know, what you really need to do is take a step back and understand what’s happening in that neighborhood, know the names of the people on the street that are around that house. Um, people are looking for that. They ask all the time, “Oh, did you know so and so?” or, “Do you know this?” If you don’t, how you learn those is by sitting open houses and meeting the neighbors.
So use the Tom Ferry Mega Open House idea, but do an exclusive event for the neighbors beforehand so that you get to meet the neighbors, so when the next neighbor comes in you can say this neighbor was just there and they feel like you’re the market expert rather than you having to actually have known them for years. They don’t need to know that. So, there’s ways around that, um, that you can really, but I think it’s important if you really focus on one specific area first and then you can start moving out, outside of that area and that’s advice I’ve given to a lot of clients I know you’ve referred to me to talk with is, don’t try and take the whole market at once. Start small. Become the expert in that community and then start to branch out because that will eventually happen, um, when people are coming through open houses or you have those types of ‘exclusive’, uh, luxury people like exclusive events.
BP: You know, you’re talking to your sphere of influence. But if I’m brand new, get to the events. You know, find social functions. I call it social farming, right? Do social farming where you’re out and about and you’re seen, because those, I think you’ve said in the past, those individuals that you’re gonna, you know that, that higher-end buyer or seller, they like people that are also in sort of that network a little bit, right? They like to see you. And then I love this. Open houses, the, the whole concept of open houses, uh, you know being able to do that and do the mega open where you, you get to connect with the neighbors. You know, I know a lot of people may be sitting there and thinking, “Gosh, you know, I, I’ve got a little fear. I got a little anxiety.” You know, it’s, it’s one thing if I’m talking to, and not that it’s right, wrong or, or indifferent, but it’s one thing to talk to someone that’s a $250,000 homeowner, but it’s another thing to talk to someone who is, I mean you’re talking about athletes. CEO’s you know, like high-powered individuals. How did you personally overcome that fear and did you ever have it to begin with?
WW: I did have it, but you know, as I mentioned at the beginning of our conversation is, how I get to a place of confidence is by feeling that I can bring value and I’m knowledgeable and they need me. And so, I really studied and I spent a lot of time. I went around to open houses. I went to all the caravan tours. I talked to the agents. I spent a lot of time really educating myself on the market, this very small market that I wanted to work and it, it, it took, it took awhile.
You know it’s the streets, the houses, the neighborhoods, how they’re different. You know, when you’re showing houses, people want to know the difference. They want to know about the schools. They want to know about … you know they do that, but, but in the, the luxury market, really they want you to do that very succinctly and they want you to have the knowledge to do it quickly because they don’t have a lot of time.
They like confidentiality, quickness, privacy, security, convenience, you know, they’re emotional people. They don’t, they don’t need to be schlepped around. I don’t, I don’t ever show more than 10 houses generally because I can narrow down exactly what they want or at least be able to tell them what community they would want to be in and generally they are.
BP: It needs to be delivered confidently. Men and women are all on to something else. They don’t have the time. Okay. So just build that confidence again. Just go, you know the studying and, and build the confidence so that you can overcome that fear. You know, you and I, you’ve been through a lot and it’s been, it’s been exciting to watch. I mean, it really has. Inspiring. So, in, I always ask this question and I’m going to ask it to you, too. How important is mindset in this game of, of your success and what do you do to be able to maintain your mindset and be able to be a great mother, great wife, amazing agent, incredible leader, give back to the community? With all the highs and lows, what do you do to maintain your mindset?
WW: Besides crying to you every week? Well, I think the mindset and I, I think it was even Tim in his video, the mindset’s everything. I, you know, there was a, I think over the summer, I was tired. Our season was in a lull and I just stopped prospecting. I wasn’t listening to the right music. I wasn’t reading the books like I generally do. It was, I was just completely out of sorts, but I sort of gave myself that, that latitude, because I thought I’d worked so hard, you know, at the first six months which is our high season and really it hurt me tremendously in this last part the second half of last year.
It really did and, and I felt it and, you know, we talked about it is, you know, once you get back on track and you have that energy, I love negotiating, I love working with people. I listen to music, I’m reading books, you know, I love Au-, um, Audible. I listen to a book on tape about once a week and it just really is energizing and being around other agents and really networking around, um, those folks.
I actually flew to Beverley Hills last year to meet with an agent because I just told her I was in a lull, I was in a funk, I wasn’t, you know, I was thinking maybe there’s more to life than this and all these things and she said, “Wendy! My gosh! What are we gonna do with yourself? You love to negotiate. You make money. You work with these amazing people. You…” you know, and I thought, “Gosh, actually she’s right. What would I do with myself?” So, you know, you just have to really, um, have that support around you. Coaching obviously is, helped my business tremendously. From a leadership standpoint, I really had to work on my leadership skills and read books and talk to people and I’m very fortunate that I have a wonderful database of people that are highly successful and really willing to share because once they get to know you, the circle of the affluent sometimes is very small in people that they trust and that they really confide in and so, you know, once you, once you’ve established that relationship, you know, they become friends and, and fortunately I’ve been able to, um, to have many of them as mentors even if they didn’t know it.
BP: I love it. Awesome. So there’s so much. There’s, there’s way more than three things inside of this, but, uh, and for me number 1 is knowledge. Build the knowledge. Build the knowledge that they have the confidence. Number 2 is they’ve gotta update their marketing. They’ve gotta really look at their brand and, and without spending a lot of money, up-, upgrade the brand a little bit, right?
Number 3, prospecting is prospecting. I mean, the way that you’re generating business is very similar to the way that other individuals are. It’s just a matter of, maybe it’s more social farming, more events, and things along those lines. And, and it’s all, and again, mindset. You know, like you’re listening to Audible, you’re reading books, exposing yourself to other great agents and you guys are sharing ideas, so there’s so much. Leaving this call, if I were to do one thing from today’s interview, you know, if I were to take one thing away, what would you recommend that first action that I take be if I wanted to actually increase my price point or break in to luxury market?
WW: Well, number 1, you have to really decide that you want to do it, and that you have the ability, and the time, and the effort, and the energy to invest in it. That’s number 1. Don’t just dabble in it. If you’re gonna dabble in it, you may as well co-list with somebody, um, which isn’t a bad idea. I tell agents that, you know, again, I don’t take every listing, but I do tell agents, you know, I’m happy to help them, um, if they want to bring something to me and I, you know, I’ll look at them and I’ll help them even if I don’t take it. At least, you know, it’s an opportunity for you to go on a listing presentation with an agent who does this all the time and so you, it gives you just an idea of what you might have to do.
And so, if you have to give up a little on the commission, big deal. That’s a huge learning lesson and maybe you find that it’s not for you, but if you find it is for you then you’ve got to invest the time and you really have to decide that you’re going to, you’re really going to push towards raising that price point or you’re really going to push towards that market and how do you do that? How do you best do that in the area that you are in? Is it by being at events, or country clubs, or is, is there something else in that community that’s a driver? Um, you know, do you want to live in that community?
I lived in one of the communities for a while, um, just to have the sphere of influence and know the people. So, you know, I would say number 1, decide, and then number 2, really educate yourself so that when you do get that appointment you’re very confident, um, and you’re not scratching to get it. You’re really presenting something that they need, that they really need you and that you have the ability to handle that listing properly.