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Rewarding Realtors

Many home stagers receive a significant amount of business through partnering with Realtors, leading one to ask "to discount or not to discount". This question was posed by Reece Gutekunst in her blog titled "Realtor Partnership Program - To Discount or Not To Discount?".

I know that Debra Gould of The Staging Diva (the training program that I took), would be the first to say "No, no, no - don't do it!!", and I have to agree.

Once you start giving discount things can get really tricky, what starts off as a goodwill gesture can quickly become a nightmare.

Yes, a business should acknowledge repeat customers but that doesn't mean that you have to discount your price. Let's face it, is the grocery store going to knock $50 off my bill because I shop there every week? No, that's why they are a billion dollar company, and why should it be any different for us.

Your fees are based on what you are worth, your daily operating expenses and your fixed expenses. Those don't change so neither should your fees.

I offer my best possible price to everyone and try to find other ways to reward loyalty. The best compliment you can give a Realtor is by simply referring them, other ideas could include:

offer links from your website
provide tip sheets for their customers
write an article for their newsletter or website

Don't under estimate the value in a handwritten note, just to say thanks. A nice bottle of wine or bunch of flowers at the holidays (or anytime) is also a great way to say thanks.

Reward your customers, create a loyalty program but avoid the pitfalls of discounting your price.

Posted by Lucie Quigley on 03/23/2007 08:29 AM

Comments (24)

customer service, customer loyalty, rewards, customer loyalty programs, loyalty programs, realtors

24 Comments on Rewarding Realtors

MAR

2007

I'm one of those stagers that does offer a realtor discount. I don't offer my services for free, but I do give them a discount for frequent use. Unlike a homeowner who may be only using me once, an agent could potentially pay for my services 100's of times. I think that's worth something.

Is the grocery store going to discount my price? No....But they are going to offer me airmiles or pc points. The drug store offers me a discount card that after frequent use is worth something. Many places offer punch cards, where your 10th is free.

The House Painter I use offers me a discount. The Handyman I use does. Even the big chain furniture stores gives me a discount on my purchases because I'm such a good customer - and a DEEP discount too. They understand the value of my business for them and frequent use is rewarded.

and don't forget Pier 1 who offers a discount to interior designers and stagers.

I'd like to hear specifically what the pitfalls may be.

Lucie, I had a broker ask me to create a colorful document that he could slip inside their realty's marketing packet. It's some additional effort to create and print, but hopefully a great marketing tool for me to "link" with their agency. Linking with them on my website is another good idea....thanks.

Lucie, I guess it's like my mom always told me....Dont start something you cant finish!

Sue: That's a favulous marketing tool. I also give them postcard size ones with a before and after for them to put out at their open houses - whether I've staged it or not. (they put them beside the listing sheet, mortage info, anything the agent is presenting. - for those agents that use me often, they link from their site to mine. I haven't added them to my site yet, as I am not sure I want a huge list on it, or make other agents feel uncomfortable if they want to use me...

Hi Lucie - Right on!!! I too, am a graduate of Debra's program. I would not offer realtor discounts either, why should I. If I were to list my home, the realator is not going to give me any freebies!

I don't know of any other professionals, who would even consider giving discounts for their time and experience. How many doctors offer every 4th visit free? How many teachers say, "Oh, after the first half of the school year, I take a 20% salary cut/discount? Fughedaboutit!!!!

Giving your time away and selling yourself short is no way to do business. Also, you will lose credibility by not being professional and stick to the rate you set for yourself and deserve!!

Alyse, I have had those same reservations about linking off my website...not sure if other Realtors might be turned off...

Lucie, I agree with you 100% as you knew I would :)

I also like your suggestions for other ways to benefit Realtors.

I don't offer discounts to Realtors. By recommending me to their clients, real estate agents get:

to offer a service that shows they're up on the latest trends in selling real estate quickly and for top dollar
a third party to tell their clients all the things they'd never say (like "your house smells")
a third party to resolve disagreements between husband and wife over things like whether repainting is necessary, what colors to use, whether counter tops should be replaced, etc., etc.
a house that's easier to sell because it looks beautiful
the convenience of showing up on open house day knowing that all they have to do is put out their sign and unlock the front door and listen to the oohs and aahs from prospective buyers. They won't find ugly, disorganized or crowded rooms. They won't find unmade beds, dirt, odors or dishes in the sink.

There are other ways to "thank" realtors who send many projects my way:

while I don't do free consultations, I will sometimes drop by and give some quick comments on an especially challenging listing where the fundamental question might be "is it worth staging at all?"
help taking listing shots of a home I've staged
helping with the agent open house, especially when they're hosting a lunch which requires pick up, delivery, clean up
a color or interior redesign consultation for their own home
doing a presentation for their prospective clients

I'm really pleased to read Staging Diva Graduates sticking to their guns on issues like discounts, free consultations and the other topics we discussed in the training that could negatively impact your ability to grow a profitable staging business.

debra

This is a very interesting post. Just yesterday, on a forum that I participate on, a Realtor was very vehemently insisting that many Stagers in his area do all of his consultations for free.

I asked him if perhaps what he meant was that they provide free proposals and provide some generic Staging Tips in their introductory package opposed to providing an individual Home Staging Consultation and Individual Report. He was quite nasty and insisted "he has never paid a dime for a Staging Report" and that it is common practice for the Stagers to do Consultations for free.

Of course, I didn't want to argue with him, but I was quite surprised by his views. Certainly he does not work for free; I don't know how he thinks that Home Stagers can make a living by working for free. I left our conversation on the forum that I hope it is a win/win situation for everyone involved, but it sounds to me like his clients are not getting full service when it comes to their Home Staging needs - either that or those poor Stagers will be out of business quickly.

MAR

2007

Yes, an interesting post and I can see both viewpoints. I DO offer a discount to my Realtors, but I am not sure that I will continue it. I might consider this a "test bed" for my pricing strategy. We all will develop business strategies which work for us. Some will offer discounts, or monthly specials...others wont. What works in one market, wont work in another. Its all about balance, maintaining your customer and keeping them happy while making a profit :-) I am still working on the profit thing.....LOL

Great topic, and one I struggle with constantly. At the very beginning of my business, I did give free consultations to Realtors. I must have done 20 or so. But I got NO business from these Realtors. So, I concluded that they were valuing my services at the same rate I was--they were worth $0. Now, I only give "deals" to my freqent users, and not always. I tell my Realtors that they face competition from Discount Brokers, and it's the same with stagers.(They can really relate to this!) There are many part-time stagers out there who are undercutting those of us who are trying to really make a living at it. These folks may be able (financially) to do this as a second job or as a hobby, but for me it's a full-time profession.What one stager does affects another. Stage it forward!

Lucie, I'm glad I re-visited this post. It's so valuable to get different view points from business owners that have learned from experience.

MAR

2007

Lucie,

Thanks for the info. I had contemplated doing this for realtors, but now am not so sure. I was worried about down the road that I would always have to keep this discount structure.

~Kimberly~

Lucie - A friend of mine who has her own business in another field gave me a piece of advice, She said never devalue your business when it comes to pricing. She said make sure you know your pricing and be firm. If a client detects that you are not sure they will attempt to get you to come down on your price. She said she learned the hard way. So from the get go we are remaining firm on our pricing. We felt that was good sound advice and keeps us from wavering! Sue

APR

2007

Most of my Realtors pay for my reports because I am part of their team. My prices stay the same for my reports but I have made exceptions to some small stagings where the Realtor has had to foot the bill just to make the house look good. I will go above and beyond in my service for them, sometimes I put a couple of extra items in to help. I have learned in this business that we really are all the same boat, we just have different paddles. I have no problem helping one of my Realtors out. I have had two of them for almost two years now and I am honored to be a part of their team. What goes around comes around.

Oh.. Starbuck's cards work good too :)

Lori

It is good to learn that there may be more than one way of looking at rewards. My best reward is another referral and I work very hard at my staging to make that home the best that I can. I'm up for Caribou Coffee cards tho.

APR

2007

All good points and excellent advice. It really comes down to the individual relationship and how often you work with a particular realtor.

Kathi, I like your comparison of 'discount' realtor's vs/stagers. I'll be sure to use this one!

APR

2007

Hi Kathi,

I agree with you about not discounting. I heard Suze Orman one day on tv. She is the perky financial guru and she was saying the pitfall of WOMEN is that they don't feel their sense worth, especially if we are in a service provider sector.

She was giving an example of a hair stylist who has to raise her prices to accomodate for rising inflation, rent, etc. The customer tells her, "but I've been coming here for years, you can't raise your prices on me." So the hair stylist thinks, well she's right, if I want to keep her business, I need to bite the bullet. HELLO! She has been coming to the hairstylist for years because the customer knows she is GOOD! But with the hair stylist not raising her price, she is now having to work twice as hard (calling in on customers more often and cutting more hair, doing more highlights), which means, she is in the salon longer, which means she is not at home, which means the children are also being cheated out of time spent with mommy. You shortchanging yourself isn't really affecting just you - you are shortchanging you and YOUR FAMILY. It really does have a spiraling effect.

I don't believe in discounting but I do believe in the power of a gesture. Whether it is a hand-written note of thanks on a beautiful one of a kind card, or a beautiful basket with wine and cheese. How about taking out the Realtor to lunch - they have to eat sometime! I am usually generous with this as I know it is the feeling they remember, not numbers. (well, that applies to most, except for those who are like accountants and can recall every number! LOL) I rather spend money on them on a thoughtful gift than discount.

I did a staging for an invester who is also a Realtor and I spent about $40 in making her a gift basket. I know that may seem pricey but I was thinking, how much would I have discounted in order to get the job? I was thinking if I were to discount her $40, she would have said "that's it?," not to mention, once I gave her a discount, she would expect a discount from future stagings. By standing my ground, exclaiming "I am worth it," I was able to be generous with my gesture AND create a great feeling for her. It is important to note, I am not raising their rates to accomodate for nice gifts because you are at a risk to losing all the stagings to lower bids, besides you are probably like me, it's fun to give. If you are having to really lower your staging costs to be able to land the contract and there is NO room for "play" money, a beautiful thank you card or a token inexpensive gift (Get really creative which I know all of you can. I just thought of onhe cute, kinda cheesy gift idea - get a pretty rock that can be used for a paperweight with a "YOU ROCK" tag on it or anything like that.) It can have just a powerful effect.

APR

2007

Marcyne... excellent point. One that was just brought up with a member of my team. It also made me think about what I do. I don't discount but I will do a little more. When I think about it, it is the same thing because I am discounting my time. We women are pleasers and very often sacrifice our time. I am going to try the gift basket thing because my time is precious.

Thank you for making me think!

Do agents offer discounts on their commission? No. We are creating equity for the seller and a faster hopefully more profitable sale for the client and the realtor (putting more money in their pocket and building their reputation also as a top producer whose listings sell!) - I think some agents have a misconception as to what "staging" is - maybe just putting potpourri in a bowl and few towels (that's what some think and have told me so) then once they are educated as to what it is we REALLY do and HOW HARD WE WORK - then they won't be asking for discounts or freebies. But hey, you can't blame someone for trying! It's up to the stager to decide what they want to offer. But I ALWAYS say don't sell yourself short, you are WORTH what you are paid!

I agree Lucie. Do we not make more money for the Realtor with the higher selling prices? Look at the trickle down from that alone...newspaper ads every week, gas going back to get price reductions signed....

In my opinion, too many stagers don't charge enough for their services to start with. To then discount their fees, they'd have to be doing this part-time as a hobby, not to make a living.

APR

2007

I have to disagree, all my agents who pay for the consultation for their clients get a Preferred Agent Discount of 20% off the consult fee. I have been working every day and the agents never hesitate to write the check...

Phyllis Pafumi

APR

2007

Phyllis, It's great that you're working every day, but it you weren't giving them 20% off, you'd be able to take 6 days off every month and still earn the same income you are now!

I've bought 7 houses and sold 6 through different realtors. One gave me a set of wind chimes, another a plant and the rest just put me on their mailing list to receive a calendar every year. Their commissions on those transactions ranged from $7,500 to $20,000. And, since I've always staged my own homes, they always sold fast.

So while we're all busy fretting over how much of a gift to give the realtors to thank them for giving us work that makes their life easier and makes them look good, consider how many of them are accustomed to doing the same for their clients! In other words, many of them don't feel compelled to gift others for what to them is a business transaction and how they earn their living. Why should we?

debra

Hi Debra - I couldn't agree more! It surprises me that people are worried about discounting to realtors or rewarding them. Why? Stagers are providing a valuable professional service. It is a win win situation for stager, realtor and homeowner. Also, by not sticking to a firm fee set for yourself, your business lacks integrity and will not be taken seriously. Once you give discounts, everyone will want the same rate. Another thing I don't understand is "working within the homeowners budget". This could get to be a very sticky situation. I think one rate for consultation and any work required beyond that should be done at a fixed hourly rate.

I don't see any other professional's out there giving me rewards for giving them my business. My doctor or mechanic don't give me discounted rates, so why should I as the professional stager that I am????

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