The 36:12:3 Model: Foundations, Myths, and the Lead Generation Challenge

The 36:12:3 Model: Foundations, Myths, and the lead generation❓ Challenge

1. Foundations of the 36:12:3 Model

1. 1 Behavioral Economics Framework
   • Prospect Theory: Humans assess value gains and losses asymmetrically, placing more weight on losses than equivalent gains (Kahneman & Tversky, 1979). This impacts lead follow-up; perceived loss of contact reduces lead value.
   • Hyperbolic Discounting: Individuals prefer smaller, immediate rewards over larger, delayed rewards (Ainslie, 1992). Consistent lead generation (3 hours/day) overcomes this bias by providing regular reinforcement.
   • Commitment Devices: Pre-committing to a lead generation schedule (36:12:3) utilizes commitment devices to improve adherence to long-term goals (Bryan, Karlan, & Nelson, 2010).

2. 2 Time Management and Productivity Principles

   • Parkinson’s Law: Work expands to fill the time available for its completion. Allocating a specific time block (3 hours) forces prioritization of lead generation activities.
   • Pareto Principle (80/20 Rule): Approximately 80% of effects come from 20% of the causes. Focus on the 20% of lead generation activities that yield 80% of results.
   • Time Blocking: Scheduling specific blocks of time for specific activities (lead generation) increases focus and reduces task switching costs (Newport, 2016).

3. 3 Statistical Considerations:

   • Conversion Rates: Understanding conversion rates at each stage of the lead generation funnel (e.g., leads to appointments, appointments to closings) is crucial for setting realistic targets.
   • Let L = Number of Leads, A = Number of Appointments, C = Number of Closings.
     • Conversion Rate: CR = (C/L)100%
   • Statistical Significance: When analyzing lead generation methods, use appropriate statistical tests (e.g., t-tests, ANOVA) to determine if differences in lead quality or quantity are statistically significant.

2. Debunking Lead Generation Myths

1. 1 Myth: “I don’t need to lead generate—I have enough business.”

   • Truth: Continuous Lead Generation is Essential.
   • Market Dynamics: Real estate markets are subject to fluctuations. Relying on existing business exposes agents to market downturns (Ling & Naranjo, 2015).
   • Attrition Rate: Existing clients will eventually age out or move out of the market. Continuous lead generation replenishes the client base.

2. 2 Myth: “I don’t have anyone to help me do everything that must be done.”

   • Truth: Focus on Lead Generation First.
   • Revenue Prioritization: “Leading with revenue” means generating income❓ before hiring help.
   • Opportunity Cost: The opportunity cost of delaying lead generation outweighs the cost of initially handling all tasks.

3. 3 Myth: “I don’t have the money to lead generate.”

   • Truth: Time Investment Can Substitute Financial Investment.
   • Prospecting vs. Marketing: Prospecting methods (e.g., cold calling, door-knocking) require time investment, while marketing methods (e.g., online advertising) require financial investment.
   • Resource Allocation: In the absence of capital, allocate time to cost-effective lead generation strategies.

4. 4 Myth: “I can’t lead generate because I’m not a natural lead generator.”

   • Truth: Lead Generation is a Learned Skill.
   • Skill Acquisition: Lead generation is a skill that can be developed through training, practice, and feedback (Ericsson, Krampe, & Tesch-Römer, 1993).
   • Growth Mindset: Adopting a growth mindset (Dweck, 2006) is crucial for overcoming the belief that lead generation ability is fixed.

3. The Lead Generation Challenge

1. 1 Quantifying the 36:12:3 Goal

   • Financial Modeling: Calculate the revenue generated by 36 transactions based on average commission per transaction.
     • Total Revenue R = nx*c; where n = number of transactions, x = commission rate, and c = average home cost
   • Return on Investment (ROI): Assess the potential ROI of dedicating 3 hours/day to lead generation.
     • ROI = (Net Profit / Cost of Investment) * 100%

2. 2 Strategies for Time Blocking

   • Calendar Integration: Schedule lead generation blocks in a digital calendar with reminders.
   • Distraction Minimization: Identify and eliminate distractions during lead generation blocks (e.g., social media, email notifications).
   • Batching: Group similar lead generation activities together (e.g., phone calls, email follow-ups) to minimize task-switching costs.

3. 3 Lead Quality vs. Lead Quantity

   • Lead Scoring: Implement a lead scoring system to prioritize leads based on their likelihood of conversion.
   • Segmentation: Segment leads based on demographics, interests, and buying stage to tailor communication and increase conversion rates.

References

• Ainslie, G. (1992). Picoeconomics: The strategic interaction of successive motivational states within the person. Cambridge University Press.
• Bryan, G., Karlan, D., & Nelson, S. (2010). Commitment devices. Annual Review of Economics, 2(1), 671-698.
• Dweck, C. S. (2006). Mindset: The new psychology of success. Random House.
• Ericsson, K. A., Krampe, R. T., & Tesch-Römer, C. (1993). The role of deliberate practice in the acquisition of expert performance. Psychological Review, 100(3), 363.
• Kahneman, D., & Tversky, A. (1979). Prospect theory: An analysis of decision under risk. Econometrica, 47(2), 263-291.
• Ling, D. C., & Naranjo, A. (2015). Why real estate prices may boom or bust. Journal of Real Estate Finance and Economics, 50(1), 97-120.
• Newport, C. (2016). Deep work: Rules for focused success in a distracted world. Grand Central Publishing.