Building a Real Estate Database: Contact Aggregation and Classification

Customer Relationship Management (CRM) is a cornerstone of success for any real estate organization, and building a robust and effective real estate database is a fundamental basis for this management. This chapter, titled “Building a Real Estate Database: Collecting and Classifying Contacts,” aims to provide trainees with the scientific knowledge and practical skills necessary to create and develop a comprehensive and dynamic real estate database.

The scientific importance of this chapter lies in its reliance on the principles of information management, data classification, social network analysis, and marketing psychology. By understanding these principles, real estate professionals can build a database that not only collects information but also enables them to:

• Improve operational efficiency by organizing information systematically, reducing the time and effort spent searching for potential customers and managing relationships with them.
• Enhance the quality of decisions by providing classified and organized data, offering deep insights into customer behavior and needs, which helps in making informed marketing and investment decisions.
• Increase competitiveness by building strong and sustainable relationships with customers through understanding their preferences and providing customized services.
• Measure and evaluate performance by enabling the tracking of marketing campaign performance and evaluating the effectiveness of CRM strategies.
• Leverage the power of referrals by identifying the most loyal customers and motivating them to refer new customers, thereby reducing marketing costs and increasing the customer base.

By the end of this chapter, trainees will be able to:

1. Understand the theoretical foundations of building a real estate database by grasping the basic principles of information management and data classification and their importance in the real estate context.
2. Identify sources for collecting potential customer data, recognizing the various sources from which information can be collected about potential customers (whether they have “met” or “not yet met”).
3. Apply effective strategies for classifying contacts, learning how to divide customers into categories and groups based on different criteria (such as degree of knowledge, commercial capabilities, and level of loyalty) using scientific models such as dividing customers into groups of “allied resources,” “advocates,” and “core advocates.”
4. Use Customer Relationship Management (CRM) programs effectively, selecting and employing the appropriate tools and programs to manage the database and facilitate communication with customers.
5. Analyze data and extract insights using analytical tools to extract valuable information from the database that helps improve marketing performance and increase sales.
6. Develop a practical plan for growing the database by developing sustainable strategies for adding new customers to the database and keeping it constantly updated.
7. Evaluate the quality of the database and identify areas for improvement by using key performance indicators to assess the effectiveness of the database and take necessary corrective actions.

Importance of Contact Collection and Classification:

• Improves customer targeting by segmenting customers based on criteria like interests, budget, and preferred location.
• Builds stronger relationships through personalized service based on understanding customer needs and preferences.
• Increases operational efficiency by organizing the database and facilitating quick access to information.
• Measures and improves performance by analyzing customer data to identify strengths and weaknesses in marketing and sales strategies.

Sources of Contact Collection:

• Haven’t Met:
  • General Public: Reached through mass marketing (TV, online, print ads) and prospecting (directory search, real estate❓ exhibitions, informational events).
    • Formula for evaluating mass marketing campaign❓ effectiveness:
      • Leads = Impressions * CTR * CR
      • Cost Per Lead (CPL) = Cost / Leads
  • Target Group: Reached through direct marketing (mail, email) and targeted advertising (social media ads based on demographics or interests).
    • Example: A Facebook ad campaign targeting individuals❓ aged 30-45 with an interest in real estate in a specific area.
    • Formula for evaluating Return On Investment (ROI) for Direct Marketing:
      • ROI = (Revenue - Cost) / Cost
• Met:
  • Network: Reached through personal communication❓ (social gatherings, phone calls, text messages) and targeted marketing campaigns. Strategies like 8x8 and 33 Touch involve regular communication.
  • Allied Resources: Individuals in related fields (mortgage lenders, home inspectors, real estate lawyers). Reached through joint ventures, mutual services, and personal relationship building.
  • Advocates: Previous clients willing to recommend services. Reached through referral programs and appreciation gestures.
  • Core Advocates: Influential individuals (sports team owners, executives, builders). Reached through value-added services and strong personal relationships.

Contact Classification: A Strategic Model:

• A hierarchical classification of contacts, progressing from the general public to core advocates.

• Strategic Pyramid of Contacts:

  • Level 1: General Public (Haven’t Met)
  • Level 2: Target Group (Haven’t Met)
  • Level 3: Network (Met)
  • Level 4: Allied Resources (Met)
  • Level 5: Advocates (Met)
  • Level 6: Core Advocates (Met)
• Progression Strategies:
  • General Public to Target Group: Effective targeted marketing campaigns.
  • Target Group to Network: Personal relationship building through regular communication.
  • Network to Allied Resources: Strategic partnerships through joint ventures.
  • Allied Resources to Advocates: Excellent service exceeding customer expectations.
  • Advocates to Core Advocates: Strong personal relationships and value-added services.

Customer Relationship Management (CRM) Programs:

• CRMs facilitate efficient contact collection, classification, and management.

• Features:

  • Recording and storing customer information.
  • Classifying contacts.
  • tracking❓ customer interactions.
  • Automating marketing tasks.
  • Generating reports and analytics.

• Types:

  • On-Premise.
  • Web-Based.

• Selection Factors:

  • Features and functions.
  • Ease of use.
  • Integration with other systems.
  • Cost.

Entering Contacts into the Database:

• Establish procedures for regular contact entry into the database.

• Timing:

  • After receiving a call from a potential client.
  • After meeting a potential client, allied resource, or advocate.
  • After completing a seller or buyer interview form.

• Process:

  • Use seller or buyer interview forms.
  • Update contact information with personal details (birthdays, hobbies) using VIP questionnaires.
  • Place new contacts on automated action plans.