In today’s competitive markets, the business mantra is “increase wallet share and client stickiness,” making it crucial for brokerage platforms to offer a full line of services and solutions to clients. Firms across the commercial real estate landscape are continuing to broaden their offerings as they attempt to capture additional revenue, diversify their businesses and broaden their attraction to clients.
By cross-selling existing clients complementary products and services—ones that are necessary for the client such as leasing and financing—brokers can deepen and broaden their client relationships. Failure to effectively cross-sell clients opens the door for competitors to sell directly to your clients. There are several reasons why brokerage firms are broadening their businesses. When a client is able to view a firm as a one-stop-shop for all of their real estate transaction needs there is less of a risk that the client will seek services elsewhere or defect.
In contrast, if a client buys a building from a firm that does not offer leasing or financing the owner needs to engage professionals from other firms who may very well compete directly for the clients’ sales business in the future. As a broker why would you want to place your client relationships at risk?
The three most common cross-sell services to couple are investment sales, financing and retail leasing, although some firms will also add office leasing, property management and even insurance services. For example, Eastern Consolidated, known for its dominant position in investment sales, also provides retail leasing and capital advisory services (debt and equity financing). This strengthens not only our firm and its brokers but also the relationships with our clients.
At Eastern, our model is unlike other firms because we believe in the integrity of relationships and the procuring broker acts as the centerpiece of the relationship. Supported by experienced professionals in allied disciplines, the broker is involved every step of the way but partners with the team members who specialize in other services. The increased knowledge and experience only help our brokers develop more quickly and add depth to their real estate experience so they can better serve clients.
While some clients like to shop around, most prefer the convenience and having a broad mix of services makes it easier for a broker to quickly and efficiently provide the services a client needs at the time. At Eastern, we have established processes that let us compete and win financing or leasing opportunities even when a client is not ready to sell.
This provides additional “arrows in the quiver” for our brokers. What I mean by this is that if a broker speaks to a client who is not interested in selling they can still do leasing or finance business with them. This is a critical point. Generally, when a client begins working with a broker he will continue working with them unless an issue arises or a clearly better value proposition presents itself. Since people remain consistent with their prior commitments—it’s a way we rationalize our decisions—there is an increased likelihood that they will choose you to sell their building when they are ready. Therefore, when an owner is not ready to sell but may be looking for a retail tenant, by cross-selling and working with a leasing broker you can begin doing business with them.
From a broker’s perspective it is important that you educate your client in all of the products you offer. Clients tend to only know brokers by the transactions they have conducted in the past or by reputation, making it crucial to purposely communicate your entire value proposition. This can be accomplished a number of ways, such as through marketing materials and emails, but it is most effective when done at a face-to-face meeting.
It costs less to sell more to an existing client than to find new ones. When cross-selling, you can leverage your existing reputation and experience with a client. By providing additional services you show that you understand their needs and can effectively address them.