An inside-out look at what it takes to succeed as times stay tough.
Source: BIG BUILDER Magazine
Publication date: October 8, 2010
By Teresa Burney
Erica Lockwood’s home builder clients think her job recruiting home sales managers should be easy. At least, that’s what she thinks.
“The typical response I get is, ‘Well, Erica, you should have hundreds of people to choose from.’” As she sees it, the perception is that, in the wake of all the industry layoff s, there must be sales managers aplenty.
The problem is, there aren’t many good ones now, because there weren’t many good ones before the crash, say recruiters and sales trainers. The overheated market covered up a lack of basic sales skills, plus the skills a sales manager needs now are considerably different and broader than they were in the past.
“The truth is, there are not any more ‘A’ players in the workforce now than there were five years ago,” says the Kingwood, Texas–based recruiter. Plus, most of them remain employed, have become more loyal to their employers during the downturn, and are reluctant to move to a new employer that may be less economically stable, she adds.
“Those people are very sought after,” she says.
That demand is increasing as more builders seek to bring back middle-level sales managers to bulk up for recovery in the new-home market. Not just any sales managers will do. They’re looking for professionals who can motivate and train frontline sales agents who have been beaten down by the market and who may have never learned what it takes to sell in a depressed environment.
“The need for top-notch salespeople has increased dramatically over the past six to nine months,” says Lockwood.
Lockwood and other experts point out that the best sales managers now must exhibit a wide range of skill sets, some old-fashioned sales tools that were left by the wayside during the boom years and some new ones created by the technology revolution. Plus, he or she needs to be able to demonstrate those skills, teach them to agents, and insist that they use them.
“The salesperson has not gotten markedly better than they were in 2005,” says Jeff Shore, an Auburn, Calif.–based new-home sales trainer. “That’s not universal, but it is common.” He says that’s because sales training requires more than just an occasional lesson or role-playing exercise. Successful techniques and strategies need to be regularly demonstrated in the field, in a real-world environment, by somebody who knows how to employ them.
“It’s coaching, not just training,” says Shore. “These need to be sales managers who work shoulder to shoulder with the sales professionals.”
“[Sales managers] need to spend at least four hours a day in the field, side by side with the agents, shadowing, teaching, showing,” says Kitty Hawk, N.C.–based sales trainer Myers Barnes. “You almost have to touch these people daily.”
And for those whose salespeople are spread too remotely for daily contact, Barnes is a fan of Skype, the video-chat Web site, which he sees as a potent new tool.
“You can call them up at 10 o’clock randomly,” says Barnes. “You can chat face-to-face with a person every day. These are powerful tools of technology.”
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Still, lip service is one thing. Salespeople, and sales trainers, are known to talk a good game. For hands-on training to prove successful, managers need to have the right kind of personality to be accepted by the trainee. “Oftentimes, they’re not welcomed by the seasoned [sales] veterans,” Shore says.
“They need to truly be a motivator,” adds Lockwood. “To the point that [the sales associates] don’t know they’re being motivated.”
It takes more than a pep talk to combat the negative energy that most sales centers exude these days, says Shore.
“It’s a retail market to which people are bringing a negative energy,” he says. “That sales office has got to be a positive-energy experience.”
HUNTER VERSUS FARMER
The ability to motivate is especially key in a market where sales agents get little positive reinforcement from the meager sales that do occur and where agents need inspiration to work harder and more creatively than they have had to work before.
The experts say they need to learn to work differently, as well.
“It was a paperwork job,” says Barnes. “Now, it’s people work. You were handling sales, and that’s the operative word, ‘handling.’ Today, you need to be the creator of sales. Most people don’t grasp that.” Teaching sales agents to hunt for customers rather than wait for them to come in the door is one of the biggest challenges, say sales trainers.
“A builder can no longer say, ‘We are going to provide you with all the traffic,’” says Barnes. “Now, you have to prospect” for leads and customers.
Building partnerships with Realtors is one often-overlooked way to generate leads, says Barnes. During the sales boom years, Realtors were frequently all but ignored by home sellers because, frankly, they weren’t needed as much (and then there’s the matter of commissions).
“Today’s customer is no longer just the customer,” says Barnes. “Today’s customer is a Realtor, too.”
Another source of live prospects is the builder’s Web site. Most home buyers begin their search online, yet many sales agents are failing to mine those lists of cyber-shoppers, explains Shore.
“You need to connect with the leads you already have,” he says. Online leads are valuable because you already know they’re interested enough to click on specific neighborhoods and floor plans, he adds.
“Take every prospect lead as far as it will go,” says Shore, though he admits that doing that is a skill that most sales agents have lost—or never had.
“Only 10 percent of sales executives will follow up more than three times,” says Shore. “It takes five to 12 connection points for people to make a buying decision. We lose it at three.
“Lead conversion should be the No. 1 focus of every sales manager,” Shore continues. “Saving a few bucks on a flat of flowers, that is not lead conversion,” he says. “Sitting in a meeting you don’t need to be in is not lead conversion.”
CYBERSPACE, NOT MODEL SPACE
Since most people are shopping on the Internet first, most of the work of selling a home now can and should be done via Web sites, e-mails, and text messages before a customer even sets foot in a model center, say sales consultants. They say the ideal sales manager is comfortable with technology and knows how to use it to market, hunt down leads, and sell homes.
“Twenty to 25 percent of sales are coming from online leads, calling, and e-mailing,” says sales consultant Mike Lyon, of Tulsa, Okla. “If [sales professionals] can’t specifically point to 20 to 25 percent of sales coming from online leads and sources, then they’re missing a huge opportunity.”
That number can easily be boosted to 30 to 35 percent by focusing more on mining Internet leads, he says.
That requires agents who have enough tech savvy to communicate primarily through e-mail, text messages, and social media, as well as by telephone with many clients. Yet the industry still has old-school sales agents who are reluctant to embrace new technology or who have done so infrequently and grudgingly, says Lyon.
Builders need sales managers who go beyond telling agents to use the technology—they need to use it themselves and demonstrate its effectiveness.
“If you’re not doing that as a manager, and you’re not committing, how can you expect that to be transferred down to a sales agent?” says Lyon.
That extends to lead management systems, too, which some agents are reluctant to use consistently.
“The sales manager better know how to use these sales systems,” says Lyon. “If they don’t, the salespeople see it and call their bluff and say, ‘He’s not going to be able to check up on me anyway.’”
Holding sales employees accountable for poor performance is a new mantra among builders and sales trainers.
Lockwood hears builders complain that “sales-people aren’t organized [and are] not willing to play within the black-and-white rules that people have in place.”
Agents have gotten used to managers who create new systems or roll out new technology and then look the other way when agents don’t use them consistently or at all. “It’s a question, over time, of variable standards,” says Shore. “You look the other way when salespeople tell you they won’t work on them.”
Barnes goes his colleagues one better. “I don’t believe in accountability management,” he says. “I believe in consequential management. I’m not just holding you accountable. If you don’t do it, there are consequences attached to it.”
But the problem is, if you let somebody go, you need somebody better in line to replace them. That’s why Barnes thinks the ability to recruit new, better talent is a must skill for sales managers.
“You almost have to be running like a professional sports franchise, building a deep bench,” he says.
A seasoned sales veteran shares his insights on the importance of coaching and mentoring today’s sales professionals.
Two years ago, when Shawn Ricks went on a cross-country job search for a management job selling and marketing houses, he met with rejection despite 10 years of builder sales and marketing experience and 10 more years as a successful custom home builder.
“Everyone was bracing for the worst, and these positions just evaporated,” says Ricks, who eventually found a job working for Sivage Homes in San Antonio. “Sivage had the opposite attitude,” Ricks remembers. “It was, ‘If there ever was a time to invest in sales training and a good sales force, now is it.’”
During Ricks’ tenure, Sivage gained market share and turned a profit, despite considerable pressure from the big production builders in town.
“We had tremendous results in the face of the toughest market in history,” says Ricks.
Recently, bigger builders came calling, looking to recruit him. He had offers from Meritage Homes and PulteGroup before deciding to become general sales manager for the latter’s San Antonio division.
The results at Sivage, and the way Ricks helped achieve them, made him the model for the type of sales manager builders are looking for as they work to refill their middle sales ranks.
“I’m a guy who has actually delivered in a tough market,” he says. “I am very proud of that.”
He chalks up his success to hands-on coaching and mentoring. “Honestly, that’s my secret sauce. That’s what made me different. I am deeply involved in the sales counselors’ lives.
“I work alongside them,” explains Ricks. “I don’t mean competing with them. We tag-team buyers, side by side; I’m teaching them, showing them how to follow up on phone calls, doing role playing, just real in-the-trenches, hand-to-hand combat.”
Such intense coaching is necessary because salespeople either have forgotten or never learned how to really sell, says Ricks. “I think there’s an entire generation of salespeople out there who are very ill-equipped to sell homes in today’s market.
“If they’re old dogs, they’ve either forgotten or can’t quite bring themselves to go back to what they had to do 10 to 15 years ago,” he explains. “And, if they’re younger, they don’t know what a tough market is. We have a bunch of sales counselors who don’t know what to do, or how to do it.”
Ricks says he understands why many sales agents are downtrodden and confused these days, especially because so much about selling houses has changed since the go-go days of home building. One of the hardest things he had to realize is that whatever he had done in the past doesn’t matter; it’s how you perform in today’s market.
“I think there are a lot of people who think that their laurels, their past successes, are sufficient to get them hired,” he says. “I went through a period like that. It was a rude awakening for me. It’s kind of a harsh reality.”
It’s how sales agents have dealt with that harsh reality that serves as a gauge to help Ricks decide whom to hire. He asks all sales applicants how they’ve survived the market and what they’ve learned.
“It’s amazing what you hear, and I can tell if somebody has really grown and improved and reinvented themselves or if they are in denial and have their heads in the sand,” he says. “About half the people out there haven’t changed; they’re just hoping things are going to change for them.”
Ricks looks for candidates who have “grabbed themselves by their bootstraps, who are humble, teachable, open-minded. Your pride is not what it used to be.
“And there is no resting on laurels these days. Every day is war.”