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Generate Business, Generate Impact

February 24, 2011

Stop Paying Referrals – Start Investing In Communities

IIC is a social enterprise, and we’ve paid a fair amount of attention to its social value on this blog. So today I’d like to focus on the enterprise component of IIC – the engine behind our social mission.

Inman news recently reposted a nice piece to its marketing blog, Future of Real Estate Marketing, titled “8 Ways Real Estate Agents Can Generate Referrals for Free.”

The post illustrates two fundamental truths about the real estate industry:

1) Real estate professionals receive the vast majority of their business through referrals or “business leads,” and –

2) Professionals often pay real $$ for referrals and leads.

Real estate professionals often pay for services that simply generate business leads, regardless of whether leads translate into deals. When referrals do turn into business transactions it’s customary (or mandatory) that a percentage of the commission is paid to the referring entity. Commercial RE referrals typically cost between 15 % – 25 % a commission.

Yet a broker I know is fond of saying, “Our only complaint about referrals, is that we don’t get enough of them!” So it comes as no surprise that Inman readers are interested in getting more referrals for less dough.

While the post offered sound advice, it actually caught my eye for another reason. By offering 8 strategies in response to a basic business development question, the Future piece highlights exactly why the IIC model is poised for success, and why the real estate industry is ripe for social innovation.

Below, I breakdown the Future post to demonstrate how IIC integrates these business strategies, while adding value to the real estate sector and generating a social return.

Statement: “95% of business comes from past clients of referrals”

IIC Value:

  • IIC functions like a referral network, by connecting socially conscious clients (IIC Friends) to socially responsible IIC Members. IIC Nonprofit Partners have thousands of individual and corporate donors, volunteers, and supporters. These businesses and individuals will work with IIC Members because doing so will generate funding for the nonprofits they care about.
  • How does this happen? When an IIC Member receives business from an IIC Friend, 10% of the Member’s commission on that deal goes to the client’s preferred nonprofit. No referral fees – just philanthropy, and at a fraction of the cost of referrals. 

IIC Takeaway: Social Innovation Meets an Existing Industry Need

Question: “How can you get referrals for free?”

IIC Value:

  • When Members receive business through the IIC network, they do not pay IIC any additional fee or percentage of their commission. Members donate 10% of their IIC-related commission to the IIC NGO Partner that their client selects. That’s it.
  • The 10% pledge does not apply to business that Members receive independently of IIC.
  • At roughly the cost of a single weekend classified ad, a full year’s Membership in IIC may not be free – but it’s pretty darn close. Plus, tax-deductible Member dues enable IIC to grow in scope and in philanthropic impact.

IIC Takeaway: Philanthropy replaces referrals to drive business and social impact.

Strategy: “Offer a service that is unique.”

IIC Value:

  • IIC Members are unique because they fund philanthropy – not a third party – when they receive business through IIC.
  • Members empower their clients – large corporations, small businesses, or regular individuals – to support the nonprofits they care about.

IIC Takeaway: Clients become philanthropists – at no personal cost.

Strategy: “Understand and convey your specialty”

IIC Value:

  • IIC publicizes its Members’ unique philanthropic service, and offers Members outreach tools to do the same.
  • IIC NGO Partners will communicate with supporters about using IIC as a tool to generate unrestricted funding for themselves and other nonprofits – and that means working with IIC Members!

IIC Takeaway: Partners’ Enlightened self-interest drives Members’ ROI & exposure.

Strategy: “Build relationships”

IIC Value:

  • Rather than building relationships between real estate professionals alone, IIC builds relationships between professionals, NGOs, and the NGO’s supporters in a larger community. IIC enables socially conscious clients to connect to IIC Members in their area.

IIC Takeaway: Social Commitment Drives Business Connections.

Strategy: “Be easy to find and contact”

IIC Value:

  • IIC online lists members in an online database, and provides members with individual profile pages where they can list their agency listings. This makes it easy for IIC Friends – the corporate and individual supporters of IIC nonprofit partners – to connect with an IIC professional in their area.
  • IIC online offers a local experience, highlighting the profiles of Members and NGOs based in the visitor’s local area.

IIC Takeaway: National Presence meets Local Exposure

Strategy: “Be an approachable expert”

IIC Value:

  • IIC imbeds professionals in their community, by forging symbiotic relationships between professionals and NGOs working within (and beyond) their community. What’s more approachable than an individual committed to improving his / her community?

IIC Takeaway: Grow your business and your professional reputation

Strategy: “Find ways to do business with those outside of your original client target”

IIC Value:

  • More than ever, corporate and individual consumers want to make an impact with their dollars – and not just through strategic philanthropy, but through standard operating decisions and consumer purchases.
  • IIC exposes Members to a fast-growing segment of socially conscious consumers, and offers these consumers a new and unique opportunity to generate impact while meeting their real estate needs.

IIC Takeaway: Lead the curve to serve a new and growing market.

Strategy: “Thank everyone who attempts to make referrals (not just the ones who produce them).”

IIC Value:

  • If Members receive no business through IIC, they do not donate through IIC.  Members pay nothing when they receive contacts through IIC. The donation to their client’s preferred nonprofit only occurs if the IIC connection becomes an IIC transaction. No “extra” payment is necessary.

And don’t worry,  you’ll never have to write IIC a thank you note.  Helping nonprofits thrive is all the thanks we need!

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