The ability to choose is one of the greatest blessings we, as human beings, have ever been given. Conscious choice is what makes each day unique, each person unique, and what makes us different from, say, a tree or a rock. Being able to determine what we do, rather than having such a thing determined for us, is something we will always have a natural instinct to protect.
This isn’t some romantic or sophist dream. This is an everyday reality that affects our relationships, our interactions, and many other facets of our lives. If the illusion of choice is ever shattered, we have an immediate instinct to retreat.
Ultimately, tailoring choice is one of the best ways to attract and maintain the attention of a prospective investor. By incorporating multiple choices and by focusing those choices on the primary decisions driver into a broader (and still specialized offering), potential investors will immediately gain the benefits of personalization and active participation and be more inclined to act.
The Girl Scout Cookie model
Why are the Girl Scouts able to sell so many cookies by going door to door? Is it because adorable children are at the center of their business model? Perhaps. But what is even more likely is the fact that rather than offering just shortbread cookies, as they once did, they offer many different choices, ensuring that there is something for everyone.
A person can’t simply say, “I don’t like shortbread” because even if that were true, there is still likely something available that appeals to them. By including a complete menu of selection choices, the burden is, in a way, turned to the buyer who now has to argue against many different possible options.
Of course, commercial real estate investments involve a much more layered decision-making process than a four-dollar box of cookies. But having a diverse, accessible “menu” of options that are carefully crafted to attract and engage investors gives syndicators immediate ammo to counter objections.
The real estate syndicator must first directly address the most obvious objections that investors may have. If the stock market is being particularly volatile, emphasizing the stability of real estate as a counterbalance to market fluctuations can provide just the right “flavor” to a pitch. If investors are driven by yield because interest rates are low, then that is how a deal should be positioned. Sponsors must offer a menu of viable options that satisfy investor needs by positioning them in the context of what investors want at any given time.
Watch as author Adam Gower speaks with Andrew Lucas, director of capital markets at Trion Properties why it is important to provide education to prospects.
Clearly, offering a varied menu of investment options is an effective way to attract and maintain an investor’s attention. Rather than direct selling, you are engaging the potential investor and illustrating the current state of the company or market as a whole. However, at the same time, you do not want prospective investors to feel overwhelmed.
Your duty, as a syndicator, is to offer enough options for investors to feel involved and self-determined, but not to offer so many options that your message gets diluted. In real estate crowdfunding, this means that rather than positioning your deal with 20 or 30 descriptors, focus on three to five of the most desirable selections according to market sentiment and allow the investor to choose their own fate.
When your campaign is being conducted online, you should highlight a select few aspects of your offering to your entire audience to attract attention, and then make it possible for those prospects who are responsive to the initial messaging to learn more. Regardless, it is clear that choice helps create a better dialogue. When you go “all in” on a single property, the investor will compare the investment to the most obvious alternative—not investing at all. But when multiple options are available through ever increasingly detailed messaging, the investor will gradually get to know you and what you are offering, overcome their doubts, and subtly eliminate the likelihood of abstaining entirely.
The reason why “menu-based” selling is so measurably effective is that it not only makes it clear that the client has choice, but also, it encourages active participation. If you look at someone’s face any time you are delivering a one-sided, one-option pitch, they might feign interest, but in reality, they are probably waiting for your pitch to be over. Because there is no choice and because they are not participating, they have likely mentally checked-out and are simply being polite.
By encouraging participation, by asking questions, by being able to sincerely respond to an investor’s questions, you’ll be moving in a productive direction. You want to make the prospect feel as if their investment was something they sincerely choose and sincerely wanted—not just something they were convinced to do.
Once again, it is evident that many of the most common short cuts used in selling fall short. To convince someone to invest with you, you will need to offer them something that is genuinely beneficial. With a wider variety of options and an empathetic mindset, you will be much more likely to find the perfect fit.
Adam Gower Ph.D., builds digital marketing systems for real estate professionals who want to find more investors so they can raise more money and do more deals. He is known as the creator of the Investor Acquisition System and combines a lifetime of experience in real estate investment and finance with best-of-class digital marketing tactics, techniques, and strategies to help crowdfund real estate syndications.