Success Metrics Every Real Estate Agent Should Track

There are dozens of business success metrics you can track. It’s important to focus on the ones that will help you streamline your operations, increase lead generation and close sales. Metrics like days on market, market share and database growth are easy to quantify. But, how do you track the subjective aspects of your business, like customer satisfaction and database quality?

Success metrics answer the age-old question: “How do you know where you’re going if you don’t know where you’ve been?” Understanding which metrics to track will help you analyze your business and show you where you have room to grow.

Measure what matters

Running a profitable business requires careful attention to detail. You have to determine what success looks like for your business, figure out what goes into achieving it, execute your business plan and evaluate the results.

Success metrics should:

• Link to behaviors - It’s pointless to measure something without understanding what you did — or didn’t do — to influence the outcome. Take strategic action and plan.
• Provide guidance to answer your most important questions - For example, when you know the average number of days your listings stay on the market, you can  ask, “How can I reduce that number?”
• Measure variables that you can influence: Why bother measuring something you lack the interest, resources or support to change? It can be a morale-buster for everyone if your team doesn’t understand the changes are required for success.
• Empower you with data to keep learning and growing: Success metrics show what is happening, not why it’s happening. The outcomes you identify are merely starting points for you to make a course correction. It’s up to you to decide why and how to make them.

Business success metrics

Many real estate agents don’t track business costs. Don’t get caught in the trap of thinking you’re too busy or not knowing where to begin. Tracking metrics doesn’t have to be complicated, but you must be thorough, consistent and realistic.

1. Revenue and expenses
   

   Tracking your revenue is an excellent way to see where your business scores its biggest successes. Perhaps you attract lots of first-time home buyers, or maybe you’re a selling superstar. Pinpointing the sources, size and flow of your revenue stream not only illuminates your business performance, it also reveals new directions to explore — or set aside.

   
   

   You might not care about the number of paper clips you use in a month, but you should care about the overall picture of your expenses. There are probably unseen costs that you don’t track: lunch with a client, a last-minute bouquet of flowers for a staging, industry memberships — they all affect your bottom line but can get lost in the daily shuffle of running your business.

   
   

   How to track

   
   

   There are many software programs available to help you track expenses and revenue. You could just start with an Excel spreadsheet if you don’t want to invest your money in something more comprehensive.

2. Agent productivity
   

   You should know how your team is performing. How many leads do you generate in a week? A month?  How many deals does your office close? How many industry networking events do you and your staff attend? How often, and how effectively, do you work your spheres of influence?

   
   

   Agent productivity isn’t just a way to measure how much money is coming in. It can also help you identify underdeveloped skills or untapped superstars who are ready for the next phase in their real estate career.

   
   

   How to track

   
   

   Jotting down your success criteria for each agent in a simple Excel is a good way to start measuring productivity. Make sure you compare apples-to-apples; if you have agents of varying experience or expertise, tweak your criteria so that the measurement is accurate and actionable.

3. Database quality
   

   Your database is only as good as its data. In the beginning, you may have added anyone you met and assigned them to a campaign. Did that approach work? Are you sending messages to uninterested or unqualified recipients? If so, how much time, effort and money is that costing you? While you never want to give up on a lead, make sure it’s one that can eventually pay off.

   
   

   Take time to scrub your database before you start tracking other metrics. You’ll find patterns in your database, and will be one step closer to populating your funnel with quality prospects.

   
   

   How to track

   
   

   Analyze your database and see what kind of data you have on each contact. Do you at least have a name, phone number and email address? Have you contacted each person? How many times and by what means?

4. Customer satisfaction
   

   How many reviews do you have? How many leads do you get from referrals? You should know what your past clients think of their experience. Just because they haven’t posted a review or passed your name along doesn’t mean that they wouldn’t recommend you. It could mean that you never asked them to — or they forgot that you did.

   
   

   Referrals and reviews from satisfied clients are real estate currency. Track and learn from them to understand what your customers value most from working with you.

   
   

   How to track

   
   

   Referrals and reviews are easy ways to evaluate customer satisfaction. If you aren’t already in the habit of asking for referrals and reviews, you should start now and keep track of who responds. You can also send a post-sale survey that asks clients how they enjoyed working with you. Keep it simple with a 1–5 scale for how they would rate different aspects of their experience, such as your response time, communication style or knowledge of the market.

   
   

   Marketing success metrics

   
   

   Measure your marketing results to see which activities generated the most listings. It will show you what worked, and what didn’t, so you can focus your dollars and labor where they will be most effective.

5. Number of listings
   

   The number of listings you have is usually a direct result of your marketing efforts and should be a key area of focus. You probably use several marketing tools and techniques to generate listings — for example, a Zillow Group profile page and email marketing messages — or you might use targeted campaigns with URL-specific calls to action (CTAs).

   
   

   How to track

   
   

   Use your customer relationship management (CRM) system to track how many listings you have and each listing came from. How many came as a referral? An email campaign? Farming?

6. Website statistics

   Every marketing task should drive traffic to your website, your primary online marketing tool. If you’re treating your website as an online business card — offering no informative or engaging content — you are missing out on opportunities to attract and convert leads.

   How to track

   Use Google Analytics to track your website’s traffic and how long visitors stay. Some metrics to watch:

   • Total visits: How many visitors is your website attracting every month? If you don’t think the number aligns with your marketing efforts analyze where and how you’re presenting your website.
   • Bounce rate: How many visitors leave your website after viewing just one page? If visitors aren’t staying to browse your website, they’re probably not finding what they need. Rework your content to address your audience.
   • Most popular pages: Where do people go most often when visiting your website? This metric can show you what visitors are looking for.
7. Cost per lead
   

   Do you keep track of how much it costs to convert leads into sales? This is a crucial metric. It will show you where your marketing efforts are working. Divide the amount you spend on a campaign by the number of leads that campaign generated to find your cost per lead:

   
   

   Amount Spent/Leads Generated

   
   

   Only you can define the ceiling for your cost per lead. It, depending on several variables, but the lower the cost, the higher your profit.

   
   

   How to track

   
   

   Your CRM makes it easy to track your cost per lead. If you’re not using a CRM, you can create an Excel spreadsheet and set up formulas to calculate your cost per lead.

   
   

   What gets measured gets managed. — Peter Drucker, social ecologist and modern management guru

   
   

   Whatever goals you have for your business — sales growth, staff development, raising brand awareness — this principle applies. It’s easy to be overwhelmed by the details of running your business. Use a task list and only include what matters most to you and that you can control; whether it’s something tangible like cash flow, or intangible like your process for responding to incoming messages, you can measure it. If you can track what metrics affect your success, you can manage and improve them, and see even greater returns.