Categorize Contact List
-- How To Do It

Customer Line-Up

There are many different approaches on how to categorize contact lists. For example, one way could be A, B or C customers defining the level of interest in buying or selling. This is a very simple approach, but also very limited.

Another more versatile option, is to break down your contact list into more specific groups, i.e. Friends, Family, Past Clients, Potential Clients, Niche, etc. This option offers more opportunities for specific target marketing and contact.

You can use both methods of categorization within one list as long as the contact management software you choose allows for multiple category assignments and has the ability to search and export the contacts based on the findings from your searches.

A record assigned to multiple categories might look like this: “Customer 1” is in the following categories – “Friend”, “A”, and “Niche.” Because of the variety of classifications, you can contact Customer 1 with an invitation to your spouse’s birthday party, send information about properties or investments that meet their needs, and let them know about a Niche convention coming up.

The variety in this option allows for a personal level of contact that the simplest classification cannot easily offer. From a marketing standpoint, the more personal you make your communications with your customers, the better your results.

On a side note: you could keep separate lists for each group, especially your farm area. Farm data changes every time a home is sold. It pays to keep your records updated and this is challenging to say the least.

There is a downside to keeping separate lists. The disadvantage again is where you have contacts with multiple interests. If you have a contact who is your friend, a potential client, and in your niche, you would add this contact into each list (three times) to adequately contact them with offers of value. This causes problems when you want to communicate with everyone on your lists – these contacts show up three times – this can be very costly if you are direct mailing and annoying to your friend when they receive three of your postcards. You can have a mailing house remove duplicate addresses but often times they charge extra for added database manipulation services.

Ask yourself these questions before you choose a categorization approach:

  • How do I intend to market to my customers?
  • How specific do I want to be able to get in my communications?

The more specific you want to be in your marketing and communications with your contact list, the more sophisticated the category list should be. Just, don’t go overboard. The more categories you have, the harder it is to maintain. For example, every potential customer that you convert to a past client, you will need to update your contact list to reflect the change in status. This can be a lot of work if you over-categorize a list that is too specific or where contact statuses change too regularly.

Think through all your options and categorize your contact list to your best possible advantage. Just bear in mind, from the other side, if you under-categorize now and change your mind, it may be just as time-consuming changing the categories as it will be if you over-categorize your list.

So, categorize carefully.

Risk of Poorly Planned
Database Categories

Here’s a hypothetical example of how poorly planned database categories can cost you.

Imagine this…in the beginning you decide to categorize your contact list with the simplest database option you could find and your current database consists of A, B and C contacts regardless of where you acquired the contacts from.

Your hobby is widget collecting and you’ve now decided that you love collecting widgets so much that you want your niche to be Widget Collectors. You have gathered all the contact information for the people in your community who collect widgets. There are three highly competitive widget manufacturers and the loyalty among many Collectors is fierce. But you’re different and you collect all three.

You assign “Widget A Collector”, “Widget B Collector”, “Widget C Collector”, to each of the contact database records that you add. You wouldn’t want to send Widget A Collectors information on Widget B collection opportunities with the competition being so fierce, would you?

You get a call from an out-of-state, Widget A Collector friend who is selling his collection. He wants to give you first dibs to buy or arrange buyers for his widgets. You already have most of the widgets he has in his collection and you want to share this amazing opportunity (that your real estate competition simply cannot provide) with your “Friends” and “Clients” first who are also Widget A Collectors.

How? If you have under-categorized your contacts with your friends and clients all labeled A, B and C contacts or the contact management software you own doesn’t allow you to search the database for multiple categories if you had categorized them differently, you’re stuck doing the sorting by hand. OUCH!

What you thought would be a slam dunk offer of value to your friends and clients is now costing you valuable selling time. But, you wouldn’t want to waste the opportunity, would you?

From this example, you can see the importance of making sure that a) you categorize your contacts with enough depth to allow you to make contact on a specific personal level if you want to and b) the software you consider allows for multiple category assignments for records. The software must have the capability to search by these different categories or combination of categories and be able to export the records found into separate files for your mailings.

Though this example is imaginary and unrelated to most real estate business goals, it is an opportunity to contact your customers with something of value to them and build relationships that can develop into sales later. Keep your eyes open. If you don’t plan for possible opportunities, they won’t exist.

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