Episode #139 – The Business-Transforming Power of Long-Term Thinking

You're listening to the “REI Marketing Nerds” podcast, the leading resource for real estate investors who want to dominate their market online. Dan Barrett is the founder of AdWords Nerds, a high-tech digital agency, focusing exclusively on helping real estate investors like you get more leads and deals online, outsmart your competition, and live a freer, more awesome life. And, now, your host, Dan Barrett.

Dan: All right, hello everyone, and welcome to this week's episode of the REI Marketing Nerds podcast. As always, this is Daniel Barrett here from AdWordsNerds.com. If you are looking for someone to help you with your online marketing strategy to find more motivated-seller leads and deals online, you know where to go. That's AdWordsNerds.com/strategy. We will hook you up. [01:07.4]

Now, this week, we're going to back up a little bit. We're going to talk about more of just a basic business thing, a basic humanity thing, because it's what I want to talk about this week and, look, I'm going to make this relevant to your marketing for motivated sellers. Of course, that's what we do here, but I want to take a step back and just talk about the way that you and I approach our businesses in general, and I think you can divide business owners, entrepreneurs, real estate investors into two basic camps, and these are people that think short-term and people that think long-term.

Now, people that think short-term are focused on exactly that. Where is that next deal going to come from? Where's my next check going to come from? What can I do to maximize the revenue of this particular transaction that I'm engaged in? [02:01.6]

A long-term focused person, a long-term thinker, is focused not necessarily on maximizing the short-term value of this immediate transaction, but is instead interested in maximizing the value of all their transactions going into the future.

Look, there are places where both of these mindsets make sense. There are times when you need to maximize the immediate transaction. But here's why I'm bringing this up. If you are only focused on the immediate transaction, if you are focused on making the fastest possible dollar, over time, you will almost certainly make less. You will underperform, and this is not intuitive, right? [02:58.0]

Because if you are obviously focused on maximizing this immediate transaction, and then the next transaction, you're focused on maximizing that transaction, and then the next one, you're focused on maximizing that transaction, it seems like in every single transaction I'm maximizing the outcome, and so over the lifetime of my business, I should have a maximal outcome. That makes sense, right? Every individual one, I'm maxing it out, so over the long-term I'm going to be maxed out. I'm going to achieve my potential.

But in actuality, this is not what happens, and that is because, as business owners, we tend to do things and prioritize things and value things differently when we are focused on the short-term versus the long-term.

When you walk into a seller's home and you are thinking about maximizing the value of that particular transaction, you will negotiate with that person in a certain way and you will treat them in a certain way. [04:04.1]

Now, if you walk into that, seller's home thinking not just about that immediate transaction, but every potential transaction that could happen with that person moving forward and every potential transaction that might happen with the people that that person refers or recommends you to, then it's very possible you're going to negotiate with them differently and treat them differently.

This is a very real thing, this idea that we treat people differently if we think we're going to be dealing with them moving forward or if we think we're never going to see them again. [04:47.3]

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Right? Why are the movie theater floors-- I mean, look, we're still in pandemic times, so I don't know, I haven't been to a movie theater in a while, but back in the day, you'd go to the movie theater and the movie theater floor would be sticky and dirty and kind of weird, right? If you drop food on the movie theater floor, you're not picking it up and eating it. There's no five-second rule in the movie theater, right? It's five milliseconds.

But, anyway, why is that the case? It's the case because when people go to the movies, they're surrounded by people they think they're never going to see again and they're in the dark, okay. It's much easier for people to rationalize the idea of like, I'm just going to drop my popcorn on the floor and I'm not going to pick it up. I'm going to spill the soda and who cares. Who cares? Never going to see these people again. They don't know it was me. It doesn't matter. [06:10.4]

Now, if you are engaging with people, you are out to dinner in a really nice restaurant with people whose opinion of you you really care about, and you drop something on the floor, you’d better believe you're going to pick it up. You’d better believe you're going to do that, because, again, you are thinking long-term in that scenario. You're thinking about your reputation. You're not just thinking about, How do I make this immediate moment as easy on myself as possible?

Now, in business, any business, any industry, real estate investing included, there are these two types of people, right? There are people that think long-term habitually who are always thinking about not just this deal, but every deal that this deal could become. [07:00.0]

I'm telling you that real estate investing as an industry is transitioning right now—you may have heard me talk about this before—transitioning right now from an industry where all you had to do was tell people what you did. Hey, I'm an investor. Hey, I buy houses. That was it. Transitioning to an industry where brand and reputation matter a lot, because now when you go to talk to a seller, now when you market to a seller, you have to be answering the question. Not just, “Why do you want to sell to an investor?” you have to answer the question, “Why do you want to sell to me rather than to the investor down the street, rather than to Zillow, rather than to Trulia, rather than to Opendoor, rather than to Offerpad, rather than to Knock, rather than do all these brands that you've probably heard of. They've got a really fancy website. They make it real easy. So, why me?

For the vast majority of sellers, the thing that's going to move the needle when they're answering that question, Why me? Why you? when they turn around and they want to answer that question, they're making a decision that the thing that's going to move the needle is your reputation. [08:14.6]

It's the fact that their friend worked with you and had a great experience. It's the fact that their neighbors have sold to you and had a great experience. It's the fact that they heard that you did right by someone in a situation where you didn't have to. That's what's going to move the needle. It's not a landing page or an ad or some kind of weird algorithm, or some trick you're going to do with Google My Business or whatever. It's nothing to do with SEO. It's nothing to do with PPC. It's got nothing to do with direct mail. It has to do with your reputation and your reputation is all about, whether every time you go into a negotiation, you're thinking short term or long-term. [09:03.2]

I'm telling you, there are two types of entrepreneurs, two types of real estate investors, people who think short-term and people who think long-term, and for a long time, this has been an industry where all you had to do was things short-term and that was enough. I'm telling you right now, right now, this period that we're in, that's not going to be enough anymore. It just isn't going to be enough. You’ve got to be thinking long-term, and if you can do that, not only are you going to feel better about yourself and better about who you are and when you wake up and what kind of stuff you put out into the world, that's going to feel good, but you are going to do more deals and make a more money, and have better margins to boot.

If you're listening to this right now, I want you to think about, next time you go to talk to a seller, are you thinking short-term or long-term? Because I will tell you, that's how I'm thinking about my business and I think it's going to be helpful for yours. [010:01.8]

I hope that makes sense. As always, I really, really appreciate you listening to the podcast. Did you know I have a Facebook group? It's free and I'm in there every single week, posting content , going live, answering questions. You should absolutely join. It's all world-class real estate investors talking about online marketing for motivated sellers. It's the REI Marketing Nerds Facebook group. You can get there by going to AdWordsNerds.com/group or just go on Facebook and type in “REI Marketing Nerds and you will find it.

As always, this is Daniel Barrett here from AdWordsNerds.com, signing off. I will see you next time. Cheers.

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