What is the Principle of Reciprocity?
The principle of reciprocity is a term in social psychology. Simply put, it means that if someone does something nice for you, you have the built-in tendency to want to do something nice for them.
Law of Reciprocity and Real Estate Agents
Think of the people you do business with. This can be working with your clients or vendors from other businesses. It can also be the companies you do business with on a personal level – local merchants, restaurants, etc.
In almost all cases, we work with people and businesses we trust. Would you develop a business relationship with someone you didn’t trust? This is exactly where the law of reciprocity comes into effect.
Here are three absolutely positive effects of practicing this principle as a real estate agent.
1. Build Trust
When a company is still small and looking to gain more customers, they usually give away something for free to grow their business. These could be pieces of advice or services, but most of the time, these are products like gift cards.
This is very evident in our industry. The reason is simple: people get to try a new restaurant or product without having to spend their own money. Trying it for free allows them to be less critical and, more often than not, have a good experience. That’s a good experience they now feel indebted to you for.
2. Show Appreciation
Now that the trust has been built, clients and vendors will show ongoing appreciation for your thoughtfulness. Again, this is the law of reciprocity coming into effect.
In a study by the U.S. Small Business Administration, almost 68% of customers will end a business relationship if they do not feel appreciated. Compare this to the 14% who leave a company because of poor service.
When a real estate agent shows appreciation, clients feel like they care about them. This is why we love it when businesses give us “special discounts” for being their loyal customers.
3. Incentivize Customers
This is where the referrals come in. How many people do you know that have referred a masseuse or a personal trainer to someone? Exactly.
Giving someone a gift incentivizes them to refer you to their friends, family, and co-workers.
It’s All About Relationships
Instead of viewing our prospective clients (or our current clients) as dollar signs. Successful business people know that business is nothing but relationships. And the best thing you can do for your community, your country, your business, and your wallet is to nurture those relationships.
That’s why we created BizGift™. We got sick and tired of people throwing away our business cards. We wanted to give people something that they valued, because we simply want to add value to your life.