Realtors and Technology - Who benefits? Part 2

July 25, 2007

A big “thank you” to all of you who commented, sent emails, and voted for my last post “Realtors and Technology - Who Benefits?” from last week. I have also received a number of requests for the sequel, alluded to at the end of my last post. And so we go . . .

Technology for the sake of new technology without marginal benefit really is a waste of time and money. I briefly mentioned a couple of technologies that DO provide benefit to both client and agent, like electronic signatures and online listing search tools, virtual tours, etc.

What I think is easy for a lot of agents to forget is that our clients tune into WIFM (What’s in It For Me) radio, and it’s their favorite station. We need to remember this and focus our marketing activities around this idea of providing value to the client, and the business will follow. A major proponent of this idea is mega-agent Craig Proctor, who sells around 500 homes a year and dominates his marketplace. Whether you think his marketing techniques or his televangelist style events are hokey or slick, you can’t argue with his success.With this WIFM idea in mind, let’s look at how it plays into the evolving role of the Realtor.

Marketing:

I have a saying that finding a Realtor in Palo Alto who advertises that they are #1, in the Top 1%, or a Top Producer in whatever category is like finding the oldest pub in England. There is one on every corner. I really don’t believe that my clients care how much money I make selling real estate, or how many homes a year I sell.

What IS important is how well I manage the transaction process and manage and mitigate risk on their behalf. Avid readers will recall my article “Are Newspapers Dead?” discussing polling I did at some recent listings, where I asked open house visitors how they found the open house, and was not surprised to find that few to none of them came from newspaper ads. Since newspapers aren’t an effective way of getting Buyers into my clients’ homes, I have shifted my advertising budget to television. A 2006 study by the Television Bureau of Advertising found that over 70% of consumers’ media time is spent watching TV or online. Only 4% is spent reading newspapers. I read the newspaper online, so I’m not sure where that gets counted. If you are wary of the source of that study, I’ll point you to the numerous articles in print and online discussing to troubled state of the newspaper industry because readers have switched to online sources for news.

So then, why do Realtors advertise listings in the paper? It’s a great way to promote themselves, and thumb their nose at their competitors and colleagues over their new listing. Newspapers do work, and a top producing agent in my office in
Palo Alto, who has asked to not be mentioned in this forum, has built a business on newspaper ads, but his ads tend to be more focused on him than his listings. As Steven Colbert would say, Moving on . . .

Consumers really only have 4 questions they are interested in answering when they contact you, unless they need to sell TODAY.

1)      What is my house worth?

2)     What is the market doing? (Related to #1)

3)     What is my neighbor’s house worth? (Also related to #1)

4)     How much is the house I want to buy?

Given that, is it more effective to send a someone market information like Altos Research provides, information on new listings in the neighborhood, or the typical recipe cards or football schedules to stay top of mind? Personally, I’d rather that people think of me as an expert on the local real estate market who is the source of information, than the person to call for a good recipe for Thanksgiving turkey.

Customer Experience:

I have had the good fortune to have been in sales with IBM’s Business Consulting Services division in a past life, and so I’m a veteran of their lauded sales training program / boot camp. The key to IBM’s reputation and their ability to grow their services business is the client’s experience. IBM costs more than about anyone else for similar products and services, but clients are willing to pay a premium because their IBM contacts are focused on making sure things go smoothly, customers’ expectations are met or exceeded, and if there is an issue, it is handled quickly and to the client’s satisfaction. 

If you doubt me, go to your local Lexus showroom, look at some cars and see how you are treated. Now go to a Hyundai dealership and do the same thing. It should be a pretty eye-opening experience.  

Here in Palo Alto, we have a lot of folks who drive BMW, Benz, Lexus, etc. and so that is the treatment they are used to and expect. They know that $50 for an oil change is ridiculous, but the dealership has good coffee, free WiFi, and a clean, new loaner car so they are willing to pay that premium.  

The same goes for Realtors and other service professionals. I think a big reason that discount brokerages like Help-U-Sell and Redfin haven’t made inroads into the
Palo Alto market is that consumers here are willing to pay a premium for skilled professionals to manage transactions. So far, I haven’t seen discount firms delivering the service and skilled professionals here. You do get what you pay for. 

That’s today’s rant. Stay tuned for more thoughts on the evolving role of Realtors in the Internet Age.

Thanks for reading . . . 

Tags:

Written by Chris Iverson, Realtor · Filed Under Real estate 

Comments

2 Responses to “Realtors and Technology - Who benefits? Part 2”

  1. Kevin Boer, Realtor, Alain Pinel Realtors on July 25th, 2007 6:34 pm

    My theory is that the main reason Realtors advertise in the paper is the same reason that dogs pee on fire hydrants: marking their territory. I’m convinced that 90% of the readership of the real estate section of any newspaper is Realtors.

  2. Diane Aurit on July 26th, 2007 11:21 am

    A very well written rant! Newsprint is for uninformed sellers and for agents and real estate firms to market themselves. I just left a very large firm that used extensive print advertising to promote the company brand under the guise of providing agents with great tools for CMA’s. Our greatest challenge still is to teach sellers that print advertising won’t sell their property and what will…like pricing properly and staging.

Got something to say?





« Back to text comment