The availability of information online in the 21st century has radically changed many industries, including real estate. Travel agents and car dealers have found their businesses impacted dramatically as consumers tap into online information that gives them power and choices and makes proprietary information a thing of the past. In the real estate industry, the “one size fits all” model is quickly becoming antiquated. Consumers want choice. They want more control. They are more educated and feel more empowered and many do not fully understand the value of the real estate agent in their transaction.
The good news is that our business is more complicated than buying a trip or a car. You and I both know much of the information available online is not accurate or useful, the volume of information is staggering and valuations shift quickly based on market demand. So, our ability as professionals to interpret the information and bring value and sense to it all is vitally necessary to help a consumer make good decisions.
How have you changed your business model? During the ‘80s and ‘90s, most agents and companies offered a single way of doing business, usually with a fixed percentage of the sales price as compensation. As flat fee, limited service brokerages, offering menus of service become more common, consumers have begun to question which model suits their needs best. Traditionally, the seller’s objective has been to sell their home for the most amount of money in the least amount of time. This is still the goal most all of the time. Consumers often find hiring a full-time, full-service professional is the best and easiest choice to achieve that result. An expert knows how to put more money in their pockets. However, others are questioning that premise and are trying to understand the value of using a full service broker.
Greater access to more information and exposure to different models gives today’s consumers many choices. Smart agents, who previously offered just one model, are adapting and expanding their thinking and strategizing to identify how to best serve and bring value to today’s consumer. Offering different levels of service with different costs is one variation that is becoming more popular. As the Gen Yers, 79 million strong, become a more significant segment of our markets as first time homebuyers (they were 47% of the 2009 market), their love of self-sufficiency and autonomy will continue to mold expectations and drive the desire for multiple models and choices.
How Will You Stay on the Short List of Most Wanted?
If you are ready to do some re-invention, these four questions will give you a framework for your brainstorming and re-strategizing. Set aside a couple of hours to work on this. If you are part of a team, the synergy of masterminding with others is more powerful than solitary work. If you have a coach, their outside perspectives can help expand the thinking you have. Or invite a few friends to do the work with you. The National Association of REALTORS® as part of its Right Tools Right Now program, has made The Profile of Home Buyers and Sellers available to members for free. This profile offers a wealth of information to help understand the wants, needs and buying habits of today’s consumers.
1. Who are your clients? Know your target client/market in terms of their age (generation) and preferences. Define your present clientele and project what this will look like in one year and in five years. The easiest way to do this is to define your business by percentage of type (i.e. 35% Internet, 20% 1st Time Buyers, 20% Referral, 25% Sphere of Influence).
2. What do they want or expect? For each category, list their preferred style, buying habits and needs. Think about where they do their research. What social media do they use? What ways of communicating do they prefer?
3. Where are you right now? (Or look at last year.) Review your present business to determine:
a. What segments or niches generated business?
b. Where did you generate leads that didn’t turn into business?
c. What percentage of your business comes from buyers? Sellers?
d. What choices are you giving consumers in regards to services? Commissions?
4. Where can you learn to increase your business?
a. What objections are you hearing on listing appointments? Are you losing listings because of these objections? What scripts or objection-handling tools should you be using?
b. What new services can you offer and what would you charge? Look at each of your business segments (Internet, SOI, first-timers) and identify the services that are most wanted or important.
c. What seminars, courses, certifications or designations could give you new ideas and tools? Consider NAR’s e-PRO certification for Technology & Social Media training, The Seller Representative Specialist (SRS) designation or the Accredited Consultant in Real Estate(ACRE®).
Most agents who have expanded offerings for consumers have found something interesting:
While the clients call or are attracted to the agent because of the choice they are offered in how to work with them, over 80% will still choose the full service model once they understand the benefits. So, while choice is important to attract the interest in the first place, an agent who can demonstrate the value of all of their different marketing tools and strategies provides the consumer with a compelling reason to choose them. It should also be noted that about 15% of consumers make their choice on price and price alone. These clients are often higher maintenance and less respectful of what you do. These are the ones that will take an inordinate amount of time and energy. So we should be cheering for the fact they have models that fit their wants. And…if their homes don’t sell with a limited service model, because you have stood your ground with how you do business and the choices that involves, they may come back and give you the respect you deserve. “You want to be the first love, second wife and third REALTOR®!” These are demanding times, and this is the new NORMAL.
So even if your skills were adequate and served you well in the past years, to be successful in the coming years, you must make some adjustments and connect with the needs of today’s (and tomorrow’s) sellers!
If you don’t want to lag behind and are ready to be among the elite selling agents, set aside time today to hone your skills for today’s markets!
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