There are two basic reasons why companies fail: unwillingness to embrace the obvious changes of their day, and a smug rejection of customer feedback. Those two factors can be found in every company that once commanded its market, then lost the leadership spot: Ford, Motorola and IBM. Each thought it “knew what was best” for the consumer. And each was taught quite quickly that the customer is always right. It’s a lesson being learned by other industry leaders today – such as Barnes and Noble, and some of the biggest real estate brokers in the country. We call it the “Failure Mindset.”
If it’s one thing technology companies just can’t seem to learn, it’s that their users hate it when they are forced to learn – all over again – how to use their products. Whether it’s Microsoft’s incessant rearranging of menus and folders, or Facebook’s latest face lift, users are getting quite fed up with having to suddenly “look around” to figure out how to do today what they did yesterday without effort. It’s a lesson for all businesses that consumers prefer it when we stick to it.
On Screen – a periodic “launch” of news, commentary, resources, bloggers and other information you can use to get your week started – from Matthew Ferrara & Company.
On Screen: Real Estate Industry news launch for February 9, 2010:
- The Wall Street Journal reports that Fannie and Freddie have already consumed more than $111 billion in taxpayer dollars. And they are likely to need more.
- A real estate bubble in Canada looks like it’s already inflated and expanding. Some markets are experiencing surges of 20% month-over-month, and it shows no signs of stopping.
- NAR Economist Lawrence Yun finally acknowledges that the tax credits are causing housing data to skew wildly every month in the latest release of pending sales figures from the National Association of REALTORS.
On Screen: Expert Advice from Industry Leaders:
- Steve Harney reminds REALTORS that the housing “recovery” is shaky in “Built on Jenga Blocks.”
- Stephen Fells offers ideas on how REALTORS can keep an eye on what the social sphere is saying about their business in “Why Every REALTOR Should Use Google Alerts.”
- Ron Hahn offers thoughts on how branding differentiation works in the real estate industry in “Interesting Branding Insights: Real Estate Companies Pay Attention!”
On Screen: Technology Trends (with Comments)
- Cisco says there will be more than 5 billion personal devices connected to wireless mobile networks. (Important trend considering under 50% of REALTORS reported using a smartphone last year).
- Comscore research shows that more than 178 million US citizens watched more than 33.2 billion videos in December 2009. (Amazing considering so few property listings have videos on them.)
- Nielsen research says that use of social networking online soared more than 82% last year over the year before. (Yet less than 35% of REALTORS had a social networking presence in 2009)
On Screen: Smart Ideas to Sell More
- Entrepreneurs should beware “vanity metrics” when measuring true performance, says the Harvard Business Review.
- Timeless ideas on innovation from Peter Drucker at Human Resources IQ’s website.
On Screen: But Wish it Were Not!
Here’s the MLS photo of the week from “Really Bad MLS Photos” group on Facebook:
Recently while teaching a social media strategies workshop, one of the brokers approached me during a break. In essence, while he admitted to being dragged into the social media world reluctantly, he was just about furious with my suggestion that agents play games online. It’s bad enough they are wasting time in these social networks, was his point. To suggest they should spend time farming, killing vampires and running a mob gang was simply stupid. How are REALTORS supposed to make sales while they are playing games online. Let just see, shall we?
Riddle me this: How is it that the industries that charge the least for their products and services seem to have more more advanced technology than those that charge the most? Some time ago, we wrote that REALTORS might want to take a look at how gas stations were using technology to market ancillary products to their customers. Now a year later, my local real estate brokerages still don’t offer any interactive technology to their visitors in the waiting area, but my local veterinarian and shoe store does.
Download a copy of the latest survey of REALTORS by the Center for REALTOR Technology and you’re certain to be fascinated – startled, perhaps – at what’s happening on the Bat-belts of modern agents trying to make buying and selling homes a twenty-first century experience. While the report is no page-turner – in fact, it looks a bit like it was produced on a Commodore 64 with dot-matrix fonts – a few facts stand out, highlighting just how easy it should be for serious salespeople to scoop up market share in the months to come. And all they really need would be a Blackberry and a thousand bucks.
For many real estate brokers and agents, the hot technology today is social networking. Facebook, Linkedin and Twitter are the “new new thing” for making friends and influencing business. There’s probably no better tools for directly prospecting your marketplace – and maintaining your referral and repeat business base. But let’s not lose sight of the other pieces of the social networking-sphere, notably those technologies that we all take for granted, but may not be maximizing to drive web traffic and sell more homes. Long before there was social networking, there was social bookmarking, a system for recommending cool web content to your friends – and millions of others. The real estate industry should revisit these networks as free systems to drive web traffic without increasing their marketing budgets.
Blogging is both art and tax. Good blogging means turning a steady flow of useful ideas into interesting content. Bloggers must be good writers. And developing a readership takes a lot of time each day and week. So it’s not unusual for busy salespeople to worry that they’ll never really leverage the medium, tending instead to go for quick contributions in their Facebook updates. Yet there is opportunity in between the blog and the burst, providing ample opportunity to show off your knowledge, influence your contacts and develop new business. It’s called LinkedIn Answers, and it may just be the answer you need. Read more…
For some time now, I’ve been asking myself if I’d missed the point about Twitter. Give it some time, I told myself. Sometimes these new technologies just need to shake themselves out. Originally, Motorola shelved the mouse as an input device, only to have someone dust it off years later and make it the tool of choice for personal computers. So I gave Twitter a chance. I tried it myself, and even started to “follow” some people online. Alas, with the release of a new study, I now know that I should have stuck with my initial reaction. Twitter is really dumb.
Readers of our column know that we called the beginning of the end of search engines some time ago, when we noted that Facebook and MySpace had already started to generate more ad views and targeted traffic than Yahoo and Google. Unfortunately, Microsoft didn’t seem to have read our post, and went ahead with Bing. Microsoft calls it a “decision engine” and it certainly works differently than the traditional search sites. Yet technology improvements aside, none of the search engine players have considered the basic question: Do people really “search” for things on the internet any more?
Once again, as REALTORS converged last week for their MidYear meetings in Washington, D.C., the forces of stability and sameness were present, coming up with last-gasp-ways to protect the tattered vestiges of Real Estate, the Last Generation. New white-papers and shiny-Powerpoint presentations proclaimed the “we-can-renovate” mentality of Gen 2.0 MLS systems struggling to enter the 3.0 version of the industry. Much like Google and Yahoo – who refuse to admit their advertising model is crumbling in the face of social networks – MLS’s are trying one last time to burnish a brand that has already worn off the chrome. What’s left underneath are the mostly rusted pieces of a structure whose time has come and gone, even if some REALTORS still believe the Comparables Book will someday make a comeback.
It’s time for the real estate industry to implode the MLS model so they can build something better suited to the next generation of real estate practices. Read more…
A while ago I wrote a short article comparing some of the “standard” real estate marketing tools with those of other industries. I remember commenting how REALTORS, who sell commodities in the hundreds of thousands of dollars range, try to entice buyers with printouts made from an off-the-shelf inkjet printer on recycled paper, while automobile companies readily offer super-glossy-multi-page professional brochures to promote their lowliest of models. Of course, times change: When Baby Boomers invented the real estate industry, printing anything was a mimeographic achievement, so the small office printer was a revolutionary upgrade in marketing in the 1990s. Yet today’s buyers and sellers increasingly come from the Gen X and Gen Y demographics.
Does anyone still think we’re going to re-start the housing market by handing out listing sheets?
Let’s review some basic facts: Last year the average first time buyer was 31 years old, smack-in-the-middle of the Gen X/Y profile. This means many buyers were in their early twenties, while some lagged into old-age-thirties. Even the average seller was only 45 – the tail end of the Boomers, even if they try to pass themselves off as early X’ers. Either way we’re talking consumers who entertain on YouTube, read the news on their iPhones and post video clips to their Facebook page with their eyes closed. Whether it’s a kitchen faucet from Kohler or a new laptop from DELL, the way to attract these consumers is modern multimedia.
Of course, some printed items still work to provide information about products and services. For example, luxury products like the LearJet – comparable in price to some premier homes around the country – feature downloadable PDF spec-sheets complementing their virtual tour and video marketing. not completely unlike a property listing sheet found on some better real estate websites. Still, even LearJet could improve its printed marketing tools compared to a travel site like Abercrombie and Kent, whose Royal Scotsman Train Holiday offers an eight-page brochure online for a $7000-10,000 product. Even an inexpensive piece of software like ACT by Sage offers a multi-page full color product brochure.
The bottom line: One-page property listing sheets are simply pathetic.
To be fair, it’s not just the one page printout that’s awful; it’s the one-page information presentation that most real estate websites provide as well. Whether it’s a jet or a vacation or a software program, all of which have stiff competition in their price range, the marketing tools on their websites offer much more than a single page. Yet most real estate presentations stick to an address, a couple of photos, a few bullet points and a paragraph describing the product. Forget about the huge gap in multimedia – the Learjet site is NASA-like in it’s design while the ACT site offers a full-product video demonstration and a trial mini-site. It seems nearly impossible that real estate would ever reach that level of product marketing, considering the continuing challenge to get agents to put more than a half-dozen photos on every listing. Yet you have to wonder if the real estate industry has some other reason why it continues to propagate the one-page minimalist approach to marketing its products.
Oh, right: They want to force the customer to call.
Does providing less information lead customers to call, email or otherwise contact the “broker” of a product? Possibly. But has anyone ever wondered how many people simply don’t reach out at all, when so little marketing information is presented? Why do so many buyers who visit an open house fail to call for a second appointment? Was it because they didn’t like the house the first time – or that the listing sheet was such a poor “sales support piece” that it failed to inspire them to consider a second look? What percentage of online leads never inquire on a listing – or at best, delay that inquiry because the presentation of home information is flat, one-dimensional, and mostly organized like an IRS form?
Could the listing sheet actually be harming sales?
Any of this could be possible. But perhaps it’s not even that complicated. Maybe it’s just another example of how the Gen X / Gen Y consumer has moved far beyond the Baby Boomer modality of the real estate sales industry (I almost typed “stales” industry – what an interesting slip that would have been…) Listing sheets aren’t just a bad marketing piece; they are a bad marketing mentality. They reduce homes to uniform, tabular experiences that mostly fail to excite, entice or even adequately inform the potential buyer. The “just the facts” approach to room sizes, amenities and taxes smothers emotional excitement about buying a home. Everything about the listing sheet presentation is dull, rough, plain-paper-bag.
Where are the download-ready multi-page flyers, with edge-to-edge high quality photography? Who is handing out CD’s or flash drives at open houses with dozens of photos, documents and videos to help the buyer learn as much as possible? Have you ever seen an agent offer to SMS a video clip from their smartphone to the buyer’s smartphone after touring a home? I’m guessing these aren’t the ordinary experiences that real estate agents are offering to their customers today.
Think about a great product experience. Perhaps it’s the thrill of flying on a private jet. The luxurious feeling of a train ride through the Scottish Highlands. The creativity of a powerful, intuitive piece of software. There’s no way those emotional responses can be conveyed on a single web page or printout. Complex sales take complex marketing tools. Capturing the value proposition of these products simply can’t be done in a sanitized one-page format.
Real estate is perhaps one of the most complex transactions – emotionally, financially, intellectually. Trying to excite buyers by handing them a single piece of paper seems – well – just a little pathetic.
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As part of a new ongoing series of posts on our blog, we’re going to apply our brainpower here at Matthew Ferrara & Company to looking at the latest numbers from real estate industry research and helping our readers make sense out of their meaning. Many organizations from NAR to Case-Schiller to research firms and universities worldwide study consumers, agents, brokers and the business of real estate. They release “findings” – lots of numbers – but rarely interpret their meaning. Of course, that’s where we have always been helpful to our clients: leveraging the research facts about the marketplace to make sensible decisions – not gut reactions – to be one step ahead of the consumer.
And forget about the competition – since they’re mostly not really competition, when you look at the numbers. In that spirit, let’s start with some startling numbers that may indicate that NOBODY in this business is really in competition for the online consumer: The sorry state of social networking usage by real estate professionals. Read more…
Every year at this time, most of us are making “resolutions” of how to improve ourselves for the upcoming year. We resolve to go on a diet, save more money, take time off with the kids, and so on. Business people usually take it one step further, resolving to do all the things they “put off” in the last year because they ran out of money, or opportunity knocked, or they just forgot. We all do this – while conveniently forgetting the most common thing about New Year’s Resolutions is that we usually forget about them by the end of January!
So this year, why don’t we resolve NOT to make any resolutions, and try something much better, instead…
Sometimes, you just have to learn the hard way. That seems to be the real estate industry’s preferred method of implementing technology tools – at least for the last twenty years or so. A herald comes over the hill, the masses become excited, everyone just starts doing it: And that’s when the highest risk to sound business principles usually occurs. Which is exactly where we are today with IDX – the “sharing” of listing inventory between competing brokers’ websites. It sounds like a good idea, except for one small snag:
Your million dollar website now looks awful because the data from your friendly cooperating brokers sucks.
