I’ve just been wandering around the United States presenting to real estate agents, and asking them, “What is the one thing that sets them apart from any other agency in the community?” Simply, I’ve been trying to get agents to identify what their point of difference is…why would I choose them over anyone else? It’s been a fascinating experience with possibly less than two handfuls out of some big audiences that could actually give me some sort of meaningful “One Thing” on why they deserved to be chosen above the smorgasbord of multicoloured, multi-fonted logos from Agents far and wide that really offer me no value proposition other than “shiny.”
By no means am I seeking to offend the goodwill and good-nature of the people I’ve met. But seriously folks, it’s 2013. There are oodles of tools available to home sellers that allow them to sell their own properties these days. For the $10..$20…$30…… $50,000 you want as commission, I think you want to come up with a better value proposition than “shiny.”
(“Shiny” can include: “Ringing our clients back.” ”We know the market better than anyone else.” ”Our signs get more inquiry than other agents.”)
Seriously, in 2013, is this the best value proposition that our real estate community can offer me as a home seller? Especially a home seller that’s not overly enthused to part with almost $60,000 of his hard-earned cash? For “shiny”?
So, my Aussie agent friends, let me throw a scenario to you that may or may not be hypothetical:
Are you ready?..
A Seller has a property to sell. Seller asks 3 agents to submit proposals to market their property, following certain guidelines, including asking for thoughts on: Pricing, Marketing Dollars, Commission, Service, Online approach.
Agent 1 suggests based on sales comparables that property will sell $900K-$1.3m.
Agent 2 suggests based on sales comparables that property will sell $1.6m-$1.9m.
Agent 3 doesn’t respond to 2 emails.
Agent 1 seeks $19,500 marketing budget. Says 90% of his enquiry comes from the Internet, and yet seeks: $15,000 for print marketing and $2,000 for online marketing, along with miscellaneous marketing costs.
Agent 2 seeks $5,000 marketing budget. Total marketing budget is only for print advertising, but offers FREE listing on realestate.com.au, domain.com.au and franchise group website listing. No provision for quality photos, website, video, etc.
Agent 3. Where are you?
Agent 1 proposes 5% of the first $18,000, 2.5% of the balance. [Roughly $38,500.]
Agent 2 proposes same commission structure as Agent 1.
Agent 3. I’d heard you were good. At least the crap you stuffed in my letter box said you were.
So, here are my problems.
1) I can’t tell what Agent 1 or Agent 2 can offer me that distinguishes their marketing for a hypothetically $1.5m property versus what they would do for a $300K property. [Except in Agent 1's case, that he's fleecing me for $15K on newspaper/print marketing that, by his own admission, is all but pointless.]
2) Why should I choose Agent 1 over Agent 2 or vice versa? I see nothing to distinguish either of them.
3) Hypothetically, the 3 Agents chosen were deemed as the market leaders of their area. And Agent 3 didn’t even RESPOND to 2 emails requesting a marketing proposal submission.
If the hypothetical above happened to you (as a home seller), as it hypothetically did to me, what would you do? If I chose Agent 1, I’d be writing a check for roughly $56,000, on a property that he’s valued at almost $900K less than Agent 2, with marketing almost solely based in print which, by his own admission, is all but pointless. If I chose Agent 2, who represents a luxury brand, I’d possibly write a smaller check for $42,000, but for that money I’d only get $5,000 of pointless print advertising and almost nothing online, e.g. no professional photos, no professional video.
If you’re Agent 3, I just checked my email again. Still nothing there.. Looks like you really are full of hot air.
It’s 2013. Is this the best our real estate industry can give its consumers? No wonder our industry gets a bad rap.
So folks, please tell me, why wouldn’t our consumers be confused if this is the best crap Australian Real Estate Agents can trot out? Why would I employ any agent to sell my property instead of just pocketing the $50K, taking 6 months off of work, buy 50 cartons of Corona, whack a sign out front and sit on the back deck waiting for the walk-ins? :-)
Over to you Boys and Girls. I’d love your thoughts…