Standing at the front door, a tablet in hand, greeting people as they stop by. Charging their offers by swiping a credit card. Is the Salvation Army already practicing the model of a future real estate open house?


Recently, a number of news stories got me thinking: Have other industries already solved some of the problems facing the real estate industry? More importantly, could solving these problems be as simple as adapting their models to the nuances of our business?

The first story was the 2011 release last month by the National Association of REALTORS® of their Annual Member Profile. It’s an interesting snapshot of the million-or-so real estate agents who make up the voice of the industry. The technology findings were particularly illuminating: About 75% of respondents said they used a smartphone daily – good news, at more than two-times the rate of adults in society (35%, Pew Research, 6/11). The bad news (you knew there’d be some) was that only 50% of REALTORS® reported using social media, significantly lower than the percentage of U.S. adults online today (66%, Pew, 11/11).

You win some, you lose some?

More startling, however, was the data regarding the amount of business generated by real estate agents during open houses. According to the NAR Survey, “…67% percent of agents reported no business as a result of open houses, and this varied little by years of experience.” The next 23% of REALTORS® generated 10% or less of their business from open houses. So, altogether, 90% of REALTORS® generated little to none of their business by meeting people who came to see their products for sale.

Ouch.

Imagine for a moment if other “face to face” sales experience created the same results. That would be a major problem, I’d suspect, for the car, computer or cashmere sweater industry. If 90% of the people who visited a retail location left empty-handed, you’d expect somebody would be seriously upset. And yes, as the housing industry likes to protest, it’s not identical to other industries.

But really: can we learn nothing from them?

Even if we admit that selling houses is different than computers, pharmaceuticals or travel, we might want to consider the consequences of that petit conceit: By believing it so, we are limiting our thinking about how to change it. Specifically, we could dismiss out of hand how other industries are solving their face-to-face sales challenges. As we’ve pointed out before, the oldest institutions in the world are changing: The Pope has six Twitter accounts. The Old Spice guy’s got 36 million views on YouTube. My mother updates her Facebook account on her iPad.

The Salvation Army can swipe your credit card on their smartphones.

That’s right. According to a story in the New York Times today, the Salvation Army has joined the future. This year, they’re testing a new system to let the public charge their donation by swiping their credit cards on a volunteer’s smartphone. Using a technology called Square (invented by Twitter co-founder Jack Dorsey), Salvation Army volunteers attach a small device to their smart-phones enabling them to securely take mobile donations from consumers.

As the Times reports, “[according to] Maj. George Hood, the Salvation Army’s spokesman, “We’re basically trying to make sure we’re keeping up with our donors and embrace the new technologies they’re embracing.””

Now there’s the spirit!

Essentially, the Salvation Army decided that it simply couldn’t survive if large percentages of passersby – say, 90% – walked away without making an offer, er, donation. Yet the “old way” of donating money – spare change – had become cumbersome to consumers, who have increasingly abandoned cash for credit or debit instruments. Consumers decided they simply didn’t want to interact with the Army on the traditional basis.

Sound familiar? Could there be a lesson there about how passersby at real estate open houses want to interact with the agent who’s ringing the bell? Maybe a different way to make an offer, even? Sure, it’s not exact; but ask yourself how the 50% of real estate agents who won’t interact with consumers using social media expects to get an offer from future buyers carrying iPads, not pens? While agents struggle to manage electronic offers, consumers meanwhile are donating money by swiping their cards on the smart-phones of complete strangers.

Well, I guess some are wearing friendly red suits.

Now, don’t think the Salvation Army didn’t have trouble putting this idea into action. There was plenty of resistance, which might seem familiar. Again, the Times: “The Army does listen to advice,” he said. “It may not agree and sometimes it takes a while to convince the top managers, but in this case, they were very fast to conclude this made sense for them.”

And put it into action. For an institution created in 1865, the Salvation Army is dedicated to keeping up with modern times. So, too, are many real estate professionals. But it begs a bigger question: Why so slowly? The National Association of REALTORS® reported in 2008 that “… 95% of consumers between the ages of 18 and 44 who bought a home … used social networking sites at least a few times a week, and a majority used them daily.”

That was almost four years ago, and yet a majority of REALTORS® still aren’t using social media daily today.

Ironically, the majority of agents reported they did own a smartphone this year. We guess a small percentage have also adopted tablets, too (the number was not reported). So it’s not even a matter of buying expensive technology: most already have it. It’s a question of using it to change the experience – in this case, of the open house. We’ll leave it to our readers to decide if they’re still more likely to see paper at a typical open house than electronics.

Sure, real estate agents might not be taking credit card escrows on their smartphones just yet. But if the Salvation Army can teach us anything, it’s that we’d better be thinking about doing it ourselves, and soon, too.