Now that home sellers are challenging real estate commissions more than they ever did before, realty agents can better protect their fees by focusing on marketing homes rather than selling them, according to Realtor.com President Allan Dalton.
“Homeowners don’t need Realtors to sell homes; they need Realtors to sell homes for more,” Dalton said during a recent Inman News audio conference.
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He used the example that anyone could sell a SuperBowl ticket for $500, but a person with a marketing plan could sell the same ticket for thousands of dollars.
Dalton, an industry veteran and longtime real estate marketing expert, became head of Realtor.com in 2002, after a five-year stint with NRT. He joined NRT in 1997, when the Cendant Corp. unit acquired an independent brokerage company he had owned for 12 years.
Westlake Village, Calif.-based Homestore operates the Realtor.com homes-for-sale Web site under a contract with the National Association of Realtors. Realtor.com also sells a line of real estate marketing and technology products to Realtors.
The proliferation of real estate information now available publicly on the Internet means realty agents who tell people they sell homes will have a difficult time justifying their fees, Dalton said. Instead, agents should present their marketing skills as the value they bring to the real estate transaction.
“We are in the skill sector, but we’ve done a very poor job of articulating that to the consumer,” he said.
The value a Realtor brings to a transaction is marketing properties by creating competition and driving up the value of a home, he added. The Internet has created an opportunity for agents to market properties in a new way.
“Real estate companies did not previously advertise properties to advertise properties…they advertised to attract buyers,” he said. “Now, because of the greater utility of the Internet, you can truly market real estate.”
Dalton believes a strong connection exists among the decade-long housing boom, the explosion of the national Realtor population and the ability to market real estate online. Access to real estate information has increased home sellers’ and buyers’ desire to be more involved in the transaction.
The Internet has raised expectations, but Realtors haven’t done a great job at meeting those expectations, he said. For example, home sellers’ chief want is multiple pictures of their home to appear with the listing online.
“What is disturbing is only a small percentage of our industry is willing to provide that to the consumer,” Dalton said. “There is a tremendous disconnect between what the consumer wants and what we deliver,” he said.
New business models and the Internet haven’t disintermediated real estate agents from home sales, but realty fees are being challenged.
The Internet is also driving greater focus on lead management because more prospects are finding Realtors online. Agents collectively have to field millions of inquiries they receive through their Web sites and other online lead generators.
“Twenty years ago, Realtors were prospecting for consumers. Now consumers are prospecting for Realtors,” Dalton said.
He said the nexus of traditional and online real estate occurs when traditional brokers recognize the skills and values of traditional brokerage have to be replicated online. Evolving the Web into a marketing medium with advertising and skill-based services is where the two worlds meet.
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