A tale of two industries
Real estate professionals could learn a thing or two by paying attention to another industry that’s been having a tough time.
Last year, Paul McCartney distributed his new CD through iTunes and Starbucks; Radiohead netted millions selling their latest album themselves; and Gene Simmons of Kiss fame turned to creative licensing to drive revenue.
During the worst year ever in the music industry — an industry hit as hard as ours by disinterested consumers, overstocked inventory, technology overload, Internet interlopers and a timeworn value proposition — some artists flourished.
These are the artists not mired in blame. And they aren’t sitting around waiting for their market to change. They’ve moved beyond the mainframe and disengaged from dead-end practices. Amid the woes experienced by many of their peers, they’re rocking out. If asked to explain, I believe they would say that a bad market can be an entrepreneur’s best friend.
Unfortunately, few in the music industry think that way. They’re stuck in the past with huge executive overhead and an overpriced product that’s packaged poorly. They excel at doing nothing and complain about everyone out there eating their lunch.
Over the holidays, I stumbled upon the RE/MAX 2000 obituary on AZCentral.com. The Phoenix-based brokerage of 350 agents folded days before Christmas, citing lack of sales and the depressed housing market as the cause.
I can’t help but consider the similarities between the music and real estate industries as they drag down highway 2008 with all eyes affixed on their rearview mirrors.
Contrary to the company’s statement, I refuse to believe that a depressed market is the reason RE/MAX 2000 folded. Furthermore, I find this excuse irresponsible and insulting to those who own homes in Phoenix or who are in the market to buy and sell. I own several properties in California and if I read this about one of the larger brokerages in my town I’d be freaking out right now.
This can’t be put on the media either. I don’t buy it.
Don’t get me wrong — a market shakeup is challenging. But it’s not a death warrant. In the music industry, tours don’t sell, labels fold, and artists go broke. In real estate, homes don’t sell, brokerages fold, and agents go broke. Each has examples of those who prevail and some who thrive amid the turbulence.
2008 in real estate must be the year everyone stops waiting for yesterday to become their tomorrow. Yesterday’s paper-based real estate transaction will not come back in vogue. Stealth lead generation will not flood agents with new prospects. Bidding wars are over. Overpriced homes are over. Unimaginative marketing is done. Confusing map mash-ups are done. Companies need to be slimmed and trimmed and made nimble again. Being a visionary is back in fashion. And thinking outside the box … well, as Bill Maher says, let’s leave that for the really smart guys.
The rest of us should just make the box we have neater, cleaner and current.
A neater, cleaner, current box
2008 should be the year of CEM — Customer Experience Management. Learn why more than 80 percent of consumers polled by the California Association of Realtors say they will use the same agent again but only one out of five people actually do. Why is that? Polls, surveys, questionnaires and focus groups should be a critical play for any brokerage this year. Real estate should not be afraid to talk to its clients. Find out where your weaknesses are. Identify your hidden strengths.
Vendor and product analysis is also critical. The number one question every vendor should be asking themselves is: “On what basis do I believe my product works?” Vendors need to get cracking on that answer because every agent and broker customer should be asking that question.
2008 needs to be the year of crystal vision. Getting real. Your Web site alone is a life raft at sea. Your blog — another life raft. You need to push your content out, attach that raft to the large ocean liners. You need to work with online companies to push, push, push your content and listings out so they can be seen.
2008 is the year to reduce expenses. Don’t fire smart people, fire stupid processes. Analyze the return on investment on that newspaper contract you’ve routinely renewed for the past decade. Scrub your marketing costs. Learn how to use free online social networks. Learn how to blog correctly and efficiently. The Web is replete with free software that can enhance your presence and save money.
2008 must be the year we begin to conserve. Reduce the amount of paper you use. Go digital everyone. Agents, get tablet computers. Get e-signature software. Send the copy machine to the Smithsonian. The amount of gas you buy to deliver paper back and forth is criminal. The savings you’re leaving on the table is mind-blowing.
Yesterday, all my troubles seemed so far away
Maybe time ran out for RE/MAX 2000. Maybe their yesterday never came back around.
The party hats are off. We’ve dusted away the new year’s confetti. Let’s embrace the depressed market. Let’s let it serve a greater purpose. Let’s take a cold hard look at the problems it is uncovering and start addressing them right now.
Markets come and markets go. The real estate market will rebound itself next month or next year. The greater question worth discussing is what kind of real estate industry will be left — and who will be working in it.
What’s your opinion? Send your Letter to the Editor to firstname.lastname@example.org.