- If you feel threatened by discount brokerages, your gut is telling you it's time to up the level of how and what you deliver in your business.
- Nothing impacts the dollar value a homeseller receives more than the agent they choose to manage the process.
- Improving the systems you incorporate in your homeselling process is the starting point to creating the "unfair advantage" that positions your clients for the best results.
It seems we, as an industry, are constantly inviting new variations of discount brokerages into our arena. I remember how bothered I used to get when the newest brokerage of this kind would show up in my market.
I see now that the disdain and disrespect I had for these new real estate companies came from my fear of scarcity. I realize how much misguided energy I gave to these “discount competitors.”
Threatening industry forces
Environments operate within the principles of cause and effect, and our real estate sales industry is no different. Discount brokerages exist because people within our industry — and some who are on the outside looking in — see an opportunity to benefit monetarily by offering the same services for a lesser charge.
The industry has made room and created this vacuum because of how we are perceived by the consumer.
The genesis, as I see it, of discount brokerages is basic single-cell evolution, or “amoeba” thinking, and the lowest form of industry creativity and differentiation. Adding the latest and greatest technology to its arsenal doesn’t change this fact.
It’s the same as adding beautiful decorative icing on a cake that’s been made with substandard ingredients. It doesn’t make for a great cake, but the cake looks good. Using a savory analogy, it’s the same as the expression I’m sure you have heard: “all sizzle and no steak.”
There is no need to fear the Redfins and SRE Matrixs of our industry any more than excellent restaurant owners fear fast food chains.
There’s plenty of room for these companies to service those who don’t understand the economic and strategic principles that exist in the real estate industry and are as true as scientifically proven facts.
For example, water boils at 212 degrees Fahrenheit or 100 degrees Celsius, and homes do not have a fixed value — period, game set and match. Understand this alone and you should welcome the lowest forms of differentiation, not fear them. Their entire existence is based on what consumers don’t know.
The conscious agent
The conscious agent sees opportunity when competing against the discount cupcake because the areas where actual value can be offered are endless.
Take this mindset and philosophy a step further, and understand the difference between technological necessities versus technological accessories, and you’ll have a game plan for a good ole fashioned Rose Bowl blowout. (What can I say? It’s that time of year, and Stanford rocks!)
Change your perspective by recognizing that the quantity of services provided to the consumer for the same or less cost does not in and of itself make you consumer-centric.
In fact, if you ask your clients which would they prefer, service or results, they will choose results every time.
The server who comes to your table every minute and half to check on you does not enhance your dining experience.
To safeguard your real estate business, you need the tools to create a durable competitive advantage — one that companies on the kickback and technology playing field simply cannot meet because they are not designed to.
It’s as simple as focusing on the nonfiction rather than the fiction of our industry. Again — water boils at 212 degrees Fahrenheit, and real estate properties do not have a fixed value.
I find this quote by from Takeshi Sekiguchi, founder of SRE Matrix, in a Dec. 30, 2015 Inman article interesting:
“We believe most real estate agents are people of integrity, and our experience so far supports that,” Sekiguchi said.
“If an agent is not showing one of our listings because of a commission percentage, then you have to question that agent’s integrity. Real estate agents have a fiduciary responsibility to do what is best for their client, not what is in the best interest of the agent.”
I believe that integrity, as it involves agents, also constitutes the awareness of knowing one’s own value and demanding it, rather than having it dictated to you. There is no correlation or congruence that suggests devaluing oneself is a representation of integrity.
In fact, that kind of thinking sounds like another industry — the one that’s been around the longest. If a kickback to the consumer is without question and in all circumstances what’s best for the client, then water does not boil at 212 degrees Fahrenheit.
The truth is that discount brokerages will never be able to compete for listings with those agents who have developed a durable competitive advantage aka “unfair advantage.”
Like motivational speaker Jim Rohn so eloquently said, “Don’t wish it was easier; wish you were better.”
Never before in our industry has it been so obvious that mastering one’s craft — rather than simply being licensed to sell — should be an agent’s single most important goal.
Eric Putoto is the founder and creator of the Platinum Process Realtor Coaching and Mentoring Program. You can learn more about the Platinum Process Program on Facebook, or follow Eric on Twitter.