How are real estate broker-owners responding, adapting or changing? Here’s what Daryl Rogers, CEO and owner of Better Homes and Gardens Real Estate Reliance Partners, is doing.
This is part of “Fighting back,” a new series of profiles on how broker-owners are responding to industry disruption.
Daryl Rogers is real estate’s unpretentious leader — he believes in sticking to the basics and putting the customer first. All the shiny new technology can be a distraction from what matters — buyers and sellers.
Based in Roseville, California, as the CEO and owner of Better Homes and Gardens Real Estate (BHGRE) Reliance Partners, Rogers and his business partner Matt Cord, president and owner based in Berkeley, California, built and run one of the most successful real estate brokerages in the state, with nine real estate offices and some 450 agents throughout Sacramento and the East Bay.
What is your no. 1 asset in this environment?
Not to be flippant, but our two biggest assets are our ears. The best way to battle this change is to listen, and more importantly, listen to the right people.
The consumer is the first and foremost person to listen to. We have done a variety of focus groups to find out what the consumer wants, including technology, services, value, costs and more.
Next, we listened to our agents and challenged them on their views. You need to make sure that their view is not a regurgitation of an article they just finished reading somewhere. They need to back their views with substantive examples, not just anecdotal evidence or something that they’ve “heard from a bunch of people.”
Here’s the real problem that skews many agents’ views: there are too many folks talking about change and innovation who have zero experience in the business and who haven’t talked directly to consumers about their experience in the last 10 years. That’s why we spend so much time finding out what consumers want and sharing that information with our agents.
How do you leverage what you have?
The best way to leverage what we have at Better Homes and Gardens Real Estate Reliance Partners is to continue to drill it with training and culture. Almost every brokerage talks about being consumer-centric, but we actually execute a consumer-first model, where everything starts with the consumer.
We have found that if you continue to talk about focusing on the consumer, you install it in everyone’s mind, and leverage is not an issue. Every agent you hire, every manager, every trainer starts with that philosophy, and it infuses your company no matter how large you get.
What new thing must you do to compete?
I am a strong proponent of steering clear of too many “new things.” Most shiny new objects often turn out to be nothing more than a giant distraction. How many “new things” have truly revolutionized our business in the last 20 years? How many were started by brokerages?
Yes, the real estate business is changing, but not on huge quantum steps. It’s been much more of an evolution than the revolution everyone predicted. It’s tiny things that are creating the biggest change.
Things like DocuSign, zipForms, MoxiWorks — things that are making the job easier for the consumer and the brokerage. I think it is more valuable to consumers for us to focus on simplifying what we already have instead of coming up with brand new systems altogether.
Are acquisitions the way to fend off change?
I think the right acquisition can fend off shifts in the market, but I am not sure it can fend off change. I think we are in a time where the right partnerships can merge and create a greater strength to battle the market itself.
We certainly are looking at opportunities. Just look at the average age of the broker-owner in the U.S. and you can see we are at a major crossroads. We are likely to see many more mergers and acquisitions in the next 12-18 months.
Does your technology strategy change?
This has to change. It has to stay focused on what the customer wants and be able to adjust to the wind as what the consumer wants changes.
Do you explore alternative business models yourself?
Absolutely! Matt and I are always looking at who is doing things differently but more importantly, who is successful in doing things differently. Too much attention is given to “new business models” that are not all that new and are not successful. Now or in the past.
Cloud-based, non-brick-and-mortar is not a new business model. It has been tried several times over the past 15 years and failed each and every time.
However, several companies are running internet-based companies where the owner supplies all the leads, and they keep the operations small, with 30-40 agents. This is a very interesting model, and from what I can tell, they are having success with it.
It seems that every summer we are talking about a hot new company that is going to “disrupt” the real estate industry. Today it is Compass. But Compass is not changing the real estate industry.
They have introduced no new technology, do not have a new business model, and they have no fancy gadgets; they are merely a company with a charismatic leader who can raise a lot of capital. I am not going to try to compete with that (and I don’t need to).
At one time, the company that was going to “disrupt” real estate was Redfin. To give them credit, Redfin certainly created better technology systems and terrific consumer interfaces, but they look a lot more like a traditional brokerage today than the “hot” disruptor everyone got so excited about when they started.
Has Redfin really taken off? Not in my market (the Sacramento area). They continue to struggle with getting listings, and they have not had success outside the Greater Bay Area. Yet they are still being included in the talk of “Everything is changing.” Why?
Now consider what is happening at eXp, the brokerage everyone talks about being 100 percent virtual. If they have reinvented the real estate model by exiting the brick-and-mortar business, how come so many of their agents throughout our markets have opened up dozens of small brick-and-mortar offices? Because top producers typically need a physical office.
At Better Homes and Gardens Reliance Partners we know that you can only control what you can do. We also know that if we do one thing well, all of this other stuff doesn’t matter. So, we tell our agents to stay focused on the consumer, and if they do, we are all going to do great.