Can you define your value proposition quickly and effectively, in language your non-real-estate-trained client can understand? If not, you should work on that.
Jay Thompson is a former brokerage owner who spent the past six years working for Zillow Group. He retired in August 2018 but can’t seem to leave the real estate industry behind. His weekly Inman column publishes every Wednesday.
We’re neck-deep into “conference season” — that time of the year when everyone including small brokerages, coaches, franchises and the National Association of Realtors (NAR) has a conference, often complete with a trade show expo, fancy galas, black-tie gatherings and a near-endless stream of vendors throwing “client appreciation” parties.
Having just attended not one, not two, but three conferences inside of a two-week period, I can safely say I am all conferenced out. Given the often zombie-like blank stares of my fellow conference goers, apparently this feeling is not unique to me.
As I walked onto the expo floor at NAR Annual Conference in Boston, one thought popped immediately into my head: All the shiny objects!
Shiny object overload
It was, to be frank, overwhelming. Row after row after row of booths — some large enough to literally park cars in, others barely big enough to hold two people and a folding table — are presented for your viewing pleasure.
Virtually all of those exhibiting are trying to sell you something.
Perhaps it’s just the one-off gift for yourself — a lovely cashmere scarf, some glittery costume jewelry, a quick massage for your tired and achy feet or back.
Then there is the gauntlet of those charging a monthly fee for services ranging far and wide. Only $29.95 a month (12-month minimum, and God help you if you forget to provide the requisite 90-day cancellation notice).
I attended my first NAR Annual and Expo back in 2006. Maybe it was 2005, I don’t know, the years seem to all merge together. Since that time, I’ve had this weird desire to walk the entire expo floor and add up what it would cost to buy one of each. Yeah, one of each and every thing for sale at the expo.
No, I didn’t do that this year. Although I did give it a shot.
Armed with my iPad, I set out down one row of the expo floor, fully intending to stop at each booth, sample the wares and note what was being sold and for how much.
The very first booth I hit up proudly proclaimed, “We aren’t trying to sell you a thing!”
Yeah, that’s why you spent in the neighborhood of $10,000 for a table, a chair and a lousy Wi-Fi connection, just so you can show me something that might solve all my troubles that you plan on giving away for free.
Fifteen minutes later, I still couldn’t figure out what this vendor was selling. So I dropped a big question mark onto my spreadsheet and moved along.
Want to watch a vendor lose his or her mind? Walk up to them on the trade show floor and simply say, “What are you selling, what does it cost, and what does it do for me?”
Most can’t answer that. You’ve opened with a statement that immediately throws them off their script. Their eyes glaze over, they flounder and hem and haw. They can’t articulate their value proposition, despite standing in a booth that, at least in theory, is dripping with examples of the value of their product.
I made it to about booth number six (of 421!) in my quest to quantify the cost of all the shiny objects before I gave up. It was virtually impossible to ask simple questions and receive simple answers.
What can you do for me?
Meandering aimlessly about, I continued to approach vendors slogging their wares, solely focused now not on cost, but on who could succinctly and effectively tell me or demonstrate to me, the value proposition of their product.
Several came up to bat, and every single one went down swinging. Some immediately launched into competitor bashing. I didn’t want to hear what the other guy can’t do, I want to hear your solution.
Most had remarkably lame presentations, some chocked-full of industry buzzwords and jargon that felt like they were jammed into the scripts simply to make them sound important.
Others seemed more fear-based than fact-based, with more than one vendor promising to “future-proof your business from disruptive venture capitalists” — whatever that means. To listen to some, you’d think the economy was on the verge of world-wide collapse and that the end of time itself is nigh.
Agents have long struggled with identifying and expressing the value they bring to the real estate transaction.
It’s not an easy thing to do.
Jump into a discussion on “discount brokerages,” and you will immediately be presented with something like, “Well, you get what you pay for.”
Really? And what, exactly, is it that consumers are paying for?
There are the tangible things like professional photos, videos and online marketing. Then there are the more soft and fuzzy things like, “representation” and “negotiation skills.” Everyone knows that a good agent is a “neighborhood expert,” but what exactly does that mean?
Yeah sure, you know the inventory. You know the major builders in the area, maybe you even have a clue of their spec inventory and build times. You can almost always say which elementary school is in what neighborhood’s school boundary (or at least you know where to find the most current boundary map).
But are you really the neighborhood expert? Are you up on the latest from the town’s planning commission on what the plans are for that big vacant lot down the road? Are you aware that there is a proposal on the table to consider changing its zoning to allow for commercial use?
When the wind blows out of the south in the cool winter months, do you know which homes suffer from the brown cloud blowing in from the dairy farm four miles down the road?
Forget neighborhood expert, know your value
Can you define your value proposition quickly and effectively, in language your non-real-estate-trained client can understand?
If you are honest with yourself, the answer is most likely no, you can’t define your value proposition. The vendors in the space can’t, the MLS can’t, your association can’t and you can’t. Or at least you can’t do it well.
You are not alone.
So practice. Come up with three or four short phrases — one or two sentences is all you need for each one — that explain in simple terms what services you offer to potential clients, with special focus on what it means for them. Remember, it’s about them, not you.
Once you’ve formulated some value proposition statements, run them past your friends — your non-real estate friends — and see if they understand your value and can recite it back to you. If not, be prepared to modify and adjust your statements until they succinctly and effectively communicate your value proposition.
Just doing this exercise will place you well ahead of many in the field. If you can actually come up with a solid way to communicate your value prop, then you’ll be miles ahead of everyone else who is still swimming in a sea of shiny objects.
Jay Thompson is a real estate veteran and retiree in Seattle, as well as the mastermind behind Now Pondering. Follow him on Facebook or Instagram. He holds an active Arizona broker’s license with eXp Realty.