Ryan Gorman spoke with Inman by phone to discuss some of the challenges his company is facing head-on this year and his letter raising concerns about competitor Compass.
Ryan Gorman has a lot on his plate this year. As the CEO of NRT, the nation’s largest brokerage company, which owns and operates a vast collection of residential brokerages under parent company Realogy’s brands Citi Habitats, Climb, Coldwell Banker, Corcoran, Sotheby’s International Realty, and ZipRealty, he’s contending with Realogy’s slumping stock at a time when competition in the space has never been higher.
Still, in the face of this ultra-competitive atmosphere, Gorman tells Inman he’s “laser-focused” on his company’s more than 50,000 agents and their clients. NRT has spent much of the past year rolling out product after product, from its social ad engine to the listing concierge platform and Desk, a single unifying interface for agents to access all their important digital tools.
Ahead of Inman Connect Las Vegas, where Gorman will appear on stage alongside Compass CEO Robert Reffkin in a discussion entitled, “What does the real estate chessboard look like in 2020,” Gorman spoke with Inman by phone to discuss some of the challenges his company is facing head-on this year and his letter raising concerns about competitor Compass.
Obviously, the equity markets haven’t been kind to Realogy this year. Is that something that you have to concern yourself at NRT and does it hurt your ability to recruit agents when that’s the picture being given about the company’s health overall?
Agents and the agents who have not yet made a decision to join us are for the most part focused on – as they should be – their clients and their business. Our conversations with them are really about how our support our tools, and our network can help them grow their business.
There’s always noise and distraction, whether its competitors or equity markets that take place. So lately it might be a little bit more one than the other. But in the end, it ends up being about the agents’ business and our ability to help them grow that business.
Candidly, we’ve done that more successfully recently, than ever before. Just in the past two months, we’ve grown our agent force by over 1,000. So our message of value seems to be resonating.
A lot of the talk from Realogy CEO Ryan Schneider and the leaders at Realogy has been about streamlining and simplifying things while maintaining and even enhancing the company’s value proposition. What are you doing specifically at NRT to address some of those investor concerns and things Schneider has mentioned?
My focus is very much laser-focused on our agents and their clients, but the message is the same.
So our agents are looking for simplification and integration so that they can work more efficiently. Our agent-facing marketing tools when I stepped into this role over a year ago, numbered something like 133. And we’ve eliminated over 100 of those tools as we give back agents a simplified, but amplified value proposition.
The message and the reality of simplification and amplification of that value proposition has gone over extremely well, you’ve probably seen some of that, whether it’s in social or hearing directly from our agents, but our core four value proposition and executing with the core tools that really make a difference for their business going over really, really well.
There’s always a lot of talk in this industry about disruption. What kind of disruption are you seeing in the industry generally? And what is an area you think actually does need to be disrupted more and how can NRT be at the forefront of that with its scale?
So candidly, I’ve seen more talk about disruption than actual disruption. As one agent who recently joined us, told me who joined us from it would be disruptor, we actually have what that disruptor promised. So I think it’s been more talk than execution.
Can you disclose what that is?
For that particular agent, that came over, what they were reacting to is our full suite, but specifically our listing concierge product. We may have talked a little bit about before, but essentially taking the burden off the agent to deliver back to them an incredible listing marketing campaign, that would really blow away the competition and also blow away the listing client.
What specifically does NRT need to provide its agents to weather such a competitive atmosphere now? It does seem like competition is so high because of all the money flowing into the industry.
Yeah, there’s certainly a lot of money and there’s a lot of noise, but agents are still valuing support. And the support that we’re providing is in the form of some of the tools that we’re providing. But also, the individuals who are deeply experienced in their craft, who can really help to coach and train and mentor and grow an agent business. That’s a large part of our focus every day and it seems to resonate, even cutting through the noise of what some of the other promises are. The tools we’re rolling out such as our concierge suite, listing concierge design concierge, social concierge are part of that core value.
You have this social ad engine product developed in partnership with Facebook and you have had a lot of success with that early. How do you think it enhances agents’ ability to serve clients and why have so many agents been quick to adopt it?
Facebook itself is a phenomenal tool, as is the Facebook asset of Instagram. You can very efficiently market your listing or yourself on those platforms, if, and it’s a big if, you’re able to efficiently pull the levers that Facebook gives you access to. That’s a very hard thing to do without considerable expertise.
We have that expertise and we have the scale, to work directly with Facebook, to leverage that expertise on behalf of our clients, our agents, giving them back an opportunity to leverage that expertise, immediately – such as listing, marketing their listing in just a few minutes, but taking advantage of all the learnings that we’ve packed into the backend of the tool that they’re using.
What do you think NRT’s biggest asset is, in this competitive market place?
Our agents. It’s actually huge. We have more and better agents serving clients every day, and those agents are making one another and us better every single day. When we go to learn our way into developing a new program, or developing a new tool, we immediately speak with hundreds, thousands, sometimes tens of thousands of agents to get feedback on how to help them serve their clients better grow their business. Frankly, that’s an enviable scale that we can take advantage of to deliver for them.
For the first time in 20 years NRT wasn’t the top brokerage on the Real Trends 500. You were very close behind it number two and number one in total sales volume. Is that something that concerns you is at all? Is that something that you know, you hear feedback from within the company? And is there something specific you want to do to address that?
So my focus is very much on our agents and our clients and our agents and clients care a great deal about the volume. For a client, there’s no such as size or volume there’s their home, how quickly it can be sold and for what price. On that score, we continue to reign supreme.
Earlier this year, you sent out a letter questioning some of the motives of Compass and kind of framed it almost as a warning for agents in the industry of things to look out for and things to be skeptical of. Do you still stand by the contents of that letter?
I do. The guidance I provide to our managers and that they provide to our agents, I take extremely seriously. Frankly, I take ethics and integrity incredibly seriously as well, which is a big reason why our agents are with us and why our clients do business with us.
Do you have any regrets about sending it or getting out there publicly?
It was obviously intended for our managers, but I have no regrets that it raised important questions for people to ask to ensure that they’re managing their career well and they’re partnering with firms that have the highest levels of integrity.
It seems like lately, traditional real estate is a bit under siege, obviously, you’ve got the Moehrl lawsuit that Realogy is involved in and fighting back against. But there’s been questions in California in the wake of the Dynamex decision about independent contractor status too. Are these things that concern you at all running the biggest brokerage in the country?
Truly, my only concern is that our agents are able to ply their trade and serve their clients in a way that’s in the best interests of both parties. So with all of the questions, litigation and speculation, my only interest is ensuring that remains true.
Another thing that’s come out recently is that the Department of Justice could be looking at the flow of data in the real estate industry. Obviously, NRT is a huge company, so you have access to more data than any other brokerage and you’re constantly using that data for improvements. Is the way data currently flows in the industry beneficial to real estate brokerages? Do you think there are too many roadblocks to innovation?
I think the industry is awash in data, but not necessarily awash in insights. So a lot of our focuses is in taking the enormous scale of data we have and converting that into insights that can be used as action for agents or their clients.
Can you give me an example of that at NRT?
Some of what we’ve been able to determine by looking at massive amounts of data, both our own internal data, as well as external data, is that there are some key determinants as to whether agents are likely to grow their business at a faster rate than the average agent. We can see those signs early on. That allows us to not just approach the future superstars and ensure that we’re able to support their business, but also to work with all of our agents to make sure that their activities are mirroring those of the best and soon to be best.
A lot of your competitors are working on platforms to compete with the likes of Zillow, Redfin and realtor.com. Is creating a top listing website something that NRT is interested in or getting involved in, in the near future?
So Coldwell Banker NRT, where I invest my energies, has one of the best performing brokers websites in the industry in Coldwell Banker Homes.
So we will continue to work to enhance that already very strong value proposition for our agents and our listing clients.
And we’ve got a number of other things that will be disclosing here in the not too distant future, about how we’re able to use our increasing prowess on the technology data side to bring some additional benefits to those parties.
One other thing, since we got a little bit off on a tangent when you asked about what a company with scale can do to really impact the industry. Ryan Schneider has hinted at this a bit, and I suppose I’ll hint at it more, but the actual transaction itself.
While excellent guidance during that transaction can ease the process, there’s still considerable challenges in that and we think that some of those challenges could be turned into opportunities with the benefit of scale and intelligence. So just a note of things to come.
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