Real estate’s evolution in recent years has placed agents’ profits “at risk,” one industry leader argued Tuesday morning, meaning that they need to evolve into more comprehensive service providers who focus on customer experience.
Ron Peltier, executive chairman of HomeServices of America, laid out his argument at Inman Connect New York during a session titled “Staying the Course and Not Getting Distracted.” The idea, he said, is that new technologies have, among other things, made listings ubiquitous — and thus reduced the gatekeeper role agents used to play.
And that means “our industry is maybe vulnerable where we are.”
“Those fees that we’re charging and the margins that we’re charging to the consumer are at risk,” Peltier said, “unless we expand our value proposition.”
But Peltier also said that there are things both agents and brokerages can do to keep turning a profit. In general, he suggested agents focus on the customer experience, saying that research suggests people are less interested in rapid transactions than they are in simplified transactions.
“The customer would really prefer one-stop shopping,” he told a packed ballroom. He added a moment later that “the customer deserves to have a great experience in the most significant investment, financial transaction, they’re going to make.”
In the case of HomeServices of America, Peltier said the company has tried to improve the customer experience by adding services such as mortgage, title and insurance. The goal is to “create a superior customer experience” where one provider can deal with all of a consumer’s core real estate needs in one place.
“Whatever part of the business that you’re in,” Peltier continued, “we should be focusing on the customer first and then working backwards.”
Peltier also said that real estate professionals who want to defend their margins need to think of the transaction as “just the beginning of the homeownership experience.” If they want to succeed in the business, then, they should work to become a point of contact for their clients other needs.
Peltier specifically suggested helping consumers with services such as refinancing, or replacing major appliances in their home.
“We should be involved in helping the consumer, our customers, manage their home,” Peltier said. “We have an opportunity to stay connected.”
Overall, Peltier was bullish on the state of the industry. He described ongoing tech disruption from high-value companies as “everything old is new again,” and said that real estate professionals can indeed survive a changing industry. But to do that, they need to come to grips with the fact that the “buying process is experiential.”
“People love housing,” he said. “They would like to be dealing with a company that’s got standards, got values and has the best interest of the customer in mind.”