Inman news is a real estate industry site “Where Real Estate and Technology Connect.” There are usually blog-like discussions going on about various topics in the real estate industry. This morning’s lead article was nominally about how real estate offices must shrink (to reduce costs) but was really more handwringing about where the industry is going. To me these kind of discussions still miss the point that not just the industry but the way we sell homes must change. So, I jumped into the discussion with this post. I’ll repeat it here because it contains a theme that is central to what I preach here and also because I have neglected this site recently to work on some others. Even though it’s not directly related to luxury real estate in Durham, you may find it interesting that this kind of discussion is going on within the real estate community.
I agree completely that during tough times sellers will seek out the best representation and will not be as determined to negotiate compensation down. What seems to be conspicuously absent from the conversation in the industry is what makes one agent better than another.
Most training that agents get in marketing emphasizes marketing themselves to get clients. Because it really isn’t needed in a boom market, very little attention has been paid to marketing homes. When the inventory is greater than the number of buyers, sophisticated marketing can make a difference. There are several areas that need to be explored including:
1. Developing marketing plans for homes that address in a more complete way all elements of the marketing mix, product, price, promotion and distribution.
2. Further distinguishing between the roles of the listing agent and the buyers agent. A listing agent is much more like what in most industries would be a marketing director. The buyer agent is more like a manufacturer’s rep. These roles require different skills and often different personalities.
3. Compensation issues generally. Commissions are only one way to compensate. Again, in the wider world of marketing, marketing directors are seldom compensated by commission nor do they directly bear other marketing expenses. On the other hand reps are often incented with higher commissions to move products that aren’t moving.
4. Development of tools that support the marketing of homes. For example, I am starting to see things like software to take pricing of homes to a more sophisticated level. Also, we are exploring the use of tools like the one we developed primarily for lead development, BestHomePro(BestHomePro.com)in the marketing of homes. BHP is a sophisticated IDX solution, but we are now seeing how it can be used to support the selling effort and how additional enhancements might contribute even more.
