RISMedia Forum discusses what buyers and sellers want now
By Maria Patterson
RISMEDIA, May 24, 2007-Leading brokers and real estate visionaries tackled one of the industry’s biggest challenges recently-effectively connecting with today’s consumers-during RISMedia’s Power Broker Forum at NAR Midyear last week.
Attended by more than 500 brokers and Midyear Conference attendees, the Power Broker Forum-“Are You Creating a Consumer-Facing Business”-was led by an impressive panel of real estate experts:
John Featherston, President & CEO, RISMedia and Ed Krafchow, President, Prudential California/Nevada/Texas Realty moderated the event with panelists Allan Dalton from Move, Inc.; Marty Frame, CIO, Fidelity National Real Estate Solutions; Justin McCarthy, Partner Development Manager for Real Estate, Google; Terry Morris, President, GMAC Company-Owned Operations; Kaira Sturdivant Rouda, COO, Real Living; President, Real Living Network Services; Brenda Shipplett, President and COO, Long & Foster; and Bev Thorne, Senior Vice President of Marketing for Century 21.
“Profiting in today’s market requires a comprehensive understanding of the contemporary consumer,” said Featherston.
“There couldn’t be a better time for a panel like this,” agreed co-moderator Krafchow. “The people on this panel are people who have built and understand a consumer-facing business.”
According to Move’s Allan Dalton, the real estate industry has been playing a “three-card Monte” with consumers for years. “For many decades there are some consumers who are of the opinion that we are non consumer-facing,” said Dalton during the Forum. “But in fact, we have actually been mooning consumers. This concept goes back to when I first came into the business and we were told that when someone called on the phone and asked for information, not to answer them, but to instead repeat their question.”
Dalton emphasized that today’s real estate professionals need to start giving consumers what they want-information. In order to do so, he proposed that real estate firms develop research and development divisions. “Giving consumers what they want requires research,” he explained. “Other than NAR, most real estate organizations don’t have research and development divisions. We have to work more arduously in satisfying the consumer. We have a history as an industry of being very superficial in our responses.”
Because of that trend, consumers, says Dalton, have developed “antibodies” to real estate professionals, leading to an overall devaluation of the role of the Realtor in the transaction process.
The dilemma, said Krafchow, is in part related to an inherent contradiction in the industry as to whether consumers want “fast or friendly” service. According to Google’s Justin McCarthy, there is a way to offer both through proper online positioning and marketing.
Today’s real estate professionals need to look closely at the “footprint” they are leaving on the Web, said McCarthy. “What is your Web strategy?” asked McCarthy. “You need to have a cohesive strategy and think about consumers in a new way-not the way you thought about them in the past.”
Responding to continued concern over Google’s intentions in the real estate space, McCarthy explained that Google is not the destination for real estate consumers, but rather a vehicle to get them to where they want to go.
“People who are coming to Google are not looking to Google for Real Estate information,” he said. “They’re coming to Google to look to you for real estate information. The problem is, many of you are not there (online).”
McCarthy added that real estate professionals should, in fact, take a cue from Google in terms of information sharing: “Google is very transparent in that if consumers ask for something, we try to give it to them; we try to direct them to that information. We’re not trying to point people internally. It’s that open-source mentality-it’s that Swiss nature-that’s why people continue to use Google. Consumers will find the information first, and second will remember who supplied them with that information.” Realtors, he added, should strive to be that person who provides the information.
Building New Businesses for Consumers
Krafchow then directed the floor toward Long & Foster President & COO Brenda Shipplett: “Long & Foster is a great company for its size, culture and its build out-for building vertical businesses to serve the consumer.”
According to Shipplett, building vertical businesses under the real estate umbrella in order to better serve consumers is a philosophy that both she and Long & Foster have long held.
“In the ’70s when I was a hard-working agent, I was a full-value agent. I knew what my consumer wanted. Today, agents still believe in providing full-value to customers-the difference now is that it takes a bit more money to give full value and our industry has grown and has many new players. In order to give full value, it takes dollars to train people on the skills they need.”
According to Shipplett, brokerage firms need to have the right resources in place to help consumers and help agents have the “one-stop skills” they need. Instead of just the agent, it has to be the broker and the agent delivering services to consumers.
“As a company we have everything from mortgage and title insurance to home warranty,” she said. “We as a company use our resources, sometimes not profitably, to bring that value to the consumer. We have shown our agents that we, as brokers, are necessary to their business.”
Taking a Cue from Other Professions
In a very moving and unique analogy, GMAC President of Company-Owned Operations, Terry Morris, shared in detail his recent bout with prostate cancer.
What Morris discovered during his experience battling the disease, is that the interaction he had with his medical team was much like the interaction a consumer has with a Realtor during a real estate transaction.
“I want to add color and realism to this concept of a consumer-facing business; I want to demonstrate what our clients should experience,” said Morris.
Morris explained that once he was diagnosed with cancer he went online for more information. He showed up at his first surgeon’s meeting with “stacks of paper” – much like today’s real estate consumer. “My surgeon through this process was my trusted advisor, my expert facilitator,” said Morris, referring to his doctor in the same way the industry refers to real estate professionals.
Just like good Realtors should, Morris’s surgeon used the latest technology, clearly laid out all the things that might go wrong, set up the right expectations for what was ahead and then proceeded to get the job done.
“At the end of the process, I got a survey to complete from my medical team,” said Morris. “My experience was not about the nursing staff, the administrative staff, the surgeons and doctors-it was about me-the consumer. Everybody involved put their arms together and delivered a world-class experience-but this didn’t diminish the role of the surgeon.” Morris has since referred several people to the surgeon.
“If we can establish that world-class experience in the real estate industry, the agent at the end of the day, is the winner.”
Editor’s note: Morris is well on the road to recovery since the surgery for his prostate cancer.
Sending the Right Marketing Message
During the Forum, Real Living COO, Kaira Sturdivant Rouda emphasized the need to create the right branding and messaging in order to accurately target today’s consumers.
“The interesting thing about real estate is that there are so many great hearts and great salespeople-you all want to do the right thing for consumers, but somehow when the marketing message comes across, it gets all messed up and you start talking to yourself instead of consumers.”
Misdirected marketing messages are based on misperceptions that the industry needs to relinquish, says Rouda, such as referring to women as a “niche market.’
“Women are 52% of the population, so we’re really not a niche,” Rouda explained. “Women buy 79% of all consumer purchases, 53% of investments are made by women, 62% of all new cars and 66% of computers are bought by women, and 91% of all home buying decisions are made or directed by women.”
That said, Rouda emphasized the need for real estate professionals to be forthcoming with information. “Women crave information and women will research online-you have to let them get to that information.”
Part of reaching today’s consumer also means looking outside of geographical boundaries. To that end, Krafchow asked Century 21 SVP of Marketing, Bev Thorne, how her company is now approaching the real estate business on a global level.
“As we seek to appeal to global consumers, we need to listen and really understand what consumers want on a global basis,” said Thorne. “As a firm we need to listen to individual consumers and understand different markets. What’s driving consumers in Turkey is different from what’s driving them in Spain.”
Thorne added that while Century 21 is striving to understand the consumer in different markets, it is also necessary to look internally and understand who Century 21 is as a company.
“We’re looking in the mirror and asking, ‘Who are we?’ We are embracing the gold jacket again as a visual representation of a full-service agent, as a symbol of what we’re willing to bring to the table. The gold jacket is something that people can see and understand regardless of what language they speak.”
Not One, but Many
One of the most salient points of the Power Broker Forum was made by Fidelity National Real Estate Solutions CIO and head of the CyberHomes division, Marty Frame: In order to properly create a consumer-facing business, segmentation of consumers is key.
“Our approach begins with the segmentation of consumers. We have gone from the singular word ‘consumer’ to the plural,” explained Frame. “It is our habit to talk about the consumer in the singular, but we know there’s a segmentation taking place and it’s possible to perceive that segmentation online.”
According to Frame, there are 45 million unique users looking at real estate online.
“Forty-five million is a huge, incomprehensible number, but if you realize that there’s 500,000 looking at refi activity, that’s more manageable,” said Frame. “But who are the rest of these people? We tend to treat everybody as potential buyers and sellers, but to properly address these people it requires segmentation.”
Through online vehicles such as Cyberhomes, consumers will eventually segment themselves, said Frame, based on how they use the data. “The more they engage, the more artifacts they leave behind, the more you can engage them.”
“Online, we are able to engage the consumer through information that allows them to segment themselves,” says Frame. “Execution comes down to understanding who these people are and offering them what they’re looking for. Attract these people and get to know them through their behavior. Position yourself as a vertically integrated home service provider to consumers well outside the point of sale. Put yourself in front of them and make it easy for them to press the ‘buy’ button at the end.”
Above All, Know Who the Consumer Is
Power Broker Forum panelists ultimately agreed that understanding who today’s consumers are is critical to success.
“How can we build a consumer-facing business if we’re not facing the facts about who today’s consumers really are,” said Featherston. “You can’t rest on your laurels-the industry is changing.”
Also of utmost importance, added Featherston, is the ability to clearly articulate the value of a real estate professional to consumer: “Every agent should be able to articulate the value of what they offer.”
“We all started out talking about ‘the consumer’ in a monolithic way,” concluded Dalton. “What we ended up seeing is that every consumer is an individual and we need to approach them that way.”