A comment from Linsey Ehle on yesterdays post about the Internet’s impact on great REALTORS® has me thinking about group identity this morning.
She wrote, “‘If the data were not such a part of our past value proposition, agents and brokers wouldn’t be bawling about it as much as they do, nor would we see the pocket listing strategy used amongst small groups of power agents the way we do.” And it reminded me of the writings of Joshua Meyrowitz, in his book, No Sense Of Place: The Impact Of Electronic Media On Social behavior.
At the beginning of chapter 8, Meyrowitz writes, “group identity is based on ‘shared but special’ information-systems.” Did private access to special information become a part of the group identity of REALTORS®? I think it would be difficult to argue otherwise. “The change in the information characteristics of traditional groups,” Meyrowitz added, ” leads to two complementary phenomena: the decreasing importance of traditional group ties and the increasing importance of other types of association.”
[vision_pullquote style=”3″ align=”right”] People must now make a conscious effort to maintain distinctions in group identities that were once taken for granted.[/vision_pullquote]
This may be a purely academic discussion, but it’s an interesting one for me. It’s important to understand the possible motivations for group behavior, and the potential for further change as new members come into play who were never a part of the old systems, who were never a part of the group that held this special information. It’s likely they don’t carry the same baggage.
It could be argued that this shift has indeed impacted the group’s behavior, even if true individual agent differentiation has not been impacted. And small group behaviors now appearing seem consistent with Meyrowitz’s findings relative to the reactions of the larger group in the wake of the loss of identity associated with the loss of this exclusive information. “Subgroups develop or continue to exist, therefore, on the basis of sub-sets of shared experience, but their boundaries are blurred by the massive sharing of information through electronic media. Indeed, people must now make a conscious effort to maintain distinctions in group identities that were once taken for granted.” This seems to align with Linsey’s observations about the “pocket listing strategy used amongst small groups of power agents.”
So, there is certainly no question that the authority that has traditionally been given to those with the control over access to information has been removed by the Internet. And at the same time, it has also exposed “back room” behaviors that further weaken the perception of “the group.” I’m certainly not equipped to argue otherwise. But the authority that came as a result of exclusive access to that information was equally spread among all REALTORS®. It was never an individual differentiator. So the playing field was always level in that regard. But the impact is real, nonetheless.
[vision_pullquote style=”3″ align=”right”] Your intrinsic value must be articulated in something other than platitudes.[/vision_pullquote]
Which brings us back to the discussion of the qualities that define a great REALTOR®. “‘Great’ may not have anything to do with gatekeeping,” Linsey writes, “but there is a fundamental shift in our value proposition when we are no longer the one and only source of the information. Today, one must find some way to have intrinsic value that can be articulated in something other than platitudes, but actually demonstrated. And that is tough to demonstrate in a powerful enough way before one is hired in the first place.”
To put that another way, communicating product difference is hard in a service industry. People can’t test drive your product before buying, like they can a car. They can’t sample it at a supermarket on Saturday morning. They can’t try it on. How do you get the real estate consumer to have an experience with you before they purchase? This is the same problem every service industry has to battle. It’s why recommendations remain so important. We rely on the experience of others in making our decision.
So, let’s take a moment to look at the sources of product differentiation and see if there are any clues that might help move this conversation forward a bit.
The major sources of product differentiation are as follows:
- Differences in quality usually accompanied by differences in price
- Differences in functional features or design
- Ignorance of consumers regarding the essential characteristics and qualities of goods they are purchasing
- Sales promotion activities of sellers and, in particular, advertising
- Differences in availability (e.g. timing and location).
This may sound a bit harsh, but it seems to me that a good percentage of agents bank on the ignorance of consumers regarding the essential characteristics and qualities of the goods they are purchasing. And by goods I’m not talking about houses. I’m talking about the services and the quality of the delivery of those services being offered to them. Perhaps this plays a role in the psychology that manifests itself in the expression of fear around feedback on agent performance. We hear this question all the time at RealSatisfied. “What if someone says something bad about me in a survey?” Where does that psychology stem from?
In contrast, the agents I consider great, and my assessment of “great” has nothing to do with their production numbers, never focus on the ignorance of the consumer. In fact, they go out of their way to educate the consumer about the characteristics and qualities essential the a great experience. So, it would be good for any REALTOR® to shift their focus away from activities designed to further buyer ignorance and toward those sources of differentiation that might move the needle more powerfully in a positive direction.
As I look at that list, I’m inclined to immediately remove the “differences in quality usually accompanied by differences in price.” Attempts to differentiate on price in the real estate industry have met with limited success, though I certainly wouldn’t argue that this is not a potential. But for my purposes here, I’m removing it. So what does that leave you with?
I think there are three areas of focus for an agent or broker looking to differentiate.
- Differences in functional features or design: I’m going to label this “the experience” of your brand.
- Sales promotion activities: this includes advertising, SEO, lead generation, content creation, etc.
- Differences in availability: this includes office locations, team activities, responsiveness, ease of access, networking, etc.
This isn’t easy. I’d love to hear your thoughts. Where have you chosen to focus your efforts to differentiate? How do you define your value proposition?
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Featured photo (modified): Some Rights Reserved by Robert Couse-Baker
I’m smiling … and now reading. 😀
I think if the BEST an agent could do is KILL number 3. Be hyper available, then we reset the bar.
I’m inclined to agree. And that doesn’t just apply to real estate.
Thanks so much, Jeff. I appreciate you giving so much thought to my comment. I’m thinking of this topic a good deal myself these days, and particularly after some of the things I heard at T3.
It’s interesting that you don’t consider production numbers as the measure of an agent’s greatness. I certainly agree. I’ve seen far too many agents that are wonderful agents that simply aren’t big producers, and many big producers that I wouldn’t recommend to my worst enemy. But, I do think that really poses a challenge for a buyer or seller in finding an agent. Reviews help, but it can be a tough and scary thing to evaluate.
I do like your three areas of focus and I’m immediately able to think of examples that leaving me nodding my head in agreement. It’s this direction, one that leads to specifics, that I’m interested in going. Feels good.
I’d love to see your examples, Linsey. Wish I could have been at T3. Every report I’m hearing is that it was a stellar success in every way.
Just forwarded this article to my web developer… Thanks Jeff and Linsey
What my clients value determines my value proposition.
Some clients are into the marketing, some are into communication, some value expertise and negotiating skills and some value things that don’t make any sense to me at all. Value is personal and unique to each of us.
My approach is not to guess what others find valuable and important, but to focus on understanding what each client values. I ask a lot of questions to figure out what’s important, make sure I understand what they want, then I ignore the unvaluable and unimportant conversations, explanations and presentations (read boring and irrelevant) and go-all-in on sharing how I will deliver what is most valuable and important to them (read relevant, personal and specific).
I generally run off the rails and lose when I assume that I know what is most valuable to my clients and go all gung-ho on what worked for someone else, or what I would want. It’s the same for all relationships (imo), if you want to know how someone wants to be treated, ask them.
The book Five Love Languages is a great example of how to be aware of and tailor your love|service to match those of the important people in your life; relatives, friends, lovers and clients included.
So my Top Three would be actually be One. My first and most important differentiator is taking the time to understand what my client values. Other points of differentiation would be introduced in support of how I could provide the specific desired results.
Of course the bare minimum, entry level requirement is that you’re honest, ethical, knowledgable and sincere, so that goes without saying.
My 3 cents.
I would pay you more than 3 cents for that.
This is what makes working with Ken fun. Batting shit like this around keeps us sharp and keeps things lively. We don’t always agree (Lord knows … as do some of the agents walking by), but I always look forward to continuing these discussions at the office.
I agree Ken, but only to a point. Can you be surprised? 🙂
My father always used to describe duck hunting. Aim your shotgun at all, and get none. Aim at one, and you will win. I think you have to know your strengths and what you value, and embrace that as an intrinsic part of your value proposition. We aren’t all good at everything.
I agree that listening and responding to the client is inherent to not only a great experience, but often our duty. But, if we are talking about showcasing our value BEFORE they even work with us, that is another matter. I do think we can see examples of that happening. It’s not often, but I see significant opportunity there.
See you in the morning. 🙂
We are definitely talking about showcasing our value BEFORE they even work with us, but I was hearing Ken describe the “experience” of his brand. I think extremely happy clients represent a way for others who have not worked with us to experience us. In this case, they experience us through the stories of someone they trust.
Right. Agreed.
Offering a unique brand experience, marketing for results and excellent availability are spot on! It is not all about us as the agent, it is about the client and offering them a custom solution that is unique to their situation. Plus an experience that is remarkable and referral worthy so they share the experience online and with their friends! Our industry has evolved to being too cookie cutter, one size fits all. Articles like yours help agents think outside the traditional box to build a business not just be an agent! Thanks for sharing!
I love the work you’ve done on your brand, Becky. I was thinking of you and a few others actually when I said, “I’m going to label this “the experience” of your brand.”
While being available and listening are both extremely important to showing value during your transaction (or interviewing for the agency agreement), I don’t think they necessarily show value well before that stage, to garner that consumer’s trust and earn their business.
I think showing a consumer your continual commitment to the industry that allows them to be property owners, and an advocate for the community they desire to be a part of, shows value before the transaction. Enabling them with information and educating them on issues, will show them that you care, and that consumers aren’t just a way for you to earn a buck.
And I’m with Linsey, I see some significant opportunities for REALTORS to not just say that they care, but *demonstrate* it, well before the transactions. Imagine the difference that value could mean to our industry, to our communities, and to the consumers. Hopefully, there will be more to come on that… 😉
“People don’t care how much you know until they know how much you care”
― John C. Maxwell
Thank you, Lori.
It’s a question I’ve been pondering since the day I got into real estate. It’s not simply academic; it’s a crucial topic that every agent should be contemplating. It’s the key to continued success.
I realized fairly quickly that it wasn’t about the quality of services. It’s only a question of whether or not someone can survive long enough.
There’s an agent in my market that does a ton of business by buying listings. He gets so many that it makes him appear incredibly successful. The unfortunate thing is that the consumer can’t see the backend MLS where it shows the price reductions, cancellations and expirations.
Ken is so right, it stings. I lost a million dollar listing because I didn’t offer the seller options – I didn’t ask enough questions. Won’t do that again.
I really connected with this post. Great stuff. Thanks.
Vicki, I find it interesting how different your response is to Leslie’s response.
Why is production irrelevant to this discussion? How can anyone who does 1 or 2 transactions a year be a great agent? I agree it is not the only measure but surely it is a key indicator. So many of the agents who dont do much business don’t keep up, don’t know what they are doing and depend on a competent and experienced agent on the other side to make it happen. Consumers want production stats and eventually, despite our best efforts to keep them hidden, they will get them.
Leslie, I don’t think they should be hidden, personally, but I think that is a different topic. You’ve chosen the low end of the bell curve. What about the sweet spot where the majority of agents fall? At some point, production numbers serve little purpose in helping me understand the quality of service one agent provides over another.
I’m one of those in the sweet spot. I’ve found that the consumer will often go for the top producer while other agents will refer to those in the sweet spot.
I don’t think production is irrelevant; it’s a piece. The largest majority of agents in my association sell 0 houses a year – yes, zero. There’s no way to keep up if you’re not selling any houses. The question becomes how many does it require to say someone is a good agent?
I also agree that stats shouldn’t be hidden. But, again, I also believe it will fuel the consumer belief that the agent who does more is better.