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Make Your Own Noise: Keeping Your Brokerage Relevant and Valuable

Nov 6, 2018 by

“Gino Blefari, CEO of HSF Affiliates LLC, co-moderates RISMedia’s 23rd Annual Power Broker Forum at the REALTORS® Conference & Expo. (Credit: AJ Canaria of PlanOmatic)

Staying relevant—that’s the name of the game in today’s highly competitive real estate industry, and the key to not only surviving the endless barrage of new technological trends and disruptive business models, but thriving, as well. At RISMedia’s 23rd Annual Power Broker Forum, “Compete—and Win—in a Changing Real Estate World,” held at the REALTORS® Conference & Expo, industry experts weighed in on how today’s brokers can beat out the competition and adapt to the modern era of real estate.

The forum was moderated by John Featherston, founder, president and CEO of RISMedia, and Gino Blefari, CEO of HSF Affiliates LLC, which operates Berkshire Hathaway HomeServices and Real Living Real Estate. Lacey Conway, president and principal broker of Latter & Blum, Inc.; James D’Amico, CEO and president of CENTURY 21 North East; Whitney LaCosta, executive vice president of Coach REALTORS®; and Mike Schlott, president of Kinlin Grover, Page Taft and Randall REALTORS®, were panelists.

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(L to R) John Featherston, Founder, President & CEO, RISMedia; Mike Schlott, President, Kinlin Grover, Page Taft and Randall REALTORS®; Whitney LaCosta, Executive Vice President, Coach REALTORS®; Jim D’Amico, CEO & President, CENTURY 21 North East; Lacey Conway, President & Principal Broker, Latter & Blum, Inc.; and Blefari (Credit: AJ Canaria of PlanOmatic)

With new entrants to the real estate space commandeering attention on what seems like a daily basis, there’s a lot of noise to work through in order for
brokers to make themselves heard—and this noise can distract from recruiting strategies, retention efforts and agents’ lead-generating and client conversion strategies.

“Present-day companies are looking to appeal to agents and the consumer, but there’s a threat to conventional full-service brokerages: companies that are looking to disrupt the industry’s value chain,” Blefari kicked off the forum. “We are about to see an epic battle between discount brokerages and consumers who think they are being overcharged versus full-service brokerages who believe in their core that they deserve what they earn. You’ve got to treat these guys very seriously—you don’t attract hundreds of millions in capital without having a compelling business plan.”

“There’s a lot of noise out there, and you can lose your focus,” said LaCosta. “You have to know what your value is to agents and clients, and stick to that value. Focus on that and you’ll be successful.”

Going a step above means brokerages have to make enough of their own noise to stay relevant and draw away some of the attention that today’s disruptive business models are reaping—after all, they’re primarily catching the eye of the media because they’re new and unproven, reminded Featherston. For brokerages that have a set track record and have made a name for themselves in the industry, it’s crucial they use their value proposition to make their own commotion and let their voices be heard.

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“(L to R) Schlott; LaCosta; and D’Amico (Credit: AJ Canaria of PlanOmatic)

“We are making noise on a daily basis, so it’s hard to hear the other noise,” D’Amico shared. “Our new office, our new lead generation strategies, our new logo, our new tools—that’s the noise that will drown out the pestering emails and the weak recruiting attempts.”

The crashing sound of symbols dominating the conversation? That’s technology, which needs to be embraced to be able to perform and meet today’s “tap and get” consumer expectation. The competition is regularly introducing business models that use technology to target and alleviate the leading pain points for clients today.

“You have to look at your company’s history with the consumer and figure out the pain point. How can we take it away?” LaCosta posed. “If you can do that, you make the experience better for the consumer—and if you don’t take it away, another brokerage will do it for you.”

Culture also plays a significant role—there’s hardly anything as powerful as core values to attract attention and create a boisterous presence. Many real estate disruptors use financial incentives to lure agents; however, many who sign on with these initially-appealing brokerages find that the culture is not what they expected, nor an environment in which they can flourish.

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“Featherston co-moderates RISMedia’s 23rd Annual Power Broker Forum. (Credit: AJ Canaria of PlanOmatic)

“Recruiting isn’t about emails or postcards anymore; it’s about contact and finding the right people that fit with the culture of the organization, and going after those people,” said Schlott.

Standing above the competition doesn’t have to mean taking in any and all agents; in fact, relying primarily on agent count can backfire on brokerage productivity. Filling the agent base with quality, professional members—who will not only bring in profits, but also market the brokerage simply because they believe in the cause and have an innate loyalty to the business—will ensure the brokerage outshines the continuous influx of recruitment emails that competitors send.

“Our managers and our agents are our best advertisers,” said Conway. “If they are out doing business and doing well, we don’t have to call around—they want to be with us. We have to do a better job of telling our story, and that’s simply about the people that make up our company—they make us what we are.”

The keys to marketing through the noise and winning in a changing real estate world?

“Culture trumps strategy—tell your story better,” stated Blefari, who also summarized four tips that can lead to a higher chance of attracting and retaining agents and clients:

  • Focus on production, rather than bodies.
  • Get your people to use and adopt technology.
  • Go where the expectations are high and deliver the next big skill.
  • Become better, stronger and more unique.

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“The panelists presenting at RISMedia’s 23rd Annual Power Broker Forum (Credit: AJ Canaria of PlanOmatic)

Continuing coverage of the REALTORS® Conference & Expo to come.

Liz Dominguez is RISMedia’s associate content editor. Email her your real estate news ideas at ldominguez@rismedia.com. For the latest real estate news and trends, bookmark RISMedia.com.

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There’s No Room for ‘B.S.’ in Today’s Brokerage Landscape

Aug 12, 2018 by

In early 2017, one of our upstart East Coast franchises, HomeSmart Realty Advisors in Philadelphia, adopted the phrase “No B.S.” (no broker splits) in their marketing to agents. This statement is powerful because it clearly summarizes the frustrations agents have with “traditional” models. It also explains why thousands of agents continue to look to a model like HomeSmart’s as the place where they want to grow their business.

A Transaction-Fee Business Model Is Not a Discount Brokerage

When I was an agent, there weren’t a lot of options. If you wanted to be an agent, you had to deal with broker splits—or B.S., as many agents would say. You gave up 20, 30, 40 percent or more of your commission every time you sold a house—and, you worked hard for that commission. Paperwork and file review was a slow and inefficient process. More time was spent chasing approval and signatures than getting leads and listings.

That’s why, the day I opened HomeSmart in 2000, I started building technology that, combined with brokerage business systems, would allow brokers to offer agents an alternative to brokerage splits (B.S.) by keeping 100 percent of their commissions, and, at the same time, run a profitable brokerage business.

Early on, there were dissenters and those who labeled us as a discount brokerage. Nearly 20 years later, the industry finally caught up to what I knew then. Technology, efficiency and customer service would become the recipe that enables growth for both the brokerage and its agents.

New Models, Old Problems

Today, there are new models and brokerage concepts emerging by the week, it seems. Some of them follow changing consumer preferences. Others promise ownership in various formats. All ask the agent to give up portions of their commission.

While these trends continue to get headlines, what we’re experiencing is that agents would rather have control of 100 percent of their commissions, and make their own personal decisions on how to invest in their businesses and their future.

Why the 100 Percent No B.S. System Wins

What many of today’s trending brokerages continue to ignore is balance. Some take the extreme position of being all-in on technology, but in ways, agents still end up paying heavily in commissions and extra fees. iBuyers have started to retrofit agents into the transaction, but not in a way that allows agents to be in control of their business.

Tech-enabled systems must help agents effortlessly navigate their day-to-day business and their sales transactions, so they can prioritize their relationship with their clients at every step. Balance of technology, process and people has always been the core focus of the HomeSmart brokerage business system, and, it works.

That same start-up franchise in Philadelphia adopted our model and grew from zero to just under 100 agents in one year. As our industry continues to grow and change, at HomeSmart, we’ll continue to stay focused on a business model that removes the B.S., leverages technology that supports operational efficiencies and allows our agents to provide exceptional customer service to their clients.

Widdows_Matt_85x100Matt Widdows is the CEO and founder of HomeSmart International. HomeSmart is built around technology that provides franchisees and agents with cutting-edge tools, which enable them to spend more time focusing on clients and the profitability of their businesses. Learn more about franchising opportunities at HomeSmart.com/Franchising.

For the latest real estate news and trends, bookmark RISMedia.com.

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Building a Virtual Brokerage with Strong Agents and Superior Online Leads

Apr 2, 2018 by

Monroe_LucasFor Lucas Monroe, broker and chief executive officer of Kendrick Realty, Inc. in Pleasant Hill, Calif., it’s all about accountability, systems and success with online leads. In the following interview, learn how in just the first few months of the year, his office has already surpassed last year’s sales.  

Region served: Greater San Francisco Bay Area
Years in real estate: 8 in real estate, 2 years as a broker
Number of offices: 1 in California under Kendrick Realty, Inc., and a second in Florida under a different name
Number of agents: 17 in California; 19 in Florida
Average sales price: $ 550,000 in California; $ 285,000 in Florida
First thing you do when you arrive at the office? Power up the computer and have an assistant give me the daily schedule.

Can you tell me about your office structure? I got my start on the real estate investment side of things, and this approach has carried over to the way in which my co-owners Dan Sundberg, director of people and culture, and Lisa Sickman, director of learning and performance and I operate Kendrick Realty. Our view is agent investment-focused. We spend a lot of our time looking at our REALTORS® as individual businesses that we as a brokerage are investing in.

Do your agents work from your office or remotely? We own our office outright, and it’s available to our agents, but while we get agent traffic every day, not everyone comes in every day. For the most part, our agents are virtual, which is how we set up our business model. Our view is that agents are most productive when they’re out in front of clients, so we try to provide enough opportunities so that they can do that daily rather than spend time in the office.

Since your agents spend less time in the office, how are you creating camaraderie within your company? Once a week, we have a team huddle call, which is a quick phone call with each agent where we go through stats, goals and company announcements. Since real estate is all about community, we’re very involved in ours, so we participate in monthly charitable events. We rotate month to month between our covered counties. We might do a local beach cleanup or a food packaging day, and we invite our whole team to come help with those events to do something social together and give back. We also do a monthly all-hands meeting where we invite the entire team to our office to go over new company updates.

All of our agents have a unique level of access to us as owners. We make ourselves accessible for one-on-one discussions to make sure our agents can continue learning and overcome difficulties to maximize productivity.

Who pays for the marketing and advertising? We put our money where our mouth is: we invest about $ 4,000 a month per agent, just in lead generation.

What gives you confidence that these opportunities are not wasted? Our custom CRM gives us a lot of transparency. We can look at agent leads and see how our agents are planning their day to make sure nothing falls between the cracks. We also have a core team of 20 full-time employees that we refer to as our client concierge. They are responsible for following up with our pipeline of leads and focusing on lead engagement.

Where are you getting your leads? We get the majority of our leads from realtor.com®.

What kind of results are you getting? Realtor.com® has allowed us, as a brand-new company just over a year old, to build up a lead pipeline of about 22,000 leads between California and Florida, which is incredible for any brokerage, but especially for one as young as ours. In addition, realtor.com® has enabled us to grow and scale into new areas, providing us with a predictable look at a fixed cost and a fairly consistent pipeline.

How do you train your agents to close online leads? Dan and Lisa have put together a new agent boot camp that all our agents go through. This boot camp is a week-long, eight-hour-a-day intensive intro to the way Kendrick Realty approaches the business, and a big part of that is focusing on how to be successful with online leads. The biggest problem other real estate professionals typically have with online leads is a lack of consistency. A typical real estate professional investing in their own business might spend $ 400 – $ 700 a month and that might bring in 4 – 8 leads, which is not a sufficient volume. So, a big focus for us is making sure we have enough lead scale that we’re able to sift through everything. Some will be golden, easy sales, some will be hard work, and some won’t turn into anything. But with a sufficient volume, we’re able to make consistent money for our agents and ourselves as a brokerage.

Any projections for the future of the company? We have intentions to open two additional offices this year. On the financial end, our sales from January and February 2018—plus what we have in contract—is already equal to our entire sales for all of last year. So, we’re having phenomenal growth. Last year was all about making sure our fundamentals were strong, that our systems were in place. Now, we’re looking forward to continuing to grow in 2018.

For more information, please visit www.realtor.com/brokerwin.

Zoe Eisenberg is RISMedia’s senior content editor. Email her your real estate news ideas at zoe@rismedia.com.

For the latest real estate news and trends, bookmark RISMedia.com.

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Is Your Brokerage Millennial-Social or Anti-Social?

Feb 5, 2018 by

It seems that with each passing week, another report, study or survey is published pointing to the impact social media can have on a real estate agent’s marketing mix. Coincidently, this data suggests a direct correlation with the world’s largest and most powerful market segment: millennials. While many real estate agents are attempting to embrace social media channels in their marketing mix, real estate brokerages are noticeably absent.

It’s difficult to deny that social media has surpassed traditional media, including cable television, with respect to audience engagement, time spent, and media consumed. Equally undeniable is the fact that the largest, most socially engaged and technology-dependent demographic in the history of the world has made social media the most powerful marketing channel. Millennials have become the largest segment of buyers and potential buyers in the history of the United States. This shift in marketing is creating opportunities for real estate brokerages to build one-to-one relationships with this group of customers like never before. Brokerages should be investing aggressively in social media, becoming the experts at using this channel to engage and interact with tomorrow’s customers, today.

After almost two decades of consulting brokerages, I can imagine that most would be asking the 64 million-dollar question: How? Building relationships with millennials requires social media specialization to maximize value. It’s important to note that if you don’t already have a social media specialist on staff, it’s time to recruit and hire one, or find qualified third parties that can assist.

Statistical data proves that recommendations and referrals from people via social media channels convert to clients at more than 70 percent, which is incrementally better than the traditional 2-3 percent conversion rates from channels like online portal leads. Add to this the fact that in 2015 and 2016, almost 80 percent of all revenue generated in real estate was procured via spheres of influence, not from random strangers. While the methods for connecting with people are evolving, the concept of persuading and influencing customers through direct contact is a time-honored practice that works. The cliché that real estate is a belly-to-belly activity still holds true, though the approach is shifting dramatically. Social media presence and targeted engagement is proving to deliver the highest returns on investment for those that understand how social media “works.”

Additionally, brokerages that focus on social media as a cornerstone for their marketing mix are emerging as the leaders in recruiting efforts while simultaneously finding new customers and business opportunities for fractions of the customer acquisition costs compared to traditional methods. The greatest challenge for most brokerages is that they lack the necessary knowledge to create an effective and impactful social media strategy. Fortunately, companies like Elm Street Technology offer social media consultation at the brokerage level and provide free social media boot camps for agents onsite in the brokerage office.

If the plan is to grow your business with the largest demographic of consumers in world history—and you agree that social media is a cost-effective method—invest the time to create a robust social media strategy or invite professionals to help you map out a plan. Avoid being anti-social and embrace more millennials with a commitment toward building more relationships.

Frank Chimento is vice president of Brokerage Development at Elm Street Technology. For more information, please visit www.elmstreettechnology.com.

For the latest real estate news and trends, bookmark RISMedia.com.

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Ask the Expert: Why Is My Brokerage Not Profitable?

Jul 2, 2016 by

Today’s Ask the Expert column features Arthur Darmanin, Chief Executive Officer with Sellstate Realty Systems Network, Inc.

Q: Why is my brokerage business not profitable?

A: The answer is simple, yet complicated. People in the brokerage business will tell you that the business is a numbers game. The idea is that the more agents you have, the more closings you’ll have, and the more money you’ll make. The concept is fairly simple.

The reality of the situation is a lot different. In order to be profitable, you must have closings, and to do that, not only do you need a lot of agents, but you also need productive agents. And that’s where it gets more difficult.

What many brokers fail to realize is that most agents will only join you if they’re convinced that they’ll close more deals or do just as well with you financially while having more free time.

So it boils down to your value proposition. Unfortunately, most brokers rely on offering higher commissions, and that’s where profits go out the window. I meet many brokers who are quick to brag about how many agents they have. Some offer 100 percent with a small (or no) monthly fee, and I’ve seen transaction fees for as little as $ 50 per side.

Top agents deserve high commissions because they’ll bring you a book of business, but not every agent is a top agent, nor will they all bring you a book of business. The worst mistake is that these deals are offered to anyone regardless of talent or experience.

Why are so many falling into this trap? What good is having 100 agents if you cannot afford to pay yourself?

I recently analyzed a brokerage that has over 120 agents. The gross revenues were under $ 100,000, and after office expenses, the net income was so low that the broker had no choice but to sell to supplement their income. Why have the headache, responsibility and liability if you can’t even pay yourself a decent wage? The scary part is, I’ve seen a lot worse.

Brokers are going into business unprepared, with false expectations. They fail to understand the principle that if you recruit on price, you’ll lose on price. There’s always someone more desperate than you out there that will give a better deal. It’s a race to bankruptcy.

The solution lies in your value proposition. What do you truly have to offer to entice good agents to join you? Do you provide technology, lead generation or training that’s structured with supporting material? Would you join a brokerage like yours?

If your value proposition isn’t good enough, you need to restructure your operation. Find out what tools agents need and provide them. If they aren’t affordable, consider joining someone or buying into a franchise that provides them as part of their value proposition. Do whatever is necessary to make your business model profitable.

To get yourself started, begin with a realistic business plan. What is it costing you to run your business? How much can you realistically expect per closing? How many agents do you need to have enough closings to break even? This exercise will help you start thinking the right way.

Once you have your plan in place, work on your value proposition. Remember, a good agent will only join you if they feel that you can provide them the support and tools to close more deals.

For more information, visit www.JoinSellstate.com.

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