REALTOR® Image, Value and Profitability
Monday, September 24, 2007 - By: John Ansbach
You may not like it, but you know it’s true: the last several years have seen a significant decline in the image and consumer perceptions of the value of today’s real estate professional. Be unhappy about it, fight it and do your best to change these unfair perceptions; but, above all, do not, I repeat, do not ignore the anti-Realtor® messages currently pervading your marketplace. For in the absence of positive, constant messages to counter these negative ones about Realtor® value, professionalism and integrity, real estate professionals across the country will soon find themselves wondering how they came to reside in the same low-orbiting professional esteem sphere as those not-so-respected trial lawyers and used car sales professionals we love to chide.
The Environment
The truth is that the current anti-Realtor® environment is not a new or overnight phenomenon, but rather, a product of a mixed bag of factors all of which have combined to send two very powerful anti-Realtor® messages: (1) “You can’t trust them,” and, (2) “You don’t need them.” However incredibly invalid or biased these messages are, powerful actors have been telling your consumers these are the “truths” about today’s real estate professionals.
“You can’t trust them.” Last year the Department of Justice filed a high-profile lawsuit against the National Association of Realtors® telling consumers across the country that real estate professionals have been acting to stomp out competition and preserve their own greed-driven cartels; the Federal Trade Commission, the Government Accountability Office and other federal, state and local entities joined the act filing lawsuits and holding well-publicized hearings all telling consumers that Realtors® are acting in their own best interest, not in the interests of their consumers. Not to be left out, the media have played their part only too willingly, also telling consumers that real estate professionals cannot be trusted. Earlier this year T-Mobile aired a commercial entitled “Motivated Realtor” featuring a mythical agent spinning facts and lying to clients while demurring on charges she’d “been drinking.”1 The national papers have also contributed with headlines such as, “The 6 Percent Solution: Skip Real Estate Agents,”2 “Brokers Fiddle as Real Estate Burns,”3 and “Broker Commissions are the Real Component to the Real Estate Bubble.”4 The last of these featured an on-line poll in which 84% of respondents said real estate agents’ commissions were generally not justified. All of these factors, as well as the volumes of others we can’t list due to a lack of space, are telling your consumers every day that real estate professionals cannot be trusted, and that, at the end of the day, they’re looking out for themselves and not consumers.
“ You don’t need them.” In addition to these anti-Realtor® negative “trust” messages, other industry players are consistently telling your consumers that they don’t need you. Enter the likes of Zillow.com, RedFin.com, ForSaleBuyOwner.com and the volumes of other FSBO and third party lead generators, all of whom are either saying do-it-yourself, or, at the very least, “let us screen your pick to guide you away from the agents you can’t trust (see message number one).”
The results of these and other anti-Realtor® messages are emerging in a number of places including declining commission rates and lower broker profits. Perhaps the most concrete result, however, is the polling. Specifically, a recent Gallup Poll of more than a thousand adults rated the honesty and ethical standards of 21 types of professionals. Real estate agents ranked in the bottom half of the list at number 11, with just 20 percent of those surveyed giving agents a “very high” or “high” rating. By way of contrast, funeral directors were rated twice as ethical and honest, with 44 percent giving them these ratings.5
The Response
Nationally, NAR has lead the charge to respond to this hostile environment for the betterment of Realtor® communities across the country. This year, NAR continued its Public Awareness Campaign, running pro-Realtor® television spots from March through September. NAR has spent in the neighborhood of $25 million on these and other efforts, including more than 4,000 spots in national TV and radio, 18,000 spots in local radio and 12,000 spots on XM satellite radio.6 Local Realtors® Associations have also ramped up strong pro-Realtor® messaging campaigns, including the Houston Association of Realtors®’ campaign that features powerful television ads promoting the value of industry professionals.
NAR and local boards cannot, of course, go it alone. Every real estate professional must have a hand in this fight, and each and every professional must be as active and aggressive (and perhaps more so) as the anti-Realtor® forces have been in promoting the messages that have damaged the industry. As a starter, I suggest the following:
1. Get serious. Despite the obvious threat, many professionals have ignored the anti-Realtor® messages, finding pseudo-security in the knowledge that their place in the industry is both “natural and eternal.” Since the truth is firmly rooted elsewhere, I suggest agents and brokers work hand in hand making Realtor® image and value a mission critical, interdependent firm-wide priority. Use NAR and HAR resources and arm yourself and your colleagues with the very best in consumer-friendly pro-Realtor® messages and facts. If this is a conversation your consumers want to have, then have it with them and win; no one ever won a war by avoiding the critical battles.
2. Get certified. HAR sponsored and other best practices certification programs are available for professionals to not only raise the level of service and performance they offer consumers; these programs are, moreover, an important advertising tool available to help you distinguish yourself from your competitors. You choose “certified” professionals and services every day over those that are not certified – what makes you think your real estate consumers won’t do the same? Offer the very best in high quality service, and let consumers know about it.
3. Get educated. Did you know that there are now dozens of Web sites at which real estate consumers can rate and rank their agents (and brokers), just like they rate their vacation spots, cell phones and consumer electronics? Web sites such as RealtyRators.com, AgentRank.com and others allow consumers to pass judgment on you and your colleagues following a transaction, oftentimes based on criteria as subjective and vague as “personality.” If you aren’t aware of these sites, you cannot take advantage of them and effectively manage your online reputation and image, an environment all too important to the more than 120 million Gen X and Gen Y consumers who now permeate the contemporary real estate consumer landscape. The truth is that the more you know, and the more your allies know, the better you’ll be able to fight the fight and tell consumers not only why they need you, but just how valuable you have been to the legions of consumers you have worked for over the past weeks, months and years.
In today’s hypercompetitive ever-changing industry, your positive, well-developed image and value to consumers can make the difference between average production and long-term profitability and success. Use the facts that are on your side, embrace the available resources and create a culture in your Realtor® community that not only promotes the value of professionals, but that, moreover, authentically and consistently delivers on the promise of great service that consumers are demanding. The tools are there, the time is now and the battle is on – are you ready?
Author’s Footnotes
1. The National Association of Realtors® sent T-Mobile a letter and demanded that the company alter the ad to eliminate improper use of the Realtor® trademark. T-Mobile officials responded saying the company “respects the rights of third parties in their legitimate intellectual properties,” but that it wasn’t planning to alter the commercial.
2. The New York Times, September 17, 2005.
3. The Wall Street Journal, September 28, 2005.
4. The Wall Street Journal, February 6, 2006.
5. “For Some Buyers, Good Real Estate Agents Hard to Find,” RISMedia, March 20, 2006.
6. “Successful NAR Public Awareness Campaign will Become a Year-Round Effort,” Atlanta Board of Realtors®, 2006. John Ansbach, Esq., is the (Xer) Vice President of RECON Intelligence Services, a national real estate consulting
services firm based out of Traverse City, Michigan.
John Ansbach is the Vice President of RECON Intelligence Services, a national real estate consulting services firm that supports brokerages, REALTOR® associations and other real estate related organizations. John is a graduate of the University of Texas School of Law where he is now a visiting lecturer; he earned his Bachelor’s of Science degree in Economics cum laude from Texas A&M University. Copyright© 2006, John Ansbach. For additional information, contact the FrogPond at 800.704.FROG(3764) or email ; http://www.FrogPond.com
