This is your broker speaking. All hands to battle stations!! We have new targets in range. Prepare to change sales tactics and ammunition.”
“Change ammunition?”, the agents on deck cry out, “But, this stuff has worked for 50 years.”
“Yes it has, and most profitably,” shouts back the broker from his seat on the bridge, “But the Combat Information Center now has fresh intelligence on our targets’ size and direction. The old ammo just won’t work. In fact, it will miss them by a mile, or worse yet, explode in our face!”
Let’s take a look over the wise old Skipper’s shoulder at some of that “fresh intelligence” and see what the industry’s new target looks like and where it’s headed.
- The median age of today’s homebuyer is 40.
- The median age of today’s first time homebuyer is 32
- These consumers are members of the “X” generation born between 1964 and 1976
- The average age of today’s top performing real estate agent is 57; someone who is definitely not a member of the “X” generation.
- Real estate agents continue to use sales approaches perfected on their Civic (born before 1946) and Boomer (1946 – 1964) generation clients. This approach does not connect with the X generation consumer.
- The “X’ers” follow a distinct set of values developed from their unique lives and in many ways is diametrically opposite that of the Civics and Boomers.
- Today’s “Xer” homebuyer is rejecting the value proposition being offered by Boomer agents. This rejection can be tracked by looking at the continuing decline in commission rates and a gentle, yet growing trend away from the use of agents
This may not be the first time you’ve seen this “intelligence”. Several major consumer surveys and numerous articles have outlined clearly both the history and value structure of this unique customer group. The most recent two surveys by Murray Consulting/Harris Interactive and by FNIS simply add more validation.
Two factors are now clear. First, the “X” generation has gone from being a fringe market group to being the target market for real estate brokerages. Second, it is now apparent that the majority of agents are relying on traditional sales approaches and choosing to ignore the significant philosophical and personal value differences between the generations.
Compounding the problem is that most firms are making the similar mistake with “X” generation agents and managers. Like their counterparts in other industries, Boomer brokers appear to be electing to manage and control their “X’er” subordinates and sales associates using the traditional rules and values of the Boomer generation.
The results are proving decidedly unsatisfactory and accordingly these new agents and managers have not been able to establish themselves as part of the profit solution. This is an unacceptable situation for all concerned.
The problem is further exacerbated by the fact that many firms’ marketing and advertising themes continue to target the virtues and values of the Civic and Boomer generations. All too many company websites are boring, time consuming and hopelessly third generation.
They fail to contain or even link to the types of information that today’s consumer believes is essential to their real estate shopping experience. Many continue to use this outdated third generation or “company centric” design rather than a consumer-centered approach. Many continue to require simply too many clicks to arrive at specific inventory or content pages.
Recent studies show the consumer’s response to sites that fail to excite or stimulate them is to move from “content” sites to “search engine” oriented sites. This migration is taking them away from industry-related and company sites and contributing heavily to the current “third party referral” phenomena.
These third party sites offer quick information across a range of topics related to real estate (and other areas). And, they offer it from the consumer’s perspective. Because these sites are so consumer-friendly, the consumer is much more likely to let that site refer them to an agent and to other services such as mortgages.
From a cultural viewpoint there is not a lot of time to solve this problem. As the leading edge of the “X” generation nears full maturity and age forty, they are developing fairly permanent impressions of those consumer experiences they would rather avoid. More importantly, they are rapidly developing the power to recognize and financially support and explore those options and alternatives.
Surely no rational business or industry would purposely avoid this huge market segment by failing to modify its approach. So, we can only assume that the real estate industry’s current head-in-the-sand approach must be due simply to a tremendous lack of knowledge about how today’s buyer differs from the one on whom most of today’s successful agents cut their professional teeth.
If that’s true, it’s incumbent upon every firm to ensure that the entire sales team, from new agents to marketing executives, understands the specific attributes and needs of a target group that is well on its way to controlling, if not dominating, the home buying marketplace.
Brokers must appreciate the psychological dynamic associated with this situation is endemic to the culture. The cure goes beyond mere education and approaches rehabilitation. Specific training on “X” generation values and approaches to buying must be provided beyond the sales meeting presentation level. It must be done at the workshop level.
New company routines and procedures must be developed, tested and used religiously. Company recognition and reward programs must include sales performance related to this vital market category. More directly, the continuing value of team members who won’t participate must be reevaluated and acted upon. This is not a drill!
From the research, here are some Important do’s and don’ts of “X” generation real estate marketing:
- Do not use template or canned approaches in your sales approach.
- Do ask “Xer” clients as many questions as possible about the real estate experience they are seeking.
- Do not take phone calls and interruptions when you are working with them. When you are with them, be there!
- Do sell them on family, and a home as a place to build one of their own.
- Do not include your sense of memory of traditional nuclear family life in your sales approach; their experience is probably not the same.
- Do not try to impress them with how hard you work or expect them to appreciate hard work as a value.
- Do promote the home as the primary tool of quality and balance of life.
- Do not try to impress them with formal living areas like dining rooms and living rooms. This group is into “informal” in a big way.
- Do sell the home as a launching pad for their fun. Remember, this group is likely to use the dining room to store their mountain bikes and roller blades.
- Do not promote your company’s prowess and marketplace power. They could care less. Concentrate instead on its ability to identify and provide the specific experience they are seeking. As tough a pill as this may be to swallow, this is not about you or your brokerage firm.
- Do not have a boring website. For this group that’s tantamount to offering up a silent movie. Remember that each click is an eternity.
