For REALTORS® to compete successfully in an evolving online and connected world, they must create and implement marketing strategies that take into consideration not only changes in technology, but also changes in consumer expectations and attitudes as well as changes made by their competitors. Everyone is jockeying for position in a race where no one is quite sure of either the starting line or the finishing line.
The above is not to be taken lightly as REALTORS® (all businesses for that matter) have limited marketing resources and must be careful how those resources are deployed. Early adoption of some technologies can be just as costly as late adoption.
Technologies are not adopted overnight and, are adopted in a rather predictable pattern (predictable except as to the time frame) as discussed by Geoffrey Moore in his technology-marketing classic, Crossing the Chasm. Moore names the phases of technology adoption as follows:
- Innovators - Techies&inventers of the technologies
- Early Adopters - those who like technology and want to be among the first to own it, even if there is no actual practical application, only the idea of how the technology might be applied.
- Chasm - unknown time period
- Early Market - those who purchase a technology after practical applications are proven. They tend to be comfortable with technology
- Late Market - Similar to the Early Majority, except they are not comfortable with technology
- Laggards - skeptics
Keep in mind that technology vendors want everyone to believe that their product or service is the "Killer Application" and that those without it will lose the competitive edge. While no specific technology on the horizon is that significant that it will change the face of traditional real estate sales, there are a number of issues that REALTORS® and their associations must monitor, as the way in which these issues are adopted or absorbed into the real estate culture could, over time, have impact in some not so obvious areas, and lead the way to new methods of marketing.
The most significant of these issues are:
MLS is and will continue to be the number one marketing tool of real estate brokers and their agents into the foreseeable future. There is no substitute on the horizon for the gathering, cleansing, maintenance, and dissemination of real property inventories that could replace the current system. Two new concepts that could possibly have dramatic impact on MLS are:
IDX - Internet Data Exchange - creates a new way to advertise, using the Internet and web sites. It is of significance to brokers, agents, and MLSs as the rules of use of content by competing brokers will be established locally (more information available about IDX at http://Realtor.org).
VOW - Virtual Office Web Sites - VOWs might lead to brokers having their own Intranet sites for the licensees in their firm, which then might lead brokers to demand a different fee structure from MLS as their agents access the broker's own, internal database, and not using the MLS infrastructure for access and searches. (See NAR white paper on VOWs at http://Realtor.org). A VOW could use instant messaging or Chat technology and "office hours" to provide consumers with "virtual agents" available to answer questions online about property availability, their specific transaction, or real estate in general. Watch for new and innovative uses of broker and agent web sites.
Internet Applications - Consumers, brokers, and entrepreneurs will continue to explore the use of the Internet in the real estate sales process and from marketing (listing) to bidding (auction) to closing (transaction platform). New plug in technology will allow for higher resolution printing from the Internet, which could change the way brochures, are created and distributed.
Despite the continued evolution of information sources for available housing, home buyers expect to continue to rely on the expertise of real estate professionals for their future real estate transactions according to NAR 2000 Profile of Buyers and Sellers (available at http://Realtor.org).
Look for MLS data being more readily available on handheld devices.
New Business Models - none appear currently to be real threats to traditional real estate sales models, and many alternatives to traditional sales models are now available which include:
For Sale By Owner Companies
Limited Services Companies
Menu of Services Companies
Discount Services Companies
To examine the scope of new business models available, go to a search site such as http://Google.com and type in a search for any of the above. You will find thousands of alternatives for consumers too choose.
TRENDS
Buyer Representation - watch for changes in state laws and for the possible growth in demand for representation by buyers. In addition, states are looking at revising agency and transaction brokerage laws. Exclusive representation of buyers only remains and will remain a very small segment of the real estate brokerage world.
Referral Companies - such as Homegain.com and HouseValues.com have, through extensive marketing efforts, gained a presence today. Watch for agent attitudes toward these entities that will be an indicator of their success and potential for growth.
Referral Communities - REALTORS who participate in nation online real estate communities will share more business with one another. A trust and confidence in not only each others technology expertise, but also shared confidence in each others ethical and professional standards are a direct result of professional online communities.
Online Consumer Communities - As consumers continue to go to the Internet to find housing inventory, they will also look to the Internet to provide local area information and market conditions. This will be provided by communication savvy agents who are comfortable providing information in the environment of an online real estate community.
Permanent e-mail Addresses - Nothing worse then sending an e-mail and not getting an answer. More REALTORS® will begin to realize the importance of a permanent e-mail address and the power and freedom of creating it around their own Domain.
In the end, success in real estate sales requires marketing and service differentiation. Most of what most brokers and agents do to sell a home is the same&neighborhood-to-neighborhood, region to region, state to state. They all place the listing in the MLS, place it on the Internet, put up a sign, put a lock box on the property, hold open houses, and run classified ads. Many will try new approaches to new concepts and new approaches to old concepts. Who will be the winners and losers? No one knows. We do know that it is now the job of the real estate broker to not only think about how they sell real estate today, but also, how they might sell it tomorrow.
