Judy Reeves, the dynamic COO of NRT, Inc. announced last month that the company had created a mandatory fair housing compliance program that would be uniformly applied by all NRT agents and offices.
Also last month the Tribune Co. announced that its Tribune Interactive subsidiary had purchased ForSaleByOwner.com. The owner of two dozen television stations, several radio stations and such famous newspapers as the Chicago Tribune, the Los Angeles Times, the Orlando Sentinel, the Hartford Currant and the Baltimore Sun, acquired a national real estate site that connects home buyers and sellers through private-party residential property listings. Within twenty-four hours of this announcement industry media correspondents were announcing that the Tribune had gone into the FSBO business.
Earlier this month the California Association of Realtors® made history, upon the release of the 2006 Internet Versus Traditional Buyer Survey, with the announcement that the Internet buyer has become the “typical” homebuyer.
Where have all those helpless consumers gone? Why are they not swarming around our brokerages seeking the expertise and magnanimity of our real estate specialists?
The smartest players in the real estate industry now realize that today's consumer represents a force that can no longer be toyed with. Today's real estate consumer is moving to control their experience and transaction with a vengeance.
This is a totally new posture for the American consumer and it is certainly not typical of the consumer that this industry has been dealing with for the past sixty years. 1947 is a great date from which to track today's consumer.
1947 was when tens of millions of Americans left their wartime pursuits to renew their “civilian” lives. For the consumer it marked the beginning of a long journey towards self-sufficiency and personal power.
Being a consumer during the 1950s and early 1960s was anything but a joy. Every scam and bunko game ever invented was either originated or improved during this period. The relatively rich economies of the post war period combined with a somewhat naïve consumer combined to create an era of vulnerability.
By the mid 60s the plight of the consumer had found a friend in the rising power and influence of mass media. Soon every television station had its consumer reporter. In 1965 consumer advocate Ralph Nader burst onto the scene with his Corvair busting book Unsafe At Any Speed. Consumers also discovered Consumer Reports that, although it had been around since the 1930s, had not enjoyed widespread consumer support. Things began to look up for America's helpless consumers.
By the mid 70s many American families had produced at least one lawyer and litigation became the consumer remedy of choice.
In the mid 1980s John Naisbitt's book Megatrends announced the beginning of the information age. For the first time the American consumer began to discover that protection often equated not to whom you knew but what you knew.
By the mid 1990s the Internet dawned for the vast majority of Americans and slowly consumers learned that being informed no longer required a trip to the local library, or other pillar of knowledge, where the accompanying cost of the parking ticket might be higher than the cost of by buying the wrong toaster.
By the end of the 1990’s the Internet was well on its way to becoming the ultimate consumer “knowledge ground.” Industry after industry found that their long-standing marketing programs had to give way to a new level of informational transparency.
During the past five years the Internet has grown to accommodate such illusive consumers as the doctor's patient, the lawyer's client, the auto dealer's customer, the airline's traveler and yes, finally, the real estate buyer and seller.
Today the Internet is totally focused on providing the real estate consumer with whatever information and guidance they might need. Every month millions of dollars are being invested in this endeavor by investors and venture capitalists of every persuasion.
What has this effort produced? Whether from apathy or stupor, it would appear that the majority of agents continue to treat consumers like their naïve predecessors. Unbeknownst to them something quite dramatic has happened to the once docile consumer.
Consumers are no longer satisfied to just be informed. Indeed today's consumer has flown past knowledgeable and is now banging on the doors marked “effective,” “empowered,” and “influential.” Having shaken off the mantel of naiveté this new consumer seeks to be powerful and invulnerable. Our industry is dealing with a consumer who no longer needs an attorney to defend their rights and seek justice. The Internet is providing the tools and the venue. Every month consumers are becoming more effective in their ability to use the Internet to praise those who are helpful and bury those who would dare to endanger them. Consumers can now return from an agent interaction and tell the world about the treatment they received. They can e-mail friends and family. They can blog about their interpersonal experience. They can go to PropertyShark.com and report what defects and misrepresentations they found in the properties they toured. The emergence of this Internet “armed” consumer is no longer measured annually but rather monthly.
Two years ago the industry rejected the opportunity to establish its own best practices. “Too risky” sounded the in-house experts. Today best practices and standards are being set by any number of online agent and brokerage rating services such as HomeGain, Agent Line, BrokerRate, Property Shark, Realty Baron, Agent Evaluator, and HomeThinking. Each new Internet entrant builds upon the last by reaching further and further into the once exclusive domain of REALTOR® practices.
Why are enlightened industry brokerage leaders moving to take control of their products, best practices and consumer relationships? It is simply the only way to meet this new challenge. Can an industry that purports to provide the consumer with 1.2 million service options prosper in this environment of transactional transparency and openness? That will certainly be the question over the next eighteen months. What is clear is that the brokerage model that had its heyday in the last sixty years needs at least a face lift, and more likely major surgery.
Do you find yourself nervously wondering where everyone went? Are you waiting (and hoping) that scores of helpless consumers will come out of nowhere and flock to your agents when they call “olley olley oxen free?” Those days are over. If you are not now working on building a bright new future in customer relations and best practices, soon your only memories of the joy of real estate will be of a time long past.
