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Will You Succeed Over the Next Two to Three Years?...And Five Other Tough Questions to Ask Yourself Now

By Lane Barnett
August 2005
National Relocation & Real Estate Magazine

The past few years have been a great run for our industry, no doubt about it. Across the nation, real estate professionals have enjoyed record sales and income…and 2005 is shaping up as another exceptional 12 months.

At the same time, consumer-driven changes are dramatically altering our business and the way we provide services. We need to not only recognize these changes, but we also must decide how we will respond to them.

So the question that every serious real estate professional must ask himself or herself is: "How am I going to sustain my success when this market cools?"

Before we get to that, let's acknowledge something very important upfront: our customers are changing. They have already changed, and in a major way. Today's consumers are much more knowledgeable-and, importantly, much more focused on the value of the services they believe they should be receiving-thanks in large part to the instant access they have to unlimited information via the Internet.

Increasingly, consumers are demand- ing to be empowered; they are demanding to play an integral role in how, when and where they access products and services. Consider consumers' wide and growing use of Netflix to rent movies, preferring to receive them through the mail so they may keep them as long as they wish and watch at their leisure, making those once popular "Blockbuster Nights" a thing of the past. Apple's iPod, meanwhile, has ushered in a whole new way for consumers to enjoy the music they want, when they want it, one song at a time. And the Toyota Scion, with all of its various options, literally allows consumers to create custom cars online.

So, what does this mean for you, the real estate agent or broker?

When you get right down to it, there are just two ways of doing business in our industry. First, you can be a discounter. Or second-realizing there's a whole lot more to our business than just undercutting the competition with discounted commissions-sell the value of your services. To all of you discounters out there, a word of caution: You're on a slippery slope, because there is always someone else more than happy to undercut you by providing services that are even cheaper than yours.

For most of us-all the non-discounters-the challenge is helping increasingly empowered consumers understand the value they receive for the services we provide. Currently, consumers aren't clear-they're downright confused, in many cases-about what we do. Why? Because we have failed to articulate how the services we provide distinguish us from every other agent out there (and we all know there are way too many agents out there).

In other words, consumers most often see absolutely no difference from agent to agent-except when a discounter comes along. Now, before you rush out and start offering discounts, consider this: Research has made it very clear that what most consumers are really looking for is value. Historically, in just about any industry (including real estate) about 15% of consumers buy solely on price. That's also roughly the percentage of consumers who opt for "For Sale by Owner" transactions in any given year. And aren't most of the discounters just dressing up FSBOs after all? It's still lipstick on a pig.

Fifteen percent. That leaves a whopping 85% of consumers who are concerned with much more than just price. They want value.

Our challenge is clear: We must "sell" our value and learn to powerfully communicate to that 85% exactly how we are different from-and a much better choice than-the discounters.

As you prepare to succeed over the next two to three years, you need to ask yourself these five tough questions:

1. How do I explain to customers-in this day and age of discounting-that my services warrant a full commission?
2. Do I have a business development plan in place that will prepare me for the inevitable market downturn? Can I create business at will?
3. How am I differentiating myself from my competitors today...and how should I do so tomorrow and in the coming months and years?
4. How can I use technology to better serve my customers…and my career?
5. How can I create a trust-based client relationship that results in repeat and referral business?

For the past several years, GMAC Real Estate has been focused on-some might say we've been obsessed with-asking and answering those questions. The reason is simple: We want our agents and brokers to have sustained success and to enjoy it along the way. And we believe we have a key that will unlock future success-no matter what the market condition.

It's a proven business system called Premier Service®, and it is based on an extensive and thoroughly researched system of service delivery, tools and training, designed to keep our sales associates and brokers ahead of their competition. Coupled with a thorough understanding of the practical use of technology, we have answers to the tough questions that no on else in the industry is even confident enough to ask.

Lane Barnett is the president & CEO of GMAC Real Estate - Franchise. If you're thinking of jump-starting your career or partnering with a firm that isn't afraid to tackle the tough questions and issues head-on, call 800-274-7661.