Brokerage Models, Consumerism, Internet, Management Principles, REALonomics

Three Stooges: ’09 Acid Test #3

Meet Curly – Part 3

REALonomics predicts the market mop-up will drag until late 2008 (best scenario) but most likely until the first quarter of 2009. We hope to be wrong.

Until then, we have an open door to begin a process of retooling our enterprises for the New Real Estate Economy, where we will need to compete for fewer transactions in a highly competitive and rapidly changing environment. We have to deal with our lingering Stooges and our ability to do so will be the acid test of real estate brokerage firms during the next upturn in the markets.

1. Acid Test Number One: Revise our Retail Models (bye-bye bricks-n-mortar).
2. Acid Test Number Two: Redefine our Markets (leaving micro for macro).
3. Acid Test Number Three: Redirect our Methods (consumer obsession).

This post focuses on Acid Test Number Three…it’s about our business methods, about the consumer, about business methodology.

Marc Davison wrote a brilliant little piece for Inman (Aug. 7, 2007) entitled A Real Estate Fable, in which he recapped his recent experience at the San Francisco Real Estate Connect. Marc’s article contains many gems, but this statement especially caught my attention:

I asked the speakers…what doesn’t work in the Web 2.0 world. Each, without hesitation, said ‘the hard sell.’ The soft embrace replaced the headlock, the conversation supplanted the pitch.

Right on! Hard sell is out as a business methodology. Why? It’s wrong and it doesn’t work with informed, information laden consumers. Savvy consumers are now rejecting our headlock-like methods. In the Third Economic Wave, which I refer to as the consumer-centric era, conversations will replace the trite sales pitchy lines we learned during the First and Second Economic Waves of the real estate industry. You know, the old Tom Hopkins-like closing approaches…50 lines written on 50 cards!

Body Slamming the Consumer

We are talking about business methodology designed around old selling and marketing techniques that seek to lock-up the consumer in a full nelson. The acid test for 2009 will be seen in our ability to execute a methodectomy that shows itself in hundreds, if not thousands of ways throughout our industry. Our strong arm methods are seen in our information control structures and our lack of industry transparency. Look a bit closer; it’s present in the way our websites look and operate, the language we use in ads, our designations and indeed our business methods that have literally said to the consumer “buy or get out of my car!” Oh, the arrogance!

Stop right here! Before we go further I want to caution you, however, that we resist the temptation to simply replace old, patently obvious selling methods with equally silly and trite, Starbuckian relationships.

Diminishing Self, Elevating the Client

The third acid test for rebuilding our operating models is to actually partner with the consumer…as soon as possible…yesterday is too late and so is today and tomorrow. We can’t retool our relationship with the consumer fast enough. The consumer is the methodology…get it? It’s about a mature relationship that is premised upon respect, transparency, excellent customer service, affordability, convenience (for the consumer, not us). It’s speed, accurate answers and images that convey a diminishing of our self-importance in favor of elevating the consumer to seat of prominence.

We have entered the Third Economic Wave (era, if you please) of the real estate industry. It’s a consumer-centric era. The consumer is your new BOSS and he/she/them are going to control the outcomes. It might be a good exercise to ponder what Davison is referring to when he wrote, “The soft embrace replaced the headlock.”

I’m wondering if the current lending mess is the logical outcome of an industry whose models have been predicated on control, secrecy and the slick side of selling…just a thought. Is the current sub prime melt down the result our methods being more about our interests than about our client’s well-being?

Our industry is finally moving toward the acknowledgement that we must be consumer obsessed in all matters. This is an incredibly special time in this industry.

Once again, here are the three acid tests for our real estate business models for 2009:

1. Acid Test Number One: Revise our Retail Models (bye-bye bricks-n-mortar).
2. Acid Test Number Two: Redefine our Markets (leaving micro for macro).
3. Acid Test Number Three: Redirect our Methods (consumer obsession).

And your comments are?

Related posts:

1. Three Stooges: ’09 Acid Test #2
2. Three Stooges: ’09 Acid Test #1
3. Moe, Larry & Curly: Nutshell Blog
4. Mug Shot: A New Front Face & Profile
5. REALonomical: an Economic Mentality