By Dave Robison
Lately, I have heard numerous agents at many different brokerages talk about their experiences trying to get listings. These stories are from top performing agents, not rookies. One of the agents expressed how frustrated they are because, for the first time, the referrals they are getting are interviewing other agents too.
We know that many home buyers or sellers find their agent via referral – and those consumers are getting multiple referrals. Here’s an example: A consumer recently posted a request on their Facebook page for help finding a good agent. That person received about 50 comments that suggested different agents. So what is the frustration of some of these top performing agents? They are getting interviewed and they are often being chosen based on commission and costs, not on reputation, experience, benefits, and results.
Here’s the irony: A recent report came out from IMPREV that discussed the biggest challenge for brokerages. It’s recruiting. What is the major reason why agents switch brokerages? Commissions/better split and lower brokerage costs. The least important reason why agents switched, according to the report? Culture of a brokerage and stronger leadership. In the same ways the majority of agents are frustrated that consumers are choosing them based on commission, agents are actually picking their brokerage based on commission as well.
I have to admit, this survey left me feeling perplexed. And in the same breath, it points to opportunity.
I love books such as Good To Great (HarperBusiness, 2001) by Jim Collins. That book talks about how the best companies have the best leaders. Another example of a great leader is John Wooden (a basketball coach legend). Where does success come from? It comes from great leaders, cultures, and teams. However, agents aren’t picking brokerages on great leaders and cultures…they are picking based on commissions and costs, according to the study.
What is the opportunity from all this? First, when consumers pick agents on commissions and costs, that shows signs of a commodity market. Second, when the overwhelming masses are picking their brokerages on commissions and costs, that shows signs of a commodity as well. Every market that is a commodity has an opportunity for someone to provide an experience or value, meaning, people will pick you based on reputation, culture, benefits instead of commissions, and costs – if you prove it worthy. This opportunity is the next Starbucks or Cirque de Soleil. Out of a commodity, great companies can be built.
Anyone can play the commission/fee game. “I’ll give a better fee than the next agent,” or, “I’ll provide a better split than the next brokerage.” That isn’t visionary nor revolutionizing. That is a dog-eat-dog world.
So you want consumers to pick you based on commission? Or do you want them to pick you based on your value, reputation, and benefits? The first step is to change your own mindset. You also need to pick a brokerage based on their culture and leadership.
Your value and creation of value is about your mindset. If you don’t believe in value, neither will your clients.
Dave Robison, known as “Utah Dave,” is broker/owner of UtahDave.com Neighborhood Experts.