The Future of the Real Estate Industry – Part Two

It’s obvious that the real estate industry is changing. And it’s changing more rapidly than ever before. But where is it going? And where does it need to go?

I touched upon things such as Barrier To Entry, Oversight and Enforcement in part one of this three part series. Here’s part two…

Technology

Emerging technologies, social media and social networking are just some of the things that have and are continuing to change the way consumers interact with agents and conduct their real estate business. Most “old timers” either don’t get it or don’t want to get it. They have plenty of referral business built up over the years and they’ll do just fine without doing anything differently. That’s ok! I applaud them and hope I can say the same for my referral business 20 years down the road.

But what about all the first and second time home buyers and tech-savvy consumers who want an agent who speaks the same language as them? Their reliance on the internet and technology for research and purchasing goods is unprecedented. Just look at CarMax, Zappos, eBay, Amazon, Overstock, CarFax and the thousands of on-line forums about various products and services.

Though we’ve come a long way, we haven’t quite figured it out (yet). The technology companies who happen to focus on the real estate commodity don’t get real estate. And the organizations and associations within the real estate industry don’t get technology. There needs to be a healthy and good marriage of the two for it to work.

We need to educate and promote technology and current trends to agents and brokers. We need to stop calling everything new “mumbo jumbo” or a “fad”. Perhaps it is a temporary thing, but it works because it’s what consumers want and need right now. Will it change down the road? Absolutely. But more than likely, it will involve some sort of new technology so the RE industry better get used to staying on top of technology whether they like it or not.

We have to realize and come to terms with the technological and social needs and savvy of today’s (and tomorrow’s) consumers. We have to communicate with them on their level and give them what they want otherwise our value proposition and relationship with them will erode like an unkept beachfront.

Marketing

DISCLAIMER: Not all markets are the same so the “new” type of marketing and advertising that works in metro areas such as mine (DC/MD/VA) may not be as effective as traditional marketing in other, smaller towns/areas. The DC metro area is fairly tech-savvy and local statistics show that 49 percent of consumers found the house they ultimately bought online, 32 percent found it through their agent, 15 found it by seeing the yard sign, 3 percent found it through print media and 1 percent found it through an open house.

Marketing is becoming synomymous with technology because technology has dramatically changed the way marketing is done and its cost. The ROI on traditional marketing such as print advertising, post cards, billboards and grocery cart ads is dwindling while the ROI on “new” forms of advertising and marketing such as social networks, social media, property web sites, virtual tours, slideshows and blogging is increasing dramatically. As Inman News said, “The dependency on print ads is unquestionably over.”

If you are to have an effective marketing campaign, you have to reach out to your target audience and then engage them. If over 85 percent of buyers and sellers are going online for information about real estate and 49 percent of buyers found the house they bought online, then you should be focusing your personal branding/marketing and listing marketing efforts online. That’s how you target them.

This is only the tip of the iceberg when it comes to the dependance of the internet by real estate consumers and if you’re late to the party, you may miss a large chunk of current and future business. One big part of that is Google. Google rewards those who have been focused on their online presence longer and “who have done no evil” and they’re not quick to elevate newcomers to the first page of results. There’s more to SEO than that, but that’s one important piece of the puzzle when it comes to getting in the game early and being ahead of the competition in the future.

How do you engage them? Be yourself and don’t try to sell them, definitely not on a social media, social networking or blogging platform. You can have your “salesy” static web site, but save that for other uses. Your marketing efforts should be focused on “engaging” consumers, not “selling” them. And if you really want to know the ins and outs of how to engage consumers, there are plenty of excellent people to learn from right here on AG as well as across the rest of the “RE.net”.

(Part three coming after Turkey Day)