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Brainwashed by the big box real estate brand


Small is the new big

I recently wrote about how Small is the new Big, making the point of how small brokers are able to compete with the large brand brokers much more effectively than ever before due to the evolution of real estate 2.0. The comments were all over the board, many supported my points and there were several dissenting opinions.

However, a few of the comments left me wondering where some agents’ thoughts come from? Are they really their own opinion or have they been brainwashed by the brand?

This article was originally published on July 07, 2008.

The comments were well presented and came to logical conclusions (I am not attacking the commenter(s), merely just pondering the possibility of broker brand brainwashing.) This comment is very logical, but sounds like broker brainwashing to me…

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Every year I look at every transaction and evaluate the source of the business. If the brand causes one transaction per year, and I were to allocate 100% of the earnings for that transaction as having paid all the royalties for the whole year, where would I stand? If the brand brings any additional transaction, my payback on the royalties far exceeds the royalty I pay. So far, over the past 6 years, the (removed broker name) brand is responsible for 3-5 transactions per year that we would not have received otherwise.

Take me to your leader

Every broker I know makes this assertion when dealing with push-back on commission plans from agents. “Would you question the splits if our brand delivered enough leads to cover these expenses every year?” That’s a hard question to say ‘yes’ to. But if you think through this assertion and realize what you are getting into, then the assertion begins to have less value.

What if a small broker could send you the same amount of leads? Would you still pay more for the brand name? What if you generated so much business on your own that you didn’t have time to work the leads from your broker? Would you still pay more for the brand name? How do you know that you would not have received those leads from a small broker? Why allocate 100% of your work on a transaction to cover royalties?

Do you enjoy working for free?

These aren’t the droids you’re looking for

Granted there can be many reasons (but often times they sound like justification or rationalizations) for going with a large brand name broker, and I contend broker brand means less today than ever before. Small brokers are generating as much or more leads from utilizing web 2.0 tools than many of the large broker brands in local markets all across the country. The real questions you should be asking yourself (and your broker) are… Did the large brand name itself generate business I would not get from a small broker? If so, then does the income from those leads offset the additional fees charged by the large brand? I simply advise you to consider small brands when shopping for a broker. Often times small broker commission plans are far more attractive and you may not give up any leads handed to you by the broker.

If large brand name broker gives you a bundle of services and leads at a cost to you of X and small broker gives you the same bundle of services and leads for Y (where X is greater than Y), then why pay more for the brand? Do yourself a favor and shop broker services and don’t forget to consider the small local broker.

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Written By

Chaotic Good adventurer on a quest to optimize the lives of others. Husband & Father to Wolverines. Founder of RETSO + Managing Director at Path & Post.



  1. Jim Gatos

    July 7, 2008 at 11:16 am

    Adam Sandler – “They’re ALL going to laugh at you…”

    Problem I see in my market area is agents that are NOT with the big brand names are looked at as “second tier” agents; “gypsies in the night”, agents that are not doing very well and that probably the big brand names don’t want anyway..

    The biggest reason I am with a big brand name is due to the value I percieve I get from them in terms of various services I get that I would find either too redundant or too expensive to get on my own. No independent agent or company would be able to match these services. The locally independently owned and operated franchised companies are themselves having a hard time matching those services. The majority of independent brokers I’ve met in my area are pretty much bad tempered, loud mouthed egomaniacs that can’t hold a candle to the statistics in terms of closed sales units we have, and of course they come across as rather bitter.

    Sorry but I get the impression that because a couple of us didn’t agree you automatically think our broker is doing the talking for us. My attitude is money talks and B***S*** walks..

    On the other hand, we in the Greater Worcester – Boston area don’t have companies that come across as yours, too…

  2. Jennifer in Louisville

    July 7, 2008 at 11:44 am

    The web has leveled the playing field significantly between the big companies and the small. A determined and smart small person can compete, relatively speaking, with the big boys (at least on the internet). For me, the bottom line is look at the broker. Not the franchise. The broker, how he runs things, and keeps you abreast on the latest technology/trends in the real estate industry play way more of an important role than whatever flag that happens to be flying overhead.

    I’ve always thought it would be interesting to start a new brokerage called GDI. [For those persons unfamiliar with the college slang, it refers to those persons that didn’t join a Fraternity/Sorority – and stands for: G** D*** Independent.] It definitely would have some built in branding with some consumers.

  3. Bill Lublin

    July 7, 2008 at 11:59 am

    Brad – I don’t have a problem with any choice people make, whether to be with a brand, or try a specific business model, affiliate with a large national company or affiliate with a small or large independent , but I do hate rhetoric without hard factual support.
    What is up with the generalizations my brother?

    The comments were well presented and came to logical conclusions (I am not attacking the commenter(s), merely just pondering the possibility of broker brand brainwashing.) This comment is very logical, but sounds like broker brainwashing to me

    If the comment is logical, why would you assume anything other then the fact that they reached a conclusion on their own? Though you say you’re not attacking them, the statement is absolutely an attack. Even if it was not meant as an attack, don’t you think your comment is at best condescending?

    Small brokers are generating as much or more leads from utilizing web 2.0 tools than many of the large broker brands in local markets all across the country.

    What objective measure are you using to make this statement? Other then “wishing makes it so”, where do we have numbers to bear this out?

    As far as the question :

    “Would you question the splits if our brand delivered enough leads to cover these expenses every year?”

    This isn’t even size or brand specific. Substitute the word office or company for the word brand, and you have every business owner’s conversation with every agent that affiliates with them. If the affiliation with the company doesn’t provide sufficient value for the agent, they will leave. And that value may not be measured in dollars, but it becomes quantified by a good broker (branded or not) so the agent can buy into the company value package. You might re-phrase it by saying “Would you question our commission split if the value of your association with our company was greater then the cost?” It doesn;t matter if you are a national brand, independent, large or small, as a company you need the answer to that question to be yes if you want an agent to remain associated with you.

    In order to have perspective about this you need to have operated with and without a franchise (as a business owner) in order to be able to make a judgement about the efficacy of a franchise. Franchises are not just about the brand, though I completely disagree with your take on that. For almost a decade I worked for a company with a forty year presence in its local market. The broker was well known and well respected in the real estate community, and had been the broker for many of the homes in the area when they were built. And yet, when i would call a FSBO and mention the company name, the consumer didn’t knopw it. Years later, I bought a company that had been 60 years in business, and again consumers had a low pre-disposition. And yet, the largest broker in my market, when they were only 1 year old had a larger awareness in the community because of their size, and people actually thought they had been in business for many years.

    We can’t determine the pre-disposition of the consumer from our viewpoint, because that viewpoint is polluted by our prejudices and pre-conceptions. Americans like Brand names – and no one in the United States under 30 ever lived in a world where there was no Century 21, and there is a pre-disposition to do business with brands we know. However as a business owner, I retain the franchise not only because of the brand, but because they offer me other tools that are beneficial to my business. If I didn’t feel the value exceeded the cost, I wouldn’t have the franchise.

    All of that being said, I would challenge your premise that all things being equal (in terms of the business acumen of the owner), not having a national brand is somehow superior to having a national brand.

  4. Thomas Johnson

    July 7, 2008 at 12:27 pm

    Brad: Since it was my “well presented and came to logical conclusions ” comment, that you proceeded to trash, I will respond. Why wouldn’t I engage in a situation where my ERA affiliation returns to me 700% – 800% on my royalty dollar? If those kinds of returns aren’t compelling enough for you, so be it. I am content to remain a brainwashed zombie.

    The point is this: we are all free market participants and presumably act in our own best interest. If you have the capital to be a solo free agent, great! Been there done that. I also know that a third of the active agents made zero $ last year.

    I am always open to opportunities from other brokers, small and large. I have yet to find a better deal. I also will not discuss my compensation package in a public forum. Suffice it to say, the ERA brand has been wonderful in helping me grow my brand in my marketplace. Just because an agent affilitates with a big brand, or as I lovingly call Realogy “The Evil Empire”, doesn’t make them mind numbed robots. I detect a little frustration from your posts that as a small independent, you have been unable to successfully recruit from the branded brokers. Maybe a look at what you offer the agent bears some scrutiny.

  5. G. Dewald

    July 7, 2008 at 12:40 pm

    I review the web analytics for the clients of the company I work for. One of the things I like to look at is the kinds of keywords which bring visitors to the site. I do a specific section on “branded search.”

    Branded search is anything which indicates the searcher knew something about this office before coming to the site. I further break this down into “agent/broker branded” (visitors who search on someone’s name who works at the office), “office branded” (visitors who search on the name of the office) and “franchise branded” (visitors who search on the name of the franchise).

    I have yet to do a branded search study and find “franchise branded” to deliver more than the other two types of branded search. It’s often a small fraction at best.

    Granted, a site visitor is a long way from an actual sale, so apply salt as liberally as you wish. And also, Bill brings up a number of other excellent considerations on the value of being with a franchise.

  6. Ben Bach

    July 7, 2008 at 1:35 pm

    “the value of your association with our company was greater then the cost?”

    I am associated with a large national brokerage (Keller Williams), and I can attest that I get more in value than I pay my firm (this is my cost of sale, you’ll have it when you run your own shop too).

    I can’t remember a deal I was ever specifically “given” to me by my broker or firm (or franchise for that matter), but the training, accountability, and supportive environment have allowed me to increase my GCI dramatically in the past two years.

  7. Brad Nix

    July 7, 2008 at 2:05 pm

    I love the passion and appreciate the deep thoughts and scrutiny from each of you. It’s easy for me to appreciate Jennifer and G. Dewald, we’re sort of on the same page. But I sincerely hope that no one else took offense to me questioning how much a brand is worth? I did not attack anyone personally and if I sounded condescending, it was not intentional. I just wanted to move our last conversation forward and try to determine what a brand is really worth? (who knows, I may be the next Bill Lublin and have an opportunity I can’t refuse knock on my door tomorrow) But what should I expect an agent to pay for the change?

    If I practice brokerage the same way I do now and add a franchise on top of it – what is that franchise brand worth? I don’t know, but I think it’s a lot less than it use to be (my opinion) and that’s the real intent of my posts.

    @Thomas, I certainly did not want you to feel like I think you (or any agent) are a brainswashed zombie. I just want agents to consider all options, ask the right questions and understand what they are paying for. Too many brokers (and not just brand brokers) take advantage of agents by hiding behind language such as I quoted and then nickle and dimeing the agents to death every chance they get.

    As for me and my recruiting, I do just fine up against the brand names. In fact, my recent success is what prompted these posts. I saved the last two agents I hired on as a team over $20,000 per year by them moving from a large brand to a local small broker. The numbers can be that big of a difference and that is why I simply encourage agents to ask the right questions and to SHOP for brokerage services. But I do agree everyone has different reasons for doing what they do, I simply intend to understand those reasons. Making bold titles and using funny pictures is an easy way to create conversation on a topic.

    Now, what is the brand really worth? If the answer is ‘it depends’, then my push for questioning and considering other options has even more merit. Don’t take offense at me prodding you to consider options, take offense at what some of the results are when you’re shopping services.

    @ Bill , I never stated my small broker brand is better than your large franchise brand. I just encourage agents not to overlook the small broker. It can sometimes be a huge ($20K+) difference. You stated “All of that being said, I would challenge your premise that all things being equal (in terms of the business acumen of the owner), not having a national brand is somehow superior to having a national brand.” I understand where your frutration lies now, because I did not make it clear that many times the services are the same (or very similar), but the costs can be completely different. (see my comment on your post

  8. Thomas Johnson

    July 7, 2008 at 4:08 pm

    Brad: There is only one option I consider: SHOW ME THE MONEY.

    If there are environmental/emotional considerations they must be evaluated in the light of how much more effective in a full life sense that environment will make me. Cost avoidance is all well and good as a recruiting tool, but my experience is that a cost avoiding agent will eventually cost avoid himself to a $1.99 broker where they hang their license for a buck ninety nine.

    As a growing agent, I am more interested in revenue adds. What can my broker/brand bring to our relationship that enhances or adds value to a cost that is already there? As an agent, I have costs which must be paid- I need a broker in order to practice real estate and that must be paid for. If I pay my broker/brand $x in a given year and get back $6-$7x back in addition to the dollars I generate on an agent- centric basis, I really do not care if it is ERA or Brad’s Real Estate Emporium. As far as rate of return, the ERA/broker dollars for the most part out-strip all the stupid vendor crap I have bought over the years. By coupling the big brand with my agent-centric efforts I have found a formula that works for me, for my family and presumably for my broker and for ERA. But as you say, this is coming from a mind numbed brain-washed brand man.

    As a managing broker, you already know that an agent has to be worth about 15-20 grand in company dollar for the relationship to be profitable ( small independents can get away with less, but not much less). Otherwise, you are carrying dead wood that ultimately will hinder your recruiting of top agents. The challenge for any brokerage is finding the secret sauce that keeps top agents seeing a sufficient return on the company dollar. Many of the broker shops become body shops because either they do not communicate the value proposition well or, they do not provide the value.

    By the way, at , we will sell your house or ERA will buy it.

  9. Jonathan Dalton

    July 7, 2008 at 6:43 pm

    When I was with Century 21 Arizona Foothills, it was costing me more to stay than to go. So I left. The office fees were minimal, mind you. But the major enticement – the “opportunity” to work on corporate relocations – turned out to be a loss leader. Spend a ton of time, spend a ton of money and receive three quarters of one percent for your trouble.

    I could have stopped doing relocations and not changed companies but the splits didn’t make sense. Neither did the assorted fees, such as the 5% I lost out of one check simply because the referring agent also was with Century 21. Where did the check go? To pay the costs of the relocation department (presumably including the salaries … here, take my commission check to pay your salary. My tuchas.)

    Looking at the cost structure where I am now, it makes less sense for the company than for me. But that’s really not my problem … the system apparently works. RE/MAX is still around. And I’m making more in the process.

  10. Brad Nix

    July 7, 2008 at 7:00 pm

    @Thomas I feel this discussion has gone away from the path I had hoped for. I really did not intend to compare my brokerage to yours (or any others). I just think that name brands mean less today than they use to. I also think small brokers compete much better today than they use to. I’m glad you’re happy and I hope you stay happy paying for your brand. However, if a time comes and you decide to shop for brokers, then I simply suggest you consider a local small broker in your search. You just may be glad you did!

    @Jonathan gets it. You hit on the many reasons why it’s not always cost-effective to stay with a large brand. It just turns out that another large brand met your needs. Again, my goal is to remind agents not to overlook the small broker. They may very well provide equal or greater services to their agents at big savings versus the large brands (and yes, they may not – but you don’t know if you don’t even consider them an option).

  11. Danilo Bogdanovic

    July 7, 2008 at 7:15 pm

    This post hits home for me. I used to be on a top team within KW that used to bring in several closed transactions per month in business for me. This was due to the incredible marketing machine it used to be. Because of that, the higher split made sense for me.

    But as the real estate world changed and RE 2.0 and web 2.0 evolved, the old ways of marketing started to become less effective. As the leads started dwindling, I embraced blogging, social media and social networking and saw most of my clients coming from my own efforts. This made the smaller number of leads and original split with my broker not worth for me.

    I switched to a niche firm that specializes in tech-savvy agents and tech-savvy consumers. The firm I’m with now is prospering while my old team and the KW market center it was a part with has gone down in the number of agents as well as the number of transactions and revenue.

  12. Thomas Johnson

    July 7, 2008 at 7:46 pm

    Brad: We agree! If an agent can’t figure out how to best maximize his net in his real estate practice, who in their right mind would hire him to sell their most valuable asset? This discussion veered from the path we are all predisposed to think that our way is the highway. That is emphatically not so. I have found that the brand is a profit center for my practice. J Dalton determined that the cemetary 21 was too costly and Re/Max will take him and his Beagle to new heights. Danilo and Ines-same thing.

    So far, consumers have voted with their money, since about half the listings in the US have been taken by brainwashed Realogy or Re/Max agents. I also know that this is not forever. We will have a whole new customer base when the people that talk with their thumbs become homeowners and then sellers. That is why I am here in your computer. Learning and engaging web 2.0.

    By the way, if you ever find yourself in Houston, Kiplinger’s #1 place in the US to live and work, let’s have a cuppa joe.

  13. Brad Nix

    July 7, 2008 at 8:11 pm

    @Thomas: I’d love to grab a drink (can it be good beer instead of coffee? not a coffee guy). I’m buying if you’re in Atlanta. I think you just said the best quote of all and I couldn’t agree more!

    “If an agent can’t figure out how to best maximize his net in his real estate practice, who in their right mind would hire him to sell their most valuable asset?”

    @Danilo way to go bro. You are on top of the wave…enjoy the ride and be prepared to have all those on the beach clamoring to ride the next wave with you.

  14. Dan Connolly

    July 7, 2008 at 9:24 pm

    Well I have been with REMAX for 20+ years and for me the reasons are simple. I have a private office in a two story brick building with white columns in the heart of Buckhead which is Atlanta’s high rent district. When people come in to meet me, there is no question in their mind about whether or not I am able to represent their most valuable assett. There are nice conference rooms and every amenity.

    I think I probably generate more leads than the office does. (not more than all of the other agents individual efforts, but more than the actual Brokerage). In spite of the fact that I stay busy anyway, I like the fact that I have a nationwide referral network which I can send and receive leads from. Many of the years, not all, but many have given me enough referrals to pay all of the Brokerage fees for the year. I also have listed a lot of property over the years and nobody has ever questioned the company. I started in a small one office company and had to sell the company on every listing appointment. Sometimes the customer didn’t buy it. For me the fees are worth it.

    Plus I think agents who move from office to office lose clients along the way. I listed and sold someone two expensive houses recently who had bought with me 10 years earlier and only remembered my first name and office. The commissions on that one paid my fees for three years.

  15. Mack in Atlanta

    July 8, 2008 at 5:29 am

    Recently a buyer searched for my RE/MAX office on Google. Because of Google Local they came to me. I guess you could say this is a combination of my office brand along with my marketing via Google generating a viable lead. The office is close to their apartment and they wanted to work with someone close by. We are writing their contract this weekend.

  16. G. Dewald

    July 8, 2008 at 7:22 am

    Given that good branding will generate an emotional connection to all who come in contact with it (not least, the employees within the branded structure), it’s no surprise that this is the sort of conversation that can press buttons. Kudos to all of you for engaging this topic.

    Sometimes I think the issue of branding in general is one that is still trying to digest that old Fast Company issue that says “Brand You” on the cover.

    @Mack: In my work, I that search would be counted as an office-branded search (Assuming their search was “RE/MAX YourOfficeNameHere”). The most specific always wins (agent/individual->Office->Franchise) because the more specific their search the easier it is for you to rank well. But I don’t want to hijack this thread with web analytics, not today anyway. 🙂

  17. Ruthmarie Hicks

    July 10, 2008 at 12:30 pm

    I think this is a long over due topic. I worked for a big brand name when I started and the took my money and delivered…..well – pretty much nothing. I’m with another big brand now and they appear to be able to deliver what I need. (I’ve only been there about a month) but the technology is so much better – I’m a bit overwhelmed. I had set some things up myself at great expense and am now undoing some of that and reallocating resources.

    Sandwiched in the middle of all this, I was with a smaller franchise that had great people but not so great technology.

    You are buying the individual BROKER and the services that brokerage offers. You can’t go to a brokerage looking for leads (I found this out the hard way.) They will talk a blue streak about the leads they genereate etc. but if you aren’t an agent that is favored – it will do you no good. Meanwhile you are forking up major money – but you have to ask for WHAT???

    Sometimes the big brand has what you want – sometimes it doesn’t. This isn’t big brand vs. small independent. Ignore all of that! Go with the best “package.” Might be a big name, might be a small timer. Doesn’t MATTER as long as it works for you.

  18. Ken Brand

    October 31, 2009 at 5:43 pm

    Talent and commitment can thrive in a small, medium or big brokerage, provided it’s led by equal talent and commitment.

    There are crap and fantastic small, medium and big brokerages, as you point out, bottom line, evaluate your local options, choose the best fit, get crack’n.

    The differentiator is not size, it’s leadership, talent, creativity, energy, belief, mind set, skill set, people skills, technical skills, financial stability, vision, imagination, culture, values, commitment, passion, etc.

    Yes, technology empowers the independent and the collective, equally.

    The debate rages, amusingly, educationally and rightfully so.


  19. Erion Shehaj

    October 31, 2009 at 7:03 pm

    What Ken said …

  20. Jay Thompson

    November 1, 2009 at 6:20 am

    Fact: When I was with a big brand, I can’t count how many times I’d meet clients face-to-face for the first time, hand them a card and they would say, “Oh, I didn’t know you were with Century 21”.

    My conclusion: they didn’t care what company I was with.

    Fact: In dozens upon dozens of conversations I’ve had with both prospects and clients since opening my independent brokerage, I can count on one finger the number of times someone asked about why we weren’t with a large national brand.

    My conclusion: Given that they bought three homes from us, I can only conclude they found our reasons for independence acceptable.

    Fact: We’ve hired 17 agents in 20 months. Every one of them came from a national brand. Only one has left (he moved out of state). Every one of them that has been with us more than a few months have increased their sales.

    My conclusion: Losing the balloons, gold jackets, the KW kool-aide and whatever CB offered doesn’t seem to have hurt any of our agents.

    Fact: My original C21 broker wanted to downsize his office space. C21 corporate wouldn’t allow that, so he was forced to sell his office building that he’d been in since 1985 and merge his agents with an existing C21 office. He is now an associate broker and is no longer in day-to-day control of the business he put his life’s work into.

    My conclusion: No one will EVER tell me how I can or can not run my business (except for my wife). If I succeed, I succeed due to my strength, skills and perseverance — and more importantly, because of those skills my agents have. If I fail, I have no one to blame but me.

    Fact: When I left C21, my broker said, “Your brokerage model won’t work. You can’t survive in this market without the support of a franchise office.

    My conclusion: Well, his office is now closed, he now reports to another broker and we just opened a second office in Tucson. Conclude what you want from that.

    No, not all of this was due to the differences between a national brand and being independent. And that’s exactly the point. You can be successful in this business if you work your ass off and do the right things for your clients. Of course an indy can succeed. And fail. Just like a big brokerage with a national brand.

    I can tell you one thing though. I don’t need a fancy office in the high rent district to show my clients I’m capable of representing them. I show them by my actions, not by providing a comfy leather couch. I get and retain clients by my actions, not by the rent I pay for an office. And to be brutally honest, if I lose a client because I don’t have a fancy office or because they think I’m a “second tier” or “gypsies in the night” agent then I don’t want nor need them as a client anyway. They’re more than welcome to go to an agent’s office, sniff the Corinthian leather and sip a cappuccino with their fancy-pants agent.

    And while they are driving around in the Lexus, they better hope they don’t come across me and my client at the negotiation table because more than likely we’ll take them and the guy in the Armani suit to the bank.

  21. Joe Loomer

    November 1, 2009 at 7:24 am

    I was with a small local brokerage, and could have written Ruthmarie’s post about why I left.

    Yes, I’m now with a national brand, and after 22 months, I have barely scratched the surface of the technology, training, and education opportunities available because of the fiscal resources this national brand can dedicate. We had our best year ever in 2008, and this year’s hot on it’s tail. We did not come here BECAUSE of the brand name – the team leader is AWESOME and could be Jay’s twin sister.

    Jay – on the other hand – is succesful because Jay is a phenomenal leader – anyone who’s visited AG knows that. I often referrence him in my own posts simply because I can’t figure out how to say something differently and not lose his eloquence. But the bottom line is he’s succesful as non-national brand because of his leadership and technology accumen. I think it would be AWESOME to sit in on any training session he’s leading in one of his market centers. That kind of leadership infects everyone. If a non-branded firm has it – they’re succesful, if a branded firm has it, they are too.

    It’s simple. Regardless of the brokerage model – people either stay or vote with their feet. If they’re leaving, it’s your fault – not your competition’s.

    Navy Chief, Navy Pride

  22. MIssy Caulk

    November 1, 2009 at 1:35 pm

    ha, ha…glad this post was resurrected as I am sure you remember our little chat when you and Rachael were in A2 last month.

  23. Bend Oregon Real Estate

    November 1, 2009 at 1:39 pm

    I totally agree with your thoughts here. Franchises are counting on an agents fear of loss to keep them beholden to their expensive commission splits. It is a total mirage and anyone who knows a thing or two about SEO, Web 2.0 and internet technology will tell you that the instamatic web portals large real estate franchises provide their agents are worthless in today’s online world when it comes down to the individual agent getting leads.

  24. Bob

    November 1, 2009 at 1:48 pm

    “No independent agent or company would be able to match these services.”

    Jim, could you specify what services cant be matched?

    I don’t see this a s an either or issue. It really is dependent on the agent. Mack and Dan delineated the benefits they receive, as did Ben. I fall more into the Jay and JD camp. Most of the big brokers here have managers who are more recruiters than anything else. Generating more leads than the big guys is not hard, its just knowing how to do it.

    I think most new agents are far better served with training programs offered by some of the big brands. I know many agents need the rah rah of KW. I find it irritating. That isn’t a good thing or a bad thing, but more of a personality thing. Some need it to stay motivated.

    Where I thing the argument breaks down is on the tech ability of big vs small. I have yet to see a big broker really understand the fluid tech aspects of online marketing. The big brokers talk about economy of scale, but that also locks them long term into solutions and prevents them from changing or adapting quickly.

    I have sat on KW tech committees and watched them evaluate year old data and pursue tech options that are already obsolete or less efficient than other options, but the bucks poured into them keeps them from dumping the less than optimum choice.

    There are trade offs to everything. I know doctors and lawyers who love the autonomy of private practice and others who just want to focus on their core competency and feel the ancillary support they receive from a larger organization is worth what it costs them.

    “Small brokers are generating as much or more leads from utilizing web 2.0 tools than many of the large broker brands in local markets all across the country.”

    @Bill you asked “What objective measure are you using to make this statement? Other then “wishing makes it so”, where do we have numbers to bear this out? ”

    I can back up Brad’s statement. I can show you dozens of markets where agents and small brokers generate more leads than the majors. In 2003-2005 when I was with Pru, another agent and I generated more leads and closed business from those leads than Pru did, even with their Yahoo leads. I left because when I refused to feed them with my leads for a 20% referral, they cut off my broker approved RETS feed. I can give you many examples where the small guy outperforms the big guy. The ones “wishing” tend to be the big guys, not us.

  25. Brad Nix

    November 1, 2009 at 4:18 pm

    🙂 I love it when AG pulls a post out of the past that still brings passion from the commenters! It has been over a year since I started this conversation and think it’s still valuable in today’s market. I know times are tough for many small brokers and large brokers alike. There are some brokers trying to grow in a down market. I have been approached myself by a large brand hoping to find us down our luck and take us into their arms. Turns out we are just as strong as before. Sure sales are down, but the beauty of being small allowed us to shift gears quickly and adjust to stay profitable. In my market, most brokerages are down 35% in number of agents – we’ve stayed the same. We had one team transfer to a bigger brand due to them physically moving across town. We also another, slightly larger team, join our firm.

    I’m not an anti-big brand guy, in some markets, for some people it’s the right choice. I just don’t want agents to always assume it’s the best choice. Shopping local for a small brand broker may turn out to be the biggest win for your career.

    special thanks to Jay for leading by example. (and yes I remember our chat in A2 Missy)

  26. Janie Coffey

    November 1, 2009 at 4:49 pm

    HI Brad,

    As a boutique brokerage, the use of web 2.0 has certainly leveled the playing field for us competing with big brands. In the end, some agents prefer the perceived safety and structure that big brands offer and some prefer the family feel and flexibility smaller shops provide. I for one, never wanted to be “boxed in” by a big brand and opened my own brokerage as soon as my first year as an agent was up, so that I would be in complete control. I have not once lost a client to a big box operator, quite the contrary, dealing with the owner with a perceived boutique flair has actually won us clients.

    I enjoyed the posts and the comments are certainly lively. There is a situation for everyone, that is for sure.

  27. JamesMalanowski

    November 2, 2009 at 1:16 pm

    Good topic to bring out and dust off … As a newly-independent broker, it took me awhile to take the plunge and bail from the big-box but when I looked at the big picture and realized I was paying up to $75,000 a year to a franchise with nothing coming in return it was a no-brainer.

    I’m sure there are other franchises and brokers that may give you some ROI, but for me it just made sense (and cents!) to make a go of it on my own.

  28. Marlow

    November 2, 2009 at 2:35 pm

    I think some individual agents may be able to excel at Brand X Brokerage, but in our market, 90% of all transactions are done by the top 5 franchise big-box brokerages. That’s just the way it is. Why reinvent the wheel? It’s a lot easier taking the path of least resistance and going along with one of the well-known brokerages than trying to jump-start your career as an unknown entity.

  29. SteveBeam

    November 3, 2009 at 12:38 am

    Yep I’m with a big company and I’ve considered moving on hundreds of times. I work mostly from my car/home/Starbucks and Panera Bread. I do not keep an office and do not pay for a desk there. I come in the office once a week (at best) just to get the mail and leave.

    From my research I can probably save $150 a month if I were to open my own company and be my own broker. I would however give up or need to replace a lot of the services they provide that would end up costing thousands each year. I have a good spot right now so I just don’t see the need to leave.

    Brand recognition. We all used to hear that you need the “10 second commercial” that will explain exactly what you do in as few words as possible right. Trainers said use it every time you meet some one. I do know that no matter where in the world I am I can say one word and everyone in the room knows EXACTLY what I do without confusion…RE/MAX. Everyone knows what that word stands for and yes I do pay for that recognition.

    Would I join them today if I was starting out? Probably not. I would probably join a smaller company or just start my own from scratch. Why? Because I do see over the past 11 years how much money I wasted having a desk in their office and paying rent when I never worked from the office. Over $100,000 in rent down the drain because I bought into the rumor that you had to have an expensive office and the leather couches to get people to like you and buy from you. Total BS.

  30. Joe Loomer

    November 3, 2009 at 7:14 am

    @Bob – the “rah rah” of KW includes kick-start programs like Camp 4:4:3, 33 touch programs, KWU, Agent Mountain, KW Connect, productivity coaching, mentoring, three bestsellers (SHIFT 2 & Bold are now nationwide training tours), and a myriad of other training programs that far exceed anything a local brokerage firm can provide. It is all about accountability – not rah rah.

    I may have drunk the Koolaid – but I was with a small brokerage, where the broker fancied herself a good trainer – and if you think KW’s technology stuff is outdated – imagine sitting in on a “Lions, Tigers, Bears, and Lambs” session about Buyer psychology (the materials where in black and white).

    I completely agree the KW model may not be for everyone, and individuals with exceptional talent and leadership abilities will excel on their own, gaining market share in the proccess. I’d further stipulate recruiting is a part of the Team Leader duties – who isn’t recruiting? Jay just opened a Tucson office – you think he’s commuting? Success is a magnet – rah rah may be too, but our increase in market share since 2003 is jaw-dropping. At the same time, other KW franchises in our region have had turnover mandating new leadership.

    What’s the first thing Hilton does when it buys a struggling hotel? Fires the leader – every time, no exceptions. Why? If the leader where worth a toss, they wouldn’t be failing in the first place. This applies to every customer service industry. If the leadership works, the franchise (or local brokerage) works – if it doesn’t, it fails.

    I don’t think the rah rah is so bad – but that’s just me.

    Navy Chief, Navy Pride

  31. Benjamin Bach

    November 3, 2009 at 7:30 am

    I agree with Joe – I think KW offers tremendous value, as I mentioned above, and as Joe outlines. A positive mental attitude, in addition to skills and knowledge is a good thing!

    I think terrific businesses, in every industry, are in the minority. I also think there are large and small companies in every industry that are great.

    Like anything, the market will reward a good model. Jay’s firm is growing, which means the market (realtors in this case) like it.

    Keller Williams has grown tremendously, from 11,000 agents in 2001 ( to approximately 73,000 today in Canada and the United States. If it wasn’t a great model, KW would not grow so quickly.

    There are some great small firms, but they’re the minority. Out of the major large firms, I’d argue there is only one that’s truly in business for and with agents, and that’d be Keller Williams 🙂

    Oh, and I think the bigger point most realtors need to remember is, as Jay said above “they didn’t care what company I was with.”

    Go where you get the stuff that helps you own and run the business you want to have.

  32. Tim Wilson

    November 3, 2009 at 9:22 am

    The best answer for me is a blending of:

    Ruthmarie Hicks (July 10, 2008) statement:

    “Sometimes the big brand has what you want – sometimes it doesn’t. This isn’t big brand vs. small independent. Ignore all of that! Go with the best “package.” Might be a big name, might be a small timer. Doesn’t MATTER as long as it works for you.”

    Blended with Thomas Johnson (July 7, 2008) statement:

    “If an agent can’t figure out how to best maximize his net in his real estate practice, who in their right mind would hire him to sell their most valuable asset?”

    Clearly, the title of the blog “Brainwashed by the Big Box Real Estate Brand” was just simply an attention getter and generalization, and the real point is that each individual needs to figure out the BEST DEAL for himself/herself, regardless of the size of the brokerage.

  33. Chad McBain

    November 5, 2009 at 7:42 pm

    Well as someone who has been at both big and small my experience is that big wins hands down. The key is not whether agents have been brainwashed but has the public? When most people order a burger and fries they order a coke as well, they really just want a brown sugury liquid drink and of coourse pepsi will do but they still say coke. The publics beliefs become our realities imho.

  34. Matthew Hardy

    December 31, 2010 at 1:05 pm

    Ownership trumps community. Be accountable to yourself.

  35. Joe Yates - The Atlas Group

    December 31, 2010 at 2:57 pm

    I totally agree with you Brad. There is no doubt that initially the “perception” from the consumer can be that the Big Box Brokers are safer and more established but this can be easily overcome by a talented agent. As someone that started with “Big Box” and is now independent, I would have no desire to go back.

    HOWEVER… we have a full time, in house, marketing / web person that not only keeps us even with the competition, but makes us significantly stronger!!

    Without that piece (which I think many small brokers are missing) I may feel a lot differently.

  36. Rachel LaMar J.D.

    December 31, 2010 at 7:23 pm


    You pose a great question. I honestly think the answer depends on the individual agent and what they need/want to get out of affiliating with a brokerage. Personally I have worked in corporate real estate, for lage and small brokerages, and now work for myself with my own brokerage.

    The experience I acquired at each phase of my career allowed me to take away different aspects of the business. I have combined all I learned, tweaked it and made some of my own rules, used what I liked and tossed what I did not. I feel all of it gave me the ability to go out on my own, and I couldn’t be happier. But I am a self-starter, an attorney, an author…it’s my personality to work hard and do the best I can. Big brokerages, with lots of training and support, are great for new agents, those who want to be around people, those who need an extra push, and those who just like them. Small brokerages offer advantages to others.

    In conclusion, I think where an agent works should be where he feels comfortable, where she can truly grow and not be held back. If a time comes where she is no longer getting anything out of the experience, it is time to move on.

    Rachel LaMar, J.D.
    LaMar Real Estate

  37. Rob

    January 1, 2011 at 9:55 am

    Wow…just seeing how long this thread has lived shows how relative this discussion is to so many…well my two cents…
    I’m one of only one agents in the small brokerage where I work. I’ve had the opportunity to work with KW not as a co-broke but I repped a landlord that leased space to open a new KW office. I had many conversations with the brokers opening the office. The reality, imo, is that neither KW, nor C21, nor any other franchise/national brokerage cares how many properties you sell or how much you learn about real estate. I liken this to a couple of other industries, namely fast food, and Business Networking Groups. I’ve also had experience with the national sub shop, Quiznos…Do a quick search of Quiznos and you will learn pretty quickly that Quizno’s is not in the business of selling subs, they’re in the business of selling franchises. BNI, who promotes themselves as helping small business connect, could care less how many referrals you pass, they care about how many chapters they can open in a year. KW doesn’t care how many houses you sell…they make their money by bringing in as many agents as possible and charging them for office space, desk time, fees, etc…It’s a reality and KW and the other big names are very good at convincing agents and brokers to get on board. Would I use the term “brainwashing”, probably not, but its not far off…I’d challenge anybody to show me proof that KW’s business model is to grow their agents’ business and not to increase the number of hours of office space rentals, and desk fees. Think about a new agent, they spend hours upon hours in their new office, working the phone, email, setting up photos of kids, arranging chairs…they they realize they have to get out of the office and KW brings in the next “butt” to fill the chair. Quizno’s sells franchises to people that want to open a sandwich shop. Then they sell you your meat, cheese, and bread, and they sell you your equipment…then you can’t hack it, and they take over your franchise after already taking all of your money, and they find the next “butt” to fill the chair…Why do we patronize the local restaurants rather than the chains? The same reason, I believe, to patronize the local business owner rather than the big named brokerage. The local guys care about their employees/agents and the big names care about their shareholders and investors.

  38. Andrea Geller

    January 1, 2011 at 11:14 am

    Different brokerage models work for different people for different reasons. It works that way in all industries. Why can’t we respect other people’s choices rather than bash them?

  39. Krisstina Wise

    January 1, 2011 at 11:27 am

    Great commentary in this post. There are many great comments therefore little I could add but thought I would jump into the conversation as a small independent who 3 years ago left the Big Box Brokerage (KW) to start my own Boutique Firm.

    For me, making the change was a powerful move … but my point will not be to convince one that my Independent way is better than the Large brands. Or vice versa (Although, I am biased and think my way is a better way:)

    I take my conversation to one word: Value (Quantifiable and Specifyable)

    The way I see it, and I dare say we would all agree, is that … things are changing for our Industry. And, the change is HERE for how we market, generate leads, connect, communicate, incubate, convert, produce new business, service our business …. and so on.

    And, This has real meaning! Brokers (Big or Small), in order to help their agents succeed in the future, have to change too. Brokers need to reinvent their value to the Agent just as the Agent needs to reinvent their value to the Consumer. I say … with trepidation of anticipating an attack for saying this … that The Value that the Broker has been to the Agent in the past is just not all that valuable any more.

    Personally, I call this the Value Crisis of the Industry … where is true value being offered from the very top of the food chain (the national franchisor) to the last link in the chain … the consumer? What value does the National Franchisor offer the Francise owner for the fees paid? And, what does the Franchise owner (Brokerage) offer the Agent in terms of real needed value for Agents to succeed TODAY? And, what value is the average agent in the brokerage offering the consumer? And, by the way, who is funding the food chain? The Agent! Their royalties, commission splits and fees fund everyone and everything from within their brokerages straight up to the very top –the Corporate office. All funded from the agent’s hard work and money that turns into commissions that then are split up many ways.

    So, what I say is … Every agent needs to reevaluate the value they get for what they pay for. If they assess that they are indeed obtaining ‘superior’ value from the royalties and fees THEY pay to provide the many salaries all the way up to the top of the Hierarchy … then it is irrelevant if the Brand is big or small. The Value makes it worthwhile to stay.

    However, if they can’t assess, quantify and specify exactly what value they get … then perhaps it is time to at least look around at new options … at how the amount of money they pay to support the top of the food chain can perhaps be used more effectively and efficiently in a different model … ?

    I claim that in order to “succeed” as Brokers and Agents, Value needs to be reinvented for our industry across the board.


    What I notice, is that most of the Big Brands are not reinventing. They extol the same Narrative they have touted for decades and bottom-line, offer the same value. And, sure, many can claim they are growing, but I dare say they won’t publicly claim the profitability numbers of their Franchises (or lack of) or the Productivity of their Agents. The training is 3rd party –either delivered through other agents or vendors. In other words, few of the large Brokers are doing themselves what they tell their agents to do. Few are bona fide leaders for their Agents to learn from and follow. So, Agents have to spend thousands of dollars beyond the fees they pay to the Broker to attend conferences, pay for product (they don’t understand and usually don’t implement) to get the REAL training they need to succeed. And, these same agents are in the marketplace confused, overwhelmed and scared. These agents are ubiquitous at the numerous conferences I attend.

    What I notice on the national circuit, is that many of the smaller independent owners ARE the reinvention. They are leading much of the change that is being talked about and awarded. The broker-owners are personally looking for places to offer NEW value and some of these small but I say powerful brands are actors and leaders with and for their Agents… taking on the cost of learning, experimenting, building new tech, etc .. AND, then they don’t “tell” the Agents about it, they actually build it INTO their brokerage model so that all of their Agents can use the technologies, etc … and the training is led by those who are actually using and succeeding with it inside the brokerage not outside of it. Brad Nix, Garron Selliken, Jay Thompson and myself I think are good examples of this.

    But, this is not to assert that the small independents are the way to go.

    I do maintain however, in this digital age that has affected our industry, as all others, the value of an Agent’s broker needs to be reevaluated. If Agents plan to “compete” and win in the future, the resources and tools they have at their disposal (including their Broker) need to support them fully.

    In other words, in the future, the Broker will matter beyond just Brand-name towards the success or failure of *most Agents. As smart business people, we just need to know within any brokerage (Brandname or Independent) what we are getting for what we are paying for … the ROI on the total cost (including outside training) and bottom-line …

    What’s the value?

    *most agents = not necessarily reflected here:)

  40. Loren Sanders

    January 1, 2011 at 12:23 pm

    I think Kristina hit the nail firmly on the head. The world we live in now is as value consious as I can recall it ever being. If I do not represent value in 2011, I simply won’t be here by 2012. Through the Internet driven world we live in,( low value- non productive) is being spit out of the system at an ever increasing rate. The question that every agent & broker must have compelling answer to: why me & my company- if your answer holds up then carry on–as you are, if not, the clock may be ticking.
    REM said it best, it’s the end of the world as we know it and I feel fine:-) all the best to every committed agent and broker. It’s both easier than ever to hang a shingle & more challenging than ever to keep it hanging high!

  41. Ashley Ralph

    January 1, 2011 at 2:14 pm

    I have a strong liking to this post, mostly because of the Star Wars reference that just makes me smile.

    I agree with Andrea that each brokerage offers a different approach, and each approach fits unique business plans for better or worse. We’re an industry of individuals and the agents matter. We’re the ones who speak to clients, make or break deals, and create the impression of our industry.

    Finding the niche that works for you is the key, and make it work. Creating a consistent, quality product with a client focus is where its at. However you do that is great. There are great agents in all types of brokerages. Since the industry in client focused, I say do whatever you need to to help you get clients in the door and blow their minds with your greatness!

    Good luck in 2011!

  42. Teresa boardman

    January 1, 2011 at 4:06 pm

    I work in a small boutique brokerage but have worked with “big brands”. I am not missing anything that I had through a big brokerage except a bunch of fees. Often it is fear that holds us back. Fortunately for me the only people in these parts who consider agents who work in micro brokerages second class citizens or the agents with the big brokerages.

  43. Jordan Gilbreath

    January 2, 2011 at 11:37 am

    Honestly, who cares? Obviously you and Jay do because your owners and are passionate, and that’s great. And this has sparked a lot of comments and debate, but is it worth the time and energy for the rest of us? I am a broker–I work with a big name that apparently has brain washed me. I dont mind doing business with boutique brokerages or with big names–bring me an offer and I’ll work with you! I dont discriminate and I dont think you should either. Some agents fit a big name better than an independent and vice versa–most try them both and then decide.

  44. Mike Pennington

    January 4, 2011 at 10:01 am

    Based on the number of responses above, I would say a number of agents and brokers care. They are passionate on both sides of the argument but perhaps the better question is “Why should Brokers care?” , regardless of their size.

    In the past, what happened in the medical field is representative of what his happening in real estate, today. It’s a stretch but hang with me.

    Hospitals and Physicians groups (brokers) made sure doctors, pharmacists, and executive staff (agents) were happy and content. Problem is, the overall service of the industry was in decline from a patient’s (client or customer) perspective.

    In the early 90’s, big medicine realized that it would be more profitable to engage the consumer of their product. Aside from emergency medicine, where time is of the essence, most surgeries and procedures are elective to some degree and, while they may be necessary, the timing, place, and other certain choices are decisions of the patient.

    Take for example child birth. Today, it is not uncommon for a mother to give birth and be sent home with child in a couple of days. And while many births are in and out to keep the patients out of pocket expense a low as possible, a surprising number of deliveries are exactly the opposite.

    For those with means, they can opt for professional makeup and photography, they can opt for a private catered in-suite dinner with wine, they can opt for larger private rooms to hold grandparents and friends, and they can choose to have WI-FI and get prepaid parking passes.

    Why is this available now? Well hospital management (broker) skipped the medical practitioner (agent) and asked a patient (client) where they find value. To a doctor (agent), none of these additional services are necessary to deliver a healthy child. But to the patient (client/customer) they are absolutely necessary to complete an experience of a lifetime and one that is well worth the extra cost.

    Build a brokerage around agent perceptions or build it around consumer perceptions? Seems the pendelum is swinging towards the latter.

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