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Op/Ed

Agent ratings: trust, Captain Obvious, and inadvertent COE violations

Agent ratings aren’t going away, so it’s time to take a look at how they’ve tempted Realtors to inadvertently violate the Realtor Code of Ethics.

agent ratings and reviews

Consumer ratings are not going away. Today, consumers are rating nearly everything and are looking for ratings before making purchase decisions as a way to accelerate their evaluation process and validate their choice of products or services based on the experiences of others who have used those products and services.

Time is a scarce resource and with all of the information available on the internet today, it is difficult for an individual to understand and evaluate all of the options, especially in areas where purchases are infrequent, complex or of great importance. Few would argue that a real estate transaction does not encompass all three of these factors. Reliable ratings help consumers make informed choices in less time. This is a good thing.

But what happens when the information is not reliable, or worse, is simply marketing disguised as objective information? It has been generally said that technology increases efficiency, making things faster and more convenient, but if the underlying process is flawed, technology can actually facilitate bad decisions or compound problems.

Agent ratings: enter temptation

A recent NAR study found that trust is the number one factor for buyers when selecting a REALTOR® and number two with sellers, after agent reputation (2014 National Association of REALTORS®- Home Buyer and Seller Generational Trends).

The temptation to improve your reputation by encouraging (often begging) happy customers to say nice things about you on the numerous open ratings and review sites is understandable. Many unfortunately take this practice to the next level by inviting friends and family who have not actually received service to leave a positive review. Today you can even hire a “Reputation Management” company or freelancers on Craigslist or Fiverr.com to write positive reviews for you (or negative reviews for your competitors), legal or not.

Marketing companies have created testimonial gathering systems where agents invite only happy clients and/or can delete any feedback that is less than flattering, and then package these testimonials as “validated reviews” for agents to share with prospects. However they justify these actions to themselves, agents that embrace these systems do so at their own peril. Once it is realized that the results have been “scrubbed,” manipulated, or gamed, there is little chance to establish the trust buyers and seller demand from their REALTOR® and may cause irreparable harm to that agent’s reputation while further damaging the consumer perception of our industry in general. Everyone loses, with the possible exception of those selling the snake oil.

Come on, consumers aren’t stupid

Consumers are on to the fact that many ratings systems are gamed, and the higher the stakes ($$$$), the greater likelihood and lengths some will go to to manipulate the results. Consumers understand the difference between testimonials and reviews; as a business person and as an industry it is difficult and dangerous for us to pretend that we thought the terms were interchangeable (but that is a topic for a future article).

Let me introduce you to Captain Obvious:

More and more we are seeing evidence of consumer demand for reliable ratings and reviews. Angie’s List is clearly taking a shot at the most popular review site, Yelp with her new tag line “Reviews you can Trust.” Putting aside the accusations and litigation regarding extortion-like practices claimed by small businesses against Yelp, that their “review filtering” is connected with advertising spend (or not spending), the fact that you can anonymously rate any REALTOR in the country right now highlights the problem.

Angie “solves” this by charging for her list via credit card, the assumption being that a real credit card equates to a real person. Better, but how does this ensure that only real clients provide feedback? In fact, “paid reviewers” charge a premium for writing reviews on Angie’s list, friends and family can still stack the deck, and clients of the agent on the other side of the transaction are able to tarnish reputations because they didn’t get everything they wanted.

California is changing the game

On August 1st, 2014 the California Association of REALTORS began publishing names and photos of those found to have violated the REALTOR Code of Ethics on a members-only section of their website. The information will not be available to the public, at least for now. They are the first state association to do so, but they are also regarded as a trend setter for REALTOR organizations nationwide.

This brings us to the critical question: Does using and marketing results from a review platform that allows or even encourages agent manipulation open you up to a COE violation? It depends, but NAR does state that most violations are related to advertising.

From the NAR Code of Ethics, Duties to the Public, Article 12 reads:

“REALTORS® shall be honest and truthful in their real estate communications and shall present a true picture in their advertising, marketing, and other representations.”

Clearly, many are actively soliciting reviews from friends and family, blocking or deleting reviews from actual clients that may be unflattering, and some are flat out buying or creating their own reviews. For those agents “gaming” these systems, the game may have just gotten real!

Should you invest your dollars in shady corners of the web?

Even if you personally are not engaged in any of the bad behavior outlined above, is it in your best interest to invest your time, energy and maybe even dollars on platforms where manipulation is likely or even accepted? You need to decide that for yourself, but I can offer two thoughts you might add to the con side of your pros vs. cons analysis:

  1. How will consumers know who is and is not manipulating the data to their advantage?
  2. How do you expect to compete against those that are willing to game these systems?

Conclusions:

  • Trust is hard to build, and once lost even harder or maybe impossible to regain.
  • Consumers don’t need Captain Obvious to explain that anonymous reviews are unreliable.
  • Honesty is still the best policy.

So how do you build trust and protect your reputation at the same time? That’s another editorial for another day…

Written By

Kevin is a Co-Founder, President & COO of Quality Service Certification, Inc. (QSC) and earned an MBA from The University of California – Irvine. With over 20 years of Real Estate experience, his primary focus is on consumer research, developing better service management systems, and sharing the importance of consumer-centric service standards, transparency and accountability to create measurable and meaningful differentiation and long term advantage for those professionals that put customer needs first.

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