Back on Real Estate Agents...

I really enjoy reading Seth Godin's blog. His content is always thought provoking and he manages so many new thoughts a week - it's astounding. Read here for his thoughts on agents (interestingly after I posted my comments on real estate agents - but I doubt it was because he reads my posts).

I thought I would share a positive story on agents. We have finally found a place to move to, just around the corner from where we are now. Part of the reason I am so happy to move is due to the agent handling the transaction. The name of the agency - Plumb Property. I had reservations around their tag line of "Providing the ultimate in customer service" as you are never really sure if you actually qualify as customer...

The agent my wife dealt with was polite, interested and went out of her way for us. When we went in to sign the documents they had a box of toys to occupy our son. The receptionist even jumped at the chance to entertain him while the agent took us through the contract. I can't even compare this to our last experience. I have to admit, as jaded as I am - I felt like a customer.

I hope they continue to succeed in these difficult times for property related business.

Does your marketing message contradict itself?

Here in Queensland, Australia - we are about to have a state election. As a South African, it is interesting to see how directly the campaigners attack each other.

I would like to highlight a particular advert that is currently airing on television. (I tried to find a video version but they are all not working...here is a link to a newspaper article about the advert). Basically a number of world leaders make very strong statements about the global financial crisis and then the opposition leader is shown supposedly disagreeing with all of them.

The advert then closes out with a homemaker in her kitchen making a plea to voters, the opposition does not really know what is going on. Trust me, you should vote for the other party....

My issue with the advert is that the message brought by the advert is : Don't vote for the opposition - they disagree with the global view. Don't vote for the opposition, there leader does not know what he is talking about. Don't vote for the opposition - they are not adequately qualified to be leading you..........brought to you by some lady in her kitchen!

If I cannot rely on an elected official because of some statements edited into a slick package why in the world would I rely on the opinion of some random person commenting on this?

What is your marketing message? Is it consistent? Does it contradict itself? Does it build your brand or compromise it?

*Disclaimer*

As a non-resident I cannot vote. I have no party affiliation. This article is purely a comment on marketing message.

Real Estate Agency Theory

Agency theory looks at the conflicts of interest that exist between parties with different interest in the same asset. Usually this refers to the conflict between shareholders and managers of companies.

Real Estate Agency Theory (which is a term I made up over the weekend), refers to the conflict a real estate agent is in when looking after the interests of the seller or lessor, the buyer or lessee and themselves. The incentives at play in the agents mind are studied in Freakonomics (a great read, buy it here if you are Australian or here if you are South African)

As a buyer / lessee, you would do well to remember that your interest will probably always be last on the list. The problem with this sort of attitude from agents is that in any property transaction - you actually need a buyer / lessee. We are kind of a big deal in the transaction, it does not happen without us. In fact, if you thought about it, the only expendable party in the transaction is actually the real estate agent.

But in the property boom we have just been coming through, demand outstripped supply and the buyer / lessee group was huge. Agents and sellers had all the power, incompetent agents and agencies could make buckets of money without providing good service to all parties.

In order to be a successful agent in a downturn economy, you need to focus on all parties. This secures repeat business, this enhances your brand. All real estate agents sell exactly the same thing, surely the differentiation is who the are and how they sell.

Case in point (with thanks to my wife for coming up with this gem) : We submitted an application to a real estate agent for a rental property we are interested in. They get a whole bunch of applications, they process them and the owner picks a winner. The winning application gets a phone call, to say : "Your application is successful." Everyone else gets....nothing.

What? Not even a phone call. In a shrinking property market! In a fiercely competitive line of work! A real estate agent has :

1. A number of properties they are trying to let
2. A list of contacts that are actively looking (they even know what type of property these contacts are looking for)

A couple of calls and you could rip through your rental property inventory pretty quickly, with very little effort - they might not even have to advertise certain properties.

But I suppose this may not work - like I said at the very beginning - it's just a theory.