She wrote, “‘If the data were not such a part of our past value proposition, agents and brokers wouldn’t be bawling about it as much as they do, nor would we see the pocket listing strategy used amongst small groups of power agents the way we do.” And it reminded me of the writings of Joshua Meyrowitz, in his book, No Sense Of Place: The Impact Of Electronic Media On Social behavior.
At the beginning of chapter 8, Meyrowitz writes, “group identity is based on ‘shared but special’ information-systems.” Did private access to special information become a part of the group identity of REALTORS®? I think it would be difficult to argue otherwise. “The change in the information characteristics of traditional groups,” Meyrowitz added, ” leads to two complementary phenomena: the decreasing importance of traditional group ties and the increasing importance of other types of association.”
This may be a purely academic discussion, but it’s an interesting one for me. It’s important to understand the possible motivations for group behavior, and the potential for further change as new members come into play who were never a part of the old systems, who were never a part of the group that held this special information. It’s likely they don’t carry the same baggage.
It could be argued that this shift has indeed impacted the group’s behavior, even if true individual agent differentiation has not been impacted. And small group behaviors now appearing seem consistent with Meyrowitz’s findings relative to the reactions of the larger group in the wake of the loss of identity associated with the loss of this exclusive information. “Subgroups develop or continue to exist, therefore, on the basis of sub-sets of shared experience, but their boundaries are blurred by the massive sharing of information through electronic media. Indeed, people must now make a conscious effort to maintain distinctions in group identities that were once taken for granted.” This seems to align with Linsey’s observations about the “pocket listing strategy used amongst small groups of power agents.”
So, there is certainly no question that the authority that has traditionally been given to those with the control over access to information has been removed by the Internet. And at the same time, it has also exposed “back room” behaviors that further weaken the perception of “the group.” I’m certainly not equipped to argue otherwise. But the authority that came as a result of exclusive access to that information was equally spread among all REALTORS®. It was never an individual differentiator. So the playing field was always level in that regard. But the impact is real, nonetheless.
Which brings us back to the discussion of the qualities that define a great REALTOR®. “‘Great’ may not have anything to do with gatekeeping,” Linsey writes, “but there is a fundamental shift in our value proposition when we are no longer the one and only source of the information. Today, one must find some way to have intrinsic value that can be articulated in something other than platitudes, but actually demonstrated. And that is tough to demonstrate in a powerful enough way before one is hired in the first place.”
To put that another way, communicating product difference is hard in a service industry. People can’t test drive your product before buying, like they can a car. They can’t sample it at a supermarket on Saturday morning. They can’t try it on. How do you get the real estate consumer to have an experience with you before they purchase? This is the same problem every service industry has to battle. It’s why recommendations remain so important. We rely on the experience of others in making our decision.
So, let’s take a moment to look at the sources of product differentiation and see if there are any clues that might help move this conversation forward a bit.
The major sources of product differentiation are as follows:
- Differences in quality usually accompanied by differences in price
- Differences in functional features or design
- Ignorance of consumers regarding the essential characteristics and qualities of goods they are purchasing
- Sales promotion activities of sellers and, in particular, advertising
- Differences in availability (e.g. timing and location).
This may sound a bit harsh, but it seems to me that a good percentage of agents bank on the ignorance of consumers regarding the essential characteristics and qualities of the goods they are purchasing. And by goods I’m not talking about houses. I’m talking about the services and the quality of the delivery of those services being offered to them. Perhaps this plays a role in the psychology that manifests itself in the expression of fear around feedback on agent performance. We hear this question all the time at RealSatisfied. “What if someone says something bad about me in a survey?” Where does that psychology stem from?
In contrast, the agents I consider great, and my assessment of “great” has nothing to do with their production numbers, never focus on the ignorance of the consumer. In fact, they go out of their way to educate the consumer about the characteristics and qualities essential the a great experience. So, it would be good for any REALTOR® to shift their focus away from activities designed to further buyer ignorance and toward those sources of differentiation that might move the needle more powerfully in a positive direction.
As I look at that list, I’m inclined to immediately remove the “differences in quality usually accompanied by differences in price.” Attempts to differentiate on price in the real estate industry have met with limited success, though I certainly wouldn’t argue that this is not a potential. But for my purposes here, I’m removing it. So what does that leave you with?
I think there are three areas of focus for an agent or broker looking to differentiate.
- Differences in functional features or design: I’m going to label this “the experience” of your brand.
- Sales promotion activities: this includes advertising, SEO, lead generation, content creation, etc.
- Differences in availability: this includes office locations, team activities, responsiveness, ease of access, networking, etc.
This isn’t easy. I’d love to hear your thoughts. Where have you chosen to focus your efforts to differentiate? How do you define your value proposition?
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