Who are your clients? Ummm, your clients, dummy!

Whenever I am at an industry conference, I’ll hear a real estate broker make the observation that a broker’s real “client” is the “agent.”  That is, although individual real estate agents have buyers or sellers who are clients, a broker’s clients are actually the agents: the broker provides services to the agents, who then treat the clients, but the broker’s main role is maintaining that client relationship with the agents. The theory is that the broker does not actually have a relationship with the buyers and sellers, but only with the agent.

This is one of those observations that always seems clever when people say it, kind of a counter-intuitive perspective that is presented as a flash of insight.  Except, of course, that it’s become pretty much of  a cliche, given that I hear it at every conference.

More importantly, it’s wrong.  If you’re a real estate broker, your agents are not your clients. Your clients are your clients.  Your agents are your agents.  That’s why we call some of those people “clients” and some of them “agents.”  

And even more importantly, I think that it’s gone from counter-intuitive clever insight all the way through to cliche and now all the way to a pernicious system of real estate brokerage that elevates the agent above the client in the broker’s perspective.

Put it this way: a great real estate broker provides outstanding client service to buyers and sellers.  The main delivery system for those services is through the individual agents, so the broker does have a significant obligation to empower those agents with tools, technology, and training to provide that client service. And, of course, the broker has to provide a reasonable compensation system to incentivize agents to stay with the broker and do lots and lots of deals.  

But you cannot always serve two masters.  Too many brokers, I think, including me, sometimes elevate the agent at the expense of the client. Here’s an easy example: do you provide dedicated parking at your offices to your agents, or your buyers and sellers?  At our offices, where possible, we have dedicated parking spots in front of the entrance for clients. Why? Because we want to make it easy for clients to be able to park at the offices.  That’s a good client service.  But I know lots of brokers who leave those spots open for agents to park in, because the “agent is the client.”

Of course, this is sort of a cross-industry standard, because you can go to most businesses in the country and find dedicated parking for staff or important employees, but not for clients.  And if you go to any mall in the country at 9AM, you’ll find the first ten rows of parking taken up by employees of stores in the mall, who will squat on those choice parking spots all day long.  

But it’s not just simple things like parking spots.  For example, many brokers, including ours, provides for “call coordinating” of sign calls and online inquiries, which go first to the listing agent.  This can be considered a good client service for the seller, who is probably best served if an inquiry is delivered to a listing agent who has a tremendous incentive to try to sell that listing.  It also can be considered good customer (not yet client) service to the potential buyer making the inquiry, since the inquiry is directed to an agent who really knows the property.

But in a lot of cases, this is actually bad customer service for the potential buyer, made in the spirit of the listing agent being the client of the broker.  Although sometimes online inquiries are made about a particular property, at other times the inquiry is spurred by that property, but the customer would be better served by talking to an agent who is sitting in front of a computer and can dedicate as much time as necessary to fielding that call.  Instead, the inquiry goes to a listing agent, who is likely out in the field, with clients, or otherwise distracted and occupied.  It’s a good service to the listing agent, good for the seller, not necessarily good for the person making the call.

This is not to criticize call coordinating, but simply to give an example that treating the agent as a client is not always in the best interests of the buyer or seller who are the actual clients of the company. This one’s a close call, but only if you actually think that people who call into your company deserve the best treatment possible. If you actually think that your agents are your clients, then it’s an easy call.

Finally, while I understand the impulse to treat agents, particularly productive agents that drive the bottom line, as the clients of the broker, I don’t see why service to agents should come at the expense of the client.  The idea that you have to choose between treating your agents/employees as clients, or your buyers/sellers as clients, is a false choice that sends us down the wrong path.  I don’t think you can have a great client service company without providing great tools, training, and technology for your employees (or in real estate, your agents).  

Inded, other industries do just fine in adopting client-centric approaches that actually empower employees and treat employees fairly without adopting a “employees are the client” standard that we hear bandied about in real estate. For example, Zappos is one of the gold standard companies in providing great client service, but Zappos also has a legendarily empowering employee culture. In fact, the great client experience wouldn’t exist without that employee culture.

A great real estate company should be able to recognize that the buyers and sellers are the clients, and provide amazing services to those clients through an empowered, trained, and motivated workforce.

You guys are wonderful…

In our recent “World’s Best Real Estate Agent” class, we discussed all the tasks that a professional real estate agent performs in taking care of a client.

My point was this — You guys are wonderful.

For the work you do, the time you spend, the efforts you make for your clients, you are simply wonderful. You take one of the most difficult experiences in a person’s life, buying a home, and you guide them through that process. You manage that experience for them, and you do a great job of it.

Think of it this way. Someone wants to sell their home, and all they have to do is sign your listing agreement, and that’s it. That’s all they have to do, except disappear for a couple of Sunday afternoons while you do an open house. You do everything else:
• You detail and stage their house.
• You put up the sign.
• You take the pictures
• You load the pictures up into our system, and they go to dozens of websites.
• You enter the property into MLS, with that stupid grid.
• You write the ads.
• You write the property description.
• You write up the mailings.
• You spend however many Sundays you need to sitting at open houses.
• You manage the scheduling of showings.
• You obtain feedback.
• You keep the seller updated about what’s going on in the market.
• You keep the seller updated about what’s happening with the marketing campaign.
• You counsel your client through the feedback, and the offers.
• You negotiate the offer.
• You help schedule the inspection.
• You manage the relationship with the seller’s attorney.
• You schlep documents back and forth.
• You attend the walkthrough.
• You attend the closing.

And if you’re trying to help someone buy a house, it’s an even more extensive list:
• You figure out what the buyer is looking for.
• You look for properties online.
• You set up alerts for yourself.
• You set up alerts for the client.
• You send the client emails on properties they might like.
• You arrange showings.
• You attend showing after showing after showing for as long as it takes.
• You go to open houses.
• You preview properties.
• You’ll go see the same property again and again and again until they’re ready to make an offer.
• You counsel them on their offer.
• You counsel them on their next offer.
• And their next one.
• You negotiate the offer on the property they ultimately purchase.
• You write up the offer.
• You manage the relationship with the attorney.
• You manage the relationship with the mortgage broker.
• You help get your client all the docs the mortgage broker needs.
• You schedule the inspection.
• You attend the inspection, as Mark Rodi explains why they shouldn’t buy this or any house.
• You do everything you can to hold the deal together.
• You go to the walkthrough, and pray they didn’t take the refrigerator.
• You go to the closing.

Wow! That’s just a staggering amount of work. When you consider that other professionals are paid by the hour, it’s something we should actually consider, particularly since you do all that work for a LOT of clients that never pay you — because they never buy anything, or their property never sells. You do it all on contingency.

Some people in the class asked me to post this up, and I’m happy to do it. If you have other things that you do that you’d like me to add to the list, just comment and I’l update the post.

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Bringing the WOW

I taught a class last week where we discussed the “Bringing the WOW,” that element of service that just completley overwhelms a client.  Bringing the WOW is performing a service for a client that surprises and delights them.  It can be a simple gesture, like a birthday card, or something more extensive, like catching a mistake in a contract that saves them thousands of dollars.

Unfortunately, our discussion of Bringing the WOW went a little askew, which was my fault.  I started the discussion by talking about WOW in the context of a really thoughtful (and cheap!) closing gift for a client — a set of 9-volt batteries.  To me, the WOW in that is the explanation — “I just thought that maybe your sellers might have skimped on the maintenance of their home while they were getting ready to sell, and I want you and your family to be safe.”  The idea is to send a simple message to the client — “I care about you” — while surprising them with something that might not have occurred to them — that they need to perform some routine maintenance that the sellers might have neglected.

Unfortunately, though, I locked the discussion into a framework of closing gifts and other gifts.  One agent had her husband make her client some adirondack chairs, so they’d have something to sit on when they moved in.  Another had food delivered to the move.  Another cut the grass for two weeks.  All very nice things, and certainly in the spirit of WOW.

But let’s not forget the core idea of WOW — it’s creating a great impression for service.  That is, I think it’s great to bring something thoughtful to the closing table, but the real issue is whether you’re providing a good service to the client.  In other words, an agent who botches a sale, or mis-prices a home, or misses that the upstairs bedroom is illegal and costs her client two months of extra payments while the closing is delayed, is NOT going to be delivering WOW by bringing pizza to the closing.

I’m not demeaning the value of the thoughtful gesture (like pizza at the move-in day), and the agents who made suggestions were terrific. I’m also not suggesting they were, say, cutting the lawn INSTEAD of verifying the taxes on their listings.  But I want to make sure that we don’t misunderstand what delivering the WOW means.

The first order of business is doing a fantastic job on the service elements of the transaction, delivering WOW through the fundamental job that the client hired you to do.  THEN you can add those little touches like 9-volt batteries and pizza and chairs and toilet paper and lawn cutting.

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Who is the World’s Best Real Estate Agent?

We’re going to be on a mission in this blog to identify the tools, systems, and processes that we need to put in place to help you become the World’s Best Real Estate Agent.  But even before we do that, we have a pretty good idea of what we’re looking for if you want to call yourself the World’s Best Real Estate Agent.

1.  Technological Competence

The World’s Best Real Estate agent knows how to use technology.  She’s not a techie, but she can use her computer, and get her contacts in and out of Outlook, and use the tools she needs in her business.

It’s no longer charming or cute for real estate agents to be technologically illiterate. Or any professional, really. I used to work as a clerk to a judge that couldn’t type, would never have used a mobile phone, and never opened a computer.  That was okay, because he was a federal judge.  Powerful attorneys would come into his courtroom to grovel and simper at his feet. The oldest constitution in the history of the world, the US Constitution, guarantees in writing that he can never be fired or have his salary reduced. But you probably don’t have that same sort of job protection. It’s okay for a federal circuit judge to not know how to turn on a computer.  Not so okay for you.

So here, on a fundamental level, is what you need: you need to know how to use a computer, to use outlook (or some other contact system), to create a PDF, to send and open attachments, to download and upload pictures, to connect your computer to a wireless hub, to surf the web, to click on links, and a host of other things.

Note that I’m asking here for “technological competence.”  I’m not looking for you to become a techie-type. I don’t think you need to know how to create a blog, or set up an RSS feed, or know what an RSS feed is. That’s okay.  But you need to have the fundamentals. You can’t be scared of the computer.

You also need to know how to use your MLS and Randcenter tools: how to enter contacts into Contact Manager, do a Simple CMA, a long CMA, a Buyer Tour, flyers, direct mail, cross-search, send out letters with letterwriter, create your email for your R4L emails, update your web profile, and the rest.  Those are the tools of the trade, we’ve created them for you, you need to know how to use them.

Oh yeah, and you need a smart phone.  None of that tap tap tapping text messages out on that two-year old phone that you got cheap with your wireless plan. You need a phone where you can send and receive emails, and send and receive text messages. That’s how people communicate in 2009, and sales is just a little bit about communication.

2.  Local knowledge

The World’s Best Real Estate Agent knows her local area.  A few years ago, I went to go look at some properties on the New Jersey Shore, condos in Long Branch.  The first agent that took me out got lost going from one condo to the other.  And she had GPS in her car.  And the condos were on the same street.  And the street was named — okay, wait for it — Ocean Drive.  And she got lost.

You need to know your area: the school districts, the tax rates and how they’re computed in the various towns and villages, the names of the local officials, the boundary lines, the names of the best professionals in the area, the charitable organizations, the people, the places, the things, the everything.  You’re the local real estate agent, you need to know the local.

How great would it be to take a client out one day, have them ask a question about the elementary school, and make a call right there to the principal of the school to set an appointment for them to meet with him (or her)?  That would be pretty impressive, I think.  Better than getting lost.

And you also need to know the inventory. I went to a showroom recently to see some cars, and the car salesman didn’t even know what he had on the lot.  And when we went to look at it, he didn’t know whether one model was longer than another model.  You have to know your inventory.

3.  Real estate expertise

The World’s Best Real Estate Agent knows the ins and outs of the real estate transaction. If you’re going to be a great agent, you need to know your legal responsibilities, your disclosure obligations, your ethical restrictions, the rights and responsibilities of the contracts you use. You need to know what engineers look for in an inspection, and what attorneys do in drawing up a contract. You need to understand what’s going on in the closing. You need to know how to check the zoning compliance, how to check the taxes, how to read a survey. You need to know how to help your clients through a short sale, or even a foreclosure, and what their obligations are to disclose property conditions. You need to understand the taxes implications and benefits of home ownership, and whether and why someone is better off renting or buying.  If it involves real estate, it’s your job to know it.

4.  Rigorous and comprehensive marketing of all listings.

If you’re going to be the World’s Best Real Estate Agent, you need to sell your listings. Or at least do the best possible job to sell that listing. That means doing an amazing job in your marketing, which is a lot harder than it used to be. Marketing used to mean putting a three-line ad in the paper, an ad that was generally incomprehensible for all the savage things we did to the English language to fit 100 words into 75 characters. But a three-line ad didn’t take that long. Now, if you’re going to market a listing, you need to know how to take really good pictures in high resolution of your listing. Then you have to upload those pictures. And then write a long, full description using real words in pleasing sentences. And that’s just in the initial intake, because then the real work begins. Marketing is not about coming up with a catchy slogan and slapping it on some supermarket carts.  It’s about identifying the core virtues of every property you sell, and then doing the best job possible in communicating those virtues to the largest possible audience.

5.  Thorough representation of all buyers.

The World’s Best Real Estate Agent treats her buyers like clients.  Buyers get a bad shake.  When most agents go to take a listing, they set an appointment, pull together their me-book that says all sorts of wonderful things about them, perform a CMA to get a thorough read on property values in the area, pull out their marketing materials, and then perform a 90 minute “presentation” of all the reasons why the seller should list with them.  It’s not the most effective presentation in the world, but their hearts are in it.

Compare that to what most agents do when buyers call — “Okay, well, you want to see 123 Bluebird lane?  Great, what time can you meet me there?”

Why is that? Why do we give sellers all the love?  Maybe it’s because most people think that the seller pays the commission (not true, actually, since the money comes from the buyer). Or maybe it’s because sellers sign exclusive representation agreements, which most buyers don’t sign (because they’re not asked to sign). Or maybe it’s because in places like New York, we all used to represent the seller in real estate transactions because buyer agency didn’t exist.  It’s only been about 15 years since agents were even able to represent buyers here.  So maybe we’re just not used to giving buyers the same service experience we give sellers.

But whatever the reason, it’s not an acceptable way to run a business. Even if the buyer WANTS to go meet at the house, it’s not acceptable.  If we’re representing buyers, lets represent buyers. Let’s do the same sorts of things we do for sellers, like prepare for appointments and prepare marketing materials and explain our value.

6.  Commitment to a service-oriented approach to business development

The World’s Best Real Estate Agent doesn’t cold-call for business, because she doesn’t have to. She’s figured out ways to develop her business without having to rely on people she doesn’t know, because her business emanates from the amazing service that she gives to people.  She does an amazing job for her clients, and they tell everyone they know because they’re so blown away by the service experience she gave them. She does an amazing job with the people in her “sphere of support,” because she keeps them so updated on what’s happening in the real estate market and community that they constantly send her referrals.  She does an amazing job with people she meets on the street, or at open houses, or through the internet, or anywhere she meets people, and makes sure she stays in touch with them.  And she even looks out for the guy selling his house on his own, giving him whatever help she can give him for free simply because it’s the right thing to do.  She’s oriented toward service in everything she does, and that’s where her business comes from.

7.  Positive attitude

The World’s Best Real Estate Agent keeps a positive attitude. When you’re in sales, you lose the right to have a bad attitude. Sorry about that. I know it’s tough to believe, because you probably deal with a lot of real estate agents with bad attitudes, but it’s the truth. If you want to be good in sales, not just real estate sales, you can’t be a jackass. No one wants to work with a jackass. People do, but they don’t like it.  Put it this way, you never know whether the couple in front of you in the Starbucks line, the couple you’re complaining about because they’re taking too long, is the couple you’re meeting tomorrow on a listing appointment.

8.  Professional Image

The World’s Best Real Estate Agent maintains a professional image, both in person and online.  She dresses appropriately, even if she’s just “stopping in” the office.  And she has an appealing, high resolution, professional photo that she uses in her marketing. It’s on her personal web page, her business cards, her mailings, everything she does.  The same great photo.  And it’s a photo of her taken sometime in the, oh, last decade or so.  Not in high school.

We don’t do so good with the photos, do we?  Yes, you can have a photo that shows the best side of you, but it should probably be a photo that actually looks like you. And it should be a professional shot, head and shoulders, dressed appropriately. Not a cropped low-resolution shot from some photo from your cousin’s wedding.

And we don’t do so good with the professional profile.  I realize that not everyone’s a writer, but WRITING IN ALL CAPS is generally not a subtle way of getting across your personal resume.  Neither is writing stuff like “I help your dream come true.” Write a profile in the third person, as if someone was writing that profile about you.  It sounds a lot better when the profile reads “Bob Smith is dedicated to helping clients through the difficult transactional process” than “I am dedicated to helping clients, etc. etc.”.  There’s something about that third person credibility which makes you sound like a professional.

9.  Ethics

The World’s Best Real Estate Agent is ethical and courteous. She knows what the Code of Ethics requires, and she lives by that code. More than that, though, she’s respectful of her colleagues, even if ethics doesn’t require it. That means returning phone calls, and keeping appointments, and giving feedback, and being honest and forthright with agents the same way she is with her clients.

10.  Management

The World’s Best Real Estate Agent manages her business like a business.  She creates and follows a business plan, she manages her time, and she is dedicated to getting better at her job.  That means she’s constantly learning, taking new classes, earning new designations, picking up new tools that can help her service her clients needs.

At the very foundation, though, it comes down to one thing. The World’s Best Real Estate is not about herself, but about her client.  What does her client need, and how can she service that need?  Everything else follows from that.

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