Last week I attended RIS Media's CEO Exchange in Denver, CO. This is an invite-only event, attended by some of the biggest brokers in the industry along with a handful of vendors (which is why I got to go as Zillow is an advertiser with RIS).
I spend a bulk of my time at Realtor focused events, it was interesting to shift gears and hear from a number of these traditional brokerage CEOs. This group of people have been in the business a long time and have a wealth of knowledge and experience behind them. They talked about how they are grappling to keep their companies relevant to not only tomorrow consumers, but also to tomorrow's real estate agents.
I came away with pages of notes, but here are a few of the high points, in no particular order:
- As a whole, the industry has done a good job adopting new technologies, but a poor job implementing them. When asked to give themselves a report card grade how they are using popular and emerging technologies, the leaders gave themselves a C average.
- Your listings have to be every now. This isn't a differentiators anymore. This is something home sellers expect when listing their home, and home buyers expect to see a full set on listings on your site.
- Brokers need to restructure work conditions to better accommodate and attract younger people into the business, this can also help keep physical office costs down. The real estate agent in their 20's or early 30's thinks nothing of working from home and being mobile. They don't require the big desk and private office within a physical office. They view the office more of a place to go to be social. This translates in work environments that should include comfy couches and communal work stations where a group can sit down and converse when in the office.
- The conversation about physical office space also extended to the number of locations necessary in today's world. Traditionally a brand would set up an office in many of the individual towns or neighborhoods (ex Coldwell Banker Lincoln Park, Coldwell Banker Bucktown, and Coldwell Banker Wicker Park- all in Chicago). The trend is to move away from having all these hyper local offices to a single, centralized, regional office. All internal research shows that this is more profitable way to operate and a concept that Gen X and Y consider perfectly normal and acceptable.
- All brokers strongly believe in the need to continue to invest in continued education. I liked this idea that a top Keller William Broker shared from Gary Keller, founder of Keller Williams, where he posed the idea that if you were in a personal financial downturn, would the first thing you cut in your family be your children's education? The answer is no, so why would companies do this? However, there seems to be a shift in the training resources to invest in the more established and top producing agents in helping to sharpen their skill set, verses focusing on the new agent. With less dollars available in the market in general, the idea is to help the top producers grow to gain more market share in the shrinking market.
- Real Estate Power Teams - This is moving from a fad to a common way of operation within real estate offices. Working with teams creates some unique issues for the managing broker to deal with, verses working with the individual agent. However, it is important to learn how to work with this business unit as it is becoming a very popular and profitable way for a power agent to operate.
- At the end of the day, with all the numbers, technology and trends- the business is still about personal relationships.
Unfortunately the conference ended on a more sobering note as Dave Linger gave the closing address, founder and President of RE/MAX international. He has been in the business for 40 years, so he has experienced many ups, downs and changes in the industry. Dave noted that this cycle is different from any other that he has experienced, because in past recessions housing has always been the stimulus that led the country out of the downturn. This time housing is the thing that is widening the gap. He predicted that like all recessions, we will come out of it, but not fully until 2018. This is due to both economic conditions and also family planning trends as their simply aren't as many Gen X and Yer's as their were Boomers to actually buy and sell homes.
The CEOs at these major brokerages definitely have a lot on their minds today as they continue to try to do more, or at least the same, on shrinking budgets. A silver lining is that these conditions have forced them to go deep inside their business, even line item by line item on their P&Ls, and hopefully emerge as a leaner and more effieciently run business.