The eve of destruction, the dawn of the future
Kaboom! Everything around you just blew up. Will you survive?
Shrapnel
According to William Gibson, the future is already here. It’s just unevenly distributed.
Gibson believes the future is ever present. It’s spread about in particle form waiting for someone to piece it together. Given the persistent inter-connectivity of people through the giant digital network called the Internet, this piecing together – the work of innovation – now occurs very, very fast.
The shrapnel of progress has obliterated things we believed to be fixed objects. Music. News. Commerce. Services. A century of analog music recorded on tape and sold on vinyl has disappeared into the ether in less than a generation.
We will find no resting place.
This condition is both frightening and beautiful, like a George Romero movie.
Change is terrifying. But you can’t prevent it. So embrace it.
Everything is ripe for…
Displacement
If you sold real estate between 1945 and 1995, your biggest challenges were mastering call waiting, learning how to shove a sheet of paper into a fax machine and leaving a message on voice mail.
Slow, turtle-like change.
Fast-forward 15 years. The social web. Pocket computing. Apps. Ambient connectivity.
Mind boggling stuff.
If you grok William Gibson, you ride these tides. If not, you kick against them, exhausting your energy fighting the inevitable.
There are a riders and fighters in real estate. The fighters still can’t nail a decent Website. Or market themselves effectively in a post-print world. They are drawn to every shiny new piece of cyber garbage. And they revile the riders.
This leads them to…
The eve of destruction
Lets place the puzzle pieces on the table.
Etsy, Taskrabbit, AirBnB, GetAround and Parkatmyhouse are among a raft of new companies upsetting the traditional car rental, vacation rental and flea markets. They connect strangers with strangers and make them comfortable doing business with each other.
Square and BankSimple are lobbing grenades at traditional banking.
Pirq delivers Seattle residents instantly redeemable retail discounts based on their location, effectively torpedoing the direct mail brochure and coupon book in the process.
Zuuvu, Klout and Kred are just the tips of a cultural and commercial iceberg that will make transactions between strangers more reliable.
StreetAdvisor, Nabewise and Everyblock are turning citizens into neighborhood reporters.
Peers communicating directly with peers. No bullshit.
2020 is eight years away. Is it so far-fetched to think that in eight years this tide will rise upon real estate’s shores?
If you believe the consumer will need the 1995 version of real estate brokerage in 2020, forget the Mayan Calendar… by that point your world will have ended.
The dawn of the future
We believe there will always be a place for real estate professionals, and for the brands and brokers that support their work. But there will be fewer of them. Those that will be rocking in 2020 are piecing together the future right now.
The glimpses of tomorrow – all that crazy stuff I mentioned above – can be platforms you build or leverage. The zombies plodding outside your cabin door need not be terrifying if you walk out to great them. Look at those around you who fight against change, and increase their distance form your working life.
And keep in mind that the future can be more than something that happens to you. It can be something you build.
[Disclosure: StreetAdvisor is a 1000watt Consulting client]
Marc,
In my 10 years as a real estate broker one thing has never changed and I doubt ever will (that’s a long time).
Offer sellers a value proposition that they want i.e. convenience, low cost, expertise, exposure and the buyers will follow.
There is a heck of a lot of moving parts out there – but when we get down to it – the residential real estate business is really quite simple.
Rightly or wrongly, many are depending on the zombies to succeed – without them everything changes. Their heels are dug in deep – we’ll see how long this takes to shake out – IMHO, it could be a long and painful battle?
Thanks,
Thanks
Great post Mark. Interesting questions:
Will the hosted services evolution plus the crowd sourcing evolution help consumers to objectify real estate agency/brokerage, discern better from worse agency/brokerage services, and focus on value?
Yes.
And will some agency/brokerage business models cobble together competitive advantages with technologies and services so their phones never stop ringing?
Absolutely.
Marc,
To Brian’s point; with all the change around us, where is the NEW agent (en masses)? Yes, there are ROCK STARS amongst us but for the most part all the zombies still roam the earth (in daylight).
Perhaps, we should recruit #occupywallstreet?
Slainte,
Jim
awesome article – no bs!
I’ll play devil’s advocate here.
The tools have definitely changed, but has much else really changed?
Sellers still often select listing agents based on referrals or number of signs the agents have.
Buyers still often feel that most agents offer the same services.
We differentiate ourselves, but have others really seen a substantive changes how sellers and buyers select their representatives?
Ira Serkes
PS – Steve Jobs said something very similar his book – I can’t recall the exact quote, but it was something like “It was always there, it’s just a matter of seeing it”
I’ll play devil’s advocate here.
The tools have definitely changed, but has much else really changed?
Sellers still often select listing agents based on referrals or number of signs the agents have.
Buyers still often feel that most agents offer the same services.
We differentiate ourselves, but have others really seen a substantive changes how sellers and buyers select their representatives?
Ira Serkes
Ira,
In general – how do agents differentiate themselves from each other – with the exception of how they look?
Don’t the 4 P’s cover most agent strategies – put it in the MLS, put a sign in the ground, put an ad in the paper (or Internet) and pray.
4P Marketing is common.
The tools have definitely changed – print to online, photo quality better, referrals via digital social network in addition to the old fashioned kind.
Yet … a often see crappy marketing done by agents … and with no “real estate client ombusdsperson” position, there’s no one who can tell the seller that their agent isn’t doing a good job for them.
I can think of a few agents in our market area who have advanced the level of their service to their clients, otherwise it seems that there’s simply more of the same.
Just curious how many people have new, or experienced, agents in their market area who have really developed a strong presence in the past few years using marketing, technology, social networking.
There are always exceptional teams and organizations – Good Life Team, Sue Adler, etc … but how many similar real estate service provider are there in your market area?
Ira
Guys,
My point is pretty simple. Everything is ripe for destruction, displacement and disintermediation. The peer to peer movement which has gone from burgeoning to commonplace is displacing middlemen at every corner. Just consider HBO GO and how I can now stream content direct from them rather than the iTunes middleman.
To think that the real estate industry will remain impervious to destruction and that agents will never be replaced by task rabbits and technologies run by non real estate entities is to remain blind to what is already transpiring right now.
That attitude will absolutely prevent an alternative future from taking place – one where the industry and agents are the peers on the platforms they create that people will rely on for everything real estate and local.
Two paths towards the future. Choices. Either get busy living or get busy dying. http://www.youtube.com/watch?v=7tkzc983aE0
Great post, Marc! It is easy for people to get caught up in the technology, which changes faster than consumer behavior does. The most interesting thing about the current wave of technology is how it makes it so much easier for one person to connect with another. Real change in the industry could happen faster than anyone expects simply because this opens the door to changes in the choices buyers and sellers can and do make.
If the process of buying or selling real estate in and of itself were simpler, I think many people would change their tune on the indispensibility of brokers. Look at how the process has changed in property management and more and more landlords and tenants are finding each other without an agent. All it will really take is an open mind and a kick ass software program to streamline the process. Remember, travel agents said the same thing about their industry a few years ago; consumers were too stupid to plan a vacation or business trip on their own…
It will not look the same in 2020. The disrupters are hard at work building, testing, refining and planning to scale.
Timing is everything. We’ll see if the disrupters you mention (now) have the endurance and survival instincts that will make them the cornerstone of the industry.
Thanks
Here’s to those of us who embrace change … and are nimble in course corrections in uncharted (or even charted) waters.
Even if i strive to be state-of-the-art from several years back, I’m still way ahead of most. We don’t have to outrun the bear, but just outrun the competition.
And with that, I’m off to the gym.
Thanks, Marc!
Ira
The future will be the Information Marketplace breaking off from the Transaction/Professional Services brokers can provide. Not unlike the record industry that thought it controlled the content creators, brokers don’t control the creation of content that Buyers and Sellers can now control by matching on their own. Platforms that enable this direct buyer to seller interaction exist, do not cost a ton to create, brokers best get on board and be the facilitators of this process rather than try to stop it.
Tina,
You’re dead on.
Regarding the “information”, there’s a big missed opportunity in the content creation world within real estate – an area currently dominated by buyer and seller (people) generated content or the media.
YouTube, Flickr, Instagram, Streetadvisor, EveryBlock – all these channels contain far more people generated content than Realtor generated content. While there is a surplus Realtor generated content, much of it is low quality or too agent to agent centric.
The road toward destruction for real estate is that most agents simply don’t know how or seem to not want to invest in developing or learning how to communicate to people as peers. So much of real estate agent marketing is still self centered, vanity rich and done as cheaply as possible. Just look at all the spokespeople to advise agents to shoot crap video on their phones and post it based on a “doing something even it’s it sucks is better than doing nothing at all” philosophy.
As a result, Realtor/broker participation on public platforms such as You Tube, Facebook or Twitter for example tends to be dismissed by the rank and file public and either not taken seriously or just discounted as useless content.
I always felt Active Rain held such promise as a way to bridge the communication gap between Realtor and Consumer but I don’t feel it has. So much of what I read there is agent to agent dialog – stuff that is of no use to regular people.
It such a shame – given what agents and brokers know and how useful that could be – it is still locked up inside their heads and or not disseminated on the Web in a way that people can access it.
If the members of the real estate industry do not figure out how to unlock their value, their professionalism and their knowledge in a manner in a more immersive way – the question I ask is – how much further out from the transaction will they then place themselves.
Nice to hear that seldom heard, yet arguably most important aspect of the real estate business – the transaction.
I’ve yet to meet a seller or buyer that cared about anything more.
Tina’s analogy is imperfect. Ulike in music, books, or movies where the bits are the product, in real estate, the content is strictly marketing collateral.
Buying a house has always been closer to buying used car than to buying a book. Sales skill surely helps the seller. For the buyer it is better know a lot about cars or have to at least have a good mechanic.
Is the content really important?
Ray, In real estate content is marketing!
Marc, yes it is! However, an agent is a licensed real estate salesperson. Perhaps some would be better called a real estate marketing person – except marketing doesn’t require a license!
LOL. I’m thinking, as time goes on, what people are going to be less and less attracted to are salespeople or marketing people – because neither of these monikers come across as having the buyer or sellers best interest at heart.
Marc,
So true about sales and marketing. Most people do not want to be sold. Marketing content is not especially important in an era of easy DIY promotion either.
Perhaps it was an unfortunate circumstance that agents have always been paid by commission, and so called a salesperson.
That said, the notion of a fiduciary embedded within the heart of the agency law defining what it means to be a real estate agent is spot on: a trusted adviser.
Missing from all the talk about how the real estate industry could/should evolve is the answer the consumer’s most basic, but almost always unspoken, question:
“Why should I trust you?”
Thank you Mark!
We have been early adopters of websites and SEO strategies to get found and seen online Google Ranking may bring the fresh eyes but the content must be there to provide “time on site” and page views.
This is now enhanced with video for self promotion in addition to property displays. QR codes and Mobile apps are a new tool arena.
The Seller of a property will ask how will you market the home? This is a demonstrable concept. But IMHO the focus here has moved from selling the house to marketing and BRANDING.
The Virtual Office Website will revolutionize how we do business. Are we ready? Yes! Its in BETA now!
Living in Toronto and Loving it!
David Pylyp