If you own, run or work at an established real estate brokerage, you may feel caught between a compass and an open door these days. Well-funded, sleek newcomers are doing things you can’t do for a host of obvious reasons.
You don’t have $800 million to fund your stampede. Shape-shifting your brand to appear modern and appeal to millennials wouldn’t be true to who you are. And revolutionizing your entire technology stack overnight is a pipe dream.
So what can you do?
Some brokers are re-thinking their tech offerings. Others are redrafting their stories, creating new campaigns and undergoing much-needed visual design updates. While initiatives like these are important, they may not be aggressive enough to successfully combat what your new competitors are doing.
Here’s where looking at other industries facing lots of new entrants and shifting consumer attitudes can be helpful. Brands in other categories are responding to the forces amassing at their gates with big bets and self-disrupting action.
The hotel industry is replete with powerful, generational brands that are under fire. Radisson, Hilton, Best Western, Sheraton, Marriott. Their stories of humble beginnings and rise to prominance read much like yours.
When thinking about these established hotel brands, words like modern, exciting, beautiful, experiential, or lifestyle don’t typically come to mind. That was never the intention of these hotels.
Today’s traveler has a choice. High-end boutiques like Kimpton and W, short-term rental services like Airbnb and Vacasa, or re-imagined budget hotels like Aloft, Ace and Nylo have placed a strain on older brands to break out some new moves.
The incumbents have done just that, liberating themselves to compete in a new era by spawning new brands endorsed, but not limited by, their parent.
Hilton’s Canopy and Curio, Best Western’s Vib, Marriott’s Moxy and A.C., Hyatt’s Centric, and IHG’s Even all provide options for a new generation of travelers looking for something other than just a room.
Ford. Buick. Chevy. Dodge. These are the tenured brands that once dominated American streets and highways. Each year’s new models outdid the previous year in style, design and performance. When it came to aesthetics, no one could confuse a Pinto with an Eldorado or a Cutlass with a Camaro. Each was unique in its presentation and clear about the type of customer for whom it was designed.
Those days are over.
The American car industry has faced challenges from all sides – import brands, newer electric cars, car-sharing services, and changing consumer attitudes towards the very idea of owning an automobile.
But they haven’t sat back and cried disruption. Instead, they’re firing on all cylinders, disrupting their own product lines and legacies in reaction to the modern reality.
GM invested in Lyft and subsequently launched Maven.
Fiat Chrysler took a different route by going back to Detroit’s roots to double down on family transportation.
Coke, Pepsi, Dr. Pepper. They’ve been quenching our thirst for generations.
Like real estate, brands in the soft drink industry have faced serious intrusion by new entrants offering something other than basic carbonated sugar water. Boutique teas, bottled water, flavored seltzers, juices and power drinks have hit the market, offering something people today want – quality ingredients, health, energy, brand transparency and social interaction.
While the older, familiar brands still dominate the market, their share is at a 30-year low, marked by 11 straight years of declines in sales.
Of late, La Croix (the Compass of the soft drink industry) is leading the charge of change. To compete, Pepsi launched Caleb’s Cola, Bubly and Lifewtr. Coke invested heavily in Fuze, Powerade Zero and Odwalla.
The older soft drink companies realize the best defense is a smart offense. As a result, like the hotel and car industries, they’ve created new brands and bought young ones.
What you could do
Might the solutions in other industries work for you?
A large brokerage in Nashville could spin out a new boutique brand called Lyric Realty, appealing to the musicians, producers and songwriters flocking to that city.
A longstanding Bay Area company could launch Pixel Realty, designed to speak to the savvy, Silicon Valley professional as well as the like-minded agent.
A Philadelphia-based company could launch Love + Liberty Real Estate, a nimble, inner-city brand to appeal to the trend-seeking, upwardly mobile urbanites moving in.
Of course, this doesn’t solve every issue or combat Compass buying agents, Redfin owning search or Opendoor owning fast, convenient transactions.
But creating a new boutique brand could free you from certain legacy shackles and get you back in play. It offers you a fresh start upon which to manicure a new brand tailored to a new demographic and customer and agent profile.
It would give you freedom to specialize, to create a new model for splits, build or adopt new technology, and offer new options for your current agents. It would generate interest in the marketplace. It very well may inform, and benefit, your established, flagship brand.
Agents are leaving great brokerage companies like yours every day seeking something they perceive as newer, nimbler and more aligned with the clients they seek.
This is no time to be a bystander.
This is a time to stop imagining and start acting.