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19 June 2014

Selling Real Estate in a “Sharing Economy”

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It is popular today to talk about the “sharing economy.”

But what does that really mean?

With the growth in social media, people and businesses have found ways to “share” news and information with consumers to build strong brands and relationships with consumers. The sharing economy was nurtured by companies, like Yelp, Zagat and Amazon, which made sharing reviews integral to their businesses.  Today it has been further expanded with services like Uber, the car sharing service, and AirBNB, the apartment sharing service. People are finding ways to make money through sharing.

So what does that mean for real estate agents and brokers?

Recently, I had the good fortune to listen in on the Better Homes and Garden®’s Real Estate Broker-Owner Conference and hear BHGRE® leaders, owners and executives from Realogy talk about the future of the real estate business. In many of those presentations, I seemed to find the answer.

As the industry’s growth strategy has shifted in focus from brokers to agents, and now to consumers, real estate professionals will only be successful if they are proactive in sharing information consumers actually need. While this may sound intuitive, it reflects a sea change in how most real estate agents have historically been trained.  Prior to the mainstream explosion of social media sharing, brokers and agents withheld information and shared it very selectively to ensure they maintained control over the process. That no longer works. It is actually the opposite of the model for success in a sharing economy.

Joe Rand of BHGRE Rand Realty provided a specific example. In the not so distant past, listings were advertised in the local newspaper. The text in the ads was abbreviated to an industry code primarily to keep the cost down: “Excl! 4 bdrm Excel Pvt Loc $350k Call 908-555-1212

There was another key benefit of these abbreviated listings.  The lack of information meant buyers needed to call to get more information, and the call became a lead. In fact, when a prospective client came in asking questions about the advertised property, the real estate professional was trained to not directly answer about that particular home, but rather fish for what the caller really needed to begin building a new client relationship.

Joe continued to explain that even today the industry works on the presumption that someone calling about a property is a “lead” – not a client, not a customer, not a living breathing person who has a simple need that we should be addressing.   So what are the needs of the clients?  With Zillow, Trulia and Realtor.com, all of the traditional information is already out there – square footage, bedrooms, taxes, etc. To some, it may seem that too much information is already out there.  But in fact, that is not true.

Alex Perriello, the President and CEO of Realogy Franchise Group, provided the valuable insight that today’s consumer expects even more. He explained that evidence reveals Americans have a voracious appetite for real estate news and information, and despite more information available than ever before, demand keeps increasing. He also provided examples of another industry where the move for more information is helping generate sales.

Have you ever looked online to buy a new or used car? There are tons of pictures – interior, exterior, engine, VIN number. These pictures give a comprehensive image of the car, and allow the seller to build trust and attract the right buyers. In the automotive industry, more information has not hurt the industry. In this case, it has helped.

How many agents want to take pictures of only the best rooms in a home, and post just a handful online? This is a result of the old school training that taught agents to draw a client in and create a need to ask for more information. This approach fails in the evolved sharing economy. It limits trust, and it wastes time on buyers that are not a right fit with the property.

It may seem counterintuitive, but by giving away more, your clients trust you more, rely on you more and refer you more business. Share more pictures and information about your properties. Share more information about the community where you sell. Share more information about the whole process.

In a sharing economy, sharing is the way you pay it forward and get more of the right clients.

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