CEO’s Introduction
A melody is heard, played upon a flute. It is small and fine, telling of grass and trees and the horizon. The curtain rises. Before us is the Salesman’s house.
So begins the superbly written and powerful Arthur Miller play, “Death of a Salesman.” Despite premiering on Broadway more than 60 years ago, the play continues to be performed around the world making the lead character, Willy Loman, a well-recognized name. Anyone lucky enough to have seen one of Brian Dennehy’s formidable performances in the lead role (and I feel fortunate to include myself in that group) can’t help but be moved.
Considered by some as an attack on the American Dream, the play came to mind when I recently read “Death of the listing presentation,” a provocative and fascinating article written by Scott Einbinder.
In the article, Scott details how most Realtors really miss the point when it comes to a listing presentation. Some of his comments are music to my ears; they touch on my own belief that a sellers needs are simple.
Sellers want to know three things:
- How much will I get for my house?
- What’s your plan for getting me that money?
- How much is it going to cost?
The truth is that most listing presentations follow a theme with core components including, “I’m great because…,” and “My company is great because…” How likely do you think it is that the seller will hear exactly the same thing from the next Realtor walking through their front door?
When it comes to the “plan,” there is a tendancy for more repetition in the pitch. It includes having the home listed on the MLS, advertised in the local newspaper, and of course, getting added to the Realtor’s personal and company Website. From a sellers perspective, each presentation has the tendency to be a variation on a theme – so how do they pick the good from the bad?
Sellers and buyers connect with their Realtor on multiple levels, but sometimes it’s as simple as a feeling: “I just felt like they were the best.” So can you ‘can’ the comfort factor and make it part of every listing presentation? Of course not.
Commissions continue to be high on the list of determining factors, and according to a recent Consumer Reports survey, Realtors are ever more open to negotiate. In the survey, almost half of the home owners spoken to said they had attempted to negotiate commissions. Over 70% of this number succeeded. RE/MAX and independent agents “appeared to be a bit more willing to deal” followed closely by Century 21, Keller Williams and Prudential agents. The survey added, “We found that paying an agent a lower commission rarely had any effect on the sales price.” Additionally, sellers were just as satisfied with independent agents who “tended to provide the fewest services.”
Further, “Sellers who paid commission rates 3 percent or lower were just as satisfied with their brokers’ performance as those who paid 6 percent or more, suggesting that haggling can’t hurt.”
I have had too many heated interactions with a handful of friends who argue about the validity of fees based on the price of an asset. Their argument always falls back to a variation of the following: If there are two homes being sold by the same Realtor, offering the same level of service, with one home worth $250k and the other $500k why should it cost the latter home owner $15k more? I counter with a slew of what I consider to be valid reasons and examples, but it rarely changes their opinion. People see and believe what they want to see and believe. During these ‘conversations’ I get a small insight into just how tough it is to be a Realtor!
The most shocking statistic in the survey was that a quarter of Century 21 (25%) and RE/MAX (24%) agents didn’t advertise homes on the Web! What is it that Messrs Flintstone and Rubble don’t get? I struggle to believe these numbers.
And so back to the listing presentation. I have spoken to countless brokers and Realtors over the last several years, and no one has ever been dumb enough to suggest that listing presentations hit the mark 100% of the time. Rather than use Scott’s suggested new term of “Listing Education,” Bernice Ross, states: “We need to move to having a listening consultation.” Listen to our clients? What a unique idea!
Of course Bernice is right. Too many people like to give their opinion (the irony of making that statement in my own newsletter hasn’t been missed…) and too few want to listen. And of course, all of us are right! So what is it that home owners want? I’ve long held the belief that the one thing that both buyers and sellers want more of is information.
As exhibit ‘A’ I present television shows. There seems to be an ever increasing slew of programs related to buying and selling homes. Some attempt to inform, others entertain, but more and more simply irritate (have you seen “Million Dollar Listing” or “Flipping Out?”). What should we take from this almost endless parade of programs? It appears there is an almost insatiable hunger for information about property.
I’m sure a decent percentage of the many viewers are “just looking” but one can’t ignore the fact that the shows, in addition to their entertainment value, are creating a public far more knowledgeable about the best (and unfortunately) worst parts of the real estate process. I am beyond full when it comes to Chad’s self indulgence and Jeff’s OCD: “Ideally, 70 percent lemonade, 20 percent punch, 10 percent Sprite. If they don’t have fruit punch, do like 85 percent lemonade, and 15 percent Sprite.” It seems I stand alone.
With the economy in its current state it’s hard to find positive things to write about. Multiple industries; travel (air and auto), finance, and property, are simultaneously hurting. It seems that only the oil companies are able to leverage (that’s a polite word for ‘exploit’) the situation. And for Realtors, this is a triple whammy as it costs more to get around, mortgages are harder to come by and inventory increases. So what is the answer?
As is often the case with complex, multi-layered problems, there’s no single answer. Part of it is obviously time. Anyone who has been in real estate long enough knows that there will always be ups and downs. No matter how bad the down looks, the up is coming. We can only hope it’s sooner rather than later.
In more ways than perhaps we would like to admit, the plight of Willy Loman is comparable to that of a Realtor. Willy is in sales, is compensated on commission, and makes his pitch ‘on the road.’ And most importantly – he is struggling. For a struggling Realtor, one part of the answer is to look at the entire process of marketing a home, and this has to start at the beginning: the listing presentation.
Are we really talking about the death of the listing presentation? I wouldn’t put it quite that strongly, but one can’t help but acknowledge that it needs to change. Step one is to ensure that clients get what they want and not what we think they want. As Bernice adds:
“Instead of the old approach of hunt’em, tell ‘em, and sell ‘em, the strategy that really works is to ask questions. What have you enjoyed about living in the property? Will these features be important in your next property? Are there any special features buyers might not notice while walking through the property? Take notes to let them see that you are listening.”
I would only add that you should then take those notes and publish them. Everywhere.
As always feel free to contact me personally, at any time, for any reason.
Stephen Fells,
CEO
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