The Blind Spot in Consumer Research

J Philip Faranda March 28, 2013

Jenn Maher Leading the MeetingWe had our monthly company meeting today and discussed, among other things, how best to best help buyers in the purchase of their home. In the group discourse on what is important to a real estate consumer in 2013, the matter of consumer research was looked at critically. There are some basic truths:
  • Brokers are no longer the gate keepers of information.
  • Brokers are no longer the gatekeepers of what home are available for sale.
  • Brokers are no longer the gatekeepers of aggregate data.
  • Brokers are still needed because our value proposition is not information, but of advocacy and guidance.
In my recent experience at Hear it Direct, a solid 18 out of 18 consumers said their broker was worth their service fee (commission). Most, if not all, would use the same broker again, or at least use a broker in their next transaction. So here is what is so funny that I pointed out to in our meeting. Consumers, who agree that brokers are necessary to their home purchase, research everything about their prospective home, such as schools, neighborhoods, crime, demographics, market stats, municipalities, local laws, and almost anything else you can think of. EXCEPT their broker. I can't tell you how many times I have spoken with people who knew incredibly granular data about their community of choice, but then either dealt directly with a listing agent with no advocate of their own, acquiesced to dual agency, or just used some guy they met at an open house. Time and time again, especially in stories of less than positive experiences with agents, when I get to how the consumer chose their representative, they reveal that they didn't really research or vet the person who would broker the largest financial event of their life. That blows me away. Yes, research. Learn about the community, the walk score, the schools, crime, and neighborhood amenities. But for God's sake don't trash all that hard work by using a sub par agent to represent you. Roughly two thirds of our company listing inventory are homes that were listed with another brokerage that expired unsold before hiring us. Typically, their last agent was a family referral, social friend or neighbor, or casual acquaintance. Many of our buyer clients worked with other agents before engaging us as well. They didn't interview multiple agents. They just figured that the Multiple List was the Multiple List, or that all buyer agents unlock doors the same way, and that their agent would do. And they lived to regret it. I don't blame these folks for researching everything carefully but their agent. I blame our collective industry for failing to educate the public. HOW you research an agent will be for another post, but suffice to say that a little thing known as Google, track records, personal references, and transparency go a long way. THAT you research an agent before hiring them, however, should be an absolute given necessity for any consumer. We are not all the same, and I'll take it a step further and say that an agent who doesn't sell a lot may be a better match for some than someone who closes lots of deals. The important thing is to find the right match, and when consumers know to do that the rising tide will carry all boats.  

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