Century 21 Canada’s president and COO, Don Lawby, has been with the franchisor since 1976, two years after he began working in real estate. Lawby oversaw the significant restructuring of the corporation’s business model in the mid-1990s, in response to the surge of “head fee” alternatives. At the same time, the company began operating much more independently from its U.S.-based parent firm. In 2007, it began a branding makeover; in the May issue of REM, Lawby announced a new corporate tagline – Connected to More – to draw consumer attention to its remodeled Century21.ca website. Recently, Lawby spoke with REM senior editor Kathy Bevan about the way his company and the industry continue to evolve.

 

REM: I understand you’re now awaiting the court’s ruling on the issue of proprietary listing data, in your lawsuit against Rogers and its Zoocasa.com syndication service. We haven’t yet seen other franchisors take up this legal battle – do you feel like a lone voice in the wilderness?

 

Lawby: Pretty much. I think that many in the industry don’t understand what’s happening to their data. They don’t understand, when they tick boxes that say, “I want the listing information to go everywhere”, what that really means.

I am not against syndication. I am against how it’s being done by organized real estate. Look at how hard it is for us to get data from our brokers to put on their site. We go back and forth with boards about how to get the data, create the software and get each of our offices to agree. We don’t send the data anywhere; it’s on our franchisees’ and our brokers’ sites. We spend hundreds of thousands of dollars to do this and a company goes to a board and the board says, “Okay, no problem, here’s the data”? This takes the data outside the industry. And let me tell you, all of the companies that are using the data are using it to build for-profit businesses.

Maybe I am a lone voice, but I will continue to speak out. I’m not against a salesperson or an office saying, “I want my data to go on Zoocasa.” I just want them to realize what that looks like, that’s all.

In future, I think we will see much more competitive sites providing information to the consumer on real estate transactions, with more and more proprietary data on the site – not just having the same data. That is, unless a decision comes from the court that says that companies have the right to take everybody’s data and put it on their own sites.

 

REM: Your company has been meeting with Royal LePage and Re/Max Ontario-Atlantic Canada to explore sharing each other’s listings on your corporate websites – what stage are those discussions at now?

 

Lawby: The three of us have hired a consultant we are collectively paying for, so that when we meet and talk, something actually happens from those discussions. That consultant is representing our three companies and dealing with CREA, as we speak.

We’re endeavouring to find the ability to get data from one source – that would be the simplest way, if possible. But it truly is up to each of the boards as to how this is put together. So we’re talking with a number of bureaucracies and the timeframe is expanding and some of us are losing patience. We may just continue to endeavour to get data from CREA, a feed, but until we can do that, we may start getting data from some boards, with of course, the approval of salespeople and offices.

Our intention is to test and start and then anybody who belongs to organized real estate will be able to participate. There will be a fee, but will it be lots? No. It will all be web-based – the simpler it is, the simpler it will work. If we can just take data from CREA, the fee will be whatever they’re going to charge. But if we’re pulling it all, sending it through and holding it on servers, then costs go up. We’re not trying to build profit – this is a business for us to continue to compete, that’s all.

 

REM: And how is your new business model competing in 2010?

 

Lawby: We’re really happy with our business model today. We’re becoming more of a recruiter and distributor of leads to our franchisees. We’re putting more and more actual, direct systems in place.

We believe, going forward, that there have to be benchmark systems where we can say, “Here is the system and when you put it in, these are the results that you’ll get.” We’ve watched other companies that are doing that – most, if not all, in the U.S. – and we’re seeing how that is working.

The travelling I’ve been doing is to meet with groups of our brokers and salespeople to push our technology, which we consider to be the leading Internet technology in this space. We continue to push our people to use it to the maximum effect, to provide the best experience they can to the consumer.

Today we have a website that operates in three languages – English, French and Chinese. We’re launching a mobile application in English; by the end of June, it will be in French; in August, it will be in Chinese. Then we’ll see if there is another language we want to add, because we truly are a multi-cultural organization.

 

 

 

REM: Is Century 21 still growing in Canada?

 

 

 

Lawby: Yes, we are. And with the re-acquisition of the management of the province of Quebec, we will have significant growth over the next 18 months.

In Quebec, we had a managing contract and we had to take court action last year. In October, we took it over and have reopened a corporate office. We’ve already started to build franchises and started to recruit.

We didn’t lose any offices or people in the process. There was a sense of “what’s going to happen?” But all of a sudden, we started to deliver service and we started to deliver tools. I took a translator and went and sat down in every office.

We were very candid with everyone – very straight. That’s the one thing I pride myself on – and our whole organization. We’re ethical, we’re straightforward, we tell people how it is. We’re not afraid to make decisions, we don’t make easy decisions – the easy decision is to say yes all the time; we don’t say yes all the time.

As well, we don’t just run C-21 Canada. We built Centum Financial Group Inc., a mortgage brokerage franchise, based in Vancouver. And we’ve just negotiated the rights for Real Property Management for Canada.

 

REM: What’s the fit you see with Real Property Management?

 

Lawby: There hasn’t been any national property management operation of this kind in Canada. We’re not talking about the big buildings downtown – we’re talking about investor real estate, the type that gets looked after by salespeople. There are a lot of investors that buy three, four, five doors and get a Realtor or real estate salesperson to look after them. Many of those Realtors and salespeople do this just to make the sale – they don’t have any real proficiency in property management. When the toilet plugs in the middle of the night, they hate getting the call. When you start talking about large offices, there’s an opportunity for a service to be put together. We think there are really good synergies for this.

Because of how this industry is, our franchisees need the opportunity to be able to connect to opportunities to have on-going profitable businesses. There continues to be pressure on commissions, both from consumers and from salespeople and profitability continues to be an issue in this industry. We believe that there are changes in what Generation X and Y want and look for – more lifestyle, that sort of thing – that will mean there will be more people turning to rental accommodation. So we continue to look at the business we’re in, which is the real estate industry.

That’s what we do – we look to the future and say, “How do we continue to build business and look after what it is that our franchisees and salespeople make a living doing?” I want to make sure that it is understood in each of the offices where we think this industry is going and how we think they need to address this – both salespeople and office owners – for their successes and our success.

 

REM: What are you hearing from your brokers and salespeople about the legal dispute between CREA and the Competition Bureau over access to MLS data?

 

Lawby: Everybody is concerned about what’s taking place within the real estate industry – nobody knows what the end effect will be. They all look around their marketplace and say, “We’re in a very competitive marketplace, we don’t understand.”

All we can say is, you need to fine-tune how you deliver the message of the value you bring to the transaction. People are willing to pay for value, for the value they see. Most consumers don’t understand the complexity of the transaction.

We have people in the industry saying, “We’re going to provide ‘no service’, we’ll just guarantee the data that is on the listing and put it on MLS for a fee and we won’t have anything to do with the transaction.” Well, in some provinces, they can’t do that – it’s against the act. So it’s not just what the Competition Bureau says; it really depends on the acts within the provinces.

I look to the American example and see that commissions have held. Actually, in the last 12 months – maybe because of the kind of market it is – average commissions have increased. So the bottom isn’t falling out the industry and I don’t think it is going to fall out of the industry.

 

REM: What do you think the industry and your company will look like over the next few years and what will you focus on personally?

 

Lawby: Personally, my commitment to C-21 is to be here for the next three and a half years. For me, over that time I want to make sure that I leave the organization in fine shape. I don’t want anyone to say that he rode the horse to the top of the hill and then jumped off. I really do care about the industry and my customers and their customers.

I’m thinking that sometime next year, I’ll do another national president’s tour – this will be my fourth one. We have 378 offices and I’ve hit close to all offices on each tour. Sometimes people will have three or four offices and we’ll visit all those in one location; it depends what works for each franchisee.

The reason I do these tours is because I like to do things that I don’t think some of my competitors would do. I go places that I’m not sure all my competitors will go to. I want to make sure I touch people who don’t come to company events. There are lots of those people in every organization – they just don’t come out. They’re my customers – they have a right to ask things that they want to know and to get the straight goods. I think that’s why we have a very good renewal rate and what I think is an excellent relationship with our franchisees.

As for the future of the industry, it will continue to have brands. Century 21, Re/Max, Royal LePage, Sutton will continue to do well with brands, because we will all do the things necessary to protect and build our brand with the consumer. And I can tell you that the consumer will pay for valued service, but it is up to salespeople in the industry to demonstrate the value they bring to the transaction.