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Real estate take notice: The consumer is undefeated

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Jointly written by: Jeff King (CEO, Real Estate Board of Greater Vancouver) and Trevor Koot (CEO, British Columbia Real Estate Association)

 

There have been many times throughout history when innovation has led the consumer. When Henry Ford envisioned an assembly line producing vast quantities of Model Ts, he did so on the premise that the consumer didn’t yet know what they wanted or needed. Before Apple put an iPhone in everyone’s pocket, nobody was missing smartphone technology.

However, in other instances – including innovation within the real estate technology space – the consumer has been and remains undefeated. And if the real estate industry doesn’t take notice, consumers may begin to turn elsewhere.

Since the first iteration of the internet, business has been maneuvering to satisfy the consumer’s desire to have more control and remove intermediaries. What started with businesses getting increased access to suppliers quickly turned into consumers receiving the same access.

 

No more intermediaries

 

This began when service-oriented businesses like airlines, car rentals, hotels, investments and entertainment started cutting out the servicing agent. Entire industries have been disrupted by this changing consumer interaction, including the travel sector, stockbrokers, cable companies, studios (music and audio-visual), banks and insurance brokers.

The next transition was from service to product. With Shopify, Amazon and even Facebook Marketplace, consumers access products without retail agents.

To be clear, this is not a doomsday “the sky is falling, and disruption in the real estate industry is going to cause catastrophic change” kind of article (though it’s probably widely agreed that change is inevitable). Instead, this is intended to inspire leadership in the industry (and all stakeholders) to consider the consumer when making decisions.

 

Consider the consumer

 

Two things drive today’s consumers: data and transparency. As much as we all continue to want our privacy protected, this is a balancing act for business leaders, legislators and the consumer because we also want technology to make things easier and more accessible.

In the music industry in the early 2000s, this change was sudden and profound. Consumers wanted digital access and the portability to take their music anywhere. Until this point, these ideas were unheard of. Even if the technology could accommodate these wants, the licensing and business models were not there yet.

So, platforms like Napster, Limewire, Kazaa and BitTorrent stepped in and gave consumers access to music (and, once broadband became more common, TV shows and movies) on demand. Instead of waiting to catch a rerun of The Office, you could just watch it whenever you pleased. Binge-watching was a new phenomenon that the consumer didn’t know they wanted.

Resisting this push from the consumer, intermediaries such as some record labels and publishers continued to fight access to downloads. Instead, they steered consumers to buying entire albums when they only wanted one or two songs. New direct-to-consumer models led by progressive licensing bodies and sizeable tech firms such as Spotify, Apple and Google started driving music consumption based on consumer desire. Record stores, movie rental shops, radio stations and traditional TV were slow to react. As a result, they have had to play catch-up in an industry they previously led.

 

Open, exploratory response to consumer demands

 

The similarity in real estate is not difficult to see. Consumers are armed with far more data than ever before, and they are demanding more and more transparency. The response by the real estate industry must be one of openness and exploration, not protectionism and defensiveness, as was the unsuccessful mandate of the record labels and publishers. This starts with understanding the consumer experience and appreciating what they will continue to want as technology evolves, with or without the industry buy-in.

The folks at Realtor.ca take this responsibility seriously. They are always looking to improve the consumer experience. Outside of the many millions of interactions consumers have with Realtor.ca, they are interacting with the industry through showing services, CMAs, MLS email, direct message updates and other services commonly offered through real estate boards, brokerages, franchises and the like. When vetted for implementation, most of these services go through a rigorous testing and approval process led by realtors.

 

Case in point: Consumers to lead change

 

One of the authors of this article recently purchased a home and used the services of a local realtor. Set up on the email update service that the MLS platform offers, every time there was a listing of interest, they would copy the MLS number and paste it into the Realtor.ca app because the thumbnail photos didn’t expand otherwise.

The experience was antiquated and less than pleasant. It would not take much for the consumer to be enthralled with a better experience elsewhere. But, if there was a suggestion to change systems, to go with something more consumer-centric, to disrupt the current “what we know,” leadership would be met with harsh resistance by the membership.

Change in the real estate industry has often been led by what is best for the realtor, which is okay in some circumstances. But if the change is detrimental to the consumer experience, the real estate industry must do better.

Realtors must look at all services provided through you (your brokerage, board, franchise, etc.) as if you are looking at it from your customer’s perspective. When considering changes in service providers or offering new services for members (such as a new showing system), real estate boards are encouraged to prioritize the consumer experience when making these pitches to the membership.

 

Everyone in the industry is equally responsible for the future of the industry. That future is bright for realtors and the value they bring, but only if we continue to adapt to the ultimate end-user’s expectations. Because, as history has taught us, the consumer is undefeated.

 


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