I read a post by Kris Berg about experts and the challenge of communicating your expertise to prospective clients. Words may not be enough to convince consumers you are great. Proclaiming you’re the #1 agent or Top Producer and you’re likely to get a yawn and a click away. But what if you really are a top producing agent?
I have suggested that real estate experts should market like other experts market, including appearing on local TV news, print news, teaching, speaking, etc.
But I was wondering. Could there be a statistical basis for showing consumers your abilities? Other professionals use stats. Baseball players have batting averages, slugging percentages, on base percentage, etc. Quarterbacks have efficiency ratings. Basketball players have scoring averages. Why not a batting average or efficiency rating for real estate agents?
Let’s say you got 10 listings last year and sold none– your batting average is 0.00, sold 3 of them, you’re batting .300. Maybe the median price of your sales is greater than the median price of homes in your market— that would indicate you have a better slugging percentage— you’re the Babe Ruth of brokers. Maybe you sell homes faster than the average. Maybe 90% of your listings renew with you. Maybe you are good at moving the tough properties (fixers, etc). (You can still get into the Realtor Hall of Fame hitting a lot of singles.) You get the idea.
Perhaps someone can come up with a working model that won’t tick everyone off.
In order to do what you are talking about, you have to throw away the commission model.
Example:
seller: what is your commission?
agent: the average commission nowadays is 5%, so that is what we charge
seller: wait, you just told me you are not an average Realtor?
agent: I’m not, I really, really advertise homes well.
seller: so why not ask for 6% if you are better
agent: because the average is 5
I argue with my wife about this all the time…It’s easy to follow and average commission model, but can be the death in any negotiation
I see your point Matt. But if you had the stats to back up your above-average results, I think you’d be able to charge the 6%.
Hmmm. Real estate stats are quite as cut and dried as baseball stats. Market times shorter? Does the agent price the homes too low? Market times longer? Does the seller insist on too high of a price? Maybe all of your listings were short sales or had small lots while mine were traditional sales with millions of dollars worth of upgrades and free-form pools. You sold more homes? You might have a team of twenty (and once hired, your client will never talk to you again), while I might work on my own and close fewer transactions overall but more “per warm body.” Finally, numbers are funny in that I can manipulate them to make them say what I want. So, we are back to the same old Top Producer dribble.
I see your point, and don’t disagree, but execution is a little challenging.
Joe, By the way, very impressive ping-back above.
>Technorati Search for: baseball wrote an interesting post today on…
Great post, and I am starting to use those averages in my marketing..
But, if you sell three out of ten, that is a .300, not a .333..
;^ )
I saw a blog on this one day that a junior realtor new to company was getting ignored and after doing her appointed duties got busy on the net and spoke to clubs and soon became an expert and was used by the media and soon her business grew and all the realtors wanted to know how she did it. She had a presence in internet community as well as local community and billed herself as an expert. She is now the top producer in the company and much to learn from her.
You can definately get into the hall of fame hitting singles but finding your market and sticking to it is best ie luxury, commercial buyers. When you specialize in an area you are able to provide the type of service the customer is looking for.
Be an expert in you niche luxury, commercial, residential.
Thanks Lane.
If you have the statistics why not flaunt them?
Because batting averages are poor indicators of performance. The strike to walks ratio is a much more useful tool. When scouts look at the stats, they don’t care how many home runs you have or what your batting average is. They look at the strikes on walk percentages.
My team came one home run away tonight from tying the state record. We average around four home runs a game. We’re young, mostly sophomores and juniors. If you look at our home runs, you would thing we’re pretty good, but if you look at our other stats, you will see we’re free swingers!
You look at my batting average in high school. I hit slightly over .600 Sounds pretty good eh? Number’s lie!
In real estate, if you sell two of your listings and get at least one buyer client, you’re average.
With real estate, the best thing to do is put together a team and compare your team with other local agents. Look at how many listings such and such brings in, compare them with your own, then look at the number of homes closed, etc. If you break them down, you will get a better idea not who is better but maybe where the opposing team’s resources are being spent and where you and your team falls.
You seem like just the guy to help come up with the stats Derek. Let’s put our heads together and create one– we’ll call it the Sellsius-Burress REASA (real estate agent sales averages)
I say it’s important to sell faster and sell above the median or average in your market, as compared to your competition. It would also help if you could move more than 1 or 2 homes a year.
So maybe there should be a DOM component, a total units sold component and a median or average price component. That’s a decent starting point, no?
In the end, all the data should be displayed so any outliers that skewed the averages could be seen.