I think the point of diminishing returns is interesting. I am seeing this in a few different advertising mediums. Also its crazy to see the conversations on Trulia. One person has a question and a ton of realtors all reply. That cant be very time effective for realtors.

Marketing is not sales— using all the tools available will bring folks to your door but you still have to convert them to clients. Being a successful Realtor means knowing how to convert, how to close the deal– that is the art of salesmanship, professionalism and understanding consumer needs & their satisfaction.
IMO, you have to S.P.E.N.D.
http://tinyurl.com/6rqymo

We often think about the time value of money, but seldom the money value of time. I think marketing is a GOOD thing. I think that too many times, though, REALTORS replace blathering on amongst themselves with marketing.

There ARE places where it is HIGHLY effective to go online and where you can create a PROFESSIONAL web presence that will attract clients and keep them.

There are also places to go that simply waste time or create value for competitors WHILE wasting time.

The key IMO is to KNOW the difference and have the DISCIPLINE to carry it out. It is about ROI and without a closing and a commission check, there is no R to put up against the I (grin).

I believe the reason people are obsessed with marketing is because that is the hardest part of real estate IMHO. Also, I think the “discussions” you are referring to are occurring online with a very small subset of the Realtor world who are tech savvy.

You can ask your broker or fellow real estate agents around the office about the art of real estate but my guess is 95% of them don’t know what Twitter is.

I agree that marketing has become an obsession and many agents aren’t ready for what it takes to become a realtor. As I wrote about recently on Bonzai, realtors must first work on their understanding and motivation to get a clear idea how to begin and stay focused.

Although I agree that being a competant realtor is not the same thing as being tech savvy, I wonder if the place for that is for coaching and mentoring from the agent’s local market center, not the place for blogs and “tech-centered” discussion boards.

Well, if we’re going to be brutally honest about it, Louis, isn’t part of the reason that there may not be a ‘craft of being a REALTOR’?

Look at the term BROKER. In every other industry, a BROKER is someone who just matches buyer to seller. Well, the advent of the computer age put most of those guys out of business — except when we’re talking about esoteric goods. (And even then, with the long tail effect, the Web is a better ‘broker’ than any human being).

A broker isn’t doing the legal documentation — you need an attorney for that. She’s not doing the “due diligence” on the subject property — an appraiser or a home inspector is doing that. If you’re on the buy-side, what exactly does the broker DO for you except show you houses? There’s precious little ‘craft’ involved in that.

If you’re on the seller side, the broker is just a marketing channel. Yes, some do things like staging — but really, there are professional stagers who are likely better at that.

Might I suggest that a “profession” whose requirements are extremely nominal — here in NJ, all you need is a high-school equivalency degree, 75 hours of classtime, and pass the test — doesn’t have a lot of “craft” to it?

The brokers who I DO respect earn that by being expert consultants more than anything else. And that’s where things are headed. Frankly, people should just do the “brokerage” for free and charge for the advice.

-rsh

Marketing brings the leads and that is very, very important but it is the expertise of the Realtor that converts and brings referrals.

To me all aspects are important. Leads are the lifeblood of a Real Estate business but the continual development of the skills to be a true professional Realtor are vital to the long term success and survival of your business.

Wayne
Correct in no way are we saying marketing is not important. Rather we are saying it seems to be the ONLY thing being discussed. Marketing with out a plan to convert is near worthless.
No amount of marketing can cover a lack of expertise in the subject matter.

It’s funny to me how people like Rob who have never sold real estate pontificate about how agents and brokers aren’t needed, yet everyday, all across the country, agents and brokers are sought out for their services and have been for many years. Consumers must not know what is best for them, only marketing experts.

The advent of the information age doesn’t make agents and brokers less useful, but more useful in a more sophisticated market where information needs to be filtered through specialized knowledge to create a competitive edge for consumers. Not only as consultants do we earn our money, but through all the actions taken to create profitable and hassle-free transactions. However, I wouldn’t mind sitting in a cozy office and giving advice all day.

To be brutally reductionist, I could reduce 90% of people’s work to uselessness through oversimplification.

there’s some good points for discussion here. thanks, louis.

to address the original post, there’s so much overlap between marketing, sales, and application of “craft.” truly, great marketing makes sales superfluous especially when you consider that marketing occurs at every point your business comes into contact with someone outside your business. and there’s your application of “craft,” too.

what i think the real issue is isn’t so much marketing vs. sales vs. professional skill – it’s really about Business.

what gears and sprockets go into operating a Business? a realtor is a business owner, right? it seems that the awarding of the license communicates that the realtor has all they need to do so effectively and we all know that’s not the truth. within moments, the most glaring challenge they have stares them in the face – “i need clients.” and there’s the origin of the obsession with marketing.

no one tells them that success requires more than that.

and that’s the prob – the practice of real estate business isn’t addressed from a holistic view from day 1.

you’ll find this isn’t unique to real estate, though – it’s present in any commissionable sales environment. the “business” is run as a numbers game – get enough leads and enough sales will happen.

if we really want to see change – and more professional focus on the “craft” of real estate – the paradigm from which the industry operates needs to shift.

We all know that marketing is critical to any agent’s success. It’s a huge part of the job and without leads that turn into clients, you have nothing. But, in my experience, the craft is also critical. Without technical know-how (and I’m talking about real industry knowledge) agents will waste time and struggle to close transactions. Let’s look at some real life examples.

My very first client was the result of an online lead. They seemed very motivated and I expected them to close on a property within 60 days of our first home tour. 90 days later I had sold them three houses. Well, actually, I showed them about 70 homes got contracts excepted on 3 properties (this, in a multiple offer market) and they cancelled each escrow. Now, to be clear, these people were schizophrenic. However, I was so eager to do a good job that I didn’t realize this until too late. I should have “had the talk” with them during week one and I would have saved a lot of time. These people weren’t motivated. They were scared to death about buying a home. I finally fired that client. I should have done it MUCH earlier. A year later I saw them at one of my open houses. They still hadn’t bought a home. Early on, I didn’t have the experience to know when to cut bait. In hindsight, those were great clients for me. I learned from my mistakes and moved on.

I sold in a high-end market and competed against some very good and competitive agents. They got most of the listings in our area. I wanted to shift my business to be 50% buy-side and 50% sell-side (most of my deals were buy-side). To do that I needed to make some changes or I would lose listing presentations to the more experienced, local agents. I started to offer a bundled package of services that included: tons of online and offline marketing, staging, home improvement, etc. I bundled these services with EVERY listing and acted as the project manager on each property. Clients loved this. I hired the gardeners, stagers, painters, handymen, inspectors, repair people, professional photographers, etc. And, I scheduled and supervised each listing preparation as a project manager. The results were great. My listings sold more quickly because they were better prepared. My clients were thrilled because I took on a huge burden for them and they made more money.

I can go on about:

o How to manage clients’ expectations during the inspection process.
o Why it’s important to remain unemotional during a transaction even when you want to strangle someone (The buyer and seller will be emotional enough. It’s your job to take the emotion out of it.).
o Ways to get your offer accepted even when a competing offer may be higher.

It’s true that without marketing you have nothing. However, without closing and personal skills, you will not be successful.

Mike Taylor wrote “You can ask your broker or fellow real estate agents around the office about the art of real estate but my guess is 95% of them don’t know what Twitter is.”
Indeed less than 1% of the agents providing 100% of the hot air.

It is very easy for an agent, especially a new one, to get caught up in all the marketing hype that is on the internet. I definitely agree while marketing is a great topic of discussion, there definitely needs to be more talk of the art of Real Estate.

Great discussion and very true. I really am guilty of being so obsessed with Internet Marketing, Lead Capture and Lead Conversion. It’s something I have spent 12 years perfecting. However, one thing I seldom talk about on here is the fact that I can have all these great systems and tools I have developed, but without great Realtor qualities it’s all for not.

I never talk about my training to help my Agents succeed. However, when training new Agents or new to my Brokerage, I actually spend very little time on lead conversion as much as how they should be the best Realtor they can be. I always teach them that their only goal should be to help their customer and never think about the check. If you help your customers, you will get paid. Instead I spend most of their training time on things such as follow up, patience, teamwork, floor calls, showing homes, writing contracts, making offeres, basic sales training, referrals which are the true measure of success, explaining Agency, financing, our “over the top” customer service, and finally our lead conversion system.

We deal with so many horrible Agents all the time. It’s amazing, as a Broker, that other Brokers would let their Agents out in the field without the proper training needed for an Agent to be successful. I have actually had Agents call my Agents because they didn’t know how to write a contract. I know, I said the same thing, unbelievable.

In the end, you can be the best marketer of all time, but if you don’t sincerely want to help your customer accomplish their real estate goals, then you will not succeed…at least not for long. Maybe I should spend more time on here helping with some of the basics along with the Internet Lead Conversion which I am so very obsessed. I guess now that I can admit to my obsession I can work on it.

Great talk Louis.

It’s funny to me how people like Rob who have never sold real estate pontificate about how agents and brokers aren’t needed, yet everyday, all across the country, agents and brokers are sought out for their services and have been for many years. Consumers must not know what is best for them, only marketing experts.

With all due respect to Mike, do let’s examine what’s happened in other pure-middle-man industries. Travel agents anyone? Stockbrokers?

Consumers still call travel agents; they still exist. But do you believe that there are people left in that industry who still do the pure brokerage of the pre-Internet era?

The advent of the information age doesn’t make agents and brokers less useful, but more useful in a more sophisticated market where information needs to be filtered through specialized knowledge to create a competitive edge for consumers. Not only as consultants do we earn our money, but through all the actions taken to create profitable and hassle-free transactions. However, I wouldn’t mind sitting in a cozy office and giving advice all day.

This may sound like arguing semantics, but my contention is that the advent of the information age makes agents and brokers less useful qua brokers. Meaning, the whole “I guard access to the MLS” thing and the whole “I have the key to the lockbox” thing aren’t going to be where the value is.

What Mike talks about — filtering information through specialized knowledge — is precisely the essence of consulting. Given that I believe “agents and brokers” have to transform into much more of a real estate consultant, and that Mike believes that’s where agents and brokers earn their money, I’m not sure where we disagree.

-rsh

“No amount of marketing can cover a lack of expertise in the subject matter.”

Louis flip that around and you have the hard facts of being in real estate. No amount of expertise in the subject matter can cover a lack of marketing.

I know plenty of agents that had to know every detail of how to fill out contracts and the transaction that would be great agents if they ever did a deal. They spent hundreds of hours learning how to do things correctly and never focused on marketing and were out of the business before ever once putting any of that expertise to use.

Now I am not saying that agents shouldn’t learn about the transaction, but that is the easy part.

Ken
I agree that marketing is important. We certaining hear enough about it. I disagree that the transaction is the easy part.
You are right that both components, however, are essential to success.

While learning about the transaction may not truly be easy, it is way easier to master then marketing.

The other thing is that you can’t learn about the transaction from a blog post or someone that isn’t in your own market (laws very and contracts very a LOT). This is something best learned from your broker and from experience. You will make mistakes during your first transactions, we all had to. This is partly why I think the current licensing system is broken. There needs to be a mentoring system like appraisers have.

When you are working hard to generate new business, it is very easy to get side-tracked and scattered when you learn about the myriad marketing tactics other agents are using and succeeding with. The first instinct is – “I need to be doing that too.”

The key is to figure out your strengths as an agent – are you more technically-inclined? enjoy writing? hate computers and relish face-to-face communication? – and put together a comprehensive marketing plan that works best for you and what you bring to the table. Shotgun marketing can drive business – but it is expensive and time-consuming, and as the author points out, leads to diminishing returns.

I just got back from training a group and it was interesting. As much as I still spend some of my times talking about lead conversion, it’s still about servicing the customer. In the end everything we do is with helping the customer in mind. Even when I do capture leads, my goal is to help the customer…in fact, hopefully we help the customer so they don’t get conned by another one that doesn’t have their best interest in mind. You can have marketing and no real estate skills and you can have real estate skills with no marketing skills….if you do, either way you will fail. The key to success is being good at both. You don’t have to be great to be successful, if you are good at market and good at being a Realtor is all comes together. Unfortunately in our business more Agents are good at marketing and not good at being a Realtor.

This is a very funny article to read when right next to it is a button to increase a websites traffic.

Just because an agent can get his website to the top of the searches doesn’t mean anything in regards to their knowledge. They may have even payed someone to do it meaning that they just plainly know nothing.