By York Baur | March 9, 2020
Mike DelPrete put it best at ICNY 2020: “The industry is moving very slow, but it’s never moved this fast.”
Franchisors are building their own technology at record rates. New proptech companies are popping up everywhere. Acquisitions and consolidations are becoming more common. There’s an electricity in our industry that’s been simmering for the last few years.
And, it’s exciting.
But it’s also been a time of uncertainty and, quite frankly, fear. Especially for the brokerages and agents all of this surrounds. I know there has been frustration, agents shuffling, lots of money changing hands, among other concerns. But, the best piece of advice I have during this age of transformative innovation and perceived disruption is simple:
Stop using the disruptors as a benchmark for your success.
Sure, they’re flashy. Sure, they’re mainstays in the news and claiming data that may or may not be true. But comparing your brokerage to their definition of success isn’t the way to measure your success.
Every brokerage is a tech-enabled brokerage
It’s true. Every brokerage is a tech-enabled brokerage, whether you build your own technology or not. And brokerages, both traditional and new, who are leveraging data and embracing the fact that they’re tech-enabled are seeing the benefits. We took a deeper dive into our data by looking at 10 of our largest client brokerages representing over 50,000 agents. We found that, on average, agents with a high usage of MoxiEngage CRM increased their transactions by 85.3% from 2018 to 2019. Even agents with a lower usage of MoxiEngage still increased their transaction count by 41.2% during the same time period. And while we believe our products are best in class, the reality is using whatever tools you have will make you better whether they’re from MoxiWorks or not.
Everything you need to be a “tech-enabled brokerage” already exists in the marketplace and agents at any brokerage with leading technology will see an impact on their business, even if your brokerage isn’t one of the “disruptors.”
A case for the mistaken market share
Market share is of course another way to reflect on your brokerages’ success, but make sure the data you are comparing it to is apples to apples and not apples to grapefruits.
For example, it’s easy to claim impressive market share to scare the competition when the sample size of that share is disproportionate. Compass made claims at the end of 2019 towards their 20/20 by 2020 vision that a number of their markets are close to 20%. But, 21.3% market share of Malibu, CA is certainly not the same as only 6.6% of LA county. And 33% in the concentrated D.C. market is not the same as only 7.3% in the DC metro area, just like 17.8% in Downtown Dallas is not the same as only 2.9% in the Dallas metro area.
While a lofty goal, there is still more than enough market share being held by other brokerages and to that we say keep it going. Instead of letting the disruptors distract you, focus on things that truly reflect success in your business. Focus on your team and your success.
The pomp and flash won’t last. Just remember, the data doesn’t lie. Big signing bonuses and other carrots being dangled in front of agents are sometimes tough to combat, but you should really be more concerned with yours and their retention rates, instead of recruitment rates.
Why? Because agents who left Compass in 2019 were only there for an average of 295 days, so less than one year. In the 2019 National Association of REALTORS® Member Profile report, they found that the median tenure for REALTORS® with their current firm was four years.
So focus on what you’re doing to recruit and retain your agents. If the industry average is indeed four years of tenure at a company, take a look at your data and see how long your agents are sticking around to determine whether you might need to make some adjustments to continue to have your agents remain at your brokerage. And remember that using technology to increase agent productivity can solve your recruiting and retention problems: productive agents are happy agents who stay at your brokerage and recruit others to it.
The road ahead
The quote written above my office from Marshall Goldsmith is a reminder to us every day and it should also be a reminder to you:
“What got you here won’t get you there.”
While I believe you have everything you need at your fingertips, I also believe you need to be proactive and provide an environment of ‘Training + Systems + Coaching’ to retain your agents and help them continue to succeed through the age of disruption.
And look, we have to give Compass credit. They set a lofty goal, and good on them for doing that. Every company should. Creating that mission, that rallying cry is a great way to not only motivate their teams but gives them something to measure.
So, instead of letting them distract you from your goals, take it to heart instead. What are your goals?
Their goal doesn’t say anything about anyone else, so think deeply about your brokerages’ goals for the company and for your agents and use that goal to measure your success.
And don’t stop there. Announce it to the team, bring it up in meetings with your team and with your stakeholders. Develop leading indicators of your progress and measure them routinely with a scorecard. Hold yourself accountable for the goals you set and what you are trying to achieve. We do this at MoxiWorks and I promise you that you will see better results by doing so as well.
There will always be disruptors. Don’t let them derail your focus. Instead, stay lasered in on your success metrics and your goals and continue to help your agents thrive with your brokerage as their home.