Brainwashed by the Big Box Real Estate Brand

By Brad Nix on October 31, 2009

 

As you wish, master

I recently wrote how Small is the new Big, making the point of how small brokers are able to compete with the large brand brokers much more effectively than ever before due to the evolution of real estate 2.0. The comments were all over the board, many supported my points and there were several dissenting opinions. However, a few of the comments left me wondering where some agents’ thoughts come from? Are they really their own opinion or have they been brainwashed by the brand?

The comments were well presented and came to logical conclusions (I am not attacking the commenter(s), merely just pondering the possibility of broker brand brainwashing.) This comment is very logical, but sounds like broker brainwashing to me…

Every year I look at every transaction and evaluate the source of the business. If the brand causes one transaction per year, and I were to allocate 100% of the earnings for that transaction as having paid all the royalties for the whole year, where would I stand? If the brand brings any additional transaction, my payback on the royalties far exceeds the royalty I pay. So far, over the past 6 years, the (removed broker name) brand is responsible for 3-5 transactions per year that we would not have received otherwise.

Take me to your leader

Every broker I know makes this assertion when dealing with push-back on commission plans from agents. “Would you question the splits if our brand delivered enough leads to cover these expenses every year?” That’s a hard question to say ‘yes’ to. But if you think through this assertion and realize what you are getting into, then the assertion begins to have less value. What if a small broker could send you the same amount of leads? Would you still pay more for the brand name? What if you generated so much business on your own that you didn’t have time to work the leads from your broker? Would you still pay more for the brand name? How do you know that you would not have received those leads from a small broker? Why allocate 100% of your work on a transaction to cover royalties? Do you enjoy working for free?

These aren’t the droids you’re looking for

Granted there can be many reasons (but often times they sound like justification or rationalizations) for going with a large brand name broker, and I contend broker brand means less today than ever before. Small brokers are generating as much or more leads from utilizing web 2.0 tools than many of the large broker brands in local markets all across the country. The real questions you should be asking yourself (and your broker) are… Did the large brand name itself generate business I would not get from a small broker? If so, then does the income from those leads offset the additional fees charged by the large brand? I simply advise you to consider small brands when shopping for a broker. Often times small broker commission plans are far more attractive and you may not give up any leads handed to you by the broker.

If large brand name broker gives you a bundle of services and leads at a cost to you of X and small broker gives you the same bundle of services and leads for Y (where X is greater than Y), then why pay more for the brand? Do yourself a favor and shop broker services and don’t forget to consider the small local broker.

Article originally published July 07, 2008

 

Posted in Real Estate | Tagged Brokerage, small broker, small vs large broker

335Share

I remember when I first saw it. My dad called me over to his office, where he had a x86 PC with a 1200 bit/s modem, which I’d mostly used for games (I was 15 at the time) and connecting to various BBS‘. He said: there’s this new thing, they call it the Internet. I think it’ll be really important.

What can you do with it, I asked? You can see what’s on other computers, far away, he said. You can do it via Gopher, or FTP, or Cello (the predecessor of today’s WWW browsers). There wasn’t a lot to see there, so I quickly moved onto other things, but soon after that day, a new way to browse the Internet came out: Netscape.

And suddenly, the Internet became great. I could find out about games and bands I’d never heard of before. I could see what the weather is like in South Dakota. I could create a personal page (that’s what people did on the Internet before blogs came to be) with my biography and picture for everyone to see. I jumped on the train and never looked back.

The real beginning was a couple of decades earlier, although no one can really set the exact date for Internet’s birth. But on October 29, 1969, the first two nodes of ARPANET were interconnected between UCLA’s School of Engineering and Applied Science and SRI International (SRI) in Menlo Park, California. It took 12 years for 213 computers to get linked in the network.

Somewhere after that, things started changing, fast. Netscape – the archetypal browser – was overrun by Internet Explorer (

). It took about 10 years for Netscape’s market share to fall from over 90% to less than 1%. Then Firefox started eating away at Internet Explorer’s market share. Who knows what we’ll be browsing on in 10 years?

Fast forward to today, and the Internet has over 1.5 billion users, and most of them can’t imagine the world without it. Most of you don’t need an explanation of what it is and how it works; it’s one of the fundamental things you encounter, like rain or electricity. It’s in our blood. It brought us the ability to communicate fast, to connect with our friends, to create stuff together; it brought us social media, Twitter (

) and Facebook (

).

But unlike rain or electricity, it changes, faster and faster, each day. Its first 40 years were just the beginning, and I’m really, really interested in what it will look like in another 40 years. Whatever it is, it’ll probably be unimaginable from today’s standpoint.

Do you remember how you learned about the Internet? What was your first experience with it? Share your thoughts with us in the comments.

Image courtesy of iStockphoto (

), Eraxion

Al Gore?

Click the link to phoenixrealestateguy.com to read the entire post

You dirty rat, the great Jimmy Cagney line is being heard more and more around town these days. Especially in the 10 cities that d-CON has announced as the worst cities for rat infestations.

Congratulations to El Paso and Washington DC on making it out of the Top 10 list from last year, even though depending on your political persuasion it is questionable how many rats left or entered Washington in the past year.

So here you have it, this years:

Top 10 Worst Cities For Rodents in 2009

1. New York City, NY
2. Atlanta, GA
3. Houston, TX
4. Louisville, KY
5. Philadelphia, PA
6. Chicago, IL
7. Boston, MA
8. San Antonio, TX
9. Milwaukee, WI
10. Detroit, MI

via d-Con

Related posts:

1. Top 10 Worst Traffic Cities in the United States For 2009
2. Top 10 Worst Foreclosure Cities For 2008
3. Top 10 Most Expensive Cities To Own a Luxury Home in 2009
4. Top 10 Safest Cities In The United States in 2009
5. Case Shiller Report For September 2009

Thank goodness Memphis didn't make the list.