Real Estate and Private Media

Everyone knows that the Internet is the greatest business model changer since the advent of mass production. Companies and whole industries and are now faced with powerful questions and choices. How do they adopt and take advantage of the Web and position themselves for the future? Fighting a future where the Net is the predominant source of information for consumers is no longer an option. If you try and shovel against the tide you will get swept way. Some businesses tried this for a while with predictable results—some trade publications come to mind.

No industry has been affected by the Internet more than the residential real estate business. In the pre-Web days, brokers had a total stranglehold on the most precious of all commodities—information. You needed to engage a broker to get on the MLS system, and you needed a broker to learn which houses were for sale via MLS. The broker advertised in local papers, but to get the real info, you needed to go to them. Because of this barrier to competition and control of information, they were able to command nearly 7% commission when selling a house.

The Internet hit their business by opening up and freeing the flow of information. Market pressure forced them to put the MLS online, and now everyone is the world has the same information access. Buyers now search the Net for buying information, not to mention past sales data and anything else you would ever want to know. Discount brokers entered the market and commission has dropped to an average of 4% in NY and 5% here in Massachusetts. What is a brokerage to do? Put their head in the sand and hope the Internet goes away, or embrace it and make it work for them.

Based on my own experience, Coldwell Banker is a company that embraced the Internet and has used Private Media to create a bond with buyers. They invested in a site like nemoves.com, where they not only list their own houses, but their competitors. This is in effort to become a valuable resource for buyer and sellers. They also have content and links to relocation and buying resources. This helps build a relationship of affinity and trust with buyers. My Coldwell Banker broker also set up a private email feed for me and my wife. Every morning we received a message with updates, new listing and sales in our target towns and price range. When we clicked on a link we went to our broker’s private page. They have created their own Private Media channel, and it works. I just sold and bought a house through them and could not imagine using another company. They created a lifetime customer in me and my wife. What are you doing to create a lifetime bond with your customers?