I was having a chat this last with the listing agent on the other side of a transaction. My client’s offer was contingent on the sale of his current home, a home currently in escrow.
“Who is the agent for your clients’ buyers?” the listing agent asked. I told him, and then I gave him the name of his company.
“Ugh,” he moaned. “Great. A no-name.”
“Hold on, Buster. I used to react that way too until I became one of those guys!” I laughed.
Keep in mind that I was having this conversation with a local agent I know well and respect. We have worked in the same market for years and even did time at the same brand-name brokerage for a while. So the punch line wasn’t lost on him. “Good point,” he conceded.
The reality, I knew, is that “no-name” is the emerging neighborhood specialist, at least if you measure success by market share. And this inspired me to pay a brief visit to the statistics courtesy of our Sandicor Multiple Listing Service (MLS).
First, I’ll start with Scripps Ranch. In the past 60 days, 87 attached and detached homes closed in the 92131 Zip code, representing 174 “sides.” Armed with massive amounts of caffeinated beverage, I tallied up the agents who were affiliated with brand name brokerages versus no-name shops. (Note that this is where some big-time scientific theory came in. If I had never heard of them, they were considered no-name. And just to be fair, I included our own San Diego Castles Realty closings representing over 5% of the sides since, much as I like to think we are a household name, you probably won’t be seeing our logo on the Times Square marquee anytime soon.)
Over the past two months, 32% of Scripps Ranch buyers and sellers were represented by small shops with curious names – like “Fine Home Living and Mortgage 4 You,” “Walter Tango Foxtrot, Broker,” “Out of Area,” and, of course, “San Diego Castles Realty.” That’s a pretty impressive performance for a rag-tag team of perceived lesser professionals.
Now, here’s where the caffeine comes in. I checked the office rosters of the “no-name” shops and totaled their licensed agents.
Of the sales, “no-names” totaled 43 companies comprising a combined 204 agents. To put this in perspective, I took just the five big broker offices within striking distance of our Zip code and found that these five offices alone comprise 295 agents. This is where the coffee ran out, but fortunately I had proved my hypothesis.
Collective market share is moving closer to belonging to the no-names; when you consider sides per agent in each brokerage, I would say the no-names are there. If I am a brokerage putting all of my eggs in the “I have an impressive household name” basket, this might give me pause to rethink my brand and business strategy. The Internet has been the great equalizer, and little guys – even the one-man shops – can compete. They can compete in all categories including marketing, exposure, technology and service.
I see this trend as a good thing. With a more level playing field and thanks to our modern ways of communicating and doing business, the shroud of mystery has been lifted. Behind that big corporate image curtain are just a whole bunch of licensed agents, and it’s the agents that matter when it comes to delivering an exceptional customer experience. With all of the information available to the consumer and the attendant transparency in our industry, they have power they didn’t wield a decade or more ago, and I see them increasingly using that power to select their representation on merit, not just on some perception based on a corporate slogan or logo.
If am a seller, this might make me rethink my interview questions at the next listing appointment or, at least, consider the information being presented to me with a fresh perspective. Here’s where I shall finally drain the coffee pot and make my point.
I spent my formative years with big name brokerages, so I am quite familiar with the pitch. “We offer the power of 13 katrillion agents in 982 countries. Our vast network means that we will reach more potential buyers.” That might have been true when we were all congregating around the Class A office water cooler in the 1990s dealing sellers and buyers out of our respective decks in a networking game of Go Fish, but it is pure baloney today.
If you don’t believe me, let’s look at those numbers again. In Scripps, 40% of the buyers over the past two months were represented by brokerages your Grandmother has never heard of. As for the no-name listing agents? The average market time for their listings was 44 days compared to 50 days overall, so you can’t even argue that they underperform in the marketing arena.
This is not to say that your agent doesn’t matter; your agent is precisely what does matter. What does not matter today is the logo on your agent’s business card, unless, of course, that logo really stands for something – consistent quality and excellence in the services the company’s agents provide– because silly things like minimum standards and expectations for all agents under ones banner are evidence that the brokerage might just remember who the customer really is. (Hint: It isn’t the agent.)
And that’s precisely our goal at our little “no-name” San Diego Castles Realty. I would much rather live out my golden years anonymous to the masses but having achieved rock star status with our clients than simply become another big, familiar, indistinguishable name in a sea of sameness.
For the big finish, here are the questions that you shouldn’t be asking the agent at the listing appointment.
1. Do you have an office? (We do, but it doesn’t matter.)
2. Where is your office located? (Ours is in Scripps Ranch, but it doesn’t matter.)
3. Do you work with relocation companies? (We do, but it doesn’t matter.)
4. How many trophies do you have for production? And, are they of the diamond, platinum or titanium variety? (None. I threw them all away years ago. We don’t do trophies here, because it doesn’t matter — not to the client, that is.)
4. How many agents do you have? (Eleven, but it doesn’t matter — except that a little depth might come in handy if your agent gets run over by a bus in the middle of your escrow.)
5. What kind of car do you drive? (A red one. But, thankfully, that doesn’t matter.)
Things that do matter include the agent’s experience, their ethics (admittedly a little hard to gauge at times), their systems for marketing your home, managing your transaction, and communicating with you throughout the process, their negotiating skills, and past client satisfaction to name a few.
Great agents, just like crummy ones, come from brokerages of all shapes and sizes. Just don’t judge an agent by their name.
(Post script: Just to be fair, I ran through the same exercise in Carmel Valley, 92130. In the past two months, no-names slightly outperformed those in Scripps with 35% of the sale sides.)