Brainwashed by the big box real estate brand

Adam Sandler – “They’re ALL going to laugh at you…”

Problem I see in my market area is agents that are NOT with the big brand names are looked at as “second tier” agents; “gypsies in the night”, agents that are not doing very well and that probably the big brand names don’t want anyway..

The biggest reason I am with a big brand name is due to the value I percieve I get from them in terms of various services I get that I would find either too redundant or too expensive to get on my own. No independent agent or company would be able to match these services. The locally independently owned and operated franchised companies are themselves having a hard time matching those services. The majority of independent brokers I’ve met in my area are pretty much bad tempered, loud mouthed egomaniacs that can’t hold a candle to the statistics in terms of closed sales units we have, and of course they come across as rather bitter.

Sorry but I get the impression that because a couple of us didn’t agree you automatically think our broker is doing the talking for us. My attitude is money talks and B***S*** walks..

On the other hand, we in the Greater Worcester – Boston area don’t have companies that come across as yours, too…

Brad – I don’t have a problem with any choice people make, whether to be with a brand, or try a specific business model, affiliate with a large national company or affiliate with a small or large independent , but I do hate rhetoric without hard factual support.
What is up with the generalizations my brother?

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

If the comment is logical, why would you assume anything other then the fact that they reached a conclusion on their own? Though you say you’re not attacking them, the statement is absolutely an attack. Even if it was not meant as an attack, don’t you think your comment is at best condescending?

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.

What objective measure are you using to make this statement? Other then “wishing makes it so”, where do we have numbers to bear this out?

As far as the question :

“Would you question the splits if our brand delivered enough leads to cover these expenses every year?”

This isn’t even size or brand specific. Substitute the word office or company for the word brand, and you have every business owner’s conversation with every agent that affiliates with them. If the affiliation with the company doesn’t provide sufficient value for the agent, they will leave. And that value may not be measured in dollars, but it becomes quantified by a good broker (branded or not) so the agent can buy into the company value package. You might re-phrase it by saying “Would you question our commission split if the value of your association with our company was greater then the cost?” It doesn;t matter if you are a national brand, independent, large or small, as a company you need the answer to that question to be yes if you want an agent to remain associated with you.

In order to have perspective about this you need to have operated with and without a franchise (as a business owner) in order to be able to make a judgement about the efficacy of a franchise. Franchises are not just about the brand, though I completely disagree with your take on that. For almost a decade I worked for a company with a forty year presence in its local market. The broker was well known and well respected in the real estate community, and had been the broker for many of the homes in the area when they were built. And yet, when i would call a FSBO and mention the company name, the consumer didn’t knopw it. Years later, I bought a company that had been 60 years in business, and again consumers had a low pre-disposition. And yet, the largest broker in my market, when they were only 1 year old had a larger awareness in the community because of their size, and people actually thought they had been in business for many years.

We can’t determine the pre-disposition of the consumer from our viewpoint, because that viewpoint is polluted by our prejudices and pre-conceptions. Americans like Brand names – and no one in the United States under 30 ever lived in a world where there was no Century 21, and there is a pre-disposition to do business with brands we know. However as a business owner, I retain the franchise not only because of the brand, but because they offer me other tools that are beneficial to my business. If I didn’t feel the value exceeded the cost, I wouldn’t have the franchise.

All of that being said, I would challenge your premise that all things being equal (in terms of the business acumen of the owner), not having a national brand is somehow superior to having a national brand.

I review the web analytics for the clients of the company I work for. One of the things I like to look at is the kinds of keywords which bring visitors to the site. I do a specific section on “branded search.”

Branded search is anything which indicates the searcher knew something about this office before coming to the site. I further break this down into “agent/broker branded” (visitors who search on someone’s name who works at the office), “office branded” (visitors who search on the name of the office) and “franchise branded” (visitors who search on the name of the franchise).

I have yet to do a branded search study and find “franchise branded” to deliver more than the other two types of branded search. It’s often a small fraction at best.

Granted, a site visitor is a long way from an actual sale, so apply salt as liberally as you wish. And also, Bill brings up a number of other excellent considerations on the value of being with a franchise.

I love the passion and appreciate the deep thoughts and scrutiny from each of you. It’s easy for me to appreciate Jennifer and G. Dewald, we’re sort of on the same page. But I sincerely hope that no one else took offense to me questioning how much a brand is worth? I did not attack anyone personally and if I sounded condescending, it was not intentional. I just wanted to move our last conversation forward and try to determine what a brand is really worth? (who knows, I may be the next Bill Lublin and have an opportunity I can’t refuse knock on my door tomorrow) But what should I expect an agent to pay for the change?

If I practice brokerage the same way I do now and add a franchise on top of it – what is that franchise brand worth? I don’t know, but I think it’s a lot less than it use to be (my opinion) and that’s the real intent of my posts.

@Thomas, I certainly did not want you to feel like I think you (or any agent) are a brainswashed zombie. I just want agents to consider all options, ask the right questions and understand what they are paying for. Too many brokers (and not just brand brokers) take advantage of agents by hiding behind language such as I quoted and then nickle and dimeing the agents to death every chance they get.

As for me and my recruiting, I do just fine up against the brand names. In fact, my recent success is what prompted these posts. I saved the last two agents I hired on as a team over $20,000 per year by them moving from a large brand to a local small broker. The numbers can be that big of a difference and that is why I simply encourage agents to ask the right questions and to SHOP for brokerage services. But I do agree everyone has different reasons for doing what they do, I simply intend to understand those reasons. Making bold titles and using funny pictures is an easy way to create conversation on a topic.

Now, what is the brand really worth? If the answer is ‘it depends’, then my push for questioning and considering other options has even more merit. Don’t take offense at me prodding you to consider options, take offense at what some of the results are when you’re shopping services.

@ Bill , I never stated my small broker brand is better than your large franchise brand. I just encourage agents not to overlook the small broker. It can sometimes be a huge ($20K+) difference. You stated “All of that being said, I would challenge your premise that all things being equal (in terms of the business acumen of the owner), not having a national brand is somehow superior to having a national brand.” I understand where your frutration lies now, because I did not make it clear that many times the services are the same (or very similar), but the costs can be completely different. (see my comment on your post https://agentgenius.com/?p=2354#comment-13029)

When I was with Century 21 Arizona Foothills, it was costing me more to stay than to go. So I left. The office fees were minimal, mind you. But the major enticement – the “opportunity” to work on corporate relocations – turned out to be a loss leader. Spend a ton of time, spend a ton of money and receive three quarters of one percent for your trouble.

I could have stopped doing relocations and not changed companies but the splits didn’t make sense. Neither did the assorted fees, such as the 5% I lost out of one check simply because the referring agent also was with Century 21. Where did the check go? To pay the costs of the relocation department (presumably including the salaries … here, take my commission check to pay your salary. My tuchas.)

Looking at the cost structure where I am now, it makes less sense for the company than for me. But that’s really not my problem … the system apparently works. RE/MAX is still around. And I’m making more in the process.

This post hits home for me. I used to be on a top team within KW that used to bring in several closed transactions per month in business for me. This was due to the incredible marketing machine it used to be. Because of that, the higher split made sense for me.

But as the real estate world changed and RE 2.0 and web 2.0 evolved, the old ways of marketing started to become less effective. As the leads started dwindling, I embraced blogging, social media and social networking and saw most of my clients coming from my own efforts. This made the smaller number of leads and original split with my broker not worth for me.

I switched to a niche firm that specializes in tech-savvy agents and tech-savvy consumers. The firm I’m with now is prospering while my old team and the KW market center it was a part with has gone down in the number of agents as well as the number of transactions and revenue.

@Thomas: I’d love to grab a drink (can it be good beer instead of coffee? not a coffee guy). I’m buying if you’re in Atlanta. I think you just said the best quote of all and I couldn’t agree more!

“If an agent can’t figure out how to best maximize his net in his real estate practice, who in their right mind would hire him to sell their most valuable asset?”

@Danilo way to go bro. You are on top of the wave…enjoy the ride and be prepared to have all those on the beach clamoring to ride the next wave with you.

Recently a buyer searched for my RE/MAX office on Google. Because of Google Local they came to me. I guess you could say this is a combination of my office brand along with my marketing via Google generating a viable lead. The office is close to their apartment and they wanted to work with someone close by. We are writing their contract this weekend.

I think this is a long over due topic. I worked for a big brand name when I started and the took my money and delivered…..well – pretty much nothing. I’m with another big brand now and they appear to be able to deliver what I need. (I’ve only been there about a month) but the technology is so much better – I’m a bit overwhelmed. I had set some things up myself at great expense and am now undoing some of that and reallocating resources.

Sandwiched in the middle of all this, I was with a smaller franchise that had great people but not so great technology.

You are buying the individual BROKER and the services that brokerage offers. You can’t go to a brokerage looking for leads (I found this out the hard way.) They will talk a blue streak about the leads they genereate etc. but if you aren’t an agent that is favored – it will do you no good. Meanwhile you are forking up major money – but you have to ask for WHAT???

Sometimes the big brand has what you want – sometimes it doesn’t. This isn’t big brand vs. small independent. Ignore all of that! Go with the best “package.” Might be a big name, might be a small timer. Doesn’t MATTER as long as it works for you.

What Ken said …

I was with a small local brokerage, and could have written Ruthmarie’s post about why I left.

Yes, I’m now with a national brand, and after 22 months, I have barely scratched the surface of the technology, training, and education opportunities available because of the fiscal resources this national brand can dedicate. We had our best year ever in 2008, and this year’s hot on it’s tail. We did not come here BECAUSE of the brand name – the team leader is AWESOME and could be Jay’s twin sister.

Jay – on the other hand – is succesful because Jay is a phenomenal leader – anyone who’s visited AG knows that. I often referrence him in my own posts simply because I can’t figure out how to say something differently and not lose his eloquence. But the bottom line is he’s succesful as non-national brand because of his leadership and technology accumen. I think it would be AWESOME to sit in on any training session he’s leading in one of his market centers. That kind of leadership infects everyone. If a non-branded firm has it – they’re succesful, if a branded firm has it, they are too.

It’s simple. Regardless of the brokerage model – people either stay or vote with their feet. If they’re leaving, it’s your fault – not your competition’s.

Navy Chief, Navy Pride

I totally agree with your thoughts here. Franchises are counting on an agents fear of loss to keep them beholden to their expensive commission splits. It is a total mirage and anyone who knows a thing or two about SEO, Web 2.0 and internet technology will tell you that the instamatic web portals large real estate franchises provide their agents are worthless in today’s online world when it comes down to the individual agent getting leads.

🙂 I love it when AG pulls a post out of the past that still brings passion from the commenters! It has been over a year since I started this conversation and think it’s still valuable in today’s market. I know times are tough for many small brokers and large brokers alike. There are some brokers trying to grow in a down market. I have been approached myself by a large brand hoping to find us down our luck and take us into their arms. Turns out we are just as strong as before. Sure sales are down, but the beauty of being small allowed us to shift gears quickly and adjust to stay profitable. In my market, most brokerages are down 35% in number of agents – we’ve stayed the same. We had one team transfer to a bigger brand due to them physically moving across town. We also another, slightly larger team, join our firm.

I’m not an anti-big brand guy, in some markets, for some people it’s the right choice. I just don’t want agents to always assume it’s the best choice. Shopping local for a small brand broker may turn out to be the biggest win for your career.

special thanks to Jay for leading by example. (and yes I remember our chat in A2 Missy)

Good topic to bring out and dust off … As a newly-independent broker, it took me awhile to take the plunge and bail from the big-box but when I looked at the big picture and realized I was paying up to $75,000 a year to a franchise with nothing coming in return it was a no-brainer.

I’m sure there are other franchises and brokers that may give you some ROI, but for me it just made sense (and cents!) to make a go of it on my own.

I agree with Joe – I think KW offers tremendous value, as I mentioned above, and as Joe outlines. A positive mental attitude, in addition to skills and knowledge is a good thing!

I think terrific businesses, in every industry, are in the minority. I also think there are large and small companies in every industry that are great.

Like anything, the market will reward a good model. Jay’s firm is growing, which means the market (realtors in this case) like it.

Keller Williams has grown tremendously, from 11,000 agents in 2001 (https://tinyurl.com/yk28n6o) to approximately 73,000 today in Canada and the United States. If it wasn’t a great model, KW would not grow so quickly.

There are some great small firms, but they’re the minority. Out of the major large firms, I’d argue there is only one that’s truly in business for and with agents, and that’d be Keller Williams 🙂

Oh, and I think the bigger point most realtors need to remember is, as Jay said above “they didn’t care what company I was with.”

Go where you get the stuff that helps you own and run the business you want to have.

Well as someone who has been at both big and small my experience is that big wins hands down. The key is not whether agents have been brainwashed but has the public? When most people order a burger and fries they order a coke as well, they really just want a brown sugury liquid drink and of coourse pepsi will do but they still say coke. The publics beliefs become our realities imho.

I totally agree with you Brad. There is no doubt that initially the “perception” from the consumer can be that the Big Box Brokers are safer and more established but this can be easily overcome by a talented agent. As someone that started with “Big Box” and is now independent, I would have no desire to go back.

HOWEVER… we have a full time, in house, marketing / web person that not only keeps us even with the competition, but makes us significantly stronger!!

Without that piece (which I think many small brokers are missing) I may feel a lot differently.

Wow…just seeing how long this thread has lived shows how relative this discussion is to so many…well my two cents…
I’m one of only one agents in the small brokerage where I work. I’ve had the opportunity to work with KW not as a co-broke but I repped a landlord that leased space to open a new KW office. I had many conversations with the brokers opening the office. The reality, imo, is that neither KW, nor C21, nor any other franchise/national brokerage cares how many properties you sell or how much you learn about real estate. I liken this to a couple of other industries, namely fast food, and Business Networking Groups. I’ve also had experience with the national sub shop, Quiznos…Do a quick search of Quiznos and you will learn pretty quickly that Quizno’s is not in the business of selling subs, they’re in the business of selling franchises. BNI, who promotes themselves as helping small business connect, could care less how many referrals you pass, they care about how many chapters they can open in a year. KW doesn’t care how many houses you sell…they make their money by bringing in as many agents as possible and charging them for office space, desk time, fees, etc…It’s a reality and KW and the other big names are very good at convincing agents and brokers to get on board. Would I use the term “brainwashing”, probably not, but its not far off…I’d challenge anybody to show me proof that KW’s business model is to grow their agents’ business and not to increase the number of hours of office space rentals, and desk fees. Think about a new agent, they spend hours upon hours in their new office, working the phone, email, setting up photos of kids, arranging chairs…they they realize they have to get out of the office and KW brings in the next “butt” to fill the chair. Quizno’s sells franchises to people that want to open a sandwich shop. Then they sell you your meat, cheese, and bread, and they sell you your equipment…then you can’t hack it, and they take over your franchise after already taking all of your money, and they find the next “butt” to fill the chair…Why do we patronize the local restaurants rather than the chains? The same reason, I believe, to patronize the local business owner rather than the big named brokerage. The local guys care about their employees/agents and the big names care about their shareholders and investors.

Great commentary in this post. There are many great comments therefore little I could add but thought I would jump into the conversation as a small independent who 3 years ago left the Big Box Brokerage (KW) to start my own Boutique Firm.

For me, making the change was a powerful move … but my point will not be to convince one that my Independent way is better than the Large brands. Or vice versa (Although, I am biased and think my way is a better way:)

I take my conversation to one word: Value (Quantifiable and Specifyable)

The way I see it, and I dare say we would all agree, is that … things are changing for our Industry. And, the change is HERE for how we market, generate leads, connect, communicate, incubate, convert, produce new business, service our business …. and so on.

And, This has real meaning! Brokers (Big or Small), in order to help their agents succeed in the future, have to change too. Brokers need to reinvent their value to the Agent just as the Agent needs to reinvent their value to the Consumer. I say … with trepidation of anticipating an attack for saying this … that The Value that the Broker has been to the Agent in the past is just not all that valuable any more.

Personally, I call this the Value Crisis of the Industry … where is true value being offered from the very top of the food chain (the national franchisor) to the last link in the chain … the consumer? What value does the National Franchisor offer the Francise owner for the fees paid? And, what does the Franchise owner (Brokerage) offer the Agent in terms of real needed value for Agents to succeed TODAY? And, what value is the average agent in the brokerage offering the consumer? And, by the way, who is funding the food chain? The Agent! Their royalties, commission splits and fees fund everyone and everything from within their brokerages straight up to the very top –the Corporate office. All funded from the agent’s hard work and money that turns into commissions that then are split up many ways.

So, what I say is … Every agent needs to reevaluate the value they get for what they pay for. If they assess that they are indeed obtaining ‘superior’ value from the royalties and fees THEY pay to provide the many salaries all the way up to the top of the Hierarchy … then it is irrelevant if the Brand is big or small. The Value makes it worthwhile to stay.

However, if they can’t assess, quantify and specify exactly what value they get … then perhaps it is time to at least look around at new options … at how the amount of money they pay to support the top of the food chain can perhaps be used more effectively and efficiently in a different model … ?

I claim that in order to “succeed” as Brokers and Agents, Value needs to be reinvented for our industry across the board.

And.

What I notice, is that most of the Big Brands are not reinventing. They extol the same Narrative they have touted for decades and bottom-line, offer the same value. And, sure, many can claim they are growing, but I dare say they won’t publicly claim the profitability numbers of their Franchises (or lack of) or the Productivity of their Agents. The training is 3rd party –either delivered through other agents or vendors. In other words, few of the large Brokers are doing themselves what they tell their agents to do. Few are bona fide leaders for their Agents to learn from and follow. So, Agents have to spend thousands of dollars beyond the fees they pay to the Broker to attend conferences, pay for product (they don’t understand and usually don’t implement) to get the REAL training they need to succeed. And, these same agents are in the marketplace confused, overwhelmed and scared. These agents are ubiquitous at the numerous conferences I attend.

What I notice on the national circuit, is that many of the smaller independent owners ARE the reinvention. They are leading much of the change that is being talked about and awarded. The broker-owners are personally looking for places to offer NEW value and some of these small but I say powerful brands are actors and leaders with and for their Agents… taking on the cost of learning, experimenting, building new tech, etc .. AND, then they don’t “tell” the Agents about it, they actually build it INTO their brokerage model so that all of their Agents can use the technologies, etc … and the training is led by those who are actually using and succeeding with it inside the brokerage not outside of it. Brad Nix, Garron Selliken, Jay Thompson and myself I think are good examples of this.

But, this is not to assert that the small independents are the way to go.

I do maintain however, in this digital age that has affected our industry, as all others, the value of an Agent’s broker needs to be reevaluated. If Agents plan to “compete” and win in the future, the resources and tools they have at their disposal (including their Broker) need to support them fully.

In other words, in the future, the Broker will matter beyond just Brand-name towards the success or failure of *most Agents. As smart business people, we just need to know within any brokerage (Brandname or Independent) what we are getting for what we are paying for … the ROI on the total cost (including outside training) and bottom-line …

What’s the value?

*most agents = not necessarily reflected here:)

I have a strong liking to this post, mostly because of the Star Wars reference that just makes me smile.

I agree with Andrea that each brokerage offers a different approach, and each approach fits unique business plans for better or worse. We’re an industry of individuals and the agents matter. We’re the ones who speak to clients, make or break deals, and create the impression of our industry.

Finding the niche that works for you is the key, and make it work. Creating a consistent, quality product with a client focus is where its at. However you do that is great. There are great agents in all types of brokerages. Since the industry in client focused, I say do whatever you need to to help you get clients in the door and blow their minds with your greatness!

Good luck in 2011!

Honestly, who cares? Obviously you and Jay do because your owners and are passionate, and that’s great. And this has sparked a lot of comments and debate, but is it worth the time and energy for the rest of us? I am a broker–I work with a big name that apparently has brain washed me. I dont mind doing business with boutique brokerages or with big names–bring me an offer and I’ll work with you! I dont discriminate and I dont think you should either. Some agents fit a big name better than an independent and vice versa–most try them both and then decide.