They are out there now.
“Technology” companies. Companies that provide “technology services.”
“Services” that you pay for to help you do deals.
They provide tools and marketing brokers need.
They aggregate create demand and generate leads.
They create lead generation via internet search and do lead vetting as Lending Tree does for mortgages.
Think about the residential side, it’s been a standard for years.
What’s coming next.
Technology and leads is what will be offered as the “fix”…….for now.
Lead generation and management of those leads just like residential.
They say they will be providing the technology at a lower or almost no cost.
Do brokerages invest in tech or tech development now?
Maybe maybe not. Most think not.
All of this technology is and will be provided by a 3rd party.
What happens when this “technology” is not branded by the brokerage?
Then there is no brand value.
What if they provided broker specific branding without the brokerage brand?
Does the brokerage value then become a commodity?
The answer is YES.
Guess how you are helping?
You are feeding the beast by giving away the data.
A simple fact is that the brokerages can’t stop this. Well they can, but.
The building owners are the ones that actually own the data. NOT the aggregators.
Oh, and I say it for the 1000th time. Brokers not only give it away they are stupid enough to PAY to get it back.
What is the easy decision?
Pay for the best quality marketing technology and lead generation/management there is.
Or pay for a platform that provides none of the above and holds the precious (data) commodity hostage for a price that has no signs of going anywhere but up. Forever.
How can brokers/brokerages fight?
First is to maintain the knowledge that only a local broker has.
No one knows the broker’s back yard better than they do.
But what about the ability to create a seamless transaction?
Is that not the broker’s job?
What about a transaction that is written negotiated financed and closed online.
That by definition has and will become the clients/users “experience.”
It’s an experience that they are now used to. It also an experience that they demand.
That online “experience” is now being created by the “technology” companies.
What are you going to do to “own the experience” online and off?
You need to have a better answer than the one you are thinking of now!
Is X becoming a brokerage?
I get asked this more now than ever before.
My answer has been “go ask them yourself.”
Think about it.
What if you had $10 million dollars and 25 people generating leads?
What would you do?
The smart answer from technology companies is “no we are not going to be a broker or competition.”
That’s what you want to hear right?
That should scare the shit right out of you.
And here is why.
What value is left for you to provide for the client?
They are getting people to sign up and give them information about where when and how much space they want and can afford.
They are qualifying the client.
They are the point of contact between the “owner of the data” and the transaction.
They are also able to “coach” them through the transaction.
They are able to provide “services” around the transaction for the client.
They are also able to if they want to decide who can “service” the client and when that “service” is needed.
Ok, stop. I know what’s in your brain. “THEY NEED TO HAVE A LICENSE.”
Step back for a minute. Do you think they give a shit about licensing and regulations?
What are the models they follow again? Do I really need to name them?
Why does a market place or a software marketing technology company need a license?
Take away that stupid argument and what happens?
Live in the now.
You are the only one that thinks a “license” matters. Today. Only you.
That’s all you have as a competitive advantage?
( As a quick side. I explained the licensing and continuing education for brokers and brokerages to some “tech” people. They laughed. They laughed hard.)
All they need to do is collect the money.
Collect the money from whatever piece of the transaction they want.
So let’s say they do decide to slip into your kitchen.
What if they did become a brokerage?
What stops them?
They are doing it all.
Would you join them?
“No way,” you say. “Hell just out of principle and that’s just tech bullshit.”
They are generating and creating leads doing deals and making money all the way down the VALUE CHAIN.
Do your babies need some shoes?
What if they decided to “align” with a major world-wide brokerage or two or three or ten?
Does it matter what “business model” they choose?
Why worry about data.? You don’t do you? It’s now a commodity anyway.
Worry about the value chain of the transaction.
All of these “tech” companies are using the data (as a commodity) to disrupt the exact thing you value the most.
The actual deals.
Here is how you are helping them even more.
You don’t invest in technology.
You don’t invest in technology that helps you market
You don’t invest in technology that helps you generate and manage leads.
You don’t invest in technology that manages the client through the entire transaction.
You don’t invest in technology that will create any value at all throughout the entire value chain.
Did you just read the last 5 lines?
And of course, I can hear you saying “Duke what in the hell are you saying? Did you not just spend five minutes of my life telling me that technology and the companies using it are basically killing me?”
Yes, I did.
Commercial Real Estate Brokerage Will Collapse. This Is Exactly How It Will Happen.
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