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Rethink Real Estate “Brands” in Hawaii…

When Hawaii’s real estate market started booming in the late 90’s, national real estate brands popped up everywhere. First, the little boutique company where I started my career became an ERA franchise (which was a fascinating transition), and then within a few short months, Coldwell Banker, Century 21, Remax, and Sotheby’s all showed up at the same time. It was literally as if brokers on the island all unanimously assumed that only a national brand could help them compete. After all, we’re all the way out here in Hawaii, and we need something that lets consumers know that we’re to be trusted, right?

Century 21 loves to tout their brand awareness, and Coldwell Banker is quick to share how many million-dollar transactions they’ve done, Remax gets ‘outstanding results’, and Sotheby’s only takes high-end listings (at least they used to). Why then, are Sellers and Realtors alike leaving the brand name companies and flocking to smaller, un-branded, local brokerages? What happened to “brand recognition”, and all of the promises that these huge brands make to consumers?

Sellers want to believe that the big brand’s network will somehow lead to the sale of their property. But the Realtors know the facts, and that’s why they’re fleeing the brands. If the brand’s ‘network’ isn’t generating more sales, or a higher quality agent, then what’s the value?

One major part of the equation is that the real estate industry is changing. The internet has empowered local Realtors to have their voices heard above and beyond the big brand messages that previously only appeared on television, radio, and the classified section of the local newspaper. The consumer now has a direct line to the agent, via blogs (like this one), or any number of Social Media outlets. Not only are the promises of the big brands being questioned, they’re losing the attention of the consumer. Why call the local big brand when you’ve got a direct line to most competent professional in your market? (by the way, just in case you didn’t know, Century 21, Coldwell Banker, ERA, and Sotheby’s are all owned by the same company, Realogy)

The other interesting part of the equation is that real estate is a personal business. It requires local professionals who know their respective markets. Buyers and sellers hire people, not brands. As a result, these international brands have very little incentive to live up to their promises, because their business models are based entirely upon volume. With enough agents, any company can be successful, even with a small percentage of each sale. Chances are, if you have a real estate license, you can get a job at any Century 21, Remax, Sotheby’s or Coldwell Banker office you choose.

I’m not saying that national brands are going to go away, or even that they won’t have value to the consumer… but the value of the ‘brand’ is shifting from the national brand directly to the brokers and agents.  And, we’re on the front lines. Realtors and Sellers alike are leaving their nationally branded companies to join Hawaii Life.

Our commitment is to be the platform for agents to reach their customers. Our core values are Smart Marketing, and Solid Representation. It’s a symbiotic relationship. We don’t hire everybody (we’ve turned down some interesting agents). The commissions paid to our brokerage stay in Hawaii (they don’t go to New Jersey), and we’re committed to giving back.

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Katie Minkus, R(BIC)

October 19, 2009

Aloha, Matt. Here on the Big Island, there are some additional twists to the big, national branding of Real Estate offices. Many of those that seem like big brands, in fact, are not full-fledged franchises but strange “hybrid” businesses where the local Broker has a “relationship” with the brand, but doesn’t have access to full functionality of that brand. Both Coldwell Banker and Sotheby’s fall into that category. In some ways, these companies are doing an extra disservice to their clients in that they claim to have superior marketing due to their brand “network” but in practice don’t have access to the networking part of the brand network… what’s the point of being part of a brand name at that point, other than the agents paying an extra 5% to Realogy for the “privilege of belonging?”

I love that recently we hired a fantastic agent away from one of these big “name” franchises and when her former CEO called begging her to reconsider her choice to join Hawaii Life and she said she wouldn’t, he asked her why and she said, “I like to be Number ONE, not number 27.” I believe our clients feel the same way – and we’re proving through our results why it’s simply more powerful to be first in Google, and follow that through with solid local representation on the ground, than carry the most prestigious “name brand.”

Katie Minkus, R(BIC)

October 19, 2009

Aloha, Matt. Here on the Big Island, there are some additional twists to the big, national branding of Real Estate offices. Many of those that seem like big brands, in fact, are not full-fledged franchises but strange “hybrid” businesses where the local Broker has a “relationship” with the brand, but doesn’t have access to full functionality of that brand. Both Coldwell Banker and Sotheby’s fall into that category. In some ways, these companies are doing an extra disservice to their clients in that they claim to have superior marketing due to their brand “network” but in practice don’t have access to the networking part of the brand network… what’s the point of being part of a brand name at that point, other than the agents paying an extra 5% to Realogy for the “privilege of belonging?”

I love that recently we hired a fantastic agent away from one of these big “name” franchises and when her former CEO called begging her to reconsider her choice to join Hawaii Life and she said she wouldn’t, he asked her why and she said, “I like to be Number ONE, not number 27.” I believe our clients feel the same way – and we’re proving through our results why it’s simply more powerful to be first in Google, and follow that through with solid local representation on the ground, than carry the most prestigious “name brand.”

Matt Beall, PB

October 19, 2009

Here’s a great post from Marc at 1000Watt Consulting about the need to focus on our Core Values: http://www.1000wattconsulting.com/blog/2009/10/like-moses-from-the-mountaintop-make-manifest-your-values.html

Matt Beall, PB

October 19, 2009

Here’s a great post from Marc at 1000Watt Consulting about the need to focus on our Core Values: http://www.1000wattconsulting.com/blog/2009/10/like-moses-from-the-mountaintop-make-manifest-your-values.html

Mike

October 22, 2009

Aloha Matt:

Great article Matt! I could not agree more. You got your points across very well.

Mike Gallagher

Mike

October 22, 2009

Aloha Matt:

Great article Matt! I could not agree more. You got your points across very well.

Mike Gallagher

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