Riding the Bullet Train toRiding the Bullet Train to r r e lr r e l e v a

e v a nn cc e ?e ?

II

Course Objectives

• Understand Social Era versus Social Media;

• Discuss the “Power Shift” from real estate professionals to consumers;

• Examine consumer influence on the agent’s business model; and

• Learn how to service the "next generation" of home buyers and sellers.

This is NOT a class on Social Media

Its ABOUT the Social Era

If the industrial era was about building things…………

…..the Social Era is about connecting things, people,

and ideas.

IntroductionsIntroductions

The Only People That Like Change……The Only People That Like Change……

Change• How did it feel to be asked to change seats?

• Did you view changing seats as an opportunity to sit with someone new or as an uncomfortable or undesirable change?

• What are some things that make people resistant to change?

• What can you do to make it easier for people in your organization to accept the changes?

1937 Clothing of the Future1937 Clothing of the Future

1967 – Predictions of Online 1967 – Predictions of Online Shopping and EmailShopping and Email

1993 GPS Prediction1993 GPS Prediction

What changes Are Coming in What changes Are Coming in 2013 and Beyond2013 and Beyond

The Social EraIf the industrial era was about building things, the Social Era is about connecting things, people, and ideas.

Connections create value. The Social Era will reward those organizations that realize they don’t create value all by themselves.

Power in community. Power used to come largely through and from big institutions. Today power comes from connected individuals in community.

The Social EraCollaboration > control.Instead of centralized decisions, there is distributed input, decisions, and distributed ownership.

Talent inclusion—across ages, genders, cultures, sexual orientation—it’s essential for solving new problems as well as for finding new solutions to old problems.

The Social Era

Buyers and sellers become “co-creators.” Embrace buyers and sellers as “co-creation” partners instead of as an object at the end of a value chain.

Mistakes can build trust.Relationships gain strength from trying new things and the resulting failures.

The Social Era

Learn. Unlearn. (Repeat.) Rather than viewing CHANGE AS BAD”, understand that it as a natural part of the business development. Adaptability is central to how we will survive.

Social purpose unleashes ownership.Purpose is a better motivator than money. Money, while necessary, motivates neither the best people nor the best in people.

When people know the purpose of an organization, they just come.

The Social Era

Generational DifferencesGenerational Differences

Generational

Differences

For the first time in history there are 6

living generations in America.

• GI Generation (1901-1926)

• Silent's (1927-1945)

• Boomers (1946-1964)

• Generation X (1965-1979)

• Millennial’s (Gen Y) (1980 -1998)

• Generation Z (1999 – present)

• And………

Generation “Wired”• Have a lifelong use of the Internet, texting, IM, MP3’s and

Smartphones (not cell) earning them the nickname "digital natives".

• Have been raised entirely after the end of the Cold War and the Internet.

• They're the children of Generation X

• The youngest members can also be children of Generation Y

• Their grandparents tend to be members of the Silent Generation

Houston’s Population by Age & Ethnicity

Generational

Differences

4 of them are working together in the

workplace and exist side by side.

• The traditional industry models become less appealing and relevant to each succeeding generation.

The generational disconnect can be bridged.

Recognize the growing differences in the agents & buyers needs, preferences, & values & do

something about it, otherwise they will deem you irrelevant.

Toyota Venza

AT&T

Market Structure:

Consolidations &

Specializations

Realtors operate in markets.

• None operate in the same market in which they were composed, structured or functioned.

• Realtors are more different than they are similar because of the demands of the marketplace.

You Have To Know Your Respective Market!

It is not It is not Business As UsualBusiness As Usual!!

Consumers listenmore to one anotherthan they do to marketing messagesof advertisers.

Technology damaged the

traditional purchase funnel.

People are increasinglyindividualist. They escape being categorized.

It’s not a question of

technology, it’s a question of

customer relationships.

Organizational Responses

• Many brokers and agents spend all day defending what they do, how they sell services, and try to prevent their organizations from being devoured by the “NEW.”

• Unaware that everything that is happening in the real estate industry is ever more likely to happen on a screen or handheld device.

• Denying that traditional Media is in a death spiral

If You Strap An Engine on a Horse do you have a Car?

• You must ask yourself what business you are in and whether your traditional idea of “how to be in that business” is still relevant to what the customers want.

• You can’t solve a problem before you know what the problem is: otherwise you wind up strapping engines on horses.

The industry faces not one but four changes

Where a change in one influences the other threeWhere a change in one influences the other three

What’s Driving the Shift?What’s Driving the Shift?

ConsumersContentCuration

Convergence

Four Factors Shaping Our Four Factors Shaping Our FutureFuture

Choose what, how & when they consume

ConsumersConsumers

Profile of Realtors & HomebuyersProfile of Realtors & Homebuyers• Median age of a Realtor is 56

years old

• 60% are female

• 76% of Realtors have real estate as their only occupation

• 9% of Realtors are foreign born

• Largest share of homebuyers are 25-34 years old; Median age overall is 42 years old

• 39% are first-time homebuyers (Median age, 31)

• 16 % are single females; 9% are single males

• 13% of first-time home buyers are foreign born; 8% are repeat

• 56% of Realtors have a smart phone with wireless internet and email access

• 91% of information on the website is the Realtors own listings

• More than 1/2 are using social media.

• Realtors spend a median of $200 to maintain their websites

• 90% of homebuyers used the internet to search for a home (96% for buyers under 44 YOA)

• 87% used a real estate agent or broker

• 27% of buyers used print newspaper ads to find info on homes for sale

• 1% of buyers found the home they purchased using print ads; 42% Internet; 34% Agent

Profile of Realtors & HomebuyersProfile of Realtors & Homebuyers

Shift from Dependence to Choice•More choices: accessed more easily•Smart devices and tablets

•More kinds of choices•Not just when and how but increasing variety of features

•Great ease of use•Voicemail vs. Text/Facebook

•Choice not to commit•They expect an option to make full commitment

•Increasing sense of entitlement•As each new generation is offered choice, their standards go up and brokers and agents must respect the new standard

Shift from Dependence to Choice

Success means giving up the habits of the old uneven power relationships and

forming a new more equal partnership/relationship.

Success means giving up the habits of the old uneven power relationships and

forming a new more equal partnership/relationship.

………………becomes King!!becomes King!!

ContentContent

Content……..becomes King!The Internet makes its possible for buyers and sellers to find information and each other without the middleman.

Consumers have little reason to pay for delivery that isn’t digital anymore, and digital delivery doesn’t create comparable monopolies to support content.

Content……..becomes King!

Where Can You Get The Stuff??

Apps

Managing Information OverloadManaging Information Overload

CurationCuration

Curation“Often what I need to know before I use any of their expertise is more about myself and my community, meaning the people I trust.

I could figure it out myself, but so often time is exactly what I don’t have.”

~ The Consumer

What consumers trust has changed:Instead of an expert, they want to hear from the source – •The person who stayed in the room•Ate the meal •Drove the new car •Got the home loan•Bought the house

Who is Your Competition?

The Forms of Communication

ConvergenceConvergence

Convergence

• Platforms that seem important today will likely be replaced in a few years.

• Convergence of technologies, media forms and other aspects of our lives will continue to intensify.

Convergence

• To focus on who will win is to miss the point about convergence: The new doesn’t replace the old; the new and the old combine.

• To focus on who will win is to miss the point about convergence: The new doesn’t replace the old; the new and the old combine.

Disruptive Business ModelsDisruptive Business Models

The Definition:The Definition:

Disruptive business models focus on creating, refining, reengineering or optimizing their products/service, role/function/practice, or industry.

The most successful companies incorporate disruptive thinking to gain distinctive competitive value propositions.

Disruptors

Disruptors

Disruptors

Are You Disruptive?

•When was the last time you embraced change and did something innovative?

•When was the last time you rolled-out an off the wall service offering?

• Is your client base void of youth?

•When was the last time you sought out a strategic partner to exploit a market opportunity?

Are You Disruptive?

• Do you focus more on process than success?

• Do you settle or are you inspired to become an innovator?

• Have you embraced social media?

• Does you have a coach or mentor?

“We can't solve problems by using the same kind of thinking we used

when we created them.” Albert Einstein

““Being Being DisruptiveDisruptive helps to keep us off the helps to keep us off the Bullet Train and Bullet Train and RelevantRelevant””

Riding the Bullet Train toRiding the Bullet Train to r r e lr r e l e v a

e v a nn cc e ?e ?

II