Good morning. This is Steve Murray. I’m president of REAL Trends. With me today is Mark Stark, CEO of Berkshire Hathaway Home Services Nevada Arizona California Realty and Alissa Harper VP of Growth from Buyside.
Mark, let’s jump in. A lot of things have changed in the last 20 years. What’s the core to being successful in the brokerage business?
You’ve heard this saying about run your business like a business? And we tell agents that. Well I think it’s the same, certainly it’s the same thing on the brokerage side. We have a unique model. We’re a business service company. So what that means is, we help agents grow brokerage under the umbrella of our company, be it a brokerage of one or a brokerage of 31, that’s up to the agent. But that’s what we do. And we’re really good at keeping the main thing the main thing.
You personally, you’re the leader of a company with over 2,000 agents in three states, last I checked. What things do you focus on, personally? Where do you spend most of your time?
Really, it’s training the leaders in the company, as well as growth of the company in all of its forms and making sure that we stay true to the vision of our model. It’s easy to lose sight as you get in the weeds in our business and the market adjusts, normalizes, things change, technology changes, and you really got to be able to stay true to your vision, because that can get away from you pretty quick.
So shifting gears a little bit, you know you and I have been around a long time, and all of a sudden, the last 10 or 15 years, everybody talks about technology and data. And we know and have observed that leveraging data in business has revolutionized entire industries, Amazon, Netflix, Uber, Airbnb, we could keep going. When did you make a decision, when did your company, when did you realize you needed to invest and step up your game in looking at data as a strategic move by your company?
Again, it really was driven by our model. And because being a business service company and supporting that agent brokerage, we tend … We’re not doing that on a macro level. We do it on a micro level. So we look to that agent and we give them that freedom to help them maximize on their data of what they’re doing. We’ve not gone down the road, per se, and captured or controlled that by ourselves. Our model really supports that agent doing that, with our help. And that’s really the direction we go.
So for instance, you might install, for your whole company’s use, various technology and data tools. But it’s not something that you use to drive your business. You make sure it’s tools that become available for the agent customers?
That’s exactly correct. We are, as it comes to technology, we’re truly agnostic. What we do, is in watching where the world’s going, we’re looking for vendor partners to stay relevant and be able to help us better service, better consult with our sales executives, so they can continue supporting the consumer in the most effective and efficient way, and based on the changes of the world. How can they, how can we help our agents keep up with the changes going on in the industry?
So when you install systems like Buyside, and we’ll get to some of your results in a minute, you basically enlist Buyside to provide data and tools for your agents, your agent brokerages, I think you called them, whether they’re one person or 30 people. That really, it’s helping them have access to that information, that tool, for their business. It’s not something you use at the corporate level per se?
Correct. Our job is to make sure our sub-businesses are using that effectively. And keeping in mind, everyone has their skill set. Doesn’t mean they’re great at everything. So what we need to look at is, based on each brokerage, who do we need to talk to? Who do we need to help so they can maximize intel that’s coming from companies like Buyside the most effective way? That’s different for each one of our players. Because some of them have that skillset. Some of them have an assistant and we’ll deal with the assistant, not that main agent, because truthfully, you know what, it shouldn’t be that person. It should be that assistant because they’re going to be the one handling that specific data.
I love that philosophy, Mark, this is Alissa jumping in here, about really helping your agents develop a business within a business and giving them the tools they need to do that. Tell me a little bit more about how you decided to partner. We have a lot of real estate firms out there kind of developing technology in-house. How did you decide it was the right move for you to partner externally versus build some of this tech in-house?
It’s knowing your strengths and your weaknesses. We are not a tech company. I’m not going to play the game. I know what I know, and I know what I don’t know. And technology and the speed of technology, I don’t know. That is not what I’m good at. And so in doing that, there’s a lot of very successful tech people, like Buyside, that understand what they offer and what they bring to the table. What I’ve got to learn is by investigating those technologies and seeing how, in what we do know and what we do accomplish on a day to day business, how do we use that technology to move our business forward?
And so, we are, like I said is, we are agnostic. We look for relevant partnerships that continually help our agents move their business forward and then we expect those vendor partners to continue staying relevant as the world changes. Because guess what? We won’t be able to do that with our own technology. I got to tell you, I have not seen one player, nationally or locally, build their own technology and be able to stay relevant over a decent period of time because it changes too quickly.
Yeah, one hundred percent agree with you, Mark. I think focusing on your strengths, you guys are real estate practitioners, that’s what you do well, that’s what you do day in and day out, so absolutely makes sense to look for a technology partner that focuses on innovation day in and day out.
Talk to me, Mark, a little bit about the process in evaluating your technology partnership, and also, how do you look at and how to you measure ROI? We’ve seen some pretty phenomenal results through your key study that we did with REAL Trends here. And sometimes ROI can be very tangible, very measurable. Other times, it’s not. So talk to me a little bit about how you look at partnerships and the ROI that’s driven from them.
Let’s use an example like a REAL Trends. Over the years, what has REAL Trends done so, so successfully? They go out to the world and they ask great questions. They do great investigation and they find out what’s actually going on: what the consumer’s saying, what other brokerages are saying, what other brokerages are doing. That’s really important. Then, they know what to share or what recommendations to make to many of their clients.
Well, we do the same thing, but we do it internally, with our agents. So that ROI really comes from what our sales executives are telling us and the way that they’re using a product. We’ve learned different opportunities of how to use these products not because we’re brilliant and came up with it. Our sales executive practitioner took that technology and said, “You know what I’m going to do with it? I’m going to use it like this, and I’m going to go door knock and this is going to be my presentation.” We’re like, “Oh my god. That’s a great idea,” and they start taking listings because of it. So we’re very open to listening to what our sales executives are actually doing with that specific technology and how they’re utilizing it.
And on the flip side of that, we also, when they come to us and say, “Hey, you know what, I really wish this technology could do x. Could you go to your vendor partner and talk to them about that?” As you know, we’ve done that quite often with Buyside and one of the aspects that I truly do appreciate with any vendor partner, specifically Buyside, is your willingness to listen and your willingness to say, “You know what? Wow. We can do that. Give us a little bit of time and let us investigate that and see how we can bring you that additional value.” And that right there is invaluable for me.
It’s very frustrating when we bring an idea of what the people on the street are doing and a vendor partner says, “Yeah, nah, we don’t want to do that, we can’t do that,” That’s not saying, “Okay, great.” Well let’s hope, or you should hope, no one comes out with that aspect of it because now that is something that agents actually see value in.
Man, that’s great, Mark. You and I hang out with a lot of men and women like yourself, running major brokerage companies. Do you think most of your peers are getting in the big data game now? I mean, are they taking your approach, or do we have others that are aggregating the data at the corporate level and essentially re-selling it to their agents? There’s two ways to do this, right?
I’d certainly see it on both sides. But I will say, the men and women in our business and certainly sitting in my chair, one challenge that we all have is the independent contractor mindset and ability to do this on a mass scale. I don’t think there’s one argument on big data is important and it’s valuable and to harness it is exciting and there’s opportunity there. The real question is, how do we do that effectively and deal with independent contractors along that line. I know there’s some companies that have kind of jumped over their independent contractor and said, “We’re going to do this in-house ourselves. We’re going to control it. And then maybe we will give our independent contractors opportunities because of the work we’ve done.” I’m not here to say that’s wrong or right. I am telling you, that’s not the way we do it and not the way we choose to do it.
Yeah, it’s a different approach to it, but there’s ways to make it work both ways. What do you do in support of your agents to get them to use this data that you get from Buyside so that they make real, effective use of it in their listing presentations?
First step, I believe, is always train the trainer. So if they’re having interaction on a consistent basis with leadership in their offices and administrative staff in their offices, those leaders and staff need to be aware and need to be trained up. Because those are the ones that are at the front line, getting the questions directly from the independent contractor. So very important that the agents hear from them on an ongoing basis.
Two, as we need those managers following up on the agents to make sure they’re using it, we need to follow up consistently with the managers, which we do. And then lastly, it’s a never ending battle to continue to bring it up again and again to sales executives and find their pain point of why they’re not using it. It’s not that they don’t want to use it and get the benefits from it. But you got to really ask yourself, “Okay, they want more business, I believe that, now why aren’t they doing this.” In many cases, it’s they don’t have the expertise or the knowledge or they’re fearful of technology just in general. So you got to give them an end around of how they can hire someone to help them within their business, so it gets done.
And part of our business service model is absolutely looking at each business unit and go, look, Bobby’s never going to do this. And to ask Bobby again and again and tell him how important it is and how beneficial it is, he’s tried to tell you with his actions, “I’m never going to do it.” So you’ve got to help Bobby hire somebody who’s had that skillset, who can help Bobby complete the task in spite of Bobby. Hopefully that makes sense. I don’t want that to come off negatively. I will tell you, it’s very effective. And Bobby’s thrilled with the end result, because Bobby’s still not doing anything with it, but Bobby’s damn good when he understands it and it’s handed to him, how he does that in an actual listing presentation in front of a seller.
I think that’s a great perspective, Mark, to understand your audience and know that some technologies, some tools are going to resonate with certain agents. Other agents might be a little bit further out on the adoption curve and others are just going to need to be supported and kind of hand held through the process. I think that’s great that you guys acknowledge that.
Talk to me a little bit about how you actually implement and execute on that. Do you look to your technology partners to help with that training, for example, on a listing presentation? Do you look to your partners to help and coach the agents and provide scripting on how to explain the data, navigate the data for consumers? Is that something that you guys have had success with?
Oh yeah, absolutely. That’s part of the process, just not the only aspect of the process. But one hundred percent. Again, not to put you on the spot here, but we appreciate all the support that we get from Buyside along those specific lines. Because again, that helps the manager each and every time. Not only does it help the agent start asking questions and be inquisitive, but again, it continues to help the leaders in the organization get better and better at those tasks, which again drives usage through the entire company. And I think that has a lot to do with why we’ve been successful with the kind of results we’ve gotten from Buyside.
Mark, this has been delightful that you’d share your time and your experience and thoughts about all of this. Is there anything we haven’t asked you that you want to talk about on this topic?
No, I would just say, in summing it up, I think technology and big data is here to stay. I think, as we heard many times, change is the only absolute. But the reality of it is, is I think clarity of who you are, number one, know who you are, know what you’re trying to accomplish and then, how you going to accomplish it? And work that plan, really will give you clarity on which direction. As we stated earlier, there’s different directions you can go and be successful in these different directions. But having clarity and not bouncing around and going to the next shiny thing, I do think with that attitude, without that clarity is really … You do that at your own peril. But if you have that clarity, I think numerous ways can be successful and I hope today was enlightening in some ways.