Presentation on theme: "Eeeee-Buyer Brought to you by the Real Estate Buyer’s Agent Council Version 2.0, May, 2004."— Presentation transcript:
eeeee-Buyer Brought to you by the Real Estate Buyer’s Agent Council Version 2.0, May, 2004
Electronic commerce is accelerating the shift of power to the customer.
3 Introduction Who is the e-Buyer Just what is e-Business How do we find e-Buyers and acquire their business? What is the status of the online transaction How do we transition all customers into the For Life Mode What are the opportunities, and associated challenges, for real estate professionals in this constantly evolving business environment?
4 Waddya Know? How many current Internet users have connected using WiFi or other wireless applications? –1 in 2 (50%) –1 in 6 (17%) –1 in 12 (8%) –1 in 23 (4%) Seventeen percent have logged on using a wireless device, and those under 27 were nearly twice as likely to have done so. Reuters, Tue Apr 13,2004
5 Waddya Know? What does the following emoticon represent? (:)-) Scuba Diver
6 Waddya Know? Which of the following are considered to be the least patient and desire instant gratification? –Baby Boomers – 1946 - 1964 –Gen Xers – 1963 - 1978 –Gen Yers – late 70’s – mid 90’s –Seniors – 55 and older These are the kids of the Baby Boomers, and they grew up with latchkeys, fast food, remote controls, automatic teller machines and microwave ovens, all of which provided instant gratification.
7 Waddya Know? What does the following emoticon represent? :-D Talks too much
8 Waddya Know? On average, how long did e-Buyers search for a home in 2002 using the Internet before contacting a representative? –1.8 weeks –2.5 weeks –3.6 weeks –4.5 weeks e-Buyers averaged 4.5 weeks investigating homes and neighborhoods before contacting a salesperson versus 1.8 weeks for Traditional Buyers (California Association of REALTORS ® study – 2002).
9 Waddya Know? On average, how long did it take e- buyers to purchase a home after contacting a salesperson? –2.0 weeks –3.2 weeks –4.0 weeks –6.6 weeks After contacting a salesperson, e-Buyers spent an average of 2 weeks in a search, visiting an average of 7.5 homes, opposed to 6.6 weeks and 15.2 home for t-Buyers. (California Association of REALTORS ® study – 2002).
10 Waddya Know? What does the following emoticon represent? }:- > little devil
11 Waddya Know? What does the following emoticon represent? # - ) partied all night
12 Activity: Brainstorm List skills and strengths required of successful real estate professional: How does technology effect the strengths and value of a real estate practitioner?
13 e-Buyer Electronic buyer Consumers who conduct research/purchase via the Internet Customers the real estate industry has always worked with, just better informed
14 What e-Buyers Want Consumers desires in the purchase of a home: Price Personal touch Customer service
15 Internet User Driving Forces 1996-2001 2002-2007 Email proliferation Free web browser Content explosion Low-cost PCs Intranets for business users Web hosting services Business-to-consumer e-commerce PC purchase rebates from ISPs Business-to-business e-commerce “Free” ISP rates in international markets Web-driven productivity gains Internet/cyber cafes Web cellular phones Pre-paid Internet access cards Broadband Internet connections Wireless Internet access Un-metered Internet access fees M-commerce (mobile devices) Business-to-Business e-commerce Wireless web content M-commerce (E-commerce for mobile devices) Internet cafes in developing countries Declining & fixed ISP rates outside the U.S. Hardware costs bundled in ISP rates Web appliances Technology is constantly evolving – changing the way we do business.
16 What e-Buyers Want Make the home buying/selling process Easier –Access to information Quicker –Communications with Broker, mortgage Broker, etc. Cheaper –Focus on value – not cost of the property
17 e-Buyer versus t-Buyer E-BuyerT-Buyer Access to informationDependence on salesperson Be involved throughout the transaction Be involved in the selection process only Desire exceptional customer service
18 Consumers Desires and Needs They wish to save time, They are techno-savvy They have high expectations They are loyal – to an extent 1st contact online must meet expectations Success in this (automobile) area will depend on dealership personnel, the dynamics of which are changing right along with the dealership Internet operations landscape. Polk Automotive Internet Study
19 Consumers Desires and Needs Access to product information Control of the buying process Quick response to inquiries Efficient use of buyer’s time Product choice Quick, friendly customer service Ease of transaction Resolving problems quickly is the factor that will lead to future business
20 Why Buy Online ? Value: product quality/support & customer service weigh heavily on e-Buyer’s decision to purchase. Control: e-Buyer will most likely obtain information before contacting you. Time: e-Buyer wants information provided quickly & accurately. Anonymity: do not push e-Buyers to reveal themselves sooner than they're ready
21 Continued Need for High Touch Incorporate technology into high- touch customer service –Determine for each customer/client how and when communications are to take place….
22 Activity: Brainstorm What “high-touch” customer services do you now offer to your buyers? What are other successful real estate professionals doing that you would like to implement?
23 The New e-Buyer - Demographics Of all the demographic data – this is the most telling… –77% say that the Internet influences their purchases more than any other media.
24 How do they React and Transact …these online customers are more regular visitors to brick-and-mortar stores than are their counterparts. In a recent survey, 74% of respondents reported that they had visited a department store recently, while only 61% of offliners had.
25 R.E. e-Buyers What real estate e-Buyers are generally looking for is a “live person” to: –Interpret information –validate and supplement information –negotiate terms and conditions –help guide them through the process of buying a home
26 CAR Study 70% of all dissatisfied t-Buyers were dissatisfied because the salesperson failed to communicate effectively 87% of the e-Buyers commented that the salesperson was always quick to respond. Good News…e-Buyers look at approximately 50% fewer homes before purchasing than do traditional buyers.
27 Distinctive Audiences As we discuss the research results of the following generations, consider the following: –What is unique about their communication preferences? –What unique ways can I market to these groups?
28 Distinctive Audiences – Baby Boomers Born between 1946 & 1964 76 million strong 52% of all online shoppers in 2000 Account for 50% of all Internet users 27% percent of boomers use the Internet for financial news at least 1 or 2 times per week, with 8 percent checking the Net every day. 62% made at least 1 online purchase Image is everything
29 Distinctive Audiences – Generation X Born between 1963 & 1981 50 million strong Kids of the Baby Boomers Grew up with instant-gratification & quick response conveniences –fast food, remote control entertainment, ATMs & microwave ovens The generation that brought e-Business into the mainstream Time is of the essence
30 Distinctive Audiences – Generation Y Born between the late 1970’s to mid 1990’s 60 million up & coming consumers Selected the Internet as medium of choice Estimated that almost 80% were online at the end of 2000 Instant gratification buyers & like the social aspect of shopping with friends Possible first time home-buyers
31 Tomorrow’s Home Buyer (IDC) (www.idc.com) noted that; “many in this group already take the Internet for granted and in five years they’ll expect it to be as reliable as electricity, the telephone, and running water”. Generations X and Y could spend approximately one-third of their lives on the Internet Generation Y likes to window-shop online & purchase in person. Verify exam That’s good news for real estate professionals!
32 Distinctive Audiences – Seniors Fastest growing group of Internet users Expected to grow 50% as compared to 3% for the 18 – 40 year olds. This group likes the Internet to connect to loved-ones. Importance of ease of use in your web-site (large text, easy navigation)
33 Distinctive Audiences – Seniors Top 5 uses by Seniors –Using email –Looking up hobby information –Seeking financial information –Reading the news –Checking weather reports These should be included on your marketing plan
34 Activity: Brainstorm How do successful communication methods differ to meet the needs of the demographic groups? –Baby Boomers: Image is everything! –Gen X: Now! –Gen Y: Possible first time home buyers –Seniors: Ease of use
35 Representing the e-Buyer Agency Laws still apply The potential for undisclosed dual agency still exists, particularly if you list properties on your site.
36 What is e-Business? Collective term to describe business & business services that use the Internet as a transaction medium. Integration of people & business processes with technology & the internet Use of electronic information to conduct business
37 Section II. E-Business “Old Economy values... still hold true in the New Economy.” -Elizabeth Heichler, IDC -What do these companies do wrong?
38 E-Business – Still a Sound Business We learn from others’ mistakes –Original e-Businesses failed because they compromised price for customer service. –Make it easy for consumers to find and contact you.
39 Activity: Brainstorm What are some of the frustrations you have had shopping/looking for information online? What are you doing to ease your online consumers’ experience?
40 Changing Role of the R.E. Professional To succeed in the new world of e- Commerce real estate professionals must move: from gatekeepers of the information to stewards of the transaction
41 The shift of Power to the Consumer Do not expect the transaction to take place entirely online –complex process –infrequently conducted –heavily regulated –saturated with many different participants
Internet Business Models Things in motion tend to stay in motion, things at rest tend to stay at rest Sir Issac Newton English Physicist 1642-1727 E-Business is constantly evolving as a result of two key factors, Economics and Natural Law
Internet Business Models New E-Business Models Economics Natural Law Supply and Demand 1 st Law of Physics Invisible Hand of Incentives
Internet Business Models Advertising Model Consumer MLS Aggregator (REALTOR.COM)) Broker Unqualified Leads
Internet Business Models Advertising Model Centralizes audience building Provides a brand Centralizes content control Unifies the consumer experience Generates unqualified leads
Internet Business Models IDX Model Consumer MLS or Aggregator Broker Selling Agent Website Provides localized branding Decentralizes content control Difficult to police Note: IDX does not preclude those without listings from displaying others’ listings.
Internet Business Models Referral Model Consumer MLS or Aggregator Referral Agent Website Broker A blend of IDX and advertising Can blur the focus of the business
Internet Business Models VOW Model Consumer MLS or Aggregator Broker Selling Agent Website Business Relationship Re-establishes the consumer- agent/Broker relationship Operator needs to supply incentive to the consumer
Internet Business Models IDX vs.VOW IDXVOW addresses Internet advertising establishment of broker-consumer relationships
Internet Business Models Lead Generation Model Consumer Broker Lender Website Leads Financial Incentive Compensation Incentive to the consumer to provide the consumer’s information, thereby establishing a relationship. This information is then sold to the broker as a qualified lead.
51 Internet Business Models If you don’t market to the e-Buyer, someone else will - for a fee
52 Types of Products & Services Standard Commodities Choice Commodities Intangible Commodities Unique Commodities (such as homes, but most homes are not sold online)
53 Standard Commodities Mass-produced Multiple purchases by multiple consumers at the same time Uniform pricing structure Products are easily packaged/shipped Example: Books
54 Choice Commodities Involve non-physical products, like offering a service Uniformity of purpose Distinction & variation in each customer’s use Purchase or use is frequently singular Varied pricing structure Time sensitive Example: Airline Tickets
55 Intangible Commodities Personalized to accommodate the needs of consumer Customer’s profile (creditworthiness, financial history) are important as features of product Example: Mortgage Loans
56 Unique Commodities Difficult to “web-ize” Not standard – no two are exactly alike Cannot be owned by different people at the same time Buyer choice & circumstances are factors Example: Purchasing a Home
57 Unique Commodities Why is your web-site not considered selling a unique commodity? Hint: What are you actually selling? Answer: Your services…
58 Activity: Brainstorm Name some traditional businesses that have made successful transitions to e-Business.
59 What Customers Want One-stop shopping A totally managed transaction All property, community & related information updated in “real time” A faster & more pleasant experience Overall transactional savings Regular & complete communication
60 Predictive Modeling Quantifying those known parts of the home-buying cycle that can be anticipated & thereby present opportunities to communicate with the customer & generate value-added revenue. Lawfully target your customer Lawfully target your market Determine your options
Facets of the Home Buying Process
62 Activity: Brainstorm What other examples can you provide that demonstrate how predictive modeling may help in assisting clients in the entire home ownership cycle?
63 Section III Communication Objectives Provide better customer service Provide direct response to the customer Cross-sell company products & services Close more sales Simplify marketing Acquire new customers
64 All Channel Partners Want: Customer acquisition Customer retention throughout the Home Ownership Lifecycle Customer cross-selling
66 Targeting Your Customer Lawfully The salesperson wants to know what customers are doing when online –Survey your customers –Focus – lead with client needs
67 Finding the New e-Buyer The search process ties in with: –Pre-qualification –Online value opinion –Online appraisal –Closing process If this what they are looking for, are you there?
68 Targeting Your Customer Lawfully... simply means taking what a good salesperson already does to the next level. The key to success is tied to the quality & quantity of data held for each customer or property.
69 Fair Housing CAUTION: In targeting your market or customers, always remember that under Fair Housing statutes it is unlawful to “profile” or otherwise discriminate on the basis of race, color, religion, sex, handicap, familial status or national origin.
70 To provide optimum customer self-service online, offer the following services –An automated or personal response system Drip e-mail, Auto responders, –High level of customized response for customer inquiries Third-level domains –Integrated online communication with offline human communication Chat or VoiP –Marriage of all communication channels
71 The International Market Physical facilities, geographical location & time zones are no longer obstacles. With the onset of nearly-instant global communication through the Internet, people can now conduct business from anywhere at anytime.
72 International Consortium of Real Estate Associations Ultimately, ICREA looks to set international real estate standards based on a common code of ethics and to facilitate referrals and related payment of fees among ICREA member constituents.
73 Activity: Brainstorm What are some needs/information that international and/or multicultural clients are seeking. Is your website meeting these needs?
New Way of Communicating & Managing Business Obsession with technological advancement and “nowness” makes utility hard to derive Harold Innis Canadian Historian 1894-1952 Don’t invest in new technologies because you need the “latest and greatest” and you need it now.
75 e-Mail e-mail has already surpassed telephone & voicemail as the #1 method of business communication. Are you using e-mail effectively & to your best advantage?
76 Managing e-Mail E-Buyers want information and they want it quickly…
77 Managing e-Mail 150+ messages per day! How do you read & respond appropriately? –Sort & file your e-mail with filters per client, geographical farm, mortgage company, etc –Organize e-mail with a comprehensive filing system –Be aware of viruses –Use customized signatures
78 Activity: Self-Assessment Do you communicate differently with e-Buyers & t-Buyers? List how. Be honest. How can you use technology to improve how you communicate?
79 Mobilemediary The Mobilemediary will be able to break into the value chain at any point, bringing information & transaction capabilities to customers whenever & wherever they are ready to buy a product or service. Test?
80 Mobilemediary Successful buyer representatives will be those who learn how to use technology to manage the key element in the real estate transaction... INFORMATION. Gaining knowledge of how to get information to the customer timely & efficiently is the job of the Mobilemediary – and the buyer representative.
81 Broadband Technology High speed internet access: –Cable Modems –T1 Lines –Digital Subscriber Lines (DSL) –Satellites The number of households with high- speed Internet connections in the US grew: –From 10.4 million in 2001 to 26.7 million in 2004
82 Wireless Communications Wireless is rapidly becoming the medium of choice for many businesses & the customers they serve. One in six U.S. Internet users have logged on using "Wi-Fi" or another wireless technology. For them, it’s “Business as usual.”
84 Collecting and Processing Data Customer service … therein lies the key element to keep in mind as the era of e-business unfolds. Using customer information in a way that aids the customer and respects them as a person is the high road to take.
Tracking Data In the business world, the rearview mirror is always clearer than the windshield Warren Buffett Investor (1930 - ?) In order to see where you are going you must see where you have been and how you got there.
86 Consumer Information Personal Data - consists of names, addresses, credit card numbers & purchasing history – use only in conjunction with specific buyer’s transaction Collective Data - concerns the overall demand for a given product or service & how that product or service should be priced and/or delivered
87 Confidentiality If you fail to convince customers that their personal data in your possession is confidential & secure you risk that they will go somewhere else.
88 Tracking Data – What do you measure? What is your product? –Listings or services, other? What is your goal? –Acquire direct communication with the consumer How do you accomplish your goal? –E-mail communication, online forms, toll- free number
89 Tracking Data – What do you measure? Can consumers easily access your communication vehicles? –Data tracking Are consumers finding your site? –Track number of “hits” – wrong
90 Activity: Brainstorm List ways that you currently track your traditional methods of marketing List ways you can track the success of your e-marketing efforts
91 Tracking Data – What do you measure? Units to consider tracking –Unique visitors –Page views –Referring page –Search Engines –Search Engine key words –Operating Systems –Who's online –Languages
92 Forecasting, What’s realistic? Ask Your Web Hosting Vendor Relate Your Estimate to Your (offline and online) Marketing Ask Experts Expected/anticipated ROI
Web sites “The value of goods are derived from its utility to the user, not the labor spent in producing it.” Jean-Baptiste Say French Economist 1767-1832 Consumers don’t care that you spent $XXX designing your web site two years ago, they care how functional it is today.
94 Your personal website should: Be the centerpiece for all online advertising & communication Have access to search data Contain tools necessary to locate property & financing are key elements Follow good design principles Web Sites
95 Activity: Brainstorm If customers rarely search for a specific real estate salesperson, what are some keywords you have used/can use so that your name will come up as home buyers search for information online? Hint – include multiple ways a word can be spelled or misspelled.
96 Web Sites – Tools for consumers Mortgage information Market/home information Area information Moving tips Contact information Other???
97 Activity: Brainstorm What other information would you provide? List the top 5 and the next top five priorities. –These should be made available throughout your site. Track how users are finding these areas through your web stats.
98 Activity: List five things you should do on your web site List five things you should not do on your web site
99 Driving Traffic to your Web Site
100 Activity: Brainstorm What additional methods would help drive traffic to your website?
101 Promoting your url
102 Voice Over Internet Protocol Benefits –Customers never have to leave your site to reach customer service rep –Reduced long-distance costs –Customers add “high-touch” when/where they want –Customer service can up/cross-sell other products & services
103 e-Newsletters Replace direct mail counterpart Cost-effective Can be more target specific Can be automated Can carry imbedded photo tours & direct links to specific information
104 Moving Non-Internet Users Online Identify who is online & who isn’t, then: –Offer a neighborhood e-Newsletter with handy information –Post a neighborhood calendar on your website with links –Send out a direct mail piece offering assistance in getting online
105 5 Cs Of Doing Business Online Contact – continue with existing customers & attract new customers Capture – after contact create a relationship Cultivate – convert contacts into customers Close – convert customer into cash Continue – keep your customer For Life
106 Activity: Brainstorm Develop business strategies that will be addressed by the Web strategy, e- mail strategy, and service delivery (what services you will make available and how often). Be sure to include measurable objectives with the frequency that they will be measured. For the web strategy you will be asked to design you home page plus identify how you will market your web site.
107 Value Through Integration As the individual parts of the transaction become individual commodities, tomorrow’s real estate professional is going to have to become an aggregator of services.