Mat Steinwede

There's been 3 comments so far...

1. Michael S says:

   January 18, 2010 at 1:50 pm

   Mat,
   I am constantly going up against agents who are including marketing with their (often lower) commission. What do you suggest is a good way to overcome this. We often have market share but most of the other the companies including the company who is a close second to us are constantly throwing in marketing and are going in up to 1% lower than what we are.

   Thanks in advance.

   Michael

   Reply
   1. Mat says:

      January 18, 2010 at 10:20 pm

      Hi Michael,
      Yes, this is a pain in the bum.
      Why agents do this is because they use these enticements as a tool because they have very little else to offer.
      See, paying for a marketing campaign on an owners behalf is effectively loaning them $5,000 or however much it will be to enhance their position in the market place. That’s like saying…. “Gee Mr & Mrs owner I think your house would look better painted white, how about I get it painted for you so it sells better and you can pay me back when it sells” and hopefully you sell it!
      Once an agent makes that sort of investment for an owner to enhance their presence in the market place through a larger advertising campaign, the owner will never know if they have achieved the optimum price because the agent now has a vested interest in getting the property sold at all cost, so they can recoup their money and therefore it creates a hidden agenda in completing the sale. This could potentially cost an owner 10′s of thousands of dollars because I have seen it many times where the agent starts to work on the owner to get the sale over the line at a point where the buyer would probably have paid more if the agent wasn’t so anxious about getting their money back and allowed the negotiation to draw out over a little more time and added a little bit more skill to the process. I can tell you a premium price is very rarely achieved, if ever for an owner, if an agent has put their hand in their pocket and lent them thousands of dollars. It’s a very dangerous way for an owner to engage an agent because they only get one shot at selling their home for a premium result and moving forward owing an agent thousands of dollars from day one can’t possibly create a clear platform to understand just how much is in the market place.
      We have agents that do it in our area too, my advice is just get good at explaining your benefits and advantages and most of the time the owners who want the very best result will use you.
      On the commission front, there is always someone cheaper in the market place and always will be, but I have one question for you, is anything good cheap? We are talking about an owners home and they are looking for maximum return on their investment 99% of the time and if they had $500,000 to invest and wanted the very best advice on how to achieve maximum return on investment for their life savings, would they just go to any financial advisor because he/she was cheap? No, they would source the very best they could, then when they have found them would fee really be a concern if they knew they would receive the highest opportunity of securing the very best return on their money? Probably not. Now this is where your difference comes in, if you can get good at demonstrating to an owner how you will protect their price and provide them with an opportunity of securing a premium result then fee is never really a major point (to most people) the ones that it is, are usually the ones you don’t want to deal with anyway. I have found the best way to attract great owners into your life who appreciate your worth is by nurturing relationships way before they are looking to sell (through prospecting and database building) and when it comes time to sell, they just want to use you and fee is rarely ever discussed because you have already earned the position as their agent. I know this is a much longer process but sometimes it’s the people that you have no relationship with who are the ones that just pop you in the same box as all the other agents and often choose the cheapest because they have very little connection with you. if you can’t demonstrate your difference extremely well in those brief market opinions with people you have only just met then chances are it will come down to price much of the time.
      Hope that helps,
      Mat

      Reply
2. Michael S says:

   January 19, 2010 at 6:42 pm

   Mat,
   Thanks for your thoughts. I have just changed areas and am finding that a lot of my business is fresh business not as a result of forming a relationship like you mentioned. Looks like I will just have to be patient and this problem may not come up as often.

   Thanks again for your help.

   Michael

   Reply