Jared James
By Jared James
Part of my job as a real estate speaker/trainer is to keep up to date on the latest news, fads, tools and technologies that come out so that I can determine if I think they are here to stay and worth covering with REALTORS®, or if they are here today and gone tomorrow and not worth our time (see talking signs as a case in point). Well, I just got off of a webinar I was doing for real estate professionals on creating new leads using both the old school and new school methods to create the maximum number of opportunities in today’s marketplace, and one of the newest methods that I think is worth paying attention to was demonstrated by Dream Town Realty in Chicago who actually decided to leverage the popular coupon site Groupon.com.
They created a Groupon coupon for buyers and sellers in their area, which cost the potential clients $25 up front and required them to used Dream Town Realty to buy or sell, then at closing the Groupon clients would get back $1,000 in cash (as long as their purchase or sale was greater than $150,000 and they closed within the next 12 months).
Amazingly enough, they had 219 people sign up for this attractive offer in only one month. I think we all would agree that we would be OK with being connected with 219 potential clients that are serious enough about buying or selling a house in the short term that they are willing to pay $25 up front for a coupon.
Now Groupon is only available in major cities, but if you are considering using such a tactic as Dream Town Realty you may want to check out Livingsocial.com or the newest site that actually focuses on secondary markets and was created by the popular ActiveRain.com founder, Jon Washburn, called www.dailyticket.com There is even a coupon site created specifically for real estate deals called housetipper.com.
Either way, I believe there is a greater point to be made here. Sometimes it is not the best REALTORS® who are always the most successful. Just like in any business that depends on the overall market to support them. Your ultimate success as a real estate professional comes down to one thing… Your ability to market yourself!! Do you think that you can’t get a better burger than the one that McDonald’s wants to sell you or a better sub than the one that Subway will make you? Of course you can, but they are both international franchises based on the success they have had in marketing themselves to the world and therefore making themselves an option for just about everybody. Pop’s Subs might make a better sandwich, but you have never even heard of them, so it really doesn’t matter how tasty it may be.
My point is simple. I think it is important to provide the best service and be the most incredible REALTOR® and best option in your marketplace for anyone looking to buy or sell. But you are not the best option to anyone if you are not first an option — meaning that customers know who you are and what you offer. How are you going to do this better in 2011?
I look forward to connecting with so many of you!
Jared James is the CEO and founder of Jared James Enterprises (JJE) and travels around North America speaking to and coaching REALTORS®. Connect with Jared at www.jaredjamestoday.com, on facebook.com/jaredjamestoday, or follow him on Twitter @jaredjamestoday.
Comments 24
“Your ultimate success as a real estate professional comes down to one thing…Your ability to market yourself” – depends on how one views success. If, like most typical brokerages and agents, one views success in terms of sales, then you are correct. I view success as satisfied and happy customers. Using a Groupon to get $25 from a potential customer so you can give them back $1000 just seems like a desperate ploy to get business. If a brokerage provides exceptional customer service and employs professional agents who are students of their trade, cheap sales tactics to attract business aren’t necessary.
This would probably work for regular sales or on the buyers side..but on a short sale, are sellers allowed to profit from the transaction in they are in a hardship?
Jared- I liked your blog. Check out my Vlog. I think the realtors you talk with would like it. http://bit.ly/fN2pLv. Keep up the good work!
Interesting blog. I think the Groupon idea would be a hit for sure. Thanks for posting. That is definitely a good idea going forward to start a buzz. Invest money to make money – like it!
I have seen other posts in the last 2 weeks about Groupon becoming a real estate tool. I researched it some more and can’t seem to find a problem with giving it a try. The beauty of it is if not a set amount of people buy the coupon, it is as if it never happened. There is no cost if the coupon doesn’t happen, and if it does the only cost Groupon takes is a percentage of the coupon fee the buyer paid. Nothing is out of your pocket and you may get an unlimited amount of exposure! I have contacted Groupon and am in the works to put out my first Groupon.
Groupon and Living Social are very selective and standoffish to a point. I myself offered up a deal but have not heard back from either one. However my deal did not involve cash back, which I feel cheapens our profession to the level of used car salesman, simply because it is far too easy to manipulate the “cash back” simply by increasing commission rates etc. Instead why not offer something substantial as I do with a free home warranty for one year and a lender credit for the appraisal at closing? For me I’ll pass on Groupon and Living Social and promote my own coupons thank you.
What a great promotion, I’m not sure if that would go over in my market, but I don’t think anyone’s tried it yet.
Interesting idea. There must be a ton of people on Daily Ticket though because I can’t seem to get onto the site.
The opportunity here to drive name recognition even if the buyer or seller did not want to purchase the $25.00 coupon or whatever deal you put together could be big. Many times buyers and sellers often pick an agent or broker because that person is in the right place at the right time. This type of example gives us one more tool to use in any fashion to get the word out about our services, our location, or product etc.
Hi Guys. Great comments all the way around. I don’t know that you cheapen yourself by offering a discount or promotion. The top businesses all over the world offer promotions as a way to boost their business. I hope it was understood that I wasn’t offering this promotion as an alternative to great customer service. I believe that a great customer experience has to become a given in our industry if you hope to build any kind of long term business. Mike: Nice Video. What software are you using for the background effects?
Thanks for your comments everyone! Keep them coming. Keep in mind that some states don’t allow for cash back offers but you can always discount your services. I hope to get to connect with you all in the future!
This sounds like a great promotion, but my question lies with the legality of it. Is there a RESPA violation in this type of offer. Could it be considered a form of a kickback? I would love any input on this because I’m looking a using a local site for this.
Hi Katrina,
We at JJE have actually looked into this for the very reason that you just mentioned. What we found was that you have to handle it differently depending on the state laws that you abide by. The way they did it in Chicago where they actually gave $1,000 cash back at closing is not allowed in most states. In almost every state you are allowed to discount your commission though. For example instead of having a $6,000 commission due to you and giving back $1,000 you would just charge a $5,000 commission. You can do this in any state as commission is a negotiable item. Great question!
Hey it would be a good one if Groupon ever responded to the emails asking if we could do it! LOL
Have emailed then 4 times now and have had no response 🙁
Hi Jared- I am currently a 10 year Real Estate agent in Baton Rouge, LA. I’m also one of the co-founders of HouseTipper. Thanks for mentioning our site in your post. We created HouseTipper specifically for Realtors and the service providers we work with. The industry is full of deals and we are just providing a central platform to feature them on which can be used as social media marketing tool. We thought the Real Estate industry was important enough and deserving its own group buying platform. Plus as a Real Estate professional myself, I didn’t think other agents should be showcasing their deals among pizza, botox, and brazilian blowout deals. HouseTipper gives Realtors, Homebuilders, Mortgage brokers and others in the industry their own unique platform to connect and engage with consumers while generating the most qualified of leads. It’s a great way to showcase experience and credentials while motivating potential customers into action. I’ll be speaking at Inman’s upcoming Real Estate Connect conference and look forward to meeting many of you there.
Alistair,
You are so right! I have heard this from agent after agent that they can’t get Groupon to respond. Not just to Realtors, but to merchants in general. They were just valuated at over $25 billion in just over 2 1/2 years making them the fastest growing company in the history of the world. Unfortunately, on one is ever ready for that kind of growth and their customer service and follow up is now lacking.
First it would be nice to get Tina Merritt’s post removed as she doesn’t get it.
It has nothing to do with making your service cheap. The $25 is charged because to be on GroupOn you have to charge something and you have to offer a discount, hence the $1000 credit. It’s no different than advertising in Zillow or Trulia or a magazine except that you reach a different demographic.
This is a great tool and I am excited to see so many Realtors really do live up to their reputation and just don’t get technology or the demographic of 25-35 year olds like Tina here. It gives Brokers and Agents like most of us on YPN a leg up on the out of touch Realtors.
http://www.weeklyplus.com/phoenix/real-estate-and-financing/team-real-az-1-1414.html
Thank-you for being open minded.The meaning of insanity is to continue doing the same thing and expecting a different result. You must be insane not notice that most typical brokerages and agents are in the unemployment lines. Change is inevitable.
OMG Guys! I am so sorry that haven’t checked for your responses lately but this has obviously created quite a buzz. You all make good points and thank you to the gentleman from housetipper.com for chiming in as well. I agree, the industry is changing and just like any good business person our values and overall goals of selling homes must remain the same, but the strategies we use to accomplish that goal must change with the times. 10 years ago it was acceptable to walk up to someone’s door and try to sell them encyclopedia’s. Now if you come to my house unannounced I am not only not buying what you are selling… but I am actually going to be angry with you. Times have changed. Great comments guys!
Wow – Jonathan. So nice to see that you feel a comment should be removed because the person has a different point of view. Before you choose to insult someone, you should do your homework. My company was named “Most Innovative Brokerage” by Inman, I am the recipient of NAR’s Technology Spotlight Award and I was founder and Chair of my local YPN. I also respect and listen to the opinions of others; whether or not they differ from my own.
I think that Groupon sounds like a good way to entice people to do business with you and get your name out there, but the enticement may be purely financial. As a result, you may find that your reputation will be based more on the financial incentives that you give (and will be expected) than your professional expertise.
You said that a real estate agent’s success comes down to one thing; the ability to market one’s self. The questions that I would ask is HOW do you want to market yourself and what do you want to be known for?
I am not aYPN Realtor. Been there already. I am an independent broker with 28 years of experience in my own successful business in a highly competitive market. Over 98 percent of my business comes from repeat business and referrals from past clients. About 1/2 of my business is FTBs that are 25-35. Regardless of the market, I always stay busy and outproduce the average agent because my business has staying power that can not be bought with short term marketing and relationships with clients that are drawn to a discount.
I have seen many agents build their businesses using short term marketing like Groupons and I track the statistics of several of my competitors that do business that way. Year after year, they get to recreate their businesses again and when the market slows, so do they. Meanwhile, their costly advertising budget remains the same and often increases as they increase advertising to bring in some business.
Short term marketing brings in short term business. Nothing wrong with that when you need it, but always be sure that it is consistent with your long term strategy because ultimately, a solid long term business is built on reputation.
This sounds like a wonderful idea, but one that is very difficult to implement. I had this idea when I was trying to fall asleep one night. When I awoke and researched this idea, I found this article. I called Groupon and they were much less than amenable to this idea. In fact, they didn’t even believe me that this article existed and that Dream Town Realty may have actually used Groupon successfully. The representatives with whom I spoke at Groupon interacted with me rather poorly, highlighting how Groupon does NOT work with Realtors and probably never did. When I asked to speak with someone who was with Groupon in September 2011 (when this Groupon was supposedly active), I got a “sigh” as if I was an incredibly annoying customer. I’m actually still on hold…………..but anyway, has anyone else had success with this idea? Am I the only one hitting brick wall after brick wall?
Andres, I believe this is it:
http://www.groupon.com/deals/dream-town-realty
I called the CAR attorney, he said here in California you can’t charge a fee before service. He said it is illegal. Oh well, if anyone could contest this let me know. In premise, it sounds like a great idea.