Over on Facebook, Sam Debord (regular readers are familiar with Sam) asked a really, really good question:
Sam DeBordRob, give us your take on AMP benefiting small MLSs. Does better software slow consolidation, or are other issues driving it?
AMP, of course, stands for RPR’s Advanced Multi-List Platform, a project with which I’ve been intimately and personally involved. Since I didn’t immediately know what I thought about it, I figured I should write this post. I often don’t know what I think about something until I’ve read what I’ve written about it. So here goes.
I have a feeling we’re going to be talking about a whole variety of things that went down at NAR Legislative Meetings & Trade Expo (aka, “Midyear”) this year for months and years to come. It’s been a great week, but rough on the sleep schedule, so these are not exactly deeply-thought-out opinions here. It’s more of a “flash impression” of where my head’s at right now, while I hurtle through the air at 350MPH.
I’m still at the NAR Midyear Legislative Sessions and heading out to meetings soon, so this will be brief. By now, you know that NAR’s Finance and Executive Committees have approved RPR to become the platform for the hitherto-mysterious Project Upstream. Inman News has coverage of the decision.
Thing is, this decision highlights precisely what is problematic with governance of Organized Real Estate entities, both Associations and particularly MLSs. NAR’s DANGER Report released yesterday highlights governance as a major threat, and I know from talking to various attendees that governance and the decision-making process are two major complaints from rather powerful and influential people in the industry.
If I were one of the 800-ish Directors of NAR, I would seek legal counsel from my personal attorney on what personal liability issues arise from my voting to approve or disapprove the RPR-Upstream project. Let me explain, briefly.
The answer to me, and to many real estate veterans, is obvious. A strategy that directly focuses on producing more transactions, while providing more value to the client, is far more rewarding, both financially and professionally.
“Offer generation,” the strategy of systematically and scalably converting clients into transaction offers, is the direct result of this realization. It will benefit the industry to have the same thought leadership, financial investment and technological innovation garnered by lead gen to be redirected to “offer gen.” We need to focus more on generating offers and less on generating leads.
I couldn’t agree with Andrew more on the concept and the philosophy behind this “OfferGen Movement”. But I thought I’d write this to point out the obvious truth about OfferGen, and make a suggestion or two (that will go ignored by the Powers That Be, of course).
Reader, thinker, and frequent commenter Sam DeBord has written a rebuttal over at GeekEstate to my declaration of vindication re: IDX = Syndication:
IDX creates efficiency for brokers, which increases financial profitability for the group as a whole. Syndication is a less-efficient platform in terms of overall brokerage profits. Real estate is, on an annual basis, similar to a zero-sum game. There are only so many transactions, and commissions, that will occur based on the market. Financial profitability is dependent on earning as large a portion of that commission pool as possible.
Read the whole thing.
I think Sam’s written a thoughtful rejoinder, and introduced a hitherto unexamined argument: that IDX increases financial profitability for brokerages. I’d like to delve into that a bit.