Notorious R.O.B.

Brian Boero of 1000watt recounts a dinner conversation and throws down some challenging questions and assertions:

This particular debate centered on the following question:

“Have we reached the end of the real estate story now that FSBOs and discounting have lost their menace?”

As Brian puts it, there were two camps, comprised of him in one camp and everyone else in the other camp:

Methods have changed. Markets have changed. The balance of power between brokers and agents has shifted. Consumers have access to enough data to choke a horse.

But the basic structure of this business remains remarkably intact.

There are two possible conclusions to be taken from this:

A. Real estate is exceptional. The complexities and emotions that characterize the real estate transaction will forever shield it from structural change. Bill Gates, Barry Diller and about a billion dollars in VC have been thrown against the barricade with no transformative impact. The story is over.

B. We’re due for a cataclysm. The forces of change, of technological innovation, of inchoate consumer frustration, are stacked high against the dam of Real Estate As We Know It. It will not – it cannot – hold. The story is far from over.

My dinner pals were in the “A” camp. I argued for “B.”

Given that the whole thrust here is theoretical and futuristic, I can’t help but charge in foolishly where wiser men fear to trod.

Read the rest of this entry »

In part 1, I started to talk about marketing in a consumer environment when the middle is disappearing.  My basic hyopthesis is that the American consumer today operates in one of two modes: Thrift and Aspiration.  Thrift mode means a focus on price above all; Aspiration means a focus on luxury, lifestyle, or something more than “mere product”.

To apply these thoughts to the marketing of real estate, I asked a few questions, of which the first one is the topic for this post:

If the Middle is disappearing, and the two dominant modes of consumers are Thrift and Aspirational… have you considered how you are positioning properties not only to demographics, but also to psychographic profiles?

Let me attempt to tackle this question and explore what real estate marketing of a property in a post-middle era might look like.

Read the rest of this entry »

Thanks to Brandie Young‘s wonderful post, I found David Amano’s thought-provoking post on “Marketing in a Post-Consumer Era”.  It’s worth reading in full.  Actually, they’re both worth reading in full.

I couldn’t help immediately reacting, however, with skepticism.

Perhaps it’s because the last time we were in a recession, we heard the same thing: conspicuous consumption is out, and frugality is in!  Since then, we have seen an absolute explosion of conspicuous consumerism, celebrity worship taking over as the official culture of the United States, and a continual denigration of the average middle American lifestyle in our cultural institutions.  (I for one do not recall “Walmart” being a dirty word back in the recession of the early 90′s.) Read the rest of this entry »

Last night’s Lucky Strike Social Media Club (LSSMC) dinner featured a presentation by Phil Thomas DiGiulio (@holaphil) of Wellcomemat on “Video and Social Media”.  I thought it was an interesting topic in and of itself, and am grateful to Phil for coming by to have the conversation with us.

During the dinner — as is normal for LSSMC — a topic came up that I thought needed more elaboration and discussion.  One of the sub-themes of social media and its impact on marketing is how professional it ought to be.  Should companies, for example, have an “official” corporate Twitter handle, like @onboard?  What topics are appropriate for a corporate blog?  And so on.

Video, as it turns out, is directly implicated in this sub-theme.

Professional vs. Confessional

One of the biggest barriers to implementing video as a marketing strategy is cost.  I have priced out what it would cost to have a professional video made for my employer, and the ease with which one can spend $15K on a 3 minute video is staggering.

Video is inherently a more difficult medium for an amateur.  Video editing — even as it is made easier with technology — remains a more technical, a more difficult, and a more expensive proposition than editing text.  Simply consider the fact that you may need to buy a piece of software to edit video.  And that’s assuming that you have the visual aesthetic sense, a talent for crafting narrative using motion pictures, and skill with blending sound and image and motion — all of which are somewhat specialized skills.

Phil usually recommends that you hire a professional to do a well-crafted video, and for good reasons.

On the flipside, however, there has been a growing trend in the world of video towards a more intimate, more amateur, and more “raw” approach.  Perhaps the explosive popularity of reality TV is reprogramming our cultural expectations.  Perhaps the wide availability of cheap equipment and editing software is bringing “moviemaking” to the masses.  The popularization of sites like YouTube certainly helps to spread video works that wouldn’t have seen the light of day in earlier times.

For example, Nigahiga is one of the top subscribed channels on YouTube.  This is a typical video:

While Nigahiga videos are hilarious, with decent editing, a story, and some really funny actors, part of the appeal is its extremely amateurish production values.  The exact same script, exact same actors, exact same everything, but done professionally by a TV production crew would be horrible.  Audiences would be making fun of the terrible script, the bad acting, and the not-so-funny jokes.

Why is that?

Audience Expectations: Artifice

I think the reason is that the modern audience grew up in the era of mass media.  Few of us remember a time before movies, a time before television.  The Millenials don’t remember a time before the Internet.  Few Gen-Xers remember a time before VCR’s.

Movies and TV are a part and parcel of our culture, our memories, and even our identities to some extent.  As we grew up surrounded by filmed entertainment, our knowledge of and expectations of motion pictures have also grown.  We are no longer fascinated, as the first viewers of movies were, by grainy black and white footage of a train pulling into the station, over and over and over again.

As filmmakers advance their art, as TV producers get savvier, as actors and directors and lightning and sound engineers and editors and the rest of the production industry continue to improve their art and technology, our expectations of professionals continue to rise as well.

Just last decade, CGI was a big deal special effects wise.  We audience members oooh’ed and aahh’ed at movies like Terminator 2 and Jurassic Park.  Today, we take CGI for granted, and harshly criticize crappy CGI work.

The result of all this improvement and sophistication on the part of the audience — as a direct response to the continual improvement by industry-leaders in film and television — is that we hold professionals to a far higher standard.  We are so jaded by movies, by TV, by big explosions, by car chases, and special effects that to break through our awareness and make an impact requires something extraordinary.

For example, this Sprint ad:

From a marketer’s perspective, having worked at an ad agency, the level of execution on that video/ad is incredibly high.  The amount of thought that went into it, the CGI-work, the models, the video shoots, the ad copy, the script, the voiceover work… all of it likely required thousands upon thousands of manhours of work by some of the best and brightest in the advertising industry — namely, Goodby, Silverstein & Partners, the winner of the 2008 Ad Agency of the Year by AdWeek.

That is the level of skill, of art, needed to break through with professional video.

In contrast, when the audience is confronted by video that is clearly not professional, and is intended not to be professional, then the expectation changes.

Audience Expectations: Humanity

The Nigahiga video on YouTube embedded above is a perfect example of changed expectations.  The martial arts fighting sequence in the Nigahiga video is hilarious precisely because it is so amateurish, and intentionally so.  What the viewer is responding to isn’t the technical perfection of the fight scene, but the humor and the personality of the actors (and the filmmaker) as evidenced by their staged “fight scene”.

What the audience expects in an amateur production is humanity, not artifice.  They want authenticity and personality, rather than perfect execution.

In that situation, I believe that the bad lighting, the bad acting, and low production values are a bonus rather than a detriment.  They help to create authenticity.

The Nigahiga videos would not be improved by professional lighting, or a soundstage.  They would be hurt by it.  Getting professional actors to act out the skits would not make the videos more interesting or more entertaining; I rather think professional acting would make the videos less entertaining.

This is, frankly, the connection to “social media”.  Video, I think, has a unique ability to help viewers assess the honesty and authenticity of the person on camera.  Visual cues, speech patterns, the facial expression, gestures — all of these things help a viewer decide whether the person they are viewing is “keepin’ it real” or faking it.

If you understand social media properly — that is, as an expression of the Cluetrain concept of authentic human connection, rather than as a collection of technology tools — then you will implicitly grasp that video is just another tool for that expression.  Based on that, you can make decisions on whether and how to use video to maximum effect.

Danger, Will Robinson, Danger!

There is, however, real danger with video, and one that I don’t think is well enough understood.

The danger is not the unprofessional video with shaky cameras and bad lighting.  No, the real danger is the mediocre professional video.

Because the audience expectation is so high when it comes to professional work, in order to avoid looking like an idiot, your execution must be extraordinary.  This is both prohibitively expensive and incredibly difficult.  The difficulty is easily illustrated with this video from Cyberhomes (which is a good company of good, smart people):

The cheesy stock photography, the horrible music, the “professional” voiceover, all combine to make what is a deadly boring corporate video.  This is not to say that the team at Cyberhomes didn’t do a good job — it did.  But the video is not extraordinary, and it couldn’t possibly be — it isn’t a Goodby Silverstein campaign costing millions of dollars.

Once the decision was made to go the “professional” route, Cyberhomes could not help but fall into the “crappy corporate video” hellhole, not because of anything its team or videographer or editor did, but because what they could not possibly do given the likely budget for something like this.

There is a price for artifice.  A rather significant one in the current media environment.

If you are unwilling or unable to pay that price, then your video project is doomed from the start.  It may be a better strategy to go the other way and go for an amateurish, human connection driven video play instead.

I think Jim Duncan‘s “hey, I’m talking on camera while I’m driving somewhere in my car” videos are absolutely fascinating.  Unfortunately, I can’t embed them on a WP.com blog, so go view a sample here.  An embeddable sample is from Robin Greenbaum, of Prudential Douglas Elliman, in New York:

The parts where Robin’s real voice comes through, when she’s giving her opinions and views rather than when she’s reading off some description of the Windermere, are fantastic.  She sounds like a human being, like an interesting person with strong views, with whom one might be able to have a conversation.

And that, my friends, is social media.

-rsh

I had a roommate in college who was an architecture major as an undergrad.  He was such an insufferable snob — for example, in the entire year we lived together, he never watched any movie that wasn’t by Fellini — that my view of architecture and architects may have been unfairly colored.

Thankfully, I recently learned just how fascinating architects are, especially in the post-Green era.  So I started to dig around just a bit.

And I must ask… why aren’t architects blogging more?

I asked this question on Twitter and LinkedIn and got some interesting responses, but thought to expand on them here.

Seriously Compelling Content

Blogs are, of course, for those who work with the written word.  At the same time, there’s no denying that pictures and graphics liven up what would otherwise be a wall of text.  Architecture is inherently a visual medium, but one that requires quite a bit of explanation (via words) to appreciate it fully.

For example, look at The Visionaire, a new building by the Albanese Organization, designed by Rafael Pelli.

That’s a beautiful building.  And a beautiful image.  There are more stunning images of gorgeous buildings in the world of architects.  Look at this image from Centerbrook:

Unlike artists, however, architects have to create buildings that people work in, shop in, play in, and live in.  There are layers upon layers of things going on that I had no idea even existed.

For example, solar path.  It makes perfect sense once it’s explained, but until it is, it’s one of those things that a normal person rarely (if ever) thinks about.

Architects routinely think about stuff like this, as well as all of the engineering that goes into a project.  I heard Stephan Kieran of KieranTimberlake spend a good 5 minutes talking about a wall.  With cross-section diagrams, showing heatmaps.  I rather think he could have gone on for a good half-hour just about a wall.  Maybe more.

And all of it is fascinating, because so much of it is simply a brilliant exercise of human ingenuity.  Intelligence, applied.

Plus, architects write.  Centerbrook has published a freakin’ book.  And here’s the whole list of their publications.

And last, but not least, non-architects are genuinely interested in architecture.  It is an art form, after all, and one that impacts the average person’s life in subtle and not-so-subtle ways.  Every New Yorker knows that a part of his identity is tied up with the skyline, the buidings, the iconic ones like Empire State, and the forgettable brownstones lining 11th street.  Every homeowner lives every day with the result of decisions made by some architect or three.  People are interested in architecture.

The whole heady mixture says to me, “Blog!”

Thankfully, some architects are starting to get into the blogosphere.

KieranTimberlake has a blog.  Unfortunately, KT seems to use it mostly as a repository for press releases, which makes it basically useless.  I learned through LinkedIn that Modative has a blog, and it’s quite good.  (I’ve linked to it in a new blogroll category.)  Most of the other architecture blogs appear to be written by critics, academics, journalists, and so on, rather than by practicing architects.  If you know of blogs by architects, please send along the link, or post it in the comments.

Effective Marketing?

Turning to the topic as a marketer, rather than a new kid-in-candy-store enthusiast, I confess that I am puzzled why more architects wouldn’t blog.  It strikes me as almost the ideal marketing vehicle for the profession.

Perhaps the bigtime developers who hire architects for the most part grow up in the industry and know all the architects they’ll ever want to know.  Maybe the plethora of design and architecture magazines makes it unnecessary for architects to market themselves.

If you’re Skidmore, Owings & Merrill, maybe blogging just isn’t something you need to do.

But what about all those who aren’t already world-famous architects?  How would a potential client know to hire you?  What does he judge you on?

I ask because I genuinely do not know, never having hired an architect, nor having been one.  But since architecture is still a services-based profession, where one’s intelligence, wisdom, judgement, aesthetics, philosophy, and temperament all come into play, it seems to me that letting people know who you are, how you think, what interests you, and what your design philosophies are would be an excellent way to let like-minded clients find you.

Sharing knowledge, sharing insight, and being a genuine, authentic person are proving to be the most important method of marketing in the post-Cluetrain world.  Architects have knowledge, have insight, and are human beings — get on the cluetrain!  Let the world know your views on things.  Talk about projects as an insider.  Let us see that you’ve put in hours of thought into just how sunlight should strike the window at a precise angle at 3PM on a Friday in April.

Let us behind the curtain.  We may have no idea what you’re talking about, but we will recognize that you do.

So architects of the world, unite in blogging and social media!  You have nothing to lose but your aura of mystery.

-rsh

Just caught Coldwell Banker’s new campaign on TV while watching some animated movie with the kids.  Here it is:

Wow, what an improvement over the misguided Talking Heads campaign:

I do think CB should have stressed the 103-years of experience thing just a bit more.  Talked about how they’ve seen ups and downs, and helped clients through good times and bad, etc.  Something kinda like this ad:

Since Coldwell Banker is probably the only real estate brand that could do a “heritage” ad like this, I rather think it ought to play up that advantage.  Especially now.

But that minor kibitzing aside, the new ad is effective all around.  It’s emotional in just the right way, strikes the right tone of positivity and reassurance, and reminds people that a house is not a bond fund but a place to live.

Back that campaign up with a social media blitz on all channels reminding people about how special their home is, how CB’s heritage helps in this time of uncertainty, and the like, and I think CB has a winner on its hands.

Anyhow, kudos to the marketing team at CB.  They got this one right, in my view.

-rsh

The second post ever on Notorious R.O.B. was entitled, “More Silliness from Real Estate Connect” and contained this passage:

The Real Estate industry has gone tech-crazy.

Here’s a wakeup call: all that technology does is make your existing processes more efficient. If what you do is crap, it makes crap more efficient. If what you do is valuable, then it makes that more efficient. Microsoft Word is an amazing piece of technology, but it can’t write the next Great American Novel for you. You have to actually write the damn thing yourself, and if you suck as a writer, then Word isn’t going to solve that problem for you.

By the way, I would like to note that I have broken through some sort of dork continuum by quoting myself from a year ago.  The only thing I could think of that might be dorkier is singing She Bangs on American Idol.  (Click on that link at your own peril; I will take no responsibility for brain meltdown and queasy feelings.)

A couple of recent experiences reminded me that plus ca change, plus c’est la meme chose.

Evidence: Oh, Canada!

First, we get this announcement from Coldwell Banker Canada:

Coldwell Banker Canada Operations ULC today announced the launch of the brand’s customized real estate application developed for Microsoft Surface™.  The dynamic new real estate interface was unveiled during a live interactive demo at the Coldwell Banker® Canadian Broker Meeting and Awards Gala being held today in Toronto. The new Microsoft Surface home search application allows users to interact with thousands of home listings, real estate maps and other www.coldwellbanker.com features in a way that is familiar, by using simple hand gestures. Similar to the intuitive technology featured in the futuristic film, “Minority Report”, this exploration on the use of Microsoft Surface represents yet another way in which Coldwell Banker is working to harness innovative technologies to benefit home buyers and sellers.

Um.  Okay guys.

So the Canadian real estate market was down17.1% i n2008, and the Canadian Real Estate Association is predicting a 16.9% drop in 2009, but one of the largest brokerage companies in Canada is excited about Microsoft Surface?

Is this really the thing that’s going to turn things around for CB Canada?

Maybe.  But I submit that the real estate industry has gone tech-crazy if folks really believe that Surface is where dollars need to be invested.

By the way, compare what CB Canada put together with this from Perceptive Pixel, the company founded by Jeff Han who pioneered multi-touch interfaces:

If you’re going to do multi-touch, then by golly do it right.  Putting a website that we’re all familiar with on Surface and calling that a “dynamic new real estate interface” doesn’t pass the laugh test.

Evidence: Ubiquity of Social Media

I don’t hate social media.  Nor do I think it’s useless.  If anything, I believe the opposite: it’s damn useful, and quite likely groundbreaking in lots of ways.  But I do think the industry is focusing on absolutely the wrong thing as it comes to social media.

People are focusing on the technology of social media, rather than on the meaning of social media.

Past two weeks, I’ve been on the road, first at RE Tech South and then at the Leading Real Estate Companies of the World Conference.  I’ve sat through hours of seminars and panel discussions and lectures on how real estate professionals and companies can survive, thrive and even improve in the current market conditions.  And it seemed that every other word being uttered was “Twitter” or “FaceBook” or “Blog”.

The emphasis on technology leads to realtors using the technology in all sorts of unsuitable ways: spamming their friends, endless twitterstreams of listing after listing, advertising after advertising, and blogs that are nothing more than digitized billboards.

All that technology does is make your existing processes more efficient.

When your existing mode of engagement is “NOW IS A GREAT TIME TO BUY OR SELL!” (And by the way, how does that work, exactly?) then the technology is just going to make you be more efficiently annoying.

To be sure, there are people like Jeff Turner who are trying to preach the meaning of social media, rather than the technology.  We need more of him, and less obsession about how to create a dozen groups on TweetDeck to keep track of all of your social networks.

It Ain’t the Technology

If I believe in nothing else, I believe that marketing post-Cluetrain is authentic, open communication between human beings.  Technology assists in the transformation, makes some of the interaction possible even, but it is not the interaction.

I firmly believe that a realtor who doesn’t know how to use a computer, but send personal, authentic, and no-bullshit handwritten notes will beat the pants off of the realtor who has thousands of Facebook Friends and barrages them with digital versions of “Just Sold” postcards.  I really do.

Because it ain’t the technology; it’s the person behind the technology.

What realtors need isn’t a newfangled technology to be a thousand times more annoying than they are today, but a transformation into the kind of trusted advisor that so many claim and so few achieve.  Companies need to be investing in technology (and processes!) that help realtors become true experts in their local market, the real estate transaction, the financial elements, and client service, rather than in gadgets that win cool points then fade away.

Show people that you care about them as people; that you will work hard for them; that you are a professional with pride in your training, knowledge, and expertise; that you won’t lie to them or bullshit them; that you will advise them to the best of your abilities for their benefit and not your own; that you are neither a huckster nor a servant; that you too are human… and people won’t care if you message them through Facebook or through smoke signals.

They will trust you.

-rsh

Matt Dollinger, of @Properties in Chicago, raised a very interesting question at the Leading RE conference that just concluded.  He then raised it again over Twitter (Matt is @mattdollinger) and the discussion threatened to overwhelm the 140-char limit.  It’s time for bloggery.

Matt’s question was this (in essence):

In 2015, with companies like Trulia, Zillow, Roost and others really advancing the technology of real estate search, should brokers have their own search site?

Since the panel was titled “Real Estate 3.0″, it naturally lends itself to these kinds of speculative questions.

This is an important question.  Money is not unlimited.  Brokers have to make decisions today to align their strategy going forward.  And as Matt himself pointed out during session, brokerages are not technology companies at heart.

The answer seemed to be from the panelists that brokers have to do both: create a top-notch brokerage website that is optimized for SEO, has great user experience, and captures leads all over the place, but also send listings to all of the aggregators to drive additional leads, because the big guys have national (global) reach and can grab so many more eyeballs than a single brokerage site could.

Trouble is… that just doesn’t jive logically.

Internet is Not Local

Fact is, while a brokerage may be local, and real estate may be local, the Internet is most assuredly not local.  There is no reason why someone searching for “chicago real estate” from New Jersey would not find a local website.

Granted, @Properties apparently needs some SEO consultancy love, seeing as how it doesn’t appear on page one, two, or three, but other local brokerage sites are right there: Baird & Warner, Rubloff, Dreamtown Realty, etc. all show up.

And Trulia also shows up.

As a consumer, if I go into a local brokerage site like Dreamtown’s, then go into Trulia, there is a world of difference there from a user experience standpoint.

The one has all manner of busy advertising, bullshit marketing messages that I would immediately ignore, and so on.  The other has a clean interface, a nice Google map mashup, and easy to use search filters right there on the page.

For Dreamtown to come up to par with Trulia, it would need to spend a pretty serious amount of money and time.  And the Dreamtown website is actually pretty darn good as far as local brokerage sites go.  Having worked on corporate brokerage sites, I think it is no stretch to say that a top-notch custom-coded website with developers, designers, UI design, SEO, and the like can easily top $250K in cost.

That isn’t even taking into consideration what it would cost to develop something actually new and innovative.  A new kind of search, a totally new way to interface with listings data, etc. could mean literally millions of dollars in R&D costs.

In theory, the aggregators and web portals like Trulia are technology companies first and foremost, and have core competencies in design and development.  They should always be ahead of the brokers in terms of technology and user interface.  (And in theory, they should dominate the brokers in SERPS… though often, they do not.)

Branding & CRM

Matt would argue — and correctly — that a brokerage company still needs a website for branding and CRM purposes.

For instance, you have to have a site where your existing seller clients can go, login, view all activity reports on their listings, see where the transaction is, download paperwork, upload paperwork, etc.  (You all do have this, right?)

And it would be difficult to brand your brokerage and your agents as local experts (since real estate is local, even if the Internet is not) without providing some heavy duty in-depth information and data about your local market.

But neither of these things need a SEARCH experience.

In theory, @Properties could have an awesome local website, filled with information about the area, a series of hyperlocal blogs written by their agents, and so on.  But rather than a search experience, just offer a “Search Our Chicago Listings on Trulia” or some such.

Either/Or?

Of course, most folks would assume that like in all debates, the real answer is a “bit of both” rather than an “either/or”.

So a broker would go invest a few thousand bucks to get a templated site from some low-cost website creator, or frame in a search solution from some IDX search provider, and still spend thousands more to feature listings on Realtor, or on Trulia, or pay for leads from some aggregator.

This is, however, a case of “either/or”. One of the following is true:

1. The money spent on putting in a search into the local broker site is wasted, since consumers would naturally prefer (and only find by year 2015) the tech-sites that emphasize the whole search user experience and functionality, and leads would be sent directly to the broker.  Instead, spend that money on enhancing local info, the brand presence, and the CRM applications.
2. The money spent buying traffic/leads from Third Parties is wasted, since all searches begin with Google anyhow.  The name of the game is to rank higher in Google, and not having search and all those results pages kills you.  Plus, you don’t need super-duper search; you just need good clean intuitive search that connects the consumer to your agent as quickly as possible.

Both cannot be true as a matter of logic.

Traffic vs. Lead

An important distinction here is between ‘traffic’ and ‘leads’.  Louis Cammarosano of HomeGain is fond of pointhing this out.  A broker or agent, in his view, could care less about a site sending him a billion visitors if all of them are bored-ass tirekickers who wouldn’t convert to a customer anyhow.  They would rather that HomeGain (or whoever) send them ten people who are solid ready-to-buy or ready-to-sell consumers.

In theory, the third-party sites can send enormous amounts of traffic to the spiffy brokerage site with a great search experience.  Since these are just random visitors, the brokerage site would need to do a lot more — including offering a search experience — in order to convert them to actual leads.  And it is possible that these sites could send millions of visitors, not one of whom will ever hit “Request More Info” or “Request a Showing” or pick up the phone.

That traffic, however, is sourced more or less from Google, which brings us right back to “SERPS are what matters, not SEARCH”.

Or, the third party sites are sending enormous amount of leads, which are consumers asking to be contacted.  In which case, they’re past the whole “search for a home” deal and into the “I need more information” deal.  And the brokerage’s spiffy new search technology is completely bypassed.

Real Estate in 2015

So let’s fast forward.  2015.  Hard to make assumptions based on technology today, with our rapid speed of change.  But let’s go with it.  Let’s assume that search technology is so advanced by 2015, and computing has totally changed, with multi-touch computing the norm.

What happens to search-based broker/agent website then?  The answer is directly related to what happens to the big aggregators by then.  And where search technology is by then.

As the fast and furious twitterstream on this topic indicates, this is a bigger issue than one might think initially, with implications across the entire spectrum of online real estate.

I’m looking forward to the discussion and exploration.

-rsh

Just a brief note from the Leading RE Show going on right now in Scottsdale, AZ.

I got to sit in on a great session earlier today with a speaker who I gather was a luxury marketing consultant.  He actually had some great points to make and great things to say.

However, a theme he sounded throughout the session grated with me.  It goes something like this:

Companies should invest heavily in CRM, and segment their clients to identify their “best customers” and then cater to them in order to drive customer satisfaction, which drives referrals, new business, and loyalty.

Now I happen to agree with the general thrust here.  I’ve already written that I think CRM is the killer app for real estate, and that real estate companies need to do a better job with segmentation and targeted marketing.

But applying principles of luxury marketing from the worlds of hospitality and retail and whatever else to real estate doesn’t readily jive with me.  Because of the Seven Year Cycle.

I just think it’s borderline irresponsible for marketers to talk about CRM or whatever without addressing this fundamental fact about real estate: consumers go seven years in between transactions on average.

I don’t know if that frequency changes with luxury buyers — maybe they can and do buy the $20m estate in Beverly Hills, then buy a $10m condo in NYC, and then a $15m villa in Lake Como, Italy.  So it makes sense to treat them as one might treat any luxury buyer of luxury consumer goods.

But if that isn’t the case, and even luxury buyers don’t go dropping $20m plus on a house every other year… then any discussion of CRM has to take this fundamental cycle into account.

That real estate is unique, and the practice of real estate marketing is as a result unique as well, are things I’m learning and relearning every day.  Absolutely non-commoditizable product (real estate) married to hugely commoditized service (brokerage services) with a seven year cycle and independent contractors operating in a significantly regulated industry constitute a truly unique set of factors and challenges for the marketer.

Yes, there are lessons to be learned from other industries.  There are best practices that can and should be adopted.  But adoption requires adaptation to the unique fundamentals of this industry.

Call it a pet peeve, but it sure would be nice if more consultants and speakers and panelists considered not only what is similar between real estate and other industries, but also what is unique and different.

-rsh

Unless you have been living under a rock, you’ve heard of this “social media” thing. But if pressed to define it, you — like the rest of us — would stammer out a few words about Twitter, Facebook, and blogs and then… realize that the term is more or less undefined.

Well, here’s the Wikipedia definition of “social media”:

Social media are primarily Internet- and mobile-based tools for sharing and discussing information. The term most often refers to activities that integrate technology, telecommunications and social interaction, and the construction of words, pictures, videos and audio. This interaction, and the manner in which information is presented, depends on the varied perspectives and “building” of shared meaning among communities, as people share their stories and experiences. (Emphasis mine)

And the entry goes on to note things like World of Warcraft is social media. Okay, then so is internet gambling.

Furthermore, the highlighted portion suggests that email is also social media. So is a fax machine. Or that cutting-edge (for the 19th century) device, the telegraph. They all “integrate technology, telecommunications and social interaction.” In theory, so do messenger pigeons and smoke signals. In other words, “social media” doesn’t actually mean anything.

And yet, it does. The real meaning of “social media” may be difficult to define, but everyone knows what it is — and more importantly, knows what it is not. Stories in the New York Times is not “social media” despite being an activity that integrates technology (the printing press), telecommunications (the Associated Press wire service), and social interaction (the reporters write, the audience reads).

Some might say that “two-way communication” is the essence of social media. This too is wrong. There are blogs that don’t allow comments — yet they are very much “social media”. YouTube is considered “social media” but it’s hard to call what goes on in the comments section to be “two-way communication” in any meaningful way.

The Internet is not “social media” since mobile applications can entirely bypass the Internet and still become social media. Meetups and Tweetups often fall into “social media” categories, but it’s hard to see how people sitting in a room together talking can be conceived of as web-based simply because they arranged to meet via the Web.

So what the hell is “social media” in its essence?

Social Media Defined

My personal definition of social media is this:

Communication channels that enable the authentic and personal engagement of one human being to another.

Admittedly, my definition is heavily influenced by Cluetrain principles. While each and every one of you needs to go read the whole thing (free, online!), this passage from the Introduction speaks most eloquently to how I define social media:

The Internet became a place where people could talk to other people without constraint. Without filters or censorship or official sanction — and perhaps most significantly, without advertising. Another, noncommercial culture began forming across this out-of-the-way collection of computer networks. Long before graphical user interfaces made the scene, the scene was populated by plain old boring ASCII: green phosphor text scrolling up screens at the glacial pace afforded by early modems. So where was the attraction in that?

The attraction was in speech, however mediated. In people talking, however slowly. And mostly, the attraction lay in the kinds of things they were saying. Never in history had so many had the chance to know what so many others were thinking on such a wide range of subjects. Slowly at first, a new kind of conversation was beginning to emerge, but it would achieve global reach with astonishing speed.

For those of us grizzled old dinosaurs who got onto the pre-Netscape Internet, and were absolutely floored upon discovering IRC know the feeling. The strange combination of utter freedom and complete anonymity brought out levels of authenticity in many people — while others invented online personas with a wild variety of roleplaying.

What makes a blog a blog and not an online magazine is the authenticity of the voice, and the personal engagement of the blogger. I’m a big fan of Instapundit, where Prof. Glenn Reynolds holds court on a variety of political, kitchenware, photography, and nanotechnology topics. There are no comments on Instapundit. Yet, it is social media because Prof. Reynolds never fails to speak in his voice. He never fails to be personal.

Another great example is contrasting the National Review Online (an online magazine) with The Corner on National Review Online (a group blog). [So sue me, I read conservative websites. The point is on social media, and these came to mind.] These are two sections of the same website, yet the flavor, the tone, the feel is very different. The NRO proper has articles that have been edited, written to professional standards. What it lacks in personality and authenticity, it makes up with authority and seriousness. The Corner, in contrast, is full of the authentic voices of the bloggers — many of whom are also writers and editors of the National Review — and a personal human engagement exists there that is lacking in NRO itself.

I believe, therefore, that social media is not defined by the tools or the technology, but by the authenticity and the personalness of the engagement.

The Corruption

Trouble is, marketing departments worldwide in every major and minor corporation could not see (and in some cases, have never seen) what the big deal with the Internet was, and what is so important about Cluetrain, and about social media. To far too many marketers, “social media” was just like “any other media”, but “more social” — whatever that means.

The same strategies and the same models for putting ads on magazines were used to put ‘banner ads’ on this newfangled World Wide Web thingamajig back in the late 90′s. When Facebook became the flavor du jour, companies regarded it as just another place to have a branch office. And as Twitter starts to take off, we are finding more and more companies regarding it as something like a streaming billboard:

@XXXXXX You kin’ buy DD coffee online: http://bit.ly/4lwB65 … see drop down menu for whole bean options. Cheers!

That tweet is from @DunkinDonuts. Cheers! Sounds just like a micro-ad! Gee, thanks!

Is this social media? Or it is just a variant of email spam, TV spam, mailbox spam, and billboard spam we have to live with in our commercialized world?

And now, we apparently have a “directory of brands” on Twitter: TrackingTwitter.com. First, the Yellow Pages, then the Web (and Google), and now Twitter. Cheers?

The Fundamental Misconception: Social Media = Media, Social

The fundamental misconception about social media — held mostly by marketers — is due to that word “media”. We understand “media”. Many of us have frikkin graduate degrees in media management, public relations, and communications. We come out of advertising agencies where dealing with various forms of “media” was a settled practice. So we apply those same principles to “social media”.

“Hey, we really need to get a corporate Twitter account!” likely passes for innovative thinking inside many corporations today. “That way, we can really engage the audience with our brand message!”

Trouble is, the audience doesn’t really want some faceless, identity-less brand to ‘engage them’ with their brand message. What the audience really wants is for a human being that works at your brand to engage them in an authentic, personal way.

Once again, Cluetrain:

In the market, language grew. Became bolder, more sophisticated. Leaped and sparked from mind to mind. Incited by curiosity and rapt attention, it took astounding risks that none had ever dared to contemplate, built whole civilizations from the ground up.

Markets are conversations. Trade routes pave the storylines. Across the millennia in between, the human voice is the music we have always listened for, and still best understand.

So what went wrong? From the perspective of corporations, many of which by the twentieth century had become bigger and far more powerful than ancient city-states, nothing went wrong. But things did change.

Commerce is a natural part of human life, but it has become increasingly unnatural over the intervening centuries, incrementally divorcing itself from the people on whom it most depends, whether workers or customers. While this change is in many ways understandable — huge factories took the place of village shops; the marketplace moved from the center of the town and came to depend on far-flung mercantile trade — the result has been to interpose a vast chasm between buyers and sellers.

I don’t want to twitter with @DunkinDonuts. I want to twitter with Amy, who works in marketing or customer service or sales or whatever for Dunkin’ Donuts, and is allowed to communicate openly, honestly, authentically, in a human voice with me.

Social media is not media; it is conversation. Theses 62 to 65 of the 95 Theses of Cluetrain Manifesto read as follows:

62. Markets do not want to talk to flacks and hucksters. They want to participate in the conversations going on behind the corporate firewall.

63. De-cloaking, getting personal: We are those markets. We want to talk to you.

64. We want access to your corporate information, to your plans and strategies, your best thinking, your genuine knowledge. We will not settle for the 4-color brochure, for web sites chock-a-block with eye candy but lacking any substance.

65. We’re also the workers who make your companies go. We want to talk to customers directly in our own voices, not in platitudes written into a script.

I have learned so much more about what the real estate community thinks, what its needs are, its pains and joys, and so on simply by being myself on this blog, on Twitter, and in personal conversations. They are all the same to me. In some cases, individuals who have decision-making authority at clients or prospects for my employer share their issues with me, not because I’m trying to sell them something, but precisely because I’m not. I think I do a better job of marketing Onboard simply by being myself, speaking in an authentic voice, and engaging in a personal way.

Could I really do that hiding behind a @onboard persona? No, not really.

The fundamental misconception about social media is that it is media, just more “social”.

The Beginning of the End

If companies and marketers continue to treat social media as just another variant of media, then it spells the beginning of the end for social media.

What makes Twitter interesting is not that I can get bombarded with offers from Dunkin’ Donuts, but that I can have real conversations with real people thousands of miles away.

Once misguided marketers and brand chieftains start to corrupt Twitter with fake-personas, with brand twittering, and so on, it will become just like blog comment spam. People will begin to retreat further and further into smaller and smaller niches where they can be left alone to have the conversations they are craving.

And companies who do not understand social media as authentic human engagement will lose out on the opportunity to empower their people to converse with those consumers.

There lies the beginning of the end.

Real Estate & Social Media

For whatever reason, social media has been a buzzword in real estate for years. Blogs, blog networks, twitter, Flickr, Facebook, and all these social media tools have been enthusiastically embraced by our industry with varying degrees of success.

The first wave of pioneers — people like Todd Carpenter — did social media as individuals. They blogged, they emailed each other, they linked up, they facebooked, and they twittered and so on. People got to know each other as people, as authentic human beings first and foremost. This early adopter group used (and still uses) social media primarily as a platform for socializing and making connections.

The second wave saw how much fun that first wave was having, and was starting to hear various ideas being floated about how these new communication technologies might be used to drive more business, sell more homes, do more transactions, and the like — and jumped on the bandwagon. Most of these people are also having a blast networking with people, meeting new and interesting folks, and having great conversations… but they’re a little concerned that all this social media stuff isn’t throwing off much cash. Because this group looks at social media as some newfangled innovative way of marketing — predictably, for realtors, that means marketing homes, listings, and themselves.

The third wave either has arrived, or is coming. This is the “professional marketer” brigade, and the future of social media in our industry depends on what happens with this group.

If the numerous newly-minted social media directors, and the VP’s of Marketing who oversee them, overcome the fundamental misconception about social media, then we may be the industry to drive change in how people who work for companies relate to other people who want to buy from those companies. If the social media directors become, in my formulation, “Cluetrain conductors“, then we have a chance to alter the relationship between consumer and service provider in a profound way.

If, on the other hand, the third wave consists of folks who think that Twitter is just another marketing channel, that blogs are just a new way of publishing listing brochures, and that branded corporate identities (which are both opaque, and speaking in that stilted “corporatespeak” we all have learned to detect) online are the answers to the challenge of “social media”… then it’s just a matter of time until these communication technologies also become just another spam-filled cesspool of fakery.

And we all, consumers and professionals alike, will move on to our next fix.

I know which way I’d like things to come out.

Markets are conversations.

Commerce is a natural part of human life.

Markets do not want to talk to flacks and hucksters. They want to participate in the conversations going on behind the corporate firewall.

-rsh