Real estate agents in Australia are facing a new wave of online innovation in which consumers use the internet to rate agents and read the ratings that other consumers have posted. In a sad attempt at a surfing analogy, let’s say that agents can either catch this wave or let it dump them.

A few days ago I attended an event at which Peter Williams, CEO of Deloitte Digital, (photo courtesy of Sydney Morning Herald) spoke to about 250 real estate agents (and me and some other folks from realestate.com.au) about the online trends affecting their industry.*

One of the critical issues Peter talked about is agents’ loss of control over their reputations to consumers online. US real estate blogger Joel Burslem called this “online reputation management” in our interview last week. He thinks it’s one of the most important issues agents face.

But how?
What both men are saying is that the rise of new tools online is giving consumers the ability to (in Joel’s words) “rate, rank and review” agents. Worse: agents might have little or no say in the matter.

To describe these tools using old media terms: It’s like having a single copy of the Yellow Pages (back when people used them) for the entire country. As people look up vendors they also write comments and reviews in the margin. They might say things like “This barber is terrible,” or “This agent was fantastic.”

Before long, the comments written by other consumers become more important than the original ads themselves.

Here’s a real-life example. On HomeThinking in under a minute I found an agent in Los Altos, California. On his profile, I could see that Owen W Halliday “usually sells 2-bedroom homes around $1.25m in value.”

I could see all nine of Owen’s current properties and four of his past sales in list form or on a map. And, I could rank him. (Luckily for him, past rankings have given Owen a positive-looking row of yellow stars next to his name.)

That doesn’t sound too scary, until you read Homethinking’s manifesto, which in its first line starts out with a reference to the “ruthless, sweet-talking and conniving real estate agents, with no regard for their customers” in the movie Glengarry Glen Ross. It then goes on to ask, “As a home seller, would you want any one of them selling the most important asset you own?”

This is what’s already happening in online real estate. The only reason you haven’t heard about it yet is because it has started in other countries before Australia.

However, you can bet good money on betfair.com that this will be coming to the sunburnt country.

[NOTE: realestate.com.au doesn't have any plans to introduce such a service (although the site is giving consumers the ability to comment about their street and neighborhood). However, realestate.com.au General Manager Shaun Di Gregorio says he fully expects someone to do so.]

The agents who have the most to fear from losing control of their reputations are those who provide the worst service. However, even good agents should worry. We all know how emotional people can get about their houses and their money–and agents deal with both. Just one former customer with a vendetta–whether justified or not–could cause many potential new customers to avoid you.

How Agents Can Take Control

Agents can take control of this situation by working with their industry bodies or with online leaders like realestate.com.au (this is my personal opinion, not official doctrine at realestate.com.au) to develop their own ratings site.

Don’t leave it to someone who may be unfriendly to agents, like Homethinking.

Instead, seize the opportunity to do something that consumers clearly like, and to do it in a way that protects good agents in the process. This could involve–for example–giving agents a chance to rebut each negative charge against them, so that no nasty complaint goes unanswered.

The details would have to be worked out, but the mission is clear: the real estate industry should take ownership of the next wave of online innovation to the benefit of agents and consumers.

Relevant Links

–Joel Burslem has some online reputation management tips on his blog here, here and here.
–For a list of some of the sites that rate, rank and review agents in the US, see this post on Transparent Real Estate.
–Read Peter Williams’ July profile in the Sydney Morning Herald.

*Full disclosure: the event was organized by realestate.com.au as a service to agents.

Let’s hear about real estate marketing and the Internet from an overseas perspective.

In particular, I’m thinking of a country where the housing market seems to be in meltdown, there is a fierce political campaign under way and there are some true online real estate innovators in action.

Yes, I’m thinking of the USA.

I’ve interviewed Joel Burslem about all these topics (except the political campaign). Before you read his words of wisdom, there are three things you should know about Joel:

1. He writes the blog the Future of Real Estate Marketing. http://www.futureofrealestatemarketing.com/

2. You’d never know it from talking to him because he’s so modest, but he is a certified expert who is quoted in the Wall St. Journal, BusinessWeek and the International Herald Tribune, among others.

3. Joel also recently got hired by Inman News, the technology and real estate news and conference company in California. He is helping them develop many of their social media and next generation web initiatives. [Full disclosure: I also used to work with Inman News.]

DP: Joel, first of all, thank you for taking the time to talk with the readers of business2.com.au today.

The picture we get of the US housing market on these shores is one of total meltdown. How bad is it really for real estate agents in the US right now?

JB: I would say that it’s probably worse than most agents are letting on. In my position I have the chance to travel around the country and talk to a lot of real estate agents in a lot of different markets.

You hear anecdotally that large volumes of agents are packing it in and leaving the business. A lot aren’t doing any transactions right now and are just trying to weather the storm.

On the other hand, the message that this is a good time to buy is valid, if you have cash and credit so you can qualify for traditional mortgages, especially if you’re in it for the long term.

The consensus that we got out of the Real Estate Connect conference that we ran in New York City in January is that we are about two years into a five-year down-cycle.

DP: How are online strategies helping agents keep themselves afloat?

JB: On the seller’s side, the big trend you are seeing now is the breakdown of the idea that the agent is the guardian of information. That’s traditionally the role they’ve seen themselves in.

Where that is shifting is now that agents are realizing that in an internet-based economy there is no value in holding the information, the value becomes your spin on that info and your professionalism and expertise.

You’re seeing a greater acceptance of the idea of listing syndication. You want to push your listings out as far and as wide as possible on the intranet. Rather than holding it close to your chest, push that listing out.

Q: What’s another thing seller agents can do to improve their online marketing?

There was a blog post Seth Godin wrote last year called “Blow up your home page.” I adapted that to the real estate market.

Your listings pages are your new landing pages. You have to think about the design of your listing pages to provide not only the listing data and photos but to provide consumers what they are looking for. Information and rich data like similar properties, a clear call to action, neighbourhood data—this will keep that potential buyer on your site.

Consumers have become more and more savvy using the internet and demand more information than they used to.

I think of Amazon.com, which recommends things that other people have also bought in addition to the product I’m looking at, and recommends accessories to go with that product. I counsel people in the real estate market to think of their listing pages as a product page. Add as many photos as you can, add all those things that you find on an Amazon site and apply to real estate.

DP: What about video?

JB: Video is a huge thing that is coming down the pike with properties. At the moment it’s limited to the high end but there is a growing realisation that it is easier and cheaper to produce your own video than ever before.

There are a four key pointers. One would be to insert yourself in the frame.

Also, make sure it’s well lit. Go down to Home Depot [the US equivalent of Bunnings] and get some work lights because there’s nothing worse than a dark video.

Keep it short, about two- to three-minutes long. Emphasize the key selling features. You don’t need to tell me how many bedrooms it has, for example, because I can get that from the text. What video allows you to do is emphasize the key selling features. Maybe it’s the great view from the master bedroom, hardwood floors, solid oak cabinets or a great walk in closet.

DP: What if an agent says I don’t want to use video because I want people to come find out what the property looks like?

JB: My argument is that they should think of a search funnel. People starting a home search start at the mouth of the funnel. They start with a city, then narrow it down to a neighborhood, then to a number of properties.

Whatever you do to move people to the next level down is really in your interest. It’s not a volume game or a numbers game in this market, it’s about getting the right buyer.

If I as a buyer have narrowed a search down to three or four properties, and two of those have videos that I’ve watched, by the time I get to those places I already feel like I know them intimately. When I show up it’s really just a matter of sealing the deal. You’ll get buyers who are that much more qualified.

Do you really want to have 20 people parading through the home, of which 18 are just a waste of time? Or do you just want that one guy who has already watched the web video and is just looking for affirmation that this is the right place for him, that guy who walks in and says “Great, let’s put an offer together.”

DP: I read about the [Help] campaign on your website. Would you tell us more about that? Is it a model that agents and online folks in other countries can use to raise cash for good causes?

I think so. The [Help] campaign is helping the tornado victims from last week in the South of the US. It is evidence of a growing interconnectedness of agents online, which is primarily a result of more and more agents starting to blog and getting involved in online communities. There have been a couple of examples here in which the community has self-organized.

Links recommended by Joel:

• Listing Landing Pages
• Real Estate Video
• Online Reputation Management
• The need for a cohesive identity strategy