Sherry Chris explained how brokers can diversify revenue streams and navigate agent preferences in an increasingly virtual world during an Inman Connect Now session on Tuesday.
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Equipping your team members with the best technology means nothing if they aren’t using it.
After making sure the team is embracing the technology the brokers have invested in, now is a good time to consider diversifying revenue streams.
These were the key messages of Sherry ChrisPresident and CEO of Realogy Expansion Brands during her discussion of the top pressure points and opportunities facing brokerages in 2022.
Chris said brokers big and small need to equip their teams with the best technology possible, but also ensure it’s adopted and used by agents.
“The technology element is important, but more importantly, what are your adoption rates like?” she asked. “It doesn’t have to be 100 tools, but the tools that agents will use and use effectively.”
Chris spoke with Kendall Bonnerbroker-owner of RE/MAX Capital Realty during a Connect Now virtual session on Tuesday.
In addition to highlighting the importance of embracing technology above all else, Chris discussed how brokerages of all sizes can pave the way for “extreme growth and profitability” and the steps they should take to staying nimble in a post-COVID world.
Diversify sources of income
It’s a good time to reinvest profits back into your business, Chris said. One way to do this is to invest in ancillary services to diversify sources of income.
This could include bringing in broker-generated leads, or providing mortgage and title income and even relocation, Chris said. This would protect brokerages from market downturns while making them more valuable in the long run.
“It creates a more valuable business overall,” she said. “If there comes a time when you want to sell, your business is valuable because you have diversified your sources of income.”
This applies to brokers of all sizes who may rely on any mortgage and title partnerships or marketing relationships they may create. They will first have to take calculated risk for what she said is “tremendous upside potential” in diversification.
“A business that survives solely on gross commission income is a business that has growth opportunities,” she said, “but not the potential for extreme growth and profitability.”
Maintain “deep” relationships
In an increasingly virtual world amid a pandemic and the growing power of technology, Chris stressed the importance of maintaining relationships between all parties.
This applies to the relationships of brokers with their agents, but also of agents with their clients.
“Brokers, be sure to surround your agents well, get to know them, and be aware of some of the personal challenges they may face and business challenges,” Chris said.
“Agents, wrap your arms around the end consumer,” she added. “We’re all feeling a little lonely right now, and consumers are in the same boat as well.”
Clients can find properties online using any number of tools at their disposal, but it’s the ‘deep’ relationship between agent and client that will close deals and clients will cross the line. ‘arrival.
All virtual or brick and mortar? Why not the two of them?
Regarding the debate over the need for office space in an increasingly digital world, Chris suggested a third hybrid approach that matches the corporate culture that brokers want to facilitate.
“You have to look at what your company makeup is, what your culture is,” she said. “Don’t worry about whether you should close offices or open up large spaces.”
Chris cited examples of brokerages opening new offices but with shared space rather than dedicated overhead for individual agents.
When opening a new space, she suggested hiring agents first before opening a physical office.
“You meet groups of agents and say, ‘There’s a prototype, that’s what we’re doing, you’ll be the first, can I get a commitment from you?’ said Chris. “By the time you open the office, you have a core group of say 20, 30, 40 agents who are ready to go.”
Email Taylor Anderson