Online Education Grows Alongside Online Real Estate Services
When was the last time you saw a commercial for an online, for-profit institution? This morning? Right now? The University of Phoenix alone has over 300,000 students, and is the only university whose stadium hosts a NFL team. It might seem that online education is taking over the industry.
After all, when was the last time you saw a commercial for an Ivy League School like Yale or Harvard? Never? Maybe you saw an ad for your state’s flagship university a few times during their last football game. Does that discrepancy suggest these institutions are failing?
Of course not. All that the difference in airtime shows is the power of reputation and repeat business. A top university has a powerful network of alumni and a reputation of success to bring in more business than it can handle, both from new applicants and repeat business from legacy applicants. So why bother with ubiquitous television ads?
There’s little risk of prominent brick-and-mortar institutions becoming obsolete. Future students know they can get something they can’t get anywhere else. For the same reason, there’s no reason that brick-and-mortar real estate brokerages should become obsolete, either, so long as they offer services that online tools cannot.
What Challenges Do Online Services Pose to Brokerages?
Brokerages, nevertheless, have lately been at the center of doubt among real estate industry pundits. Newspapers, blogs, and magazines nationwide have lately questioned their value. In a column published this summer, Forbe’s contributor Ben Kasanoff writes that 95% of a real estate broker’s responsibilities could be better handled by well-designed online systems.
He’s not altogether wrong: Some of a broker’s traditional responsibilities are handled by well-designed online systems. Consider what June Fletcher wrote in a column titled “The Gofer Broker” for the Wall Street Journal:
“In the past, agents controlled what houses buyers saw and provided data to sellers about local markets. Now, sellers can advertise their homes online and buyers can do their own research, without a middleman”
It’s not exactly shocking stuff. But consider that Fletcher wrote those words in October, 2007, and the reality sets in: Zillow is publicly traded with a $4.2 billion valuation. Trulia is now one of the the 100 most visited sites in America. And then Zillow went and bought Trulia. Meanwhile, startups like Flipt, Realscout, and Placeter continue to attract millions in funding from venture capitalists. The internet has permanently changed the way a brokerage does business.
So What Can Agents Learn from Education?
The internet has changed the way educational institutions do business, too. Even prestigious universities such as the University of Southern California and Harvard offer online degree programs. Online high schools exist as well. But no one claims Harvard will soon have to close down its campus as students move online. (In fact, the campus is expanding across the Charles, near OwnerAide headquarters.) So why do they make such a claim about brokerages?
The reason is a simple matter of understanding: Any former student knows that a good teacher is more than a delivery system for content. An impersonal lecture, after all, can be delivered through any medium—many online courses include a prerecorded video. But the memorable and effective teacher finds a way to reach every student in a unique and meaningful way. And that individualized relationship is more than just manners in the classroom. It inspires, energizes, and shapes the way a student learns.
Successful brokers do the same thing. They offer individualized preparation, nuanced feedback, and personalized content that cannot be accessed through a URL. But that value is more difficult to measure. Most people remember a favorite teacher, but a favorite real estate broker? Perhaps not.
Brokers need to assert and adapt in the same way that educators have: By embracing technology where it better allows them serve their clients, and by expanding and improving upon that service when technology frees them to do so. Myriad web services, platforms, and databases empower both teachers and brokers to create stronger, longer-lasting relationships than ever before. Brokers must use these tools to provide individualized metrics and analysis, offer unique buying and showing opportunities on a per-client basis, and get to know each client—and so better anticipate and respond to his needs— better than ever before. Instead of looking through listings the client has already seen online, take them to lunch.
Consider the calculator: It saves both the teacher and the student time so that they can focus not on the calculation itself, but the structure and relationship of variables that need to be calculated. Web tools can be just as valuable: If home sale data is easily accessible on a website, the broker can focus not on counting and sharing numbers but on forming the relationships and variables that make those numbers possible, and by supplementing available data with additional information and insight.
In the coming weeks, I’ll review in more detail a few contemporary educational paradigms, such as differentiation, backwards design, flipped classrooms, and more, and explain how the principles therein can be applied to real estate. The two industries are facing a common challenge. The adaptations are common as well.