Your weapon is simply the evidence.

I was reading Inman this morning, much like every morning and if you don’t subscribe, you should; and I came across a wonderful article on “How not to lose the commission battle with sellers (and the listing)” written by a truly accomplished professional and the author of “Waging War on Real Estate’s Discounters”, a book I bought and read back in about 2005 or 6 , Bernice Ross; and it spoke to the increasing regularity with which realtors are caving in and reducing their commissions because they’re afraid that the seller will just go with a “discount house” that’s marketing their services with reduced and in some instances, no-commission to the seller. I happen to come from the legal end of things but whether you’re an agent, broker or lawyer representing your client, especially in today’s e-everything world, personal service and demonstrated ability will always effectively separate you from the discount houses or as Bernice calls them, “limited service” companies (love this wording!). You really need to read the article but my take on it is that it’s virtually impossible to compete with the Zillows of the world. And I want to be clear here; the Zillows of the world have their place in real estate. They have their “lane”. The problem is that they have the capital it takes to not have to stay in their lane and to saturate the world with their message and their name thus, spreading it across everyones’ lanes. And when their name get’s big enough to have now entered the real estate lexicon, much the same as “Coke” when you mean cola or “Q-Tips” when you mean cotton swabs, it’s going to be near-impossible to challenge their “You don’t need to pay full commissions.” message. And when that message gets to the point that it’s simply accepted as gospel when it’s anything but, “Zillow says it’s so, so it must be fact.” ?the war is over. Fortunately we’re not there yet. In that article, Bernice is right about many things but most notably, their 15% target market (About 15 percent of all sellers will select their agent based on the?commission?amount. If they could persuade you to represent them for free, they would do so. If you are a full-service agent, these people are not your clients. Don’t waste your time.) That market can’t be your target market. That 15% is only looking for the “easy, e-way out”; the sellers with the “I don’t care, just sell it. I’m too busy to…” attitude or the “I don’t need or want to pay commissions”. These are the same people who buy their cars out of the Carvana vending machines. “With Carvana, there’s no haggling!” What they’re really saying is, “With Carvana, you’ll pay what we tell you to pay and you’ll do it because we say it’s the best deal out there.” You can’t compete with that mentality. Their message is rooted in people’s basic hatred of used car salesmen and “haggling” with them to get the best price. They’re giving you a way out of that uncomfortable situation… but at a very high price. And the Zillows of the world operate in much the same way…but again, at a very high, undisclosed price to the customer. The basic question that no one seems to be asking is that, without representation, how does the seller KNOW they got the best “net” out of the sale? Because Zillow said they did? Did everyone go to real estate school and become experts in property sales when the rest of us weren’t looking? Because if they did, then they’d know what a huge price they’re paying for the convenience of listing with a discount company or as Bernice puts it, a “limited service” company. And they’d also know that the business models of the Zillows of the world are all virtually all the same; and the sales price of the house is almost a footnote in that plan. The bulk of their money is made in everything else that accompanies the sale and anyone who knows real estate knows what a big chunk of money that all adds up to.

So what can you do? And I must tell you, after 36-years of practice, it works in all lanes not just yours. Exactly what Bernice says to do in her article; separate yourself by using your ability to provide personalized service. In short, do the work you’re getting paid to do; work that the discount houses can’t do because it’s not in their business plan. In law, everything is based on evidence. We don’t take anyone’s word for anything. Prove it. Show me the numbers. Show me the evidence. Show me the facts. That’s what a legal case is made up of. Prove to the convening authority that they have no other choice BUT to find in favor of your client because that’s what the evidence requires. Again, after 36-years in practice I can assure you; Do this and you effectively use their own message against them. Know what their message is; “You don’t need to pay full commissions.” Know what it’s rooted in; a hatred of having to deal with the “haggling” over the price of anything, especially cars and houses; Know what it costs the client to do things the “discount” or “limited service” way; and then show it all to your potential clients. Prove to them what it really costs to use a discount house and use the Zillow and Carvana examples I’ve just given you. No one want’s to be a rube or as the Google puts it, “an awkward, unsophisticated bumpkin” who’s afraid to stick up for what’s right. No one wants to be “that” guy or “that” girl; and your potential clients are no different. No one wants to haggle for the best price; it’s not in our nature. We don’t like conflict. We don’t like to fight. So don’t make them. Give them an alternative, just like Carvana and Zillow does. Tell your potential clients that that’s what you’re there for; to fight for them; to be the professional they need. No one wants to be taken advantage of but you have to show your potential clients how they are being taken advantage of and then, as I said, give them an alternative plan, a personal service plan, a Premium Marketing plan as Bernice calls it. Use their own message against them. I’ve said it before but it bears repeating; go read Bernice’s article in Inman, “How not to lose the commission battle with sellers (and the listing)”; the one that ends with, “The fee you earn is based on the business model your company uses.” The Zillows of the world have their business model. What’s yours?