AREC22: Three key data themes that continue to influence the competitive landscape
AREC 2022 was a whirlwind of perspectives, ideas and vendors providing tools that could help agents and property managers be more competitive and grow their businesses. The rich maelstrom of ideas surfaced three themes that are here to stay from a product perspective.
Data is the new “oil” in RE
Data is the new oil. It’s valuable, but if unrefined it cannot really be used. It has to be changed into gas, plastic, chemicals, etc to create a valuable entity that drives profitable activity; so, must data be broken down, analyzed for it to have value.
– Clive Humby
At AREC 22, we heard ever more clearly that data will start to be a differentiator in how agents compete for buyers and sellers. It has the potential to fuel growth for agencies, reduce the differences between large and small agencies and redraw the battle lines in many markets.
The real estate agent does many things in the course of a day, but one pivotal meeting he has with customers is at the open home. When someone comes to an open home and the agent has good data on their property journey in your CRM they’ve got the upper hand in building that relationship over the next agency. Talking to an investor, renovator, first home buyer, multiple property owner the right way changes the dynamic of the relationship and sets it on the right course.
Data surfaced via the CRM can define who that person is by analysing whether the person has been clicking on Emails, which Emails they clicked on, if they made an enquiry through your site or a portal, if they’ve been searching through your listings and what articles they’ve been reading give clear intent signals about their likelihood to take the next action.
An emerging area of data in AREC 2022 is granular buyer data: going beyond name and if they own a property, and what they are looking for we now have companies who can tell us how much they are actually willing to bid on a specific type of property: buyer data has been significantly enriched by platforms that can track the actual bids for a house so the agent can have a much better understanding of what buyers are willing to spend and have more profitable conversations with owners.
Who owns your customer data?
As data becomes the new oil, one of the most thought-provoking points raised at AREC 22 was Dirk Miller’s talk about data and parallels of the evolution of eCommerce companies who have evolved to owning more of the data giving them increasing leverage in the marketplace. In a parallel of what is happening with Amazon, in the eCommerce world, some major portals in real estate have become store houses of highly valuable buyer data.
Amazon — not the suppliers — have a direct relationship with consumers because they’re the ones selling the products. That means Amazon owns the customer data and knows what sells well on its site — and if needed, it can go make those products themselves at a lower cost, supplanting the larger brand almost immediately. For example, Amazon-branded batteries now outsell the once top-selling Duracell batteries on Amazon.
– from CNBC
Applying a hypothetical lens, AREC attendees posed questions like: what could it mean to the real estate agency if the portals have more data on the buyer and seller propensity in your locality than your agency does? What would happen if portals were able to dictate the terms of how agencies could use this data? This was the type of challenging questions posed in AREC 2022 and discussed late into the night over beers and cocktails.
Data & the end-to-end agency
The third data related theme at the conference was about boosting the total lifetime value (LTV) of the customer for the real estate agency by changing the view of the customer using data. We heard that agencies that are transactional and are unable to understand what stage the customer is in their property journey are leaving money on the table and letting valuable relationships wither on the vine.
While contrast forward-thinking agencies are viewing the customer on a journey and evolve from being renters to renters, investors, buyers and then sellers. The first-time tenant who has just moved out of the family home and becomes a tenant of a property the agency manages should be viewed as the start of a long relationship with the agency, providing steady property management income stream as well as GCI when they become a buyer and seller of their first property. Agencies who play the long game and view the tenant as the start of a long profitable relationship will be the future winners in their markets.
AREC 22 saw CRMs and tenancy platforms looking to evolve to provide ways to assist agencies surface data about their relationships to arm the agent with information that can make even the most inexperienced agent an edge when dealing with customers. With thousands of contacts in the CRM, managing the tenant/buyer/seller through that journey to increase the LTV is humanly impossible and requires workflows and habits best enabled by data that is embedded in the CRM and tenancy platform.
Overall, the conference touched on many points, but I believe these three themes will continue to be present at future ARECs because as they will continue to influence the competitive landscape for agencies for years to come and redraw the battle lines. Agencies who are able to capitalise on these trends will gain market share at the expense of others.
These three key themes at AREC this year certainly align with MRI Software‘s goal to continuously provide comprehensive and flexible solutions.
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