Ok, so we got back from Vegas and were a little swamped with follow-up, clean-up, thanksgiving, rest, football, etc. This post is a long time coming and we know it.

The questions we had on our mind the whole time…”Was sponsoring the NAR convention going to be worth it?” It’s hard to say yes to that, but we met plenty of new people and potential clients at the convention. The only problem I had was telling the “potential partners” that we were too busy to talk them. You should see my stack of Biz Dev cards vs. my stack of Realtor cards. Ughh! At least our buttons were a hit.

Anyways, overall we had a good time meeting everyone who participated in the GeekEstate blogger panel and were overwhelmed with the response to our product from many who stopped by the booth. What we found out was that many people knew about us, but weren’t familiar with everything we do or our systems. I admit it’s kind of difficult to communicate everything we do for Realtors…but basically it’s everything they need online. Websites, leads, blogs, SEM, SEO, contact management, reputation management, etc, etc., etc.

Here are a few photos from the convention.

It’s been rather interesting around Incredible Agent lately. Between getting ready for our giant booth at NAR, launching new features every week on our platform and trying to help our clients survive the current real estate market, we’ve been awfully busy.

One of the things we’ve been running into lately is defining the difference between our product and Point2, Superlative, Z57, Advanced Access, Homes.com, etc., etc. etc. For us it’s very simple, but we’re starting to realize the challenge ahead of us for defining the difference. Here’s my quick shot at it.

We’re creating a network of real estate brokers and agents to collaborate and create an open enterprise platform for themselves and their companies. The other companies products are simply real estate websites.

Example: MS DOS/Windows is a platform (Incredible Agent), Outlook is a product running on a platform (all the others).

Our philosophy is rooted in the fact that real estate 1.0 was all about competiting against one another and that real estate 2.0 will be rooted in collaboration.

There has been lots of talk lately about the direction of RE 2.0 and where it will take all of us. At Incredible Agent, we believe collaboration will be the name of the game. Collaborating together to build better products for brokerages and agents. Collaborating together to create a product better than Trulia, Zillow, Realtor.com, etc. After all, collaboration is what Active Rain, Facebook, Youtube, Trip Advisor, IncredibleAgents.com and all the other successful User Generated Content(UGC) sites out there are built on.

User generated content is an overused term with little clarity. Some seem to implement UGC just to show off that they’re a Web 2.0 company. Yawn! RE 2.0 has nothing to do with Questions and Answers. It has everything to do with collaboration. Collaborating to solve problems and find great solutions.

Incredible Agent is building a team of brokerages and agents who have come together to build a better solution for their companies, themselves and their clients.

We’re not building websites! We’re building a platform!

That’s why we don’t sell websites, we sell memberships.

Side Note: The term “Platform” is becoming a buzz word lately around the RE space. Remember, a platform is something that can grow as the users build onto it. A simple website with a few tools is not a platform.

I’ve always been a big fan of the stories from the old days. Usually the ones that stick around long enough have great lessons to be learned in them. Everything from stories in the Bible to basic Aesop fables. One of my favorites, that I admittedly don’t always remember, is the story of the Grasshoppers and the Ants. You know, the one where the grasshoppers party all summer and the ants work all summer storing their food for winter. Guess who makes it thru winter?

Well I can’t help but think this story applies to today’s current real estate market more than ever. We’re officially in the heart of one of the coldest winters in real estate. We all knew the market couldn’t continue to grow at the rate it was growing in 2005. Yet so many Realtors forgot the lessons we’ve all been taught and bought luxury cars, second homes, furniture, investment properties, etc. Thinking the money would always be coming in. Those days of easy money are now over and bills seems to be holding many agents from being able to invest in their success coming out of the downturn.

Let’s not forget these days/months/years of struggle that we’re going thru right now. Let’s bookmark this era in real estate so we can take these lessons and teach them to the future of real estate.

There’s a reason those stories have been around for so long. Let’s keep them around until we all learn the lessons from them.

Now that everyone has digested the incredible amount of information presented in three short days at the Inman conference, many are asking “now what?” I love this particular conference because it brings together the best minds in technology, most of whom are fairly candid….ok some are maybe too candid. Outside of the tech leaders, there is a smattering of brokers mixed with an even smaller number of agents (using your fingers and toes to count would suffice).

When I first attended the conference last year I wondered why more agents did not attend. Then, toward the end of this years conference when I was in dire need of a defrag on my brain (or a cocktail), it hit me. How would most agents respond if they were sitting in the room hearing about all of these new technologies? Aside from a few tech savvy agents, I would bet the farm that a huge majority would feel the sudden urge to sprint from the room and order a double on the rocks pronto.

As I see it, the problem isn’t necessarily with the new technologies. A lot of them are intriguing, and some may actually get a house or two sold. Agents are typically solo or members of small teams, however, so implementing just a fraction of the new technologies would mean a steady diet of espresso and 20 hour work days. Very few of these new technologies work together and therefore force agents to learn and use multiple systems, measure their individual effectiveness, pay for them separately, and so on. It seriously brings into question whether or not a majority of today’s agents have a big enough appetite to consume everything that they are being fed. This leads me to ask the following questions:

1) What is the best way for individual agents to use the technologies instead of getting run over by them?

2) Should brokers be doing more to assist their agents with technology?

3) What other organizations (think Realtor associations) should be doing more to assist agents with technology?

I’m typically not an apologist for agents who do not effectively use technology to their advantage, but I must admit that the landscape looks pretty intimidating from where I’m sitting.

Ok, this years Connect conference was awfully busy for us at Incredible Agent. There was plenty to do and lots of people to meet and catch up with.

As always, there are lots of take aways from Connect. Here are a few things we learned this year…
1. BS is marketing 1.0
2. User Generated Content(UGC) is marketing 2.0
3. Your online reputation will replace your resume.
4. Web 2.0 started on some island in the South Pacific in 1917. (Kula! Kula! Kula!)
5. Blogging is getting bigger. Much Bigger!
6. Being a Geek is cooler than it was in High School. (www.GeekEstateBlog.com)
7. There are lots of features being created and not many businesses.
8. Everyone is a competitor and some are friendlier than others.
9. Business is still about people and face to face introductions.
10. There are plenty of small ideas, but very few big ones.
11. Our industry is panicked with excitement.

Overall, it was a very good conference. Last year, there were some companies in the audience that were under the radar who showed up big at this conference. It makes me wonder which companies were under the radar this year and will be big next year. Hmmm??? We’ll have to wait and see.

I dug into my closet the other day and found my trusty magic 8 ball from when I was in high school. I asked it a few potent questions about the future of the real estate industry over the next year and thought I would post the responses here. Feel free to weigh in on some of the questions or just want me to ask some new ones. I’m sure I’m missing a few great questions. By no means is this scientific…but the magic 8 ball is all powerful, so keep an eye out for some of the predictions.

Q: Will Zillow and Trulia be direct competitors fighting for advertising dollars?
A: Signs point to yes.

Q: Will Realtors find it more important to post their homes to their website than it will be to post it to the MLS?
A: Outlook Good

Q: Will the real estate lead industry change dramatically?
A: Reply Hazy, Try Again

Q: Do you think comments and ratings on home listings will become commonplace?
A: Ask again later

Q: Will Realtors lose potential clients if they do not have maps and cool web 2.0 tools on their website? (Being cool is hip)
A: It is certain

Q: Is the IDX going into the twilight years of it’s life?
A: You may rely on it

Q: Will there be massive consolidation in the Real Estate industry?
A: Outlook Good

Q: Will the beginning of a National MLS be released?
A: It is certain

Q: Do you think Video home tours will begin to replace the virtual tour?
A: Yes, Definitely

Q: Will Realtors spend more time on their computer than in their car?
A: Most Likely

Q: Will more Realtors start to recognize the importance of real estate agent reviews.
A: It is certain

Q: Will brokerages?
A: Outlook Good

Q: Do you think many Web 2.0 companies will fall just like the Web 1.0 companies did previously?
A: Concentrate and ask again (so, I did)
A2: Better not tell you now (Dang!)

Q: Will every Realtor at least know what a blog is?
A: Don’t count on it

Q: Will the real estate market bounce back?
A: Ask again later

As you probably already know, we have a real estate agent review website that gets a fair amount of traffic and a fair amount of reviews left by consumers (Incredible Real Estate Agents). This topic has stirred a lot of controversy and we are a part of it everyday. Many agents want to be taken off the site and don’t want to be reviewed at all. Many complain about the reviews that were left on their profile. Some actually threaten lawsuits and so far we have 1 death threat. Needless to say it’s a very hot topic.

At Incredible Agent we’re about helping agents become INCREDIBLE by using the power of the Internet to capture leads and ultimately sell more homes. One of the key components of this process is re-enforcing your marketing materials with “Third Party Credibility”. We don’t believe reviews are meant to be open complaint sessions for clients to critique their real estate agent. Sure, that can certainly be done, however we believe agents should be utilizing their positive client testimonials to gain even more clients. Agents can view this as a huge liability or they can view it as a huge asset. It’s up to them to decide how to use this.

I have an agent that I’ve been working with for years who hangs all his client testimonials up in his office. Every letter is framed and signed from the client. When working with relocation clients he literally mails them a booklet of the same testimonial letters that he has collected over the years he’s been in business. If you’re looking to nail down a potential clients committment, I assure you this is a great tactic.

Agents have used this same kind of tactic for years. We all know that one of the best ways to gain a client is to be referred by another client. That “Third Party Credibility” is very powerful in all types of sales. Word of mouth travels fast and we all need to embrace it to be successful. Just think how popular Myspace.com would have been if other people weren’t referred to it by their friends. It’s all about creating “Third Party Credibility” and that’s where Real Estate Agent reviews become highly useful.

The only difference between testimonials and reviews is that people can leave negative comments along side the positive comments. The fear of a few negative comments causes so many agents to freak out. The truth is that most comments are positive comments. Especially if the agents send their happy clients to their profile to leave a positive comment. There’s nothing wrong with pushing your clients to your profile for a few reviews.

Many agents understand this point, many don’t. However the agents who take advantage of and manage their online presence will be far ahead of the agents who don’t.

So my question to you is…”Are you for or against real estate agent reviews and why do you feel the way you do?” I’d love to hear some feedback on this issue as it is a daily topic around the Incredible Agent office.

BTW: Sorry for the delay in my posts. Just a little busy being Incredible elsewhere.

Would you rather buy a house or a website? This is a question I’ve often asked myself. I personally believe a website is very similar to an investment property. For several years I’ve been comparing those two items and have found websites to be a far better investment than a home could ever be.

It all comes down to traffic and value: real or virtual. If you have 100,000 visitors a month to a website and you’re well ranked in Google, Yahoo and MSN; why is that any different than having a rental property that has a few hundred a month in cash flow for you. From a business perspective, I see the two items completely identical. There are only a few differences that I can find; 1. A house is not going away anytime soon and will go up in value over time with guaranteed certainty. 2. I don’t get to depreciate my websites like I do with real estate. 3. A website is a small investment compared to a rental property. 4. I don’t have to fix the toilet in the middle of the night with a website. 5. I own 100% of a website.

I want to give you a quick example of what I’m talking about. My first real estate website: Arizona Real Estate Guide (MovingtoAZ.com)
This site was built in 2001 to generate real estate leads for the Phoenix market. It’s only gone thru 1 redesign in the early days and it has been very successful in the search engines. It has been on the first page of Google for “Arizona Real Estate” for over 4 years. That website has generated well over 25,000 real estate leads and millions of dollars in real estate commissions since it’s launch. Not bad for a website that cost me nothing other than my time to build it and get it ranked in the search engines. I admit that it’s not a fancy site for today’s standards, but it gets the job done and that’s all that matters.

Now, if I would have bought an average 3 bed, 2 bath home in Phoenix at the same time I built that website, I would have probably paid around $150,000 or $900/month after the down payment. If I rented the home I would have rented it for around $1000/month, making me a whopping $100 each month in cash flow. Nothing to call home about, the real gain is made with appreciation. If I sold that home today, I would probably sell it for around $275 to $300k. That’s a profit of around $150,000; which would be great over a 5 year period. Not a bad investment at all if you’re able to keep renters in the property 95% of the time.

I don’t dispute the benefits of investment properties, I just don’t believe they are for me. Buying an investment property is like having a baby, you usually have to get qualified for the loan, put down a bunch of money, manage the property, take a significant financial risk, deal with renters, etc, etc. All for a unknown amount of money at the end and virtually little cash flow during the whole process. On the other hand, I can build a website for pennies on the dollar, get it ranked in the search engines, build traffic, develop a financial model and begin making thousands every month with comparatively fewer costs and a heck of a lot less risk. In the end, I can turn around and sell that website to the highest bidder and not have to pay a penny to the bank when I sell it. 100% ownership is the road to happiness.

My frustration:
When I talk to any of the accountants I deal with they like to talk about assets and liabilities. At this point, I usually go into a rant about how Yahoo.com is a website and it makes billions and is therefore worth billions and yet somehow my websites aren’t considered assets even though they make millions in real estate commissions every year. I get the impression they would be much happier about my asset situation if I had a rental property with a few hundred a month in cash flow and a $100k in equity. Trying to get an accountant to understand this basic business principle is like teaching a pig to sing. It wastes your time and just annoys the pig.

When are we all going to realize that websites are assets just as much as any house, office building, land, retail space or business that’s out there? Why is it any different because its on the Internet?

For all you bean counters out there here are a few key definitions:
Assets = Any item of economic value owned by an individual or corporation, especially that which could be converted to cash. (A good website)
Liabilities = A liability is a financial obligation, debt, claim, or potential loss. (A bad website)

Enough beating up on the accountants. I simply believe a website with monetized traffic is a far better investment than any property I could ever own. Just because I don’t have to call a plumber in the middle of the night to fix the toilet, doesn’t make it any less of an asset. In fact, it makes it that much better.

As an agent, following this principle has made me far more successful than ever buying that one house back in 2001. I now have over 170 different real estate lead generating websites throughout the country like the Arizona Real Estate Guide. All generating leads and commissions on a daily basis for other agents in those markets. I could have never done that if I would have bought a house instead of building a website.

Put this to use in your own real estate business. If you buy a house, will it generate the monthly revenue you need to survive? If you have a website that generates leads for you every day, will you turn those leads into commissions? Which one is going to make you the money you need to survive and grow your business? It’s a no-brainer for me, you simply need to decide for yourself.

I’ve often thought about the value of real estate traffic vs. other types of traffic. When you really get down to thinking about it, an Internet home shopper is far more valuable than say…someone looking for socks online. If you look at what an Internet sock shopper spends compared to an Internet Home shopper, we’re talking about two very different price points. A home shopper is looking to spend anywhere around $100,000 to $5,000,000 or more for their home. A sock shopper is typically looking to spend around $10.00 for a package of socks. Home shoppers are looking to spend hundreds of thousands or even millions of dollars for their next home, yet many Internet advertisers aren’t willing to pony up to reach those home shoppers.

You could easily make the argument that the Internet home shopper is the most valuable visitor on the Internet. Not only are they looking to spend hundreds of thousands on a home…they also need a loan, title insurance, home insurance, a home warranty, movers, furniture, home services, etc. I don’t have the source or stats for this, but a certain percentage of home buyers buy a new car within 6 months of buyer a home. When you really look at everything a home shopper will be purchasing along with their home, it makes you wonder why other companies aren’t willing to spend the coin to get in front of these consumers.

When looking at it like this, you have to ask yourself “Where are the advertisers”? The demand is growing, but it’s nowhere near where you would expect it to be. Currently, we see hundreds of millions of real estate ad impressions going to waste on Google Adwords syndication every month. Yes, real estate websites are making money with Adwords, but nothing that matches the true value of the real estate consumer or the cost to obtain that consumer. Besides the consumer doesn’t get too much out of Adwords campaigns, the click thru rates are horrible and they just clutter your website with useless text.

Advertisers reluctance for paying a realistic CPM is the reason I have never sold ads on any of my websites. I’m beginning to think about it with the launch of our new website www.HomeHugg.com and the popularity of our agent review site www.IncredibleAgents.com, but I certainly would prefer a different business model due to the lack of demand for reaching the home shoppers.

I’ve often questioned the legitamacy of the Internet advertising business model. We receive millions of home shoppers every year to our network of real estate websites and I’ve always resisted placing ads on those sites. I know there are plenty of successful sites that do well with the advertising model, it just seems as though it’s at the bottom of the business model food chain. Can there be a business model less creative than the Internet advertising model? It just plain stinks right now.

Overall, there isn’t a more valuable visitor than an Internet Home Shopper. In time advertisers will eventually figure this out and start paying the true value of reaching them. After all, it’s not like they’re buying socks.

The guys over at Sellsius, just wrote a great blog analyzing the difference between Internet Buyers and Traditional Buyers based on the 2006 California Association of Realtors study. It’s a good summary on why the Internet buyer beats the Tradtional buyer everytime.

http://blog.sellsiusrealestate.com/statistics/why-the-internet-buyer-is-the-preferred-client/2007/02/21/

This is good stuff that I highly recommend reading if you’re looking for a reason to jump on the Internet and start finding those Internet buyers.