Blanche Evans is a writer/editor and CEO of evansEmedia. Formerly, she was a senior editor with Realty Times, where she was named by REALTOR® Magazine as one of the most influential people in the real estate industry.
Brokers Experiment With No CMAs Left With Sellers
A franchise in Sal Lake City tries to its retrain sales staff to promote the value proposition of their services and that of the company without relying on CMAs.
April 1, 2004
After reading a story that suggested that the CMA be repositioned as a marketing tool, Century 21 broker/owners in Salt Lake City decided to see if leaving CMAs out of listing presentations would really work. While the experiment wasn't formal enough to yield solid statistics, the brokers decided that teaching their salespeople to reposition the CMA in their presentations to sellers was worth the price of the experiment—a few lost listings.
The idea behind the training, which began in August 2003 and continued as an experiment until February 2004, was to train salespeople to develop and promote their marketing plan, the value of the company, and the salesperson’s value proposition—and to emphasize those over the CMA. At first, the brokers asked salespeople not to include CMAs in their listing presentations so they could learn whether or not salespeople are too focused on using the CMA to get sales and whether sellers are too focused on CMAs as hiring tools.
Proving once again that the real estate industry is populated by independent contractors, the experiment met with mixed results. Some salespeople had not been using CMAs all along, others tried to skip the CMAs but found they lost sellers, and others, fearing risking a seller's wrath for not leaving a CMA, didn't even bother to try.
"The more insecure you are, the more heavily you rely on the CMA to sell your services to the seller," explains Steve Fairbanks, broker/owner of Century21 Coventry in Salt Lake City. "It's like turning a ship around—it goes very slowly."
The brokers, spearheaded by Fairbanks, launched the "No Free CMA" experiment with about 120 salespeople spread across six Century 21 offices owned by four separate franchisees. He says he is frustrated over the "way salespeople operate and what we have allowed salespeople to become," says Fairbanks. "We have salespeople who don't make presentations, in the sense that they have a specific regular way in which they offer their services. They shoot from the hip and the CMA is the primary part of the presentation. That's my perception.
“We talk a lot about doing presentations, and if you grab a sales associate and asked for a presentation, most of them couldn't do it,” Fairbanks says. “Some salespeople have one, but most don't. They say things like 'I don't want to sound canned,' but they should be able to at any time to tell you what they do, how they do what services they do, and why you should select them and their office as their representative.”
What do salespeople think the CMA does for them?
"They believe sellers make their decision on the CMA," says Fairbanks. "I've had situations since 1974 where I've seen salespeople bring in the listing and say 'I know it's overpriced, but they told me another salesperson said I can get you this much money, so I had to meet that price to get the listing.' No, that's wrong! It's unreasonable sellers. None of us wants to walk away from a listing. We think, what if that agent could list it and get it? What usually happens? They occasionally do get that price, but generally, the home sits and the salesperson has to get the homeowner to lower the price, or the listing runs out and they give the listing to another salesperson. If a homeowner relists with you after his or her listing has expired, that's a real compliment. But, usually, the sellers end up thinking the salesperson didn't sell the home, but that lowering the price sold the home."
Technically, it's legal to charge for a CMA in Utah, and Fairbanks suggested to his sales staff that they do so but abandoned that plan.
"Our division of real estate has let us know that they frown upon that, and we weren't willing to challenge that," says Fairbanks. "But you need to make a presentation that sells them on you and the company, and failing that, show them the CMA but don' t leave it with them unless they sign the listing agreement."
Dave Sampson, broker/owner of three Century 21 Mcaffee offices, agreed.
“Our company has tried for a long time to get salespeople to sell themselves and the company first and wait to present the CMA until after getting the sale,” Sampson says. “We try to retrain them … and encourage them to take it one step further. Don't discuss price until they agree to list with you, and you don't leave the CMA behind.
"Some salespeople were already doing it that way, but just stepped it up by not presenting the CMA at all in the marketing plan," continues Sampson. "If the seller didn't accept their expertise, or their marketing plan, without the price, we didn't get the listing."
Did the agents feel those were listings they wouldn't have gotten anyway?
"We were competing with other listing companies, and we didn't appear to have the expertise that they had so we lost credibility with the seller," says Sampson. "The salespeople quickly changed their behavior because any lead call you get costs money. So we started doing presentations that included the CMA at the end, but not leaving them, and the results were better."
Philosophically, Sampson adds, "The reasons why lead generation companies exist is because they play on the greed of the owner. 'I want to get the most money out of my house.' Nine times out of 10, an owner who doesn't have a relationship will pick the guy who sets the highest price."
If the goal was to retrain agents to give up their dependence on the CMA, the experiment was a failure. But a lot was still gained. Sampson says that out of 36 sales associates, all tried the no free CMA idea, and half of them were true to it.
"What this experiment required more of my salespeople to fine-tune their marketing presentation and their value package as a person and a company because they didn't start the conversation off with price," says Sampson. "Did all agents follow the rules? No. Did they get better? No. Is it a lost cause? Maybe. But some people came back six months later, and listed with us, because we made it without the CMA, and because the other person didn't fulfill the marketing side of their presentation. … Price isn't everything. What is important is what the plan is and will the salesperson stick to the plan."
(c) Copyright 2004 Realty Times. Reprinted with permission.
Notice: The information on this page may not be current. The archive is a collection of content previously published on one or more NAR web properties. Archive pages are not updated and may no longer be accurate. Users must independently verify the accuracy and currency of the information found here. The National Association of REALTORS® disclaims all liability for any loss or injury resulting from the use of the information or data found on this page.