The foundational crack in our industry
It's not normal, but it's been normalized
Why do you do this work?
You wouldn’t be alone if you answered, “to help people.” It’s the number one answer given when asked why folks like you obtain and maintain a license.
Rob Hahn’s recent Substack article posits that our most recent round of chaos calls for agents to keep first principles at the forefront of their actions.
First Principles and the Real Estate Agent
I have known a lot of real estate brokers and agents over the years. Like any group of people, you have the scumbags and the liars and the jerks; but on the whole, I submit to you that real estate has a high percentage of genuinely good people.
I knew, know, and talk to a number of absolutely top agents. They’re all great not just at real estate, but at business. They became fabulously successful, built giant teams, and make millions of dollars a year. A few of them got into the business because of money; one was your stereotypical suburban mom who wanted to make a little extra money who then found out she was very good at the job.
All of them, every single top agent I know personally, have stayed in the business because helping people gives them joy.
How many top agents have as their fondest memory cashing that first million dollar sale commission check? None. Not one that I know. How many have as their fondest memory something like helping a widow sell her home where she and her husband raised three kids over thirty years? How many talk about the joy from handing the first homeowner in her whole family the keys to her brand new house? All of them. Every top agent I know has some memory, some story of helping another person achieve their American Dream.
When we talk about professionalism, about ethics, about being consumer-focused… the storm of words obscure the first principle. The great real estate agents are great, because they genuinely, in their deepest hearts, love helping other people.
So why do we train, reward, incentivize, and recognize agents on volume?
Because it’s something simple to point to.
Because it’s easy.
It’s also lazy.1
Our mandate places people first. We’re tasked with being fiduciaries, and yet, the internal industry culture canibalizes care & competency for contact-to-close ratios.
No wonder agents feel conflicted and untethered. They’re licensed for one thing and deemed successful for another.
And just so I’m clear - I love making money. I love helping other agents make money. I love other agents who do big volume and make big money.
I’m a capitalist who leans on volume as an internal business metric, but not a marketing tool.
Never a marketing tool.
Why? Because people hate being sold to. YOU hate being sold to. I hate being sold to.
I hate it so much that I’ve placed Nomo-Robo on my phone to block sales calls. I have a “kindly refrain from knocking on the door of my home to sell me something” plaque on my door. I have a standard reply for sales pitches and I even try to avoid walking past girl scouts selling in front of grocery stores.
Herein lies the problem. Volume-based reward systems train transactional thinking.
When the industry norm is to reward based on volume, agent’s begin to believe success = selling. So they sell…
and consumers hate being sold to. It’s not what they want from us and it isn’t what we do. At least it’s not what I do. It’s not what the hundreds of other agents I know do.
We solve. Marketing that solves vs. marketing that sells looks and feels different.2
This volume based brag doesn’t help our industry reputation. It hurts us. It’s one of the reasons consumers think we’re paid too much. Eliminating this humble-brag BS is just one example of how change could benefit us.
So, as we burn down business practices, let’s throw this one onto the fire.
Stop normalizing the idea that your volume is your value. It isn’t.
I know offices that operate against the norm (imagine me falling over like Santa seeing talking m&m’s - they do exist!) They recognize their agent’s on various attributes and achievements. Things other than volume. And not surprisingly, they don’t need to recruit. They actually have to turn agent’s away.
My intense feelings on this topic is because this internal conflict plagued me for years (how I was advised to market vs. what actually helped me build a business I loved.) That said, it’s a part of how IBRE was born, so I guess I should be grateful.
Great perspective! Some of the best firms I’ve ever worked with have never had a top units, top volume or other metric awards. They have always rewarded according to demonstrations of their culture, manifestations of their values and notable examples of their virtues. And they have always been in the top 1-3 of companies in the market on those other metrics, too, without having to ever put them boringly into their marketing.