IN PART TWO OF OUR EXCLUSIVE interview, John talks about the success of the McGrath business in the last 12 months. He takes a stand on community, culture, property marketing and where agents should be focusing their energy for the next year.
McGrath as a business has had a very strong 2014, with a strong focus on culture. Can you tell me a bit about that, and why that’s important to you?
We focus primarily on two things – values and skills. Some agencies don’t focus on either; some focus on one or the other. We’re very fixed on values. Integrity is non-negotiable. If you step outside, you’re swimming outside the flags and we don’t want to have you on the team. We really walk our talk here. If someone doesn’t live up to our expectations, we show them the door. We push for excellence: better marketing, better open for inspections, better auctions. Everything that we do, all the key touch points in our business, we’re pushing hard on a daily basis.
Coaching, training and development are all really important. Not only are we doing a lot of workshop training in groups, but we do an enormous amount of one-on-one personal development with each individual. The numbers at the other end, be it two billion or whatever you do as a business in a good month, are a manifestation of lots of good people doing lots of good work on a daily and hourly basis. We’ve got product teams who are working on our innovations and the kind of products we’re representing, making sure its the best photography we can do, the best floor plans. We’ve got a quality control team that’s ensuring that everything we’re putting out into the marketplace is as good as it can possibly be.
What is your focus for the next twelve months?
Digital is one of the big focuses for us, as it should be for all agents right now. We’re launching a new website; working with REA and Domain, we’re focused on how we can have our clients featured as prominently as we possibly can. That’s a very big part of our future.
Looking at the next one to three years. we’re also hoping to become more familiar, and hopefully more successful, in the social space. We’re up to about 50,000 Facebook likes. We’re really focused on building a customer base that likes to keep in touch with us via social platforms. We have Twitter, Pinterest, Instagram and Facebook.
While we see social media as a terrific way to keep in touch with our customers; those who want to hear what we’re doing and read about the latest activities, we don’t use the social channel as a sales tool but more as as an information and education tool.
Community is always on our radar as very important; not just the environment, but what could we be doing as good corporate citizens? We’re now in 60-odd regions around Australia, so two to three hundred communities. Who could we help? It’s not just about writing a cheque to sponsor a soccer team. It’s about what else can we be doing, within the community? We’re very fortunate: the communities support us, but you have to give back to keep that cycle going.
Let’s talk about digital marketing and the portals. What advertising strategies should agents be using in the market today?
We have a philosophy of ‘less is more’ as far as the portals are concerned. We try and focus on the activities, the partnerships and the channels that give us the best return. If you try to do too many things with too many people you end up getting distracted, so we’ve placed our bet very firmly on REA and also Domain. I’m on the board of REA so I know that they are absolutely focused on providing the most traffic, the most eyeballs, the most visitations and the best quality technology experience for REA’s customers. Domain is still a very important channel for us in a lot of our markets, especially in Sydney’s eastern suburbs, and North Shore, and parts of the inner west.
It could be that as many as 98 per cent of listings are now online, are either on REA or Domain. We educate and encourage our client base of vendors that investing one, two, three, four thousand, depending on the area you’re in, to be at the top of REA and Domain is vital; just like in the old days when, unless you were a full page in the Wentworth Courier, you probably weren’t serious. You’re probably still going to be a full page in the Wentworth Courier; but you’ve also got to be a premier or a highlight property on the two major portals.
As a vendor, you sell a house every ten years. You’ve got to bite the bullet and invest what you have to invest to make sure every potential buyer around the world looks at your property. Our job as agents is to steer them the best way we possibly can.
There are lots of other smaller players in this space now; and one of the great things about our lives is technology, and social media and connectivity. One of the greatest distractions, and therefore detractors, of our life is also connectivity, social, media and technology. If you don’t put some very firm boundaries up, work out who you are as a business and what you want to support and believe in, I think you’re going to end up being distracted, diluted and confused. Let’s focus on the vital few, rather than trying to keep pace with every single option in the marketplace.
Apple is one of the great businesses in my lifetime to have emerged and triumphed in the world of commerce. One of their great skills is innovation, but a greater skill is discipline and focus. A lot of people think of Apple and say, ‘Oh yeah, they’re very innovative and a great customer experience’, which is true. But if you dig deep into Apple, their greatest skill, above everything, is being incredibly laser-focused on the few things that make the greatest difference.
As a vendor, you’ve got to accept that if you’re going to sell your property this is not the time to be nickel-and-diming, and trying to get the marketing cost down as low as possible. You should be saying to the agent, ‘Is there anything else I need to invest in? Any other publication, you think?’ One extra buyer could make you $20,000 or even $50,000. It’s an interesting time, because the agents who really understand marketing and can sell it well, and educate their clients about the real benefits to them, are going to get the better result. They’re going to get more sales. Agents who are not comfortable with selling marketing need to review their selling strategy and realise that marketing is, now, a core skill, and a core part of selling.
Is there is a role to play for print, moving forward?
Certainly, for the time being, the answer is yes. Some vendors say to us they don’t want to be in print, especially the younger ones. It seems that you get a lot more interest if you’re in both than if you’re just in one. If you’re only going to be in one, it should be digital. If you’ve got the money to invest to be in both, my recommendation to every client is to be in both. They say, ‘John, you have 75 per cent of your inquiries coming from digital.’ I say, ‘I know, but 25 per cent are coming from somewhere else. That can mean a lot of money for you. It could be someone who’s not online. They’re not actually even looking. They pick up the Wentworth Courier, or Inner West Courier, from their local newsagent or from their door, start flicking through it, and find their new home.’
What would you say to agents who feel as though the future is a place where they may be cut out of the transaction by the portals?
Oh, stop worrying about it – I’d be far more worried about my service levels! I think the portals have no desire to be real estate agents and the transaction will not happen without the personal involvement of agents. Vendors need good advice. There’s plenty of information online about medicine, and law, and accounting, but people still go to doctors, lawyers and accountants, because they want to speak to an expert who can talk them through the options and help them decide. They just do plenty of research online. That’s a fantastic thing.
We’re finding that clients who are coming to us nowadays are better educated than ever before, both buyers and sellers. I’m not losing any sleep about the role we play, because I think that role will always be an important one. Properties don’t show themselves. Properties don’t negotiate themselves. Vendors don’t really want to try to negotiate. They’re not expert negotiators. People need to be told about styling, and how they should best present, and what the buyers are looking for. People need to understand the right pricing. If you go to market at the wrong pricing, you can burn all your potential interest in the first four weeks.
I believe you still need, on top of all the great information available online, an expert to help you diagnose the situation and give you daily advice. All this chatter about real estate agents being made redundant – the ones who are going to be made redundant are those who are not connected, because they’re not utilising databases, they’re not giving great service, they’re not accessible, they’re not providing enough information in real time. That’s nothing to do with the internet cutting them out. It’s going to be due to their inability to change. I say to people, ‘Don’t worry about the internet. It’s not going to take your job away. What is more likely to take your job away is failing to reinvent yourself elsewhere in your business.’