Live from Austin, Texas’ Moody Theater, Gary Keller was joined by KW head of learning Jay Papasan and Head of industry Jason Abrams for his signature Family Reunion Vision Speech. The Keller Williams co-founder and executive chairman zeroed in on the items currently driving the real estate conversation: technology innovation, consumer data, the continuation and aftermath of COVID-19, and more to the virtual conference’s audience of nearly 50,000.
The Path of Technology Innovation
The trio was quick to assess what it means to be an innovator, as well as its importance in today’s hypercompetitive environment. Simply put, you have to provide unique value – through your own vision – with an operating platform. “If you didn’t build the platform and you’re not sitting on it right now, you’re behind,” Keller says. When he speaks of unique value, Keller means providing a product or service unlike anything else. That’s step one. Once the unique value establishes itself, the product and service follows the path of becoming mutually exclusive, where the customer does not want or need to use anything else.
To illustrate his idea, Keller offers the example of mobile banking. Through mobile banking and the services it offers, such as direct deposit and direct pay, banks have made it easy to retain customers because they are able to address a majority of banking needs in one place. “That’s what mutually exclusive feels like. Either it precludes or it excludes. You decide ‘I only need one.’”
In the last stage, the product or service becomes its own ecosystem, where mutually exclusive value is delivered in a far-reaching, all-inclusive environment. “You’ve gone from being an app or a service to actually being the world you live in,” Keller says. This is where the Googles, Amazons, and Apples of the world come into play – immersive companies with many touchpoints, leaving little room in the market for similar services.
How does technological innovation translate into real estate?
Real Estate: The Three Phases of the Future
The real estate ecosystem can be divided into its own three phases: pre-transaction (search and showings), transaction (contract, mortgage, title, inspection, and insurance), and post-transaction (home maintenance and home improvement). “If you think about the lifecycle from buying and owning, to selling over and over through your lifetime, this is what it is,” Keller says.
Essentially, technology plays the role of pulling out the inefficiencies within each phase and allowing for a more seamless consumer experience, one which consumers demand.
“What we saw last year was a massive acceleration. There’s no denying that the world is moving toward these digital experiences,” shares Keller. “We found really quickly how nice it is to be able to set an appointment on an app or without having to talk to anybody right there on the spot. So, as the world goes there, it’s incumbent on all of us to move in that direction.”
But technological innovation, Keller contends, does not come in a neatly wrapped box. None of the aforementioned examples got to where they are without some trial, error, and complications, and neither did Keller Williams. “It’s messy along the way,” he shares. “But that’s the Keller Williams journey. We’re committed to the messy migration of owning our technology platform.” As it’s one that keeps agents in the driver’s seat, and in control of the cards in real estate, which over time has brought new players to the table vying to innovate via consumer data.
By being an innovator at the intersection of technology and the real estate space, Keller shares, you are entering an unspoken agreement with your users and customers, one that is particularly relevant to today’s times and wider industry conversations: the usage of data. “As a consumer, if you have my data, what I expect is that you’re going to make me smarter or give me a better experience than I had yesterday. That’s the unspoken agreement between you and me and my data,” Keller says.
In this day and age, access to consumer data gives companies unprecedented power. “Never before in history has who you’re in business with been a vote for the future of the industry,” Keller says. Contrary to what some business owners and innovators may believe, not even a strong customer relationship can guarantee a lifetime customer. “The relationship moat won’t work unless you’re providing an experience at least as good as the competitor,” Papasan shares.
“Whoever controls the lead, controls who gets to make the sales and controls the industry,” Keller adds. At the current moment, in real estate, that experience needs to be created around repeat and referral business. “Between 50 and 60% of all transactions are done by repeat or referral,” Keller says. “Technology is coming for that, and the only way to fight back is to make sure your technology is equal to the task. And, if it is, you’re going to be OK.”
Like all things 2020, Keller predicts economic recovery will largely depend on how quickly we gain control of COVID-19, with effectively developed and distributed vaccines paving the way to a new normal. And just what does that new normal look like?
For starters, more people will be reentering the workforce. “We went from less than 4% to almost 15% in a matter of months,” Keller recalls, underscoring how swiftly the pandemic disrupted the economy back in March and April. But, unlike with the Great Recession, which kept unemployment above 6% for years, the current rate seems to be dropping in tandem with the rapidly declining COVID-19 cases. “That’s really important for you to understand,” Keller says, referencing a side-by-side comparison of the Great Recession and the pandemic. “This was caused by a pandemic. This was not caused by some underlying economic problem.”
After outlining the impact of COVID-19 on unemployment, Keller and the other panelists discussed how governments are fiscally tackling the pandemic through economic relief packages. In addition to the $2 trillion CARES Act passed last March, the U.S. government passed a new $900 million stimulus package intended to revive and refund the Paycheck Protection Program (PPP) while providing new stimulus payments and unemployment benefits to individual citizens. These measures, along with the restart of qualitative easing, will likely provide businesses and individuals the relief they need to continue fueling the economy, and therefore, the housing market.
While all signs point to the economy bouncing back as strong as ever, one point causes pause: inventory. Home supply has been trailing demand for several years now, and the construction setbacks spurred by the pandemic did not make things any better in 2020. However, there could be a way around this shortage. As Abrams said, and Keller emphatically agreed, “Your business is your database.” Personal connections are the key to boosting your listings. Those agents who see the people behind the names in their contacts are the ones who will be called upon when a client needs help selling their home. “Real estate agents can become first responders,” Abrams theorizes, swooping in to save their clients losing money on their properties. Whether it’s a homeowner struggling to make payments or a landlord being forced to lower the rent of their tenants, agents can help their clients decide when the time is right to put their property on the market and maximize its value.
In addition to client calls, Keller highlighted the importance of landowner calls. “If you’re a real estate agent, you should be out there talking to a land person and you should be looking for next year’s inventory,” he implores. “The smart real estate agents are going right outside of town or they’re going and looking for where zoning can be changed […] they’re talking to builders, working with developers, getting ready for their inventory because there’s going to be a boom on new construction for the next three to five years.” It was an insightful conclusion to this year’s Vision Speech, and a promising start to another unforgettable Family Reunion.