GMAC Real Estate: A Culture of Partnership When the word “paradox” was invented, whoever thought it up had in mind precisely the kind of paradox currently staring the real estate industry in its face.
The real estate industry—and the many talented and dedicated professionals who
make it the wonderful business it truly is—has enjoyed some of the most prosperous times in its history these past few years. Yet, herein lies the paradox—it is becoming harder than ever for brokers not only to grow and thrive, but to survive.
“It’s a topic you won’t hear most people in the industry bring up,
but in the next three to four years, 30 percent to 40 percent of brokers in business today will probably not
be in business,” says John Bearden, president and CEO of GMAC Home Services.
This bitter pill of a fact is top of mind for GMAC Home Services. As the operator of one of the nation’s largest franchisors, as well as the owner of one of the largest real estate brokerage and home services firms, Bearden says, “We make it our business to stay abreast of the trends in our industry…the good ones along with the not-so-good ones.” GMAC Home Services also owns and operates two other industry-leading business units: GMAC Global Relocation Services and GHS Mortgage.
Just what’s going on?
Simply put, Bearden believes, “Our industry is fractured. It’s misaligned. There is a real disconnect between franchisors and brokers; between brokers and agents; between agents and consumers.”
“A cultural shift needs to occur in our industry where there is a mutual respect of each other’s goals and a true partnership at all levels is formed,” he says.
The real estate industry was built on the premise that, to succeed, agents must work to differentiate themselves from one another, even within the same office. Similarly, managers within the same company spend inordinate amounts of time, money and other resources to do everything they can to differentiate their offices from other company offices.
In other words, building a consistent brand and unified experience for consumers, hasn’t been top of mind.
“We firmly believe that the companies that will survive and thrive will be those with cultures rooted in service excellence, partnership and mutual respect between brokers and agents for each other’s business goals,” Bearden says.
“Brokers who take the time to help their agents plan their businesses, who provide coaching and counseling, and foster a culture of partnership and teamwork, are those firms that will prosper in the future,” he adds.
“We’re trying to change the paradox and help real estate companies create environments within their own ranks that define a company’s culture and help build a cohesive brand that stands for something—in our case, Premier Service®—which creates brand loyalty while delivering a consistently high, measurable service experience with customers and demonstrates the value of the commission paid,” he says.
In fact, Bearden adds, “Ask just about any consumer to articulate the difference between a real estate agent from a local company versus an agent from a national brand, and odds are very good the answer will be a blank stare.”
“Most couldn’t hazard a guess, or worse case, might say, ‘not much,’” Bearden says.
What’s happening here?
Across the nation, each year, real estate companies spend hundreds of millions of dollars on marketing and advertising campaigns in a desperate attempt to stand out from their competition. Yet, clearly, these efforts are falling flat.
It’s time for a change.
A Cultural Change
For more than four years, GMAC Real Estate has been steadily building a new culture—one relationship at a time, one office at a time.
At the center of its culture is the industry’s most innovative customer service program, Premier Service, which not only strengthens the
partnerships forged between brokers and its Sales Associates, but also between Sales Associates and their clients. Since GMAC Real Estate introduced Premier Service three years ago, the company has received a Customer Satisfaction Rating of more than 94%.
In the process, GMAC Real Estate built a culture that recognizes the importance of truly differentiating its brand from others.
“Consumer perceptions depend on our ability to communicate who we are and what makes us different: leaders in service, performance and professionalism with proven customer satisfaction,” says Lane Barnett, president and CEO of the Franchise Business Unit. “As part of our culture, we believe the home buyer or home seller is the customer, and the brokers and Sales Associates are our Strategic Partners.”
With that in mind, Barnett says there are three guiding principles—Partnership, Performance and Professionalism—which form the basis for everything the GMAC Real Estate brand and culture stand for.
Case Study:
Putting Culture and Partnership to Work: A Franchisee’s Story of Growth
Just four years ago, Park Place GMAC Real Estate broker Danny Schwier had two offices and was looking for ways his company could grow along with Southern California’s burgeoning real estate market.
What he didn’t realize was that by implementing Premier Service and nurturing the culture it inspired within his organization, his company would not only grow, but also enjoy higher profits.
“With Premier Service, I realized that we not only had a way to brand what we offer, we actually had a way to gauge it and then take credit for it,” Schwier says, referring to the feedback he receives from Premier Service’s Customer Satisfaction Surveys that every GMAC Real Estate client is asked to fill out, and the results couldn’t be more impressive.
Culture + Brand = Increased Productivity...and Profits
“Since implementing Premier Service, we have seen a marked improvement in both the number of transactions and gross commission income (GCI),” Schwier says. “Our commission growth has increased each year, seeing a 32 percent increase two years ago and a 47 percent increase last year.”
According to Schwier, Premier Service has also provided his agents with a competitive advantage.
“The ability to easily demonstrate how we can provide better service to our customers has been an important factor in defending commission rates in a marketplace that is very much ‘commission squeezed’ in our industry,” he adds.
“And the improved culture and focus on customer service has also had a dramatic impact on our recruiting efforts,” Schwier adds.
“In the last three years, we added 192 agents to our operation and increased our retention rate, which is getting better all the time.”
When it comes to recruiting, Schwier’s message is simple and his philosophy straightforward.
“When it comes right down to it, a real estate office is a real estate office. When you cut to the chase, there are only a few ways to impress and win an agent you are recruiting: through your company’s culture and by offering higher quality, one-stop shopping with all the related real estate services our customers expect and demand. If you can show proof of these things, you will win agents over.”
Case Study:
GMAC Real Estate Company Owned Offices: Building on a Culture of Success
When you operate one of the largest real estate brokerage and home services companies in the nation with sales of nearly $16.5 billion in 2005, what do you do for an encore?
Keep pushing while creating a unified corporate culture—and then get ready to launch even bigger and better things.
“We already rank as one of the nation’s largest firms, but we also have our sights set on being the industry’s most productive firm,” says Terry Morris, president, GMAC Real Estate Company Owned.
Moving the company closer to that goal this year, the company has created a hard-hitting consumer advertising and marketing campaign that emphasizes how GMAC Real Estate is clearly differentiating itself from other real estate companies: by offering consumers a true, one-stop “homeownership services” company that provides brokerage, highly competitive mortgages, title and closing services, insurance and home warranties.
Focusing on consumers, the campaign will be introduced just in time for the busy spring 2006 home-buying season.
Among other things, the campaign will:
Highlight that GMAC Real Estate’s most powerful tool in its agents’ arsenal is the Comprehensive Home Ownership Services, which the company is able to offer all customers
Take its message of Premier Service directly to consumers by utilizing traditional offline media (i.e., TV, magazines, direct mail, catalog and newspaper advertising), as well as online sources (i.e., e-mail marketing, search engine optimization and a redesigned company Web site)
Include the company’s URL with all messaging to drive greater numbers of consumers online.
GMAC Real Estate’s Three Guiding Principles
1. Partnership
GMAC Real Estate collaborates closely with its Strategic Partners and customers for mutual success.
The company listens attentively to clarify and understand the needs and wants of its Strategic Partners and customers.
Options, opportunities, problems, limits and possibilities are discussed openly and honestly.
2. Performance
Informed, involved and thoughtful leadership is demonstrated at all levels.
Trends are analyzed and anticipated and opportunities are acted upon proactively.
Focus is placed on the important rather than the urgent.
3. Professionalism
In GMAC Real Estate’s culture, emphasis is placed on always doing what’s right ethically, morally, professionally.
Talk the talk and walk the walk.
Customers’ expectations are documented, and then GMAC Real Estate professionals deliver those expectations as promised.
Do You Have a Strategic Partner Who Cares About Your Success?
As you contemplate what 2006 and the years ahead may hold for your career, here are a couple of questions to consider:
Does your company have a culture that is well positioned and helping position you for continued success in the new real estate reality (i.e., does your company stand for something)?
Is your company working today to ensure your professional growth and increased profitability tomorrow by treating you as a respected business partner?
If you answered “no” or “I’m not sure” to either of those questions, maybe you’re ready to immerse yourself in an entirely new culture—one that positions you as a valued strategic partner and isn’t satisfied until you are. That’s the kind of culture GMAC Real Estate has created. And it was created with you—and your success and personal fulfillment—very much in mind. |
