Full Circle on the Consumer Experience

This column’s first two articles of 2016 explored the relatively narrow band of issues being generated by the emerging premium agent movement being championed by the national portals, and the industry’s growing vulnerability presented by the questionable influence and impact of the subpar “facilitator” agent. This third article of 2016 will revisit the question of the consumer experience issue, first raised at the beginning of 2015, as it relates to the two issues raised above.

All three of these subjects have been on the industry’s priority agenda for the past eighteen months. The fact, however, is that the industry’s current disruptive environment is making these factors even more relevant. More specifically, we are seeing a classic case of convergence. Three formerly marginally related issues are coming together to create a major shift in procedures. Understanding this new environment is a prerequisite to appreciating the dangers being presented.

There are two types of disruptions currently impacting the real estate industry and marketplace. The broadest reaching disruption is called innovative disruption. This is the change that occurs when new digital technologies and business models affect the value propositions of existing goods and services. Virtually every aspect of the American economy is currently being subjected to innovative disruption. Every time there is a significant digital or technological advance, the value in place of all systems that contain that technology in its previous configuration is automatically changed.

The best-known and most quoted disruptive process is called digital disruption. These occur when competitors use innovative disruptions as competitive business advantages or weapons systems to improve their market positions or propositions vis-à-vis their competitors. In a relatively high tech, competitive and complex industry such as real estate, there is always a high number of each form of disruption occurring. This rate of change can seem quite chaotic for those businesses and participants caught in the middle, with neither a disruption plan nor a developmental road map.