Charging a percentage of the listing

I've been doing more and more voice overs for virtual tours as people realize the value of professional VO, but I've often thought that we all should be charging more or less based on the listing price of the home. Realtors get paid on that basis, so is it unreasonable for us to as well? Has anyone here tried charging video rates based on the selling price of the home? 

I haven't tried it-- but as a part-time administrative assistant for a realtor, I can't see many agents biting on that one.  Even if they make more on the listing when it sells, they don't want to put out a lot of money because if it doesn't sell, they lost money on it.  Other service providers like home inspectors, maintenance, as well as marketing companies only charge a flat-rate (based on size, amount the realtor wants in marketing, exposure, etc.).  I think it would just complicate a lot of things...

I base my pricing on square footage and other factors, so I'm doing the same amount of work for the dollar no matter which video tour package the agent orders!

The less complicated the pricing, the easier it is to sell.  I've played around with different pricing options (i.e. based on square footage, based on price, etc.)  and business only took off for me when I simplified it down to basically 3 price points ($129, $200 and $300).  The only variable are homes over 5000 sq feet, where there is an upcharge of $100.  I have done (literally) 4 of the $129 videos.  95% are the $300-$400 package.  So, basically I have 1-2 price points - KISS (keep it simple, stupid).

I've seen some companies with this elaborate pricing structure that even gives ME a headache - I can only imagine how a realtor looks at that!  

Realtors care about two things:  How much and how fast.  

Yes, the amount of work can vary depending on the size of the property, etc.  but it all balances out for me in the end and at the same time keeps it simple on the selling side of things. I did a house the other day with elaborate landscaping, lake front, etc.  

From an agent's perspective... Percentage of the listing might be a viable option if you are sharing in the risk.  That is... if you agree to not be paid a dime if the property doesn't sell.

When setting our commission structure we have to factor in the cost of marketing listings that do not sell.  We put out a lot of cash for the marketing and in today's market a large number of listings never make it to closing.  We absorb all the cost of marketing the property and that cost is substantially higher than anyone outside the business might imagine.

While we believe that Video is going to play a larger part in future marketing, it is hard to justify paying someone else to provide that service in today's market.  That is why we are learning to make our own videos now... so that we will be ahead of the game later!  When the market shifts again we may or may not continue to produce our own Video... time will tell. 

If you decide to offer the percentage pay as an option, please keep us informed as to the response you get from agents.  I think we are all in a bit of a learning mode right now as this marketing tool evolves.

I just don't think that would be a viable option for most videographers, though I can see why, if you share in the risk, it could be more attractive to agents!

I just can't afford to become a collection agency.  I always require payment up front (up to $500 projects).  For projects over $500, I still require a 50% down payment before I turn the camera on.  This prevents me from worrying about it later... and it does cause a lot of stress down the road!

I like my system so far, and no one has complained about my fee structure yet... I do think it's over-complicated (sorry Fred!), but I think I'll iron the bugs out as time goes on... I've only really been doing this for a few months now. :)

An option may be to get your RE license and do videos for a referral fee.  That way you'd have access to the MLS system, have a lockbox key and a formal referral agreement with the agent.

Realty World is all but mandating a video for every listing that they are doing. They worked a deal with their video production house 415Video where 415 does videos for X per tour if they pay up front and a 25% premium on the tour if it's done on contingency. Their agents are eating it up: they are doing tons and tons of videos and haven't even announced it to their agents yet.

In the case of Realty World, videos done on contingency (or at least the option of doing an up front or contingency tour) is blowing video up for the entire firm. They are doing great things.

This would be complicated unless you were a regesterd agent in a piticular state..

There would be know way to verify an end price with out leagle documents and unless you are an agent you can not legley do it.. " In most places "

Agents and brokers would freak out !

However I do predict the the real estate agent of the future will be an moving image specilist.

I just had a long conversation with one of the most respected "luxury brokers" here in Miami, (after producing this video for her: http://tinyurl.com/mbmjfs) and the one thing she kept stressing, and I believe this relates for everyone on both ends of the business is:

If the BUYER LEAD comes Directly as a result of seeing the video, then I will have a line of people out the door..  Which means...

Targeted Distribution is where the $$$ is.. Especially now, realtors are going to have a tough time investing any reasonable amount of money into marketing, without hearing about or seeing results.

My question is: Besides uploading our videos to "popular video sites" = .03% propsect buyers,  How & Where should we be distributing to reach "Affluent/Qualified Buyers" - similar to Robb Report International reader base?  

Not to mention the obvious, but the #1 place buyers will see a listing - by a long shot - is the MLS.  That's where it needs to be.  That's where every buyer looking for a property in a specific price range will be. The rest is superfluous.  Not only does it appear on the agent's site, it appears on thousands of other sites within the MLS system through the IDX Database.

I'm constantly amazed that VERY often these tours are NOT marketed on the MLS by the agents.

Dumb. Dumb. Dumb.

great point Fred.. I just found out that the MLS will accept video, as long as it's not branded with agent/company info.. Is this correct?

also Fred, do you shoot & cut all the videos yourself? I've found that with the rates realtors are willing to spend, it's difficult to scale up this kind of business..  I read your DVD E-Book and it has a good example of shooting 3x videos/ day.. but if you're out shooting all day, how can you edit, revise, upload, burn & manage clients. (who really need their hand held in this process)?

 Yes, for the MLS it cannot be branded.

EVERY MLS is different and they all seem to make up their rules as they go along.  They also convey this information to agents (not tour providers), assuming agents pay attention or care, which they don't.  They also FINE the agents (in our area, $1000 per day), so you don't want to mess up!

So it's smart to contact them yourself and find out EXACTLY what is necessary.  None allow agent or broker branding.  Some allow addresses, some do not. Most won't allow the agent signage, so you have to remove it first from the front of the house.

I make two versions of each video - the branding on the actual video is at the end, and I just cut it out for the unbranded version.  If the agent gives an intro, they are not allowed to identify themselves by name or their company...   they do that at the conclusion, which I also cut out for the MLS.  That way it's easy to make two versions with about 2 seconds of extra work.

Then I create a web page for each version and the branded version has their information at the top of the page as well.  [branded]  [unbranded for MLS]

And yes, I shoot and edit the videos myself.  And yes, it gets hectic sometimes and I work long hours!  But I have several machines that compress and render the files... usually overnight...  and I work pretty fast and cut a lot of corners to get it processed quickly (I try and turn them around in 24 hours).  I do some work in the car between jobs transferring footage from the Compact Flash drive to the computer, etc.  I'm doing 8 this Friday and Saturday... that'll be a test of my endurance!

I also do a photo package for about 60% of my clients as well, so the total bill averages around $350-$500 for each house....  that's how I upscale it!

My biggest distraction is when people aren't ready for me and I have to muck around helping them to move furniture, straighten things, haul things out, etc.  That sample above I did yesterday afternoon... and spend two HOURS at the house, where I should have been there 45 minutes because they were NOT ready.  I was a little annoyed (to put it mildly).  Had that not been my last appointment it would have royally screwed up my day! They knew I was coming.  They had the checklist in advance.  But what can you do?  

you have a great work process and your "making money with Real Estate Video" ebook & DVD are excellent.  Going back to distribution, do you charge any extra for that (custom web page) or do you upload them through "Tube Mogul" or similar sites..

I also just came across a company "http://mymarketware.com/" that looks like a nice solution for delivery high quality photos, video & property info, as well as giving the property a unique URL..

At the end of the day, I imagine that most of your work comes from referal & repeat business, because the realtors are getting real leads & sales by using video.. correct?

I realized my links aren't appearing:  when you get  a chance I'd love to hear your feedback on my most recent video:

Sunset Island Estate

 Thanks! Glad it helped.

I don't charge extra... I upload to about 12 sites.....  about half are through Tube Mogul, the rest I do individually.  Fortunately I have a VERY fast connection so it only takes about 4 minutes each for a high def file.

I don't really do marketing at all...   it's mostly referrals, 90% are repeat customers.... many I get from Twitter and Facebook (just got a new client  last week who is doing 3 community tours plus videos and photos on every listing - and he's a top agent with lots of listings!!) . Marketing to realtors directly (for me) has been a waste of time.  I feel like I'm talking to myself.  I'd rather go kayaking.... !

What I do see a lot is competition....   when ONE agent uses me in a given market area, all of their competitors start using me!  A regular client of mine just started working in a new area a bit far away from his normal area, but he's had three listings there and sold two (one sold in 6 days).  

A very established agent in that area (who has tons of listings - one next door to my clients and has been on the market for a year!) just called me yesterday - I'm doing 8 of his listings on Friday and Saturday.  They're sort of 'forced' into doing video and good photos by customers who now EXPECT it.  My client has put 200 flyers on one of his listings over there... and I'm SURE that many were picked up by neighbors.  Of course it mentions that he does video and professional photography on all of his listings... which prompts people to question those who DON'T....  

That type of thing has happened to me over and over!  I have a half dozen clients in 3 small towns 2 hours away from me...   but I have enough work that I'm down there at least once or twice a week.  But they're all doing it because their COMPETITION is doing it - and they have to up their ante to compete!  It all started with one customer who used video as the cornerstone of his marketing for his new business... and everyone else had to follow suit...

Of course it doesn't hurt that these people get every listing and sell houses pretty quickly using video....

Did 7 today (charge a little up front and the rest when sold), for a new agent in a new city.  Is it ideal?  No but at least we are adding new agents in new cities, if this leads to more agents and more tours it will pay off, if it doesn't then at least I said I have tried.

Bernard, nice quality on the video, a few things stuck out to me. 

1.  I felt like I was always struggling to keep up.  Scene 1 was still panning while scene 2 transitioned in, and scene 2 was already moving, and so on and so on.  I think ending a scene stopped will really make your tours much easier to watch.  I was starting to get a little motion sickness by the end of the video.

2. The outside night shots were very nice, but I don't think the inside night shots added to the video, in fact I think they took away.  Plus it means you need to be at the house much longer to get the inside night shots.

Just my .02

I've been playing witht the idea of of also offering a flat fee, say $100 to shoot/video the home and then 1/10 of a percent of the selling price at closing. Meaning, I would make $100 up front and say $500 on a $500,000 home when it sells. This would have to be coordinated a the broker level (i.e. an agreement in writing with the broker and funds be distributed by the broker at closing).

This system speads the risk for realtors and could give me more clients and perhaps earn more money in the end. Although it could also be a big mess and headache.

Like Fred, I currenly offer three packages, a Cottage, Ranch, and Estate Package ($225, $300, & $450) (with some varoius add ons). The trend I am seeing in my market is that my clients are continuing to use me b/c they know the quality of my tours helps to sell their homes and give them new leads, but because of the market, they are doing a cottage package instead of the Ranch & Estate package and I've gotten into the bad habit of doing more b/c I want home to sell and I am not properly able to show case it at the cottage level. So I am working a lot more for a lot less. Working for a percentage of the selling price could change this... though now I am thinking he percetage should be 1/15

 Todd, how is the pay when sold model working for you in this market., we have agents that are sitting on properties for years?

I like the idea of pay when sold, and would charge extra for that option, but am afraid of not getting paid "forever". 

 Todd, how is the pay when sold model working for you in this market., we have agents that are sitting on properties for years?

I like the idea of pay when sold, and would charge extra for that option, but am afraid of not getting paid "forever". 

I think the ideal situation would be if agents got in the habit of charging an upfront marketing or technology fee to cover a part of their expenses/marketing fee. It's the norm in other business to pay at least something upfront. It's silly to put out all the effort and expense and the seller can walk away without paying anything:(

Welcome to OUR WORLD (the world of real estate agents)!

We spend MANY HOURS and MUCH MONEY marketing listings that never sell... I would LOVE to see the compensation model for real estate agents changed and have even tried to get it changed but without success.

The fact is that we (I am speaking personally for me and my wife) could afford to charge much lower commission rates if we received payment up front for our marketing expenses (time included) much the same way other professions get a 'retainer'.  However, the vast majority of our industry must be willing to change for this to work and that is not likely to happen anytime in the near future - I don't even know of any discussion along these lines.

This is why you guys (videographers) may be running into trouble selling your services to the average agent... we simply cannot afford to spend more money up front than is absolutely necessary to get the home sold.  Please understand that I am a huge fan/supporter of VIDEO but it is an unproven marketing tool at this time.  We see about the same results in terms of "hits", interest, showings, and sales for listings without video as thos with video.  The same is true for professional home staging.

I have been working on ideas for promoting an upfront fee with a much lower commission rate but so far the public has not been receptive.  Sellers love the fact that they can get tons of marketing from agents without spending one dime or one minute of their own.  If the house doesn't sell, the homeowner has lost nothing... the agent, however, has lost hundreds of DOLLARS IN HARD CASH and MANY, MANY HOURS of work and travel time.

Don't get me wrong... I'm not whining or complaining - just sharing the harsh realities of our business and looking for solutions.  If you guys have any ideas for us, please share them!

Thanks much,

Tim

 In reality, selling a home has three legs to the stool, and if any one of them is out of balance, the others cannot compensate: 1) correct pricing, 2) condition, and 3) marketing.  All the marketing in the world won't sell a house that's overpriced or in bad condition.  Likewise, a home with a good price may not sell as quickly if it's internet presence (including photos, tour on the MLS) don't look good or are non-existent.  These 3 requirements are even more important in a buyer's market.

One agent I work with right now has been listing and selling those listings within about a month every time for a few months now.  Before she started using video, she'd sold one home, including 2 as a buyer's agent.  Since she started using video, she's sold 2, gotten more listings, and had about half a dozen others as a buyer's agent (from buyers found through her listings).  Business is taking off!

It's not that viewership on videos are necessarily higher than normal tours (mine are getting between 200-400 in the first month on the MLS alone), it's that the video truly invites people to come to the home in person, and those who do are generally more serious about it than curious people who saw one photo of the outside.

So far, my agents have sold every home I did a video for, unless the home was overpriced.  I've been an administrative assistant for an agent, and my company keeps a real estate agent as a consultant as well.  Every home that has NOT sold was overpriced, sometimes poor condition AND overpriced, and that's why it expired.  Marketing never sold an overpriced listing (unless you got ridiculously lucky).

My mom is an also an agent, and if the seller won't sell if for what the comparables are showing, my mom walks and tells them to find another agent.  She's even done that to friends who were being stingy about it.  Her philosophy is that if she can sell homes, and not just have her sign in a yard, that will get her more business than anything else. She does no cold-calling, no calling FSBOs, no networking meetings, and no door-knocking.  People come to her because they found her online or they heard about her from somewhere else.  She's making more money than my dad now (and he keeps saying he should just retire and help her with paperwork)!  She's never had an expired listing, and that does more for her business than it would to get her sign in another yard.

Tim:  This is where I get confused.

I had to spend several THOUSANDS of dollars to purchase equipment, etc. so I can provide video tours when I first started in this business.  I didn't know if anyone would bite.  I didn't know if anyone would ever remotely be interested in what (in my mind) was a brilliant marketing idea.  I had to purchase equipment upfront.  I had to offer my time and services for FREE to agents to show them what I was doing.. in the hopes that someone would buy this service from me.  Upfront.  With no payment, no guarantees that anyone would actually ever PAY for a service such as this.

I had to pay money upfront to advertise since nobody knew what in the world I was doing.  Printing costs.  I had to pay upfront for the cost of a bulk DVD printer so I could print and burn lots of DVDs to market my business to realtors.  I had to pay upfront to exhibit at realtor conventions, etc.  Booths run $1000!  No guarantee that anyone would bite (as it turns out, nobody did!)

I'm still fronting money upfront to upgrade equipment so I can offer better services and products, with no guarantee than anyone will know or CARE.  But in the long run, I know it will set me apart from my competition.  It's an investment in my business and my future AS a viable business.

So what's the difference between my business and your business?

NONE.

It's called BUSINESS.  You have to spend money to make money.  It's always been that way and it always will be that way.  One of your PRIMARY jobs as a listing agent is to "market" that home.  To say that "you can't spend any more money than is necessary to get the home sold" would absolutely be a reason I would NOT hire you to sell my home.  I want a 100% first class job of marketing my home, not someone who will "get by" as cheaply as possible. Especially when I'm paying you a 6% commission!

I agree with Tim Frennell on this, if you want to get paid a percentage, take the risk like we agents do. If you want to make your money up front, do a flat fee.  If you want to bigger rewards you have to take the bigger risk, its that simple.

so glad you said that Fred, though I don't wish to gang up on Tim. This attitude seems to be very prevalent amongst realtors. I wish I had guaranteed income from all of my marketing efforts, but that's not the way of business. I think a lot of realtors are spoiled to the good days of a few years ago when houses pretty much sold themselves. When I sold my house 5 years ago, the realtor put out a sign and made some color copies. There was no video tour, no talking house. Now that times are tough, they balk at spending any money at all.

Realtors (and other businesses) need to stop thinking about the ROI of marketing individual properties. Your marketing efforts have a bigger goal. To market your BRAND. Everytime you stick a for sale sign in a yard with your name on it, you're marketing your brand as much as the house. So even if that house hasn't sold, you've paid a nominal amount to get your brand in front of lots of eyeballs.

So the more efforts you make to sell a property, the more effort you're making to sell yourself.

Hey all. Great debate going on here...

From my perspective, I can see both Fred's argument as well as Tim's. Ie...Tim is referring to marketing/selling each home and the risk of marketing each home with no guarantee that it'll pay off. Fred's posting ideas about the fact that he too as to invest money into his business with no guarantee that more people will use his services. Truth is you both seem to be right in your own way, but I hope the goal here is not to further a divide because there is one major problem facing real estate video:

Not enough people are using it, and until they do, they won't see the benefits of doing so...

From my perspective, agents that start using video typically don't stop. It's been hugely rare for our team to hear someone say, "well I used video and I stopped because of [insert a reason]." So, the contingency plans (where video pros get paid once a home closes or rents), seem to be more of a way to get people to try video by minimizing the risk. I only have one example of this type of effort, and it's Realty World. And, without a single question in my mind, it is working in the favor of all those involved.

If I were an agent that started using videos created by someone very talented and had to pay a 25% premium to get going on a contingency plan, the likelihood is that I'd stop paying that premium once I knew that video was a tool that I was going to contnue to use.

Just my two cents: I am very excited to see this debate going on because I feel like contingency plans could really accelerate real estate video.

 With contingency the question is... what is the list to sell ratio in your market!

Fred,

I think you misunderstood my post entirely.  I am a believer in video.  In fact, I bought your DVD, dude. LOL

That doesn't change the fact that it is an unproven resource at this point in time as far as much of the public and agents is concerned.  The idea that any agent who doesn't pay for professional videography is somehow short-changing the seller is without justification, in my opinion.  We absolutely must weigh where we spend our marketing dollars in order to get the most impact from them.

Some might argue that every listing deserves a 30 second TV commercial... but I think we can agree that this would be overkill and not cost effective. 

BTW, agents around here do NOT get paid 6% commission.  The total commission doesn't even average that high and the buyer's broker typically gets 3% even if the listing broker only charges a total of 4% or 5%.  Let's assume that the total is 6%, however.  3% goes to the buyer's broker and typically the other 3% is split between the listing agent and his broker at varying levels - typical split tends to be about 65/35.  With an average sales price of $150K, that means the listing agent will gross approximately $2900 out of which he must pay E&O insurance, personal insurance (health, life), taxes, office fees/expenses and all marketing expenses. 

Now, factor in the fact that about half of all homes listed (in this current market) never close and you can see where the listing agent needs to carefully assess what marketing venues are going to be the most productive/effective.  We (personally) spend THOUSANDS of dollars each year on marketing our listings and countless hours of manpower and miles of driving (our market covers 5 counties so we put many miles on our vehicles).

I merely hoped to share with you the perspective that your buying market has and why they may be somewhat resistent to spending a few hundred MORE marketing dollars given the fact that there is a high probability that the house won't sell and he won't get one dime for his efforts or marketing dollars spent.

That said, if you guys want to bash the people you hope to sell your service to then knock yourselves out... hope it works for ya.

Tim

 I don't think (I'm sure) we don't want to bash anyone... it would be just cool to come up with a win-win solution for all. I think we just want to understand the agents point of view and often it differs from how (I think) we would run the business if we changed positions. But perhaps it's the grass is always greener syndrome:)

You can't look at marketing individual houses. You need to look at the ROI for your entire marketing plan. If you spent $5000 on marketing all your houses over the past year and made $50,000 in take-home commissions, I'd say your marketing efforts have been a success.

You can't look at individual listings that don't sell and think, "well, that's $300 in marketing down the drain!". I send out marketing materials and if I get a 2% response rate, I'm thrilled. That, my friends, is the cost of doing business. Buck up and deal.

Oh, and if you want to reduce your marketing expenses, stop blanketing the neighborhoods with those fracking postcards every other week. I'm not selling my house, so stop asking me! :)

Matti,

I agree with you.  I am no stranger to marketing or to spending money on marketing.  My first year in this business I spent over 30K in marketing before I closed my first transaction.  I have continued to spend, spend, spend but I am careful where/how I spend those dollars.

I may have taken undue offense to Fred's comments and if so I apologize but "until you've walked a mile in my shoes........."  - know what I mean? 

We are BOMBARDED with the next biggest/baddest marketing tools to sell homes everyday.  Each makes claims to get homes sold faster and for more money but guess what.... most do not live up to the claims.  If we bought into every one of them we would go broke very fast. 

Our current market is very challenging.  Many fabulous homes that are priced unbelievably low and have outstanding marketing plans end up expiring without a sale -- the listing agent EATS all the dollars and hours spent trying to sell it and then the seller decides he doesn't want to sell if he can't get "X" number of dollars.  We (agents) have no recourse in such situations... we have done our jobs and done them well.  We've spent hundreds of our own dollars and many hours of our time in marketing the home but nothing changes the fact that we are in a lousy market right now.

I happen to be on your side - I BELIEVE IN VIDEO but I know from talking to other agents that the vast majority of them (in our market) do not share my belief.  They think I'm crazy for investing in a decent camcorder and taking the time to learn to shoot videos myself.  Listings without video are selling just as fast (or should I say... as slow) as those with video.

As business owners we have a responsibility to spend our marketing dollars where they are most effective... that means making some hard decisions and it means "trying new things"... but if those "new things" don't show results then we also have to be willing to move on.

I've just been a little surprised at some of the very negative comments that some videographers make about their potential customers.  Why bash the people to whom you hope to sell your product/service?  We are seeing many of our fellow agents leave the business in droves.  It's a very tough time to be in this business but the strong (and fiscally wise) will survive.

Hang in there... keep promoting your services and hopefully in short time more and more agents will tune in and employ you.  But, please.... don't bash us and/or accuse us of not doing the best job we possibly can for our clients.  Most of us are very dedicated professionals and are, in fact, losing money right and left in this market.

If there is some way we can work "together" for the good of all, I hope it can be found.

Tim

Jeffrey,

Do you really think that we are that short-sighted with our marketing plans?  I've started, built and sold several businesses over my lifetime... I have a pretty good grasp of how I should "view" my marketing efforts. 

Thanks for joining in the agent bashing, however.  Perhaps we should all hire you to be our coach and mentor.  You seem to know so much more about our business than we do.

Tim

BTW, we do NOT send out thousands of postcards to neighborhoods.  Our marketing is far more "targeted" than that and print media has proven to be one of the least effective marketing venues available to real estate agents.  We advertise where buyers are looking... that means that over 90% of our marketing is on the internet and NOT JUST ON LISTING SITES. 

For example, when we have an equestrian property we join in various equestrian forum communities all over the country and just "chat" about our listings - soft sell, if you will.  We use similar methods with other specific niche properties.  There are many different venues and methods available that are more effective than the old time print media and we avail ourselves to them.

One thing we DON'T DO is go online and talk bad about the very people we hope to sell our services to... perhaps this is some new marketing technique that I've not been made aware of before now.  Let me know how it works for you.  If it's effective, I'll give it a try.

You couldn't afford me.

And to answer your question, yes, I think a lot of realtors (especially new ones who want to make a quick buck) are very short-sighted and tend to look at individual listings as opposed to an overall business marketing plan. Obviously you don't fall into that category and my use of the word "you" in previous posts is directed at the general assembly, not you specifically.

Look, if you're going to mortally offended every time someone expresses an opinion, you should probably stop posting and reading.

First of all, I don't sell to realtors and I'm not bad-mouting anyone. I'm just hoping that some people will change their method of thinking and perhaps take a larger view approach to marketing strategies.

We're all connected in this business. At the end of the day, we all want the same things.  If my production work can help an agent in some way sell that property & find a potential buyer, then I will continue to be a valuable marketing asset.. 

I produced a video for an $8 Million Estate, listed by one of the most highly respected agents in S. Florida.  She made it very clear, that if the  BUYER came as a result of my video/internet marketing, then the word will spread fast & I'll have a line of realtors outside of my business.   Basically, the video is only the first part of it.. Now it's our jobs to make sure the video gets seen by the best prospect & inspires them to take action.

In that case, why not just get a real-estate license and be a part of the deal?

The comment:

"I think a lot of realtors (especially new ones who want to make a quick buck)"

is one of the funniest I've seen in quite some time.  Getting into real estate in the past few years hoping to make a quick buck... really!?  LOL  Even in a HOT market, we advise new agents to have resources to live without a paycheck for at least 6 months.  In this market, even seasoned agents are dropping out of the business right and left.

And, btw, I'm not easily offended BUT do not see any value in having my profession bashed by people hoping to sell to us.  I was particularly surprised that Fred made negative comments to me AFTER I bought his DVD product.  Just seems a strange way to talk to customers or potential customers, that's all.

 Tim:  To be honest, I've shipped out about 800 of those DVDs, so I don't actually remember specifically who purchased them.......  so I wasn't bashing "after" you bought the DVD...  And I wasn't really bashing YOU specifically... it was just a 'general bash'  :)

I've been doing marketing for exclusively for realtors for nearly 15 years now, and I've been hearing realtors whine incessantly about their expenses for virtually all of those 15 years.  It's a sore spot with me. When times were good, they were whining just as much - if not more.  Not all, of course, but a huge majority.  I always found it a difficult pill to swallow when a realtor constantly would complain about their expenses, as they were getting into their Mercedes, or their convertible BMW 'summer car'.  Or they were late paying MY bill when they were on vacation for 2 weeks in Maui.  And although you can't paint everyone with the same brush, it's a pretty darn big canvas.  

I just have huge issues with this, as every business owner has expenses, but it's just the cost of doing business.  It's expected.  Business is down?  You cut some expenses or reallocate some.  You make adjustments as necessary, but we ALL have expenses, yet listening to many realtors you would think it's unique to that industry.  In this economy, people need to shift their marketing money online and away from print and focus where the buyers are.  Yet just today I received a sports calendar in the mail from a Realtor I've never heard of....

My so called "bashing" was in regards to your statement  of "we simply cannot afford to spend more money up front than is absolutely necessary to get the home sold."  You have to market listings (aka spend some money)  in order to get the eyeballs in order to sell them, so if that's not something that you want to spend money on, maybe it's better to not be a listing agent, but a buyer's agent, where no up front expenses are incurred.  Try asking the seller to pay the costs.  Or split the costs.  Or pay the costs upfront to be reimbursed upon closing.  I have clients that do this all of the time - that puts them at less risk of losing money on homes that don't sell.  Most of my clients will only offer video if they are taking a listing they KNOW has a reasonable chance of selling, and they use that leverage to force the seller to be more realistic with their price and/or to do the necessary upgrades to get the home in the proper condition for the price the seller demands.  If they don't agree, they don't do the video.

We all know video does not sell homes - PRICE does.  A good video will get a live body out to see the house, but they're not going to buy if it's overpriced.  That's just a given. So why waste your money marketing a house you know is overpriced?

And of course, if you have plenty of time on your hands, do the video yourself!  Then you have the marketing edge AND you have no recurring expenses!  

There are many ways to use video, keep up your marketing and promote your brand - you just have to think a bit outside the box.

You have to be creative, but in a down market, the last thing you want to shut down is your marketing.  As someone else above just said, video is an investment in your brand - not just a vehicle to help sell homes.  As the market picks up, all of that marketing will pay off handsomely.  It always does.

To piggyback onto what Fred said, most advertising and marketing gurus will tell you to INCREASE your marketing efforts in a down economy. Why? Because you'll have an upper hand when the economy picks up over your competitors who foolishly cut marketing.

You can reduce the costs of your marketing without reducing the visiblity the marketing provides. Video is a great way to get that edge.

 Oops... I bumped the enter key... I'm using a different keyboard now and not quite used to it yet.

At any rate, I'm not going to share in risk and offer video tours on a contingency.  I charge a flat rate and will continue to do so.

Everybody run your business and see what happens!  To each his own... :)

Fred,

Again, I failed to adequately explain myself.  I didn't mean to imply that you would or should know who bought your DVD.  My point is that none of us really knows who might be a potential customer... to talk negatively about a whole group (in this case, real estate agents) seems counter-productive to developing a good working relationship.

I agree 100% with your comments regarding marketing and increasing marketing during a down market.  As I stated before, I BELIEVE IN VIDEO.  That said, I was trying to explain just where some/much of the resistence to your product may be coming from.  I've been "promoting" video to every other agent I know for the past year or two but have found NONE that share my enthusiasm.  I finally bit the bullet and bought some equipment recently and have made a commitment to move forward regardless of all the naysayers in my industry.

If agents jumped on every marketing tool available for their listings, they would spend more promoting the listings than they could ever hope to make at closing.  That reality forces us to make decisions as to where we spend our marketing dollars.  Very few agents in our market use video in their marketing.  Hell... most don't even put more than a couple of photos on their listings.  And, you know what?  Their listings sell anyway!  Why?  The number one reason is PRICE. 

A listing that is priced right gets attention and offers regardless of the marketing done (that means it is priced solidly within comparable listings that have SOLD within the preceding 90 day period).  This has always been true to a certain extent but is more true than ever in a strong buyers market. 

Every market is different, of course, and ours is one that is very slow to accept anything new.  This is true of agents AND sellers.  The sellers think video is "cool" but selling them on the "value" can be a challenge.  In fact, most sellers don't pay much attention to the marketing done.... they don't really care as long as they get activity (showings) and offers.  Video is GREAT in my opinion but we haven't been able to show, definitively, that video provides a positive boost toward reaching the goal.

We are learning to make our own videos and are "testing" them with different listings (different types, locations, price ranges, etc.) just as we test all of our marketing for effectiveness.  Since we've only been doing this for a very short amount of time, we don't have sufficient data to show the value one way or another yet.  That said, listings with video do not seem to be getting any more hits, showings or offers than those without video... at least, not yet.

Does this deter me from continuing with video?  Absolutely not!  But I also can appreciate decisions that other agents make to spend their marketing dollars in other places.  Many still spend hundreds of dollars each month in print advertising.  Print has proven to be an utter failure FOR US but many of our fellow agents swear by it.  That's fine and that's the business decision they've made... I respect that and don't for one minute think less of them just because they don't adopt the same philosophy as me.  THE GOAL is to get each listing SOLD at the highest price possible, in the shortest amount of time possible... if that can be done effectively without spending a few hundred dollars on video (or any other tool) then great.  Different strokes for different folks.

All that aside, I would hope to present a little different perspective... that of the typical real estate agent... so that, together, we might be more successful in selling the concept to agents and to the general selling public as a whole.

I don't comment in this forum a lot but I do read most of what is written here and have been more than a little surprised at the number of negative comments that some videographers make about real estate agents here.  I'm just saying, if agents are your target market, talking bad about us might not be the best way to win our business.  I made my original comments hoping to provide that different perspective as a means of fostering positive dialogue and GROWTH of video in real estate.  Apparently I failed in that endeavor and learned that some folks in your industry have a bit of disdain for folks in mine.  I think that's a shame... but so be it.  It is what it is, I suppose.

Since it seems that this is more of a platform for videographers than it is for real estate agents I'll refrain from sharing my perspective and just read what you folks have to say.  I've learned much from you and hope to learn more in the future.  I wish you all the best!

Tim

"If agents jumped on every marketing tool available for their listings, they would spend more promoting the listings than they could ever hope to make at closing."

Not bashing! - but I agree with Fred that many agents simply don't understand marketing... case in point > We have been selling virtual tours for the last nine years and very often we hear arguments on the personal opinions of agents such as "oh, I don't like panoramas or I don't do this or that. It's not about the agent!, is it not really about the client? Some [potential] clients may prefer stills, some panoramas, others want both, now add video to the equation.

So what should you provide if you want to satisfy the largest pool of potential buyers? ... a mixture of services!

It doesn't matter what "you" like, what matters is what the client/buyer wants. Going back to the fact that 40+% of buyers are first-time buyers and they look for vt's videos etc. As a matter of fact they will not even look at a listing that has no tour of some sorts.

My daughter (24) was looking for homes some time back and she dismayed at the lack of even pictures on most listings. 

I think this industry would would be so much better off and have a much better reputation if brokers or leadership at real estate companies demanded and enforced a certain minimum visual representation of properties on their agents. Even if it meant increasing their desk-fees. In the long run it would provide huge benefits and financial returns.

Not one to be left out of a good debate, here's my 2 cents.

Videographers are not collection people, and unless you can afford to hire a person or a collection agency for your AR, do not offer to collect payment AFTER the property sells!  Absolutely absurd idea, and I wouldn't ever put that option in the mind of a Realtor. 

"I don't comment in this forum a lot but I do read most of what is written here and have been more than a little surprised at the number of negative comments that some videographers make about real estate agents here.  I'm just saying, if agents are your target market, talking bad about us might not be the best way to win our business.  I made my original comments hoping to provide that different perspective as a means of fostering positive dialogue and GROWTH of video in real estate.  Apparently I failed in that endeavor and learned that some folks in your industry have a bit of disdain for folks in mine.  I think that's a shame... but so be it.  It is what it is, I suppose."

Tim, Tim, Tim, believe me, I know how your feel.  I made a negative comment about Fred, and it was like hitting a hornets nest. 

Frustration is what you're hearing from videographers.  "Why don't more agents get it?"

"We have been selling virtual tours for the last nine years and very often we hear arguments on the personal opinions of agents such as "oh, I don't like panoramas or I don't do this or that. It's not about the agent!, is it not really about the client? Some [potential] clients may prefer stills, some panoramas, others want both, now add video to the equation."- Matti

With less than 4% of listings having some type of true virtual tour after nine years, um hello, how big do you think the learning curve will be with video?  Now everyone is telling agents, "video is it!"

The problem is the "knowledge gap" that exists between agents and the Internet. 

Think back to a year ago, there were millions of Facebook users.  Now that number is hundreds of millions, why?  Simple, the more people that understand how Facebook integrates with their personal and/or professional life, they sign up.  They understand how it benefits them.  Now think of Twitter, not a lot of people are using Twitter compared to Facebook, even better almost everyone has heard of it, yet they don't use it.  Why not?  They do not yet understand how it intergrates with their personal and/or professional life.  Once they do, well the Twitter number users will grow.

All agents have heard of virtual tours, they've been around for awhile, yet only a tiny fraction use them.  Now the push to video.  If you bridge that "knowledge gap", guess what happens?  The amount of users go way up. 

I've offered to video and virtual tour providers to educate agents in their area to bridge the knowledge gap, and its been met with criticism.  Ok, and so their business is booming?  No, if you base your business on servicing the agents that "get it", you'll be frustrated.  The agent "gets it", what is "it", that one agent gets that the other doesn't?  It's the understanding of how the virtual or video tour works for them.

My experience is working for a large RV dealership, as a floor sales person, and then as part of an Internet Department that did $11 million in one year Internet sales.  I was also the Internet Manager for a start-up boat dealership.  Using a computer and phone,  I personally listed and sold almost $700k worth of inventory in the first three months of the selling season.  Coming from an industry where we floorplan, then have to purchase our inventory, and spent $100k before anyone walked into a "show".  I've got a real hard time with the money expense agents seem to mention a lot of.  I thought agents where their "own company". 

How does this relate to real estate?  Simple, I have experience in listing and selling big ticket items using the Internet.  The video tours you're creating for agents, is not to make the property look good, for the agent it is a sales tool.  Teach them that, how to use it, and you'll have a successful business.

I did a video presentation that talks in depth about the "knowledge gap".  Check out my youtube channel www.youtube.com/dadzfeaturedtours

<Since we've only been doing this for a very short amount of time, we don't have sufficient data to show the value one way or another yet.  That said, listings with video do not seem to be getting any more hits, showings or offers than those without video... at least, not yet.>

Tim,

My full time job is working for RE/MAX for 6 offices for the past 9 years and part time I run HDhat so I have access to a wide spectrum of statistics. Often I will show my agents a list of properties with a couple of columns one of which is LV or listing views.  I then hold my finger over the columns with VT and VID and can tell them definitively which listings have a Virtual tour or a Video Tour simply by the Listing Views. 

Overpriced listings - In our systems we have it set for "maximum registration".  Additionally our systems track all traffic so that when a potential prospect wants to see a tour or any detailed view for the first time they must register....then all that persons activity drops into client history and is emailed to an agent for followup.    My job as a trainer is to show the agent how to use that history and information(that may have initially came from an overpriced listing) to get that prospect to communicate with them and to sell them something else :) that is priced right. 

One of our agents whose statistics clearly indicate that he is taking overpriced listing and using it to haul in boat loads of buyer leads will gross 350k this year. 

We also require registration for our tours which you can see at http://www.lansing.com this is a very simple site.  Our Video Tour section is mobbed daily and our VOW is the biggest site in our MLS.  Without going into all the details we have been able to leverage the tour registrations to build our VOW into a local giant. 

ONLINE FORMS and REGISTRATION:
In 9 years of working real estate I can say definitively that more consumers will put in valid information in registration forms than ever before.  A properly trained agent can then convert these "cold" buyer leads into a sale more often than you may think.  In fact we have moved from #5 in our MLS to a strong #2 and have the highest # of transactions per agent largely due to lead generation via tours and registration and the training to convert effectively.

So if you have an overpriced listing yeah! put a registration form in front of it and distribute that link to as many sites as possible.  Then if you get a registration on that property you already know alot about the consumer on the other end....i.e. what price range they are looking and the general area...so formulate a tailored response to prompt that lead to reply to you to start the communication and sales process.  Maybe it won't help sell the overpriced listing but hey 3% of someone elses listing from a lead generated from the overpriced listing spends just the same. 

Mark

 This is an interesting discussion for sure... but I think that one point that we have to not lose sight of is that real estate is LOCAL.  We are all working in various markets in various parts of the country.  All you have to do is flip on the TV to see that some parts of the country are in pretty sad shape in regards to the real estate market, unemployment, etc.  Other parts of the country are not nearly as bad.

For example, my market (Boston, New England area) is doing pretty well.  It's not as good as it's been, but it's far from bad.  Plus, the average cost of housing here is substantially higher than Buloxi, Mississippi or Davenport, Iowa!  Most of my clients who do video are doing video on listings that run from about $220K-$12M+   Of course, periodically, I'll do a $120K condo here and there, but for the most part it's higher priced listings, which of course, equal a higher commission, which of course allows agents to be able to justify doing video a bit more easily.  I think the adoption of video (or reluctance to use video) is somewhat determined by each marketplace, so it is really difficult to compare one market to the next and paint every market with the same broad stroke.

I joke with people because I feel sometimes that I live in a parallel universe:  I personally am busier than I've ever been in my entire life - there's plenty of businss and it just keeps coming every single day (knock wood!).  But I also look at my clients - and THEY'RE busy as can be!  I have clients who are having there best year ever in 16+ years! (and almost none do foreclosures, short sales, etc).  And yet I speak to other agents all the time and it's all doom and gloom - business is horrible, etc. etc.

Of course, I LIKE to think that my clients are super busy right now because they use video!  Of course, I'm not sure that's totally the case (but it sounds good, no?).  But what I absolutely DO believe is that VIDEO attracts the BEST of the best in the real estate industry.  Those realtors who are experienced, technically savvy, SMART, who have marketing skills and business skills.  When I say you need to find the people that "get it", THESE are those people.  I can honestly say, without exception, that my clients are the top / cream of the crop agents in their market area - without exception.  They're VERY good at what they do and they know what they're doing and how to make it all happen.

This is why I don't spend time marketing to the other 95% - it's just not worth it.  Go after the best in your area - even in the down market, they're probably doing just fine!

An agent called me today (didn't find me online and doesn't have my business card, so I need to ask her how she found me), but she is looking for a company that will provide maximum online marketing for her dollar, with as small a time commitment as possible on her part.  In other words, she is looking for leverage.  Most of my clients don't have time to do their own marketing, and that's where I come in.  If they are doing a lot of business, it becomes much easier to justify spending $200 per listing to get awesome online exposure.  If they're doing less than 12-15 deals a year, then it really becomes harder to justify.

I second what Fred said: I don't KNOW that video is bringing my agents more business, but they think it does, and they have no problem forking over $200 a pop.  The leverage that gives the agent is astronomical, and it's not just the video they're paying for: I provide color hi-res photos, syndication to about 10 video sites, as well as syndication to over 200 real estate search sites.  Price reduction?  Open house?  All of that information can go through that network (at no extra charge).  For a little bit extra, I will also manage a blog with the video, photos, links to the agent's website, and weekly updates for the life of the listing.  That is a screamin' deal!  Again, every agent has there method: my clients generally do very little marketing.

One client sends a postcard to the 200 closest neigbors of the listing and tells them to "pick their neighbor" by telling friends and family about it.  It seems to work well, and she has picked up new listings and/or buyers from those postcards (I design those as well).  She spends about $300 per listing on marketing (including postcard, video, and online exposure), but she usually gets AT LEAST one new listing and at least a pair of buyers PER listing.  It's a chain reaction that continues on and on and on.  It all depends on your angle, your personality, etc.  Marketing is different for everyone- that's one thing I've come to realize after being in business myself!

I've always had a pretty voice but have not always been a voice talent.  I spent most of my life in sales & marketing and have even been in the home building business.  For a short time I worked with Tom Hopkins, who is the premier real estate sales trainer, as a sales trainer myself.  I am not going to offer any suggestions on the subjects of marketing, sales techniques, presentation skills, the psychology of sales, or anything other than a possible solution to the only issue that seems to be keeping many filmmakers from thinking seriously about producing or offering video tours on a contingency with a minimal upfront fee, and that is, "How Am I Going To Get My Money When/If the House Sells Without Driving Myself Crazy?"

Here is what I suggest as possible options. (Further research will need to be done to find out if these are viable)

1. Add an addendum to the contract.  Those funds will have to be dispursed at closing.  Those funds can come from whever you want them to come from.  Either the seller's proceeds or from the listing agent's commission or both.

2. This method will absolutely guarantee that the filmmaker will get paid when the house sells or it won't sell.  Place a lein on the property.  Make the buyer aware of this so when it comes up in the title search they know why it is there and that once the transaction closes it will be satisified.

I hope someone will research those suggestions further and get more agents on the road to the future of showcasing their listings.

That's my 2 cents.

Hi All

New here on the forum :)

This thread is exactly what I was looking for.

I only shoot for one real estate company as I have enough other work too, but was thinking along these lines a while ago already. I would not do it with anyone, but I have a very dynamic team with whom I do a fair amount of work with, but they have a lot more other work lying there. Currently they only commission sole mandates, but they happen to sell a lot of other properties too.

I had a chat today with them and they quite excited about it, but neither of us have any idea whether it should be a fixed amount on the sale or percentage. If a percentage, what should it be?

Would love to have some guidance on that

REgards

Chris

Cape Town, South Africa

Hi  Chris,

I am not sure of the % or splits realtors get in your area, but it's 6% here, 3 to seller and 3 to buyer agent and there's the split between the agent and broker

I would definitely try and work at the broker level in regards to getting a contract that states you get paid at closing ect.... I would also recommend getting an up front fee of at least $100, it makes the agent accountable and hopefully the property will be ready for the shoot if there's a small up front fee. Then maybe charge betwen a ten and fifteenth of  one percent when the listing sells - at 15th of a percent, that's $750 for a 500K home and $500 for a 10th of a percent.

Those are decent figures for shooting a home but remember there will be homes (perhaps many)  that you will be shooting that will be withdrawn from the market, listings that will expire and change brokerages ect... I just deleted 50 tours off my sever of listings that never sold in the past year and a half for various reasons.

I've been playing with the percentage idea but do not think it will work in my area given the current market situation, however, every area is different. You can get a better idea of the viability if you can pull some figures on how many listings the agency sells of their own listings compared to how many expire and are withdrawn ect..

This can be a win win for you and the brokerage. Offering professional shoots, both video and photos, not only will help sell the agents homes but it will also generate them a lot more business. When  I go into a neighborhood to shoot for a regular client, I can guarantee you that I will be back there for the same client in a few weeks or less as all the neighbors are watching and they will want to list w/ an agent that uses professional services to showcase their home.

let us knwo how it turns out....

Aaron

Thanks Aaron

I will probably have to have a look at different levels of %. The cheapest property ( they all apartments) in this area of this team is 500K and goes up to $12 million for penthouses. What makes this so convenient to shoot for this team is that all of this is in a 1.5 miles radius.

% of comm in this area is only about 4% with the different splits from there.

My view on this is that I totally lose out on non-mandate properties and that is a huge slice of the cake. I will basically also providing them with additional marketing material in the form of slideshows and newsletters to their current base

As I said previously that I am fortunate to get their other business and that keeps the cashflow going and I am making a good living of it, but hopefully with this it will create so much more.

This is the ideal opportunity for me to get my feet wet in Video as I am currently only doing stills and VT's, but I have got great equipment

Thanks

Chris, sounds like you have a perfect situation to making it work. I also come from a professional photography background and started to invest in learning video about a year ago.

Good luck!

Aaron

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