The Internet poses a very real opportunity for REALTORS® to raise the performance bar. Although the costs of doing business are allegedly cheaper on the Internet, the reality is that the Internet poses an expensive learning curve for all industries, not to mention the individual practitioners of real estate.

Already, netizens have learned some valuable lessons. Take Christmas of 1999, for example. The good news was that more people shopped on the Internet than ever before. Net commerce for the season was a staggering $4 billion, estimated Forrester Research. Yahoo! reported a 385 percent increase in traffic from the year before. The bad news? By one report, over 25 percent of online e-tailers had problems with server traffic, inventory and stock control, and/or deliveries. Online buyers quickly learned that waiting until Dec. 15th to shop was not a good idea. They may have saved money on taxes, but they often paid twice to three times as much for shipping, and many failed to receive the right item, in the right size, or in time for Santa to slide down the chimney.

The result? Next year, consumers will shop earlier and demand in-stock guarantees. E-tailers will feature free shipping and possibly free gift wrapping to gain a competitive edge.

Realtors aren't e-tailers, so what's the point? The point is that people learn from their mistakes - on both sides of the transaction.

The Internet evolves in dog years and things have changed dramatically in the last year almost too quickly for the Realtor to comprehend. Competition is keen, not just among the franchises and independent brokers, single and dual agents, but now it is coming from directions that are blindsiding the traditional practitioner. The skill set that it takes to do business on the Internet has produced a lower-cost, paperless transaction any time of the day or night.

At most risk of being disintermediated will be Realtors who stubbornly hold on to business models which no longer serve the consumer. The Internet-empowered consumer simply has higher expectations and the mobility to shop elsewhere for services. Those who are either disillusioned with traditional real estate services or who simply prefer the Internet medium will gravitate toward the new services being offered by third parties, including online brokerage services complete with customer service agents (on salary), fee-for-service, and offer and transaction management.

These new competitors will beat the traditional Realtor on points of difference, unless they are backed by large companies which are dedicating to keeping their associates in the thick of the transaction. Consumer-friendly ideas like Personal Retriever(R) and Virtual Open House(r) originated by Coldwell Banker, for example, take a corporate bankroll to come to fruition. RE/MAXdemonstrated foresight, not surrender, when it partnered with a third-party, Realtor.com, to power the listings section of its site, giving RE/MAX the most listings of any franchise on the Internet. Completehome.com promises to give a like competitive edge to the Cendant brands.

The individual real estate practitioner whether backed by a franchise or not is going to face some enormous challenges in the months and years ahead, primarily from new companies who are betting on the consumer, not on the traditions of the industry. The only way to beat back this competition will be in the restructuring of fees, the clarification of agency relationships, and improvement in services. In order to do that, the Realtor must employ ongoing education, and not content themselves with meeting the minimum continuing education requirements.

That's where the e-PRO certification will be a tremendous first step, because one of the curriculum's messages will be that the Internet is never stagnant and that agents must continuously seek to keep abreast of new ways to serve consumers as well as challenges from new business models.

Also See:

Published: January 4, 2000

Use of this article without permission is a violation of federal copyright laws.