I've always been intrigued at the differences between how real estate agents and attorneys are often perceived, based upon the prices they charge for their services. With attorneys, there is often the perception that the higher their hourly rate is, the better they'll be at getting the job done for their clients. For example, if you told someone you know of an attorney who will get whatever the person needs done for only $40.00 an hour, what immediate perception do you think the other person might have about the attorney's abilities?

Now contrast this with telling someone you know of a real estate agent who will sell their property for only a one to two percent commission. Do you think the other person's response might be a little different here? The chances are that the person will at least ask you one or more follow-up questions to first determine if this is an agent they should be interested in working with.

Think about how you really want to position yourself as a real estate agent in your marketplace. Quite frankly, you probably want to position yourself as an agent who's worth every penny of a full commission. But this is really a far cry from how many agents seem to be positioning themselves nowadays.

Oftentimes owners, when choosing between different agents, to list their properties with, grind these agents down on commission before listing with them. The owners' perception in these situations is often something similar to, "They're all going to provide me with the same service anyway, so I just need to find the one agent who will charge me the least amount of money for it."

So in effect, if you're one of the agents that the owners feel this way about, you've become a commodity who's perceived as being virtually identical to many of the other agents in your marketplace. And in a way, it can be similar to how someone feels about shopping for the exact same brand and model of sunglasses.

The sunglasses themselves will be exactly the same no matter which store they're purchased in, so the goal of the buyer is often to find the one store that will sell them the sunglasses for the cheapest price. And as an agent, you don't want to risk being perceived as being no different than all the other agents you're competing with. If you're perceived this way, it's going to cost you a lot of money. Because in this situation the only way you can differentiate yourself in the owners' minds is in the price you will be charging them to list and sell their property.

Unless you're already specializing in providing brokerage services at a discounted rate to your clients and prospects, working off of a business model that you feel brings you more income by doing this, you'll ideally want to position yourself as being the most prestigious, high-end agent in your area. That's right, the one who commands the utmost respect from your clients because of who you are, your reputation, the way you present yourself, how you have your clients and prospects feel in your presence, and how effectively you communicate the benefits of what they'll receive when they pay you a full commission.

As an example of this, when gasoline first began getting more expensive in the 1970s, the auto industry started manufacturing many more economy cars, and people began purchasing them in very large numbers. These people were looking to save money on their overall cost of gasoline throughout the year, but Mercedes Benz, Rolls Royce, and Cadillac didn't go out of business because of this. That's because in almost any market, regardless of the price competition at the lowest levels of pricing, there will always be people who want the best product or service no matter what, and they'll be willing to pay you handsomely to receive it.

So if you haven't already done so, begin carrying and presenting yourself in a way that will have the people who want the best service imaginable line up to pay you the full commission you know you're worth. And if you're not already doing this, it will probably take some work on your end to make it happen. You'll need to make sure to dress like someone who's worth a full commission in all situations, and you also may need to revise both your presentation skills, and your presentation materials, too.

But whatever it takes to make this happen, the end result will certainly beat playing the game where the most important value the owner thinks you bring to the table, is whether or not you'll list their property for a lower commission rate than anyone else will.

Published: April 15, 2005

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Jim Gillespie, Ph.D., is America's Premier Real Estate Coach℠. He has over 20 years of experience in real estate sales and is a past president of three different real estate companies. His FREE real estate E-newsletter with tips and creative ideas to help agents make more money is now read by over 35,000 agents nationwide. You can subscribe to his FREE E-newsletter by visiting RealEstateSalesCoach.com or contact him at Jim@RealEstateSalesCoach.com.