Real estate brokerage in Spain
Some prefer Android to Apple, Seagram's/Fever-Tree to Larios/Schweppes, Mango to Zara, BMW to Mercedes, Idealista to Fotocasa... Why then do so many consumers choose ANY real estate agency?
I will answer this question and explain the reasons why I think that the Spanish real estate sector lives in a pre-contemporary competitive paradigm manifested in a poorly differentiated and low quality service offer.. Four reasons:
Too many estate agents
The absence of entry barriers (economic and training) and proportionally low structural and operating costs allow a multitude of agencies to survive based on the indiscriminate accumulation of product and sales by probability. Many are neighbourhood agencies, but also franchises and large traditional agencies, which together make up the bulk of an undifferentiated business ecosystem, where door-to-door competition is carried out by poorly trained sales teams with high staff turnover.
Undemanding customers
The traditionally undemanding domestic consumer is opting for supplier diversification - "with several agencies you can sells before" (a pre-digital mantra) - rather than by informed choice of the best agency available. It may be time to explain to the consumer of real estate brokerage services that they have the industry they deserve, and that ignorant and uninformed consumption is to their long-term detriment.
Institutional paralysis
Associations and professional bodies have renounced the roles that justify their raison d'être: to regulate practice, encourage modernisation of the sector and promote a standard of quality among consumers. At the same time, the forums for reflection on the real estate sector, some of which belong to the most prestigious business schools in the country, have focused the debate on macroeconomic and financial analysis, ignoring a much more necessary and urgent reflection on technology, marketing, innovation and human resources, and centred on areas where they can have an impact.
Messianic Marketing
Finally, sectoral training has succumbed to the new-age rhetoric of trainers/coaches/if-you-want-it-you-can gurus and, in the best of cases, to cut-and-paste versions of operational marketing extracted from some CRS course. Thus, real estate marketing is reduced to a combination of sales materials and negotiation techniques designed to compensate (with two balls, of course) for the absence of positioning, value proposition or competitive advantage; real strategic marketing tools.
Post scriptum
We owe the difference between Spanish gastronomy in 1970 and today's gastronomy to some guys from Donosti who forty years ago invented the "New Basque Cuisine" and catalysed the revolution of an entire industry. People who, with audacity, study and technology, turned a simple trade into one of the most innovative industries in the country. I don't know if I'm making myself clear...
In this post about the real estate sector, José Luis Echeverría, founding partner of Monapart, explains the reasons why he believes that the Spanish real estate sector lives in a pre-contemporary competitive paradigm manifested in a poorly differentiated and low quality real estate services offer.
