Large Broker Work Group Final Report - May 14, 2014

Association Executives Committee
Large Broker Relationships Work Group
Wednesday, May 14, 2014
Washington, D.C.

Final Report

Work Group Purpose

To explore strategies and best practices for how associations develop and maintain healthy relationships with large brokers while communicating and delivering value to this constituency.

Background

During early discussions work group members provided input on the successes, challenges, and frustrations they’re experiencing with the large brokers in their association.  They also offered input on how their large brokers view the association and what, if any, association services they value. 

Some of the common successes that work group members noted with large brokers include the following:

• Serving on the association’s board of directors
• Attentive to legislative issues
• Assisting with RPAC fundraising
• Providing services to large brokers that they can’t provide themselves
• One-on-one communication with large brokers; exclusivity rather than a group approach

Some of the common challenges that work group members experience with large brokers include the following:

• View the association as a competitor
• Not interested in getting involved in the association
• Don’t want the association to level the playing field
• Frustrated that they are limited to what they can do with MLS data
• Frustrated with policies that they think bog them down
• Due to their size, some may try to influence or dictate the association’s agenda

Meeting Activity

Prior to the May meeting, work group members worked in teams to further address some of the common challenges associations face with their large brokers.  They sought input from other AEs outside of the work group for input on questions below.  Highlights of the information collected (attached) was shared with the work group.

• How do you overcome fears and confidently approach your first meeting with large brokers to establish a productive and harmonious relationship?
• How do you deliver meaningful education that large brokers and their agents need and want?
• How do you encourage large brokers and their agents to get involved in the association’s committees and events, and to assume a leadership role?
• What are some tips and suggestions for encouraging large broker involvement in RPAC fundraising and legislative issues?  How do you integrate this political advocacy focus into the broker’s culture?
• How do you influence large brokers to use statistical information (such as RPR data) in a meaningful way?
• How can large brokers help associations bridge the communication gap with their agents?

Best Practices Resource -- Work group members agreed that the information collected should be compiled into a best practices “Resource for Large Brokers” that will include tips, suggestions, and sample materials to assist associations in their relationships with large brokers.  Below are the work group’s recommendations for the end product.

• Post the information online at nar.realtor and also develop a printed piece that can be distributed at NAR meetings.
• The resource should be interactive and evergreen, so content can be added.
• Provide access for brokers, so they can add content as well on their challenges and successes in working with associations.
• Add a section on risk reduction with input from attorneys representing large brokers.
• Include an introduction to the resource that defines a large broker as someone who has a large market share of the association. 

AE Institute Session -- The work group recommended that a session should be planned for the 2015 AE Institute that focuses on developing and maintaining healthy relationships between associations and their large brokers.  Some of the best practices collected by the work group can be featured during the session. This recommendation will be communicated to the AE Institute Advisory Board.

Work Group Members

Rebecca Grossman, RCE, Chair
Duncan MacKenzie, RCE, Vice Chair
Mark Allen, RCE
Richard Barkett
Audra Burrell
Mary Cano, RCE
Cathy Faulkner, RCE
Karen Gehle, RCE, CAE
Margaret Grant, RCE
Paul Griffin, RCE
Myron Larimer
Melissa Maldonado, RCE
Patrick Reilly, RCE
Diane Ruggiero, RCE, CAE
Angela Shields, RCE, CAE
Philip Tedesco, RCE, CAE
Christine Todd, RCE, CAE
Carol Van Gorp, RCE, CAE
Janie Wilson

Liaison

Sharon Keating

Staff Executive

Cindy Sampalis

AE Input on Large Broker Relationships

How do you overcome fears and confidently approach your first meeting with large brokers to establish a productive and harmonious relationship?

1. My President and I, along with our MLS Director schedule meetings with ALL of our brokers (not just the big ones).  We offer to come to their office meetings or meet with them individually.  I also offer to stay and teach RPR for their office, if they would like.  We have hit several this year and plan to cover many more.
   • I do get a little concerned about the focus from NAR always being on the big brokers.  Every meeting and statement from the NAR staff is centered on them.  My personal thoughts are that all my brokers and members pay the same fee and I owe them all the same courtesies and services.
   • Thanks for reaching out for feedback.  This is a critical issue in our region, and we have been dealing with it for the last couple of years.  In my opinion, this is a very large part of what is keeping the industry fragmented and impacts efforts on the Association or MLS side to move ahead with programs, services, education or resources that would help all brokers and members compete at a higher level.
   • When I first was hired as CEO, the Board felt that the previous executive had neglected building relationships with the large brokers and made it a top priority for me to begin building/rebuilding these relationships.  The idea was a little intimidating… I met with a couple of smaller brokers first to see how it would go and what they might bring up.  Generally, they were very happy with our Association, and we had great conversations about any number of things.  After 4-5 pleasant visits with smaller brokers, it was much easier to visit with the larger brokers (if nothing else I knew than there was a contingent of people who were pleased with our services). 
2. For the actual meetings with the large brokers, I wanted to make sure that I got them talking, so I came prepared with a few leading questions and made sure they knew I wanted to understand what made their company unique so the Association could best serve them.  Most of them were willing to share their thoughts and ideas.  For the couple that were less willing, I was able to refer to a handful of talking points about what the Association and/or MLS was doing to keep the conversation going.  By the end of the meeting, every one of them had given me a great deal of insight into their issues, concerns and thoughts.
   • A couple that were more direct in telling me what they were unhappy with, but in general, they were happy I took the time to visit them.  After the initial visit, I found it was hard to get back in front of them.  Many would say that nothing has really changed since we last met, and that if I didn’t have anything critical, than there wasn’t any reason to meet.  
   • I have settled into a pattern that is different for each of the top brokers.  Some I visit monthly, some only once a year.  It seems to be working, and I think they appreciate that I respect their time and won’t waste it with an unnecessary meeting.  The hardest thing for me was realizing that a couple will never like me or the Association or want to have a relationship with me or the Association, but that goes back to long standing grudges or perceived slights.  That doesn’t reflect on me, and I must still do my best to serve them.
   • -Try to make it about their thoughts, needs and vision for the future,
     -Be prepared with some leading questions and topics to discuss in case they are not talkative
     -Respect their time
     -Realize they are all different and have different issues/hot buttons
     -Just do it
3. Here at the Regional MLS we have the 4th largest broker in the country and they have 32% market share in our region. They are good at what they do and their last company convention was held in (city) with 3,000 in attendance. I was invited to attend their convention and I spend one entire day and evening there. It was a wonderful experience and I learned a lot. I will tell that the main reason I was there was to show my interest in their wants and needs and to also see where my MLS begins to compete with what the company provides to their agents.
   • As CEO of the MLS, or an association of REALTORS® I better know where the line of “welcome services” and “competing for their agents is”. Whether it is real or perceived by the broker, it can be a huge obstacle to our relationship. That is a major reason why MLS gives its two largest firms (by transaction sides) a seat on our 10 member Board of Governors. We want them in on the decisions and we want to know if we have their buy-in when we consider launching a product that costs money to their agents.
4. If you were in a retail business would you ignore your largest customer? Would you ignore any customer? The successful business would say no to both. That doesn’t mean you can please everyone all of the time but they will all expect you to be fair, logical and honest with them. If they believe you are doing that, they will support you. But I must say this is an ongoing task and we have all heard the cliché “what have you done for me lately.”
   • Focus on listening more so than speaking.  Most cases they want to be heard and air their grievances or feel like they’re being heard. 
   • Fall back on the process of how decisions at the Association are made so they understand you are carrying out the direction of the Board.
   • Encourage them to get involved and if they cannot, identify an office manager or someone else in their office who they can delegate to be involved on their brokerage’s behalf. 
   • Be open minded.  Do not make promises you cannot keep, and always get back to them with answers you were unable to provide during the meeting.
   • We try to work with them the same as we do a small broker.   We do not make special rules for the broker based on size.   Obviously some of their needs are different, but a lot of times their agents need as much assistance as any other agent. 
   • If a broker requests that all invoices be e-mailed or mailed to a different place than their office, we will accommodate that.
5. I have learned that instead of making them come to me for the first meeting, I go to them individually, on their “turf”  and get to know them, what their personal needs are and what their firm needs are. Then when you invite all large brokers to a broker’s council, they are more likely to attend!
   • Works better meeting individually than in a group.
   • Don't expect to do much of the talking.  Those meetings are a lot of listening.
   • Perception is reality.
   • Ask them what education they want.  With so many brokers doing their own designations and in-house training now there is far less of a demand for the association to provide those services.  That may be an area where they actually aren't interested in association-provided services.
   • An issue we had this year was our largest association event conflicting with major events that our large firms were doing the same day.  Important to look at their major event schedules OR to provide your association major event schedule to minimize potential for conflict.
   • Open ended questions work best - such as,
     • "what problems do you believe the association could solve,"
     • "what do we do that you believe we should change,"
     • "what if anything do you hear your agents say about us,"
     • "is there an industry trend you think we should really be paying attention to,"
     • "are there ways for us to better engage others in  your office, such as your social media staff"
6. Unfortunately, I have been unsuccessful in reaching out to the large brokerage firms for me as defined with over 350 agents, primarily because of access. These brokers /owners, at least on the island, are deeply entrenched and view themselves as celebrities complete with entourages, body guards, and a plethora of underlings and sycophants who surround them to protect them from the real world and access to pertinent information.  Access is nearly impossible and if once there, I often find the decision-maker are the underlings who are much lower on the totem pole with non-meaningful titles.  It's hard to determine who's the captain of the ship, and therefore, who can provide access and make the decision.
   • Get to know the Broker first through a phone call asking if there is anything particular the Association can do for their office and ask some defining questions. 
   • Let them get to know you, the AE by offering to speak at their office meetings.  Minimum of 2-3 per month if possible.  
   • Have good speakers and subject matter that will draw the brokers to the meetings. Recruitment, getting listings, technology are the topics most successful. 

How do you deliver meaningful education that large brokers and their agents need and want?

1. With respect to education, we do monthly membership surveys.  Many of the classes we schedule are a result of the answers and feedback we receive through this process.  I was a little surprised to hear some of the comments from the big broker panel at AEI where they stated they would like us to leave the production development to them and to focus on the basics.  Our most well attended class’s center around top producer and affiliate panels. 
2. This has been somewhat sensitive.  Some of the large brokers have their own training centers and want us to stay out of everything except Continuing Education.  Others rely on the Association for all their training needs.  Striking a balance has been tough.  We generally stay away from anything that is sales training or might be in conflict with some firm’s internal policies.  The latest issue is technical training.  Some large brokers see that as a place they can create a competitive advantage, so we have had to scale back a little.  This is unfortunate, but we are constantly working on ways to provide good training that doesn’t compete with the large brokers too much.
   
   We have had an issue with a couple of our instructors who are broker/owners or office managers.  Some firms feel that this creates a recruiting opportunity and would prefer us not have these people as instructors.  We are currently working through that. 
3. Our goal is to have training that is relevant and valuable, but that does not cross the line with what the large brokers are offering.
4. Our State President this year implemented three broker forum meetings throughout the state.  Our EVP, President, Legal Counsel, and  Communications staff were there.  The purpose of the meetings was to ask the brokers what we are doing right for them and what they would like from us, and to answer any questions they might have.  The programs were well received and the brokers appreciated being  asked their opinions.
5. This goes back to my first answer- you HAVE to understand their needs, each brokerage is different and one size does NOT fit all large firms so building that one on one and having them share what they need and how they need it will better serve the general population
6. Most of the large firms have their own educational component in place and don't want "outside groups" messing with them.  They like to serve and drink their own specially formulated Kool- Aid.
7. I really don't know how to break down this barrier. Remember, for some of the large island firms, a listing system is important, for others, not so; for others none of the other services associations provide are important.
8. Offer education that the brokers cannot do as well.  Continuing education – develop courses that the Board owns and submits for CE approval.  Special pricing on some of the classes if possible. 
9. Ask them what education they want.  With so many brokers doing their own designations and in-house training now there is far less of a demand for the association to provide those services.  That may be an area where they actually aren't interested in association-provided services.

How do you encourage large brokers and their agents to get involved in the association’s committees and events, and to assume a leadership role?

1. Personally ask! This is by far the most effective and most assured way to get a large firm broker involved. Every member of our group cited this as their #1 method to obtain a 'yes' from the large broker.
2. Have a respected leader or past president ask them to be involved in a specific committee/task force/board, etc. Important to explain 'what's in it for them'; i.e.,  exposure for them/their firm, referrals for their agents, heads up on major issues/trends, early input into the decision making process, etc.
3. Keep their assignment or involvement to special projects, focused task force, PAG, etc. They are more likely to say 'yes' if they aren't being asked to serve on a standing committee that meets on regular basis.
4. If the large broker cannot/will not serve, ask them to appoint someone from their firm.
5. Offer automatic seats on the MLS Board/Committee and/or Association Board.
6. Have quarterly (or semi-annual) Broker Roundtables for the large brokers to keep them in the loop on national issues and trends. Seek their input at these meetings. Ask what's on their minds and what they need from the Association.
7. Have a Large Broker Council that meets twice a year. Seek their input at these meetings.
8. Meet with them in their office periodically, face-to-face, throughout the year.

Summary:   Generally, the group agreed that getting the brokers from the national firms involved was difficult, but that getting the large brokers from the regional and local companies involved was more likely. In the smaller associations we found that the large brokers were already involved; the larger the association, the more difficult it was to get them involved. We did agree that a Large Company was one with somewhere between 50+ agents. Some in the Work Group reported "Mega Brokers" - those with multiple offices across many associations and even states with over 600 agents. Getting these principals involved was most difficult, but it was more likely that a manager would be involved.

What are some tips and suggestions for encouraging large broker involvement in RPAC fundraising and legislative issues?  How do you integrate this political advocacy focus into the broker’s culture?

1. Peer to Peer (or Office to Office) challenges are effective ways to get large firms involved in RPAC fundraising. Competition works with these folks!
2. Provide advocacy content/information that is specifically targeted toward their business concerns.
3. Invite them (or reserve a seat for them) on the Government Affairs Committee. If they can't/won't accept, ask to appoint a manager
4. Visit the large offices during their sales meeting. Promote your advocacy and fund raising efforts. Explain how the issues impact their business and profitability.
5. Work with your state association to create RPAC marketing pieces that show them what they get for the RPAC $$ investment.
6. Take advantage of NAR's My REALTOR Party grants to assist in marketing and conducting RPAC fundraising events.
7. Create a "Calculator" that shows them how much their business (and their agents) save because of RPAC.
8. Personally ask each broker to pledge and invest in RPAC.
9. Have RPAC pavers on the association’s sidewalk or patio with names of Major Investors. This encourages others to give.
10. Put up a Wall of Fame in a prominent office location with pictures of Major Investors. This encourages others to give.
11. Beef up your Calls For Action - Show them the "Why" it's important; not just "What" to do.
12. Personally reach out to the large brokers and sign them up (with their permission) for the Broker Involvement Program. This will dramatically increase your participation in CFA.
13. Conduct 2 large, fun events per year to raise RPAC $$ and use this as a way to educate them about the 'why'.
14. Use advance marketing of RPAC events to educate about RPAC successes.
15. Talk about issues they can relate to: sale tax on commissions, sign ordinances, restrictive building and zoning issues.

Summary:  Generally, the smaller the association, the more likely the large brokers were involved in RPAC and understanding the legislative issues. Most on the Work Group agreed that they do have good input from large brokers and that a large majority of their large brokers were also Major.

How do you influence large brokers to use statistical information (such as RPR data) in a meaningful way?

1. You are assuming large brokers want the association communicating with their agents!  In our region our largest broker will not allow their listings to be fed to RPR.  Most large brokers see the association as competition for the agent’s attention and business.
2. I believe the best way to influence brokers to use RPR data and statistical information is to show them how and why – give them actual examples as to how this information is meaningful, why it makes sense to use, how it positively impacts their agents, consumers, clients, company, etc.  My experience is that brokers are best influenced when they are given concrete evidence as to how this benefits their company/brokerage.
3. Our association adopted RPR early.  We invite RPR to present and hold classes often.  They are regarded as a resource for the brokers.  Many of the Brokers have invited them into their offices to conduct private classes for their agents.  Regarding statistical information, we produce a monthly report for the members to use in their marketing.  We provide a fill-in-the-blank press release and an infographic that can be branded by the broker/agent.  Another sample of products provided is Terradatum.  By becoming the resource, the brokers support the efforts made by the association. 
4. Our statewide MLS has not yet participated in RPR but does offer the competing product (Core Logic). We do produce monthly existing home sales statistics and the annual NAR Homebuyer's Survey over sample for our state.   These are distributed to all brokers and made available to all members. Use of the information is at the discretion of the end-user. We make it available and promote it during meetings and via our communications channels.
5. Regarding statistics, most of our firms use the statistics to promote their own success.  We have been somewhat successful with a few firms who use statistical information in a meaningful way to promote the market (and not just their own firms) when interacting with the press.

Summary:  Each market is different and it is important that Associations respect the views of the brokers in their particular market.  Overall, Associations have the opportunity to be a resource to brokers and their agents.  In turn, direct communication with the broker is essential in gaining support for the Association.  Office visits have strong results in building relationships and are an excellent way to support the brokers while strengthening lines of communications.

How can large brokers help associations bridge the communication gap with their agents?

1. I find the best way to communicate with agents from large firms is to speak to them directly at their sales meetings.  I am always on the road with my 45 minute “Economic Update” power point presentation.  The sales managers love it because I customize the data for their market, the agents like it because I am not “selling anything”.  I find it very effective because I always end the presentation with 5 minutes on all of the great things the REALTOR family offers.  It is time consuming but with large offices it works very well.
2. By working with the association in disseminating information to their agents; allowing association representatives time on their weekly sales meeting agenda to discuss association programs, meetings, issues, etc.; displaying association information (printed information) in agent areas; including the association website link on their internal website for agents to access.
3. Communication and encouraging involvement.  I think it is important – in fact – crucial for associations to maintain good communication with their largest brokers directly and not assume that the agents within that office represent the views of that particular broker.  By staying in direct contact with the broker, the broker can keep the agents informed and help identify future leaders within their company. Involve the broker in high level meetings when they are able to participate so they are able to communicate the value and purpose of the association.  Make office visits as often as possible either speaking to the agents or meeting with the broker privately.
4. Through encouragement to use the association services that are relevant and helpful to their agents. Associations need to ensure that the brokers are familiar with the services and find them relevant and helpful, and not duplicative or competitive with broker-provided products and services.
5. Regarding bridging communication gaps – We recently did an MLS conversion.  As part of the process, we picked up the training expense for one person from each large office and embedded them into the office as a liaison.  They were the point of contact within that office for updates, feedback, and troubleshooting the new system.  It worked very well.  Our large offices were best prepared to deal with the issues surrounding the conv ersion.  The same concept can translate to almost any aspect of the relationship between the Association and large offices.  Essentially, identifying and supporting a “champion” on important issues with each large office.  We can justify it because through our six largest offices, we reach almost 70% of our membership.  The “champions” are also available as resources to the smaller offices on an as needed basis.  We also enlist the brokers directly on key issues, asking them to be a conduit for sharing information with their agents, especially as it relates to grass roots issues and key projects or events.