As Vice President of Revenue at Constellation1, ROI is always at the top of my mind. Whether I’m ensuring we’re driving ROI for our customers or for my own team, I know the importance of getting the most out of your investments. As we continue to hear about fluctuations in the market and rising interest rates in the media, now is a great time to really understand the opportunity for ROI in your tech stack. Read on to learn more about why real estate tech is an investment that can pay off big for your brokerage.
Getting the Biggest Returns on Your Tech Investments
As business owners, broker/owners will naturally want to know whether their real estate technology investments are paying off. They can do this by calculating their ROI, or the net profit from an investment divided by its cost. So, if you spent $1,000 on new software that earned you $2,000, your ROI would be 100%.
But this metric can be limiting because traditional ROI doesn’t account for other industry-specific factors that can have a big impact on your brokerage. These include:
Adoption Rate
Only 27% of agents strongly agreed their brokerage provided all the technology required to be successful, according to the NAR 2021 Technology Survey. This means broker/owners have a major opportunity to meet agents’ technology needs more effectively because happy agents mean better sales. The most valuable technologies included e-signature, property search, social media marketing, and customer relationship management tools, among those surveyed. Many factors affect adoption rate, including the perceived and actual usefulness of the technology, ease of use, perceived or actual benefit, and the behavior of other agents.
Market Share
The US’s ten largest brokerages accounted for about 20% of nationwide market share by sales volume in 2020, according to T3 Sixty’s Real Estate Almanac 2022. Market share helps you understand your performance against you’re competition and measure your growth over time. If new tech allows you to gain market share faster, you know it’s working, even if revenue doesn’t increase as quickly.
Customer Satisfaction
The potential cost of dissatisfied customers in real estate is astronomical because satisfied customers mean new leads. If clients aren’t singing your praises, there’s a problem. In 2022, home buyers and sellers expect brokerages to use technology like e-signatures for signing documents on the go, robust social media marketing campaigns, and tailored customer service with a personalized touch. The solutions in your tech stack need to meet these expectations. If your customer service ratings increase after adding new tech, it will have a positive effect on your bottom line.
There’s More to ROI Than Just Revenue
Technology is revolutionizing real estate, and industry actors worldwide agree new technology adoption is a strategic priority. By measuring your return in terms of agent adoption, market share, and customer satisfaction, you can assess the impact of your tech stack beyond just dollars and cents. These metrics help make sure you’re getting the most out of your investment.
Changing Up Your Tech Can Help You Win Big
Need proof that the right technology really can make all the difference? By working with Constellation1, Vylla Home was able to grow its agent base by nearly 25%, and significantly increase its revenue.
For more information about how upgrading your tech stack can help increase long-term ROI, click below.
* Reposted with permission from Inman.com.
