The Next Generation of CRM Explained by Matthew Hardy
Matthew Hardy, a 20-year CRM veteran at Real Estate Success Tools, eloquently addressed ideas proposed on our CRM 2.0 article about why social networks aren't portable into CRM systems. It's exactly what I wanted to hear, and I'm republishing his thoughts here with a few more discussion points:
Matthew Hardy comments:
As a relational database expert for over 20 years, I've designed and developed many CRM systems. What is very interesting (and sometimes makes me chuckle a bit) is the number of agents who, having gotten deeper into the operation of vendor-hosted database systems, start asking: why aren't these systems 100% interoperable? The core answer is because vendor-hosted database systems, ranging from CRM-types such as TopProducer to social media applications, derive their value and, when applicable, their monthly charges from NOT letting users have open use of the data collected. In other words: it's their system, not yours.
pk: This is absolutely correct as the business model of CRM 1.0. I'm speculating that any CRM system that allows data interoperability in a 2.0 manner could create the viral marketing buzz for fast adoption by positing the benefits of flexibility and automation.> The real estate professional theoretically should overload a CRM system because, unlike B2B professionals who tend to work with smaller networks, the agent generally casts a wide net of prospects, potentially thousands, in various stages of the transaction process.
I have not encountered an agent or team who's business would overload the systems I've developed as these systems can handle millions of records easily. To refer to Gary Kellers "Millionaire Real Estate Agent", you'll need 1,620 people in your "met" database or 16,000 in your "have not met" database to make a millionaire dollars in real estate. These are really small numbers (database-wise), yet I still don't find many real estate agents who even approach these levels.
pk: I notice I misphrased my thoughts. I was thinking that many real estate professionals would become overloaded using and maintaining the system as they developed their database. I was imagining the manual labor involved in continually adding and subtracting data records for 16,000+ leads; the most committed and successful agents who can hire assistants will do this. I can see how these systems can scale data easily.> The problem with CRM systems is the laborious process of inputting contact data. It's simply not automated, and CRM systems aren't updating themselves to automate the input process.
Here, I think you might be misunderstanding the differences between pure marketing systems and CRM systems. For instance, you may have many people you'd like to send mail to (the most common "bulk" or "mass" function of marketing systems), but how many people can you actually engage in "relationship management" with at a time - at any given moment? Your ability to quickly reference detailed history information on a person while conducting a phone call or meeting is what CRM is really about.
pk: Again, I am thinking social networks make ideal foundations for CRM systems by allowing a real estate professional to "one-click"/"add a friend" client profiles and contact data. The traditional CRM alternative is to manually input all that data. The CRM's history charting functionality on a client by client basis is the customized asset that social networks don't provide now, but could be implemented if a social network wants to add this kind of CRM functionality.If you were selling widgets, a good CRM system should automate the inclusion of a customer's purchase for sales history perusal. But selling real estate is different; just ask Glenn Kelman of Redfin.com. There are simply too many vagaries involved in the real estate purchase process to fully automate it.
The answer is to own a database system that interoperates with hosted solutions. An example is something my company is releasing soon: you store data on your clients in a private system you control and, through application programming interfaces provided by companies such as Zillow or Trulia, data from the outside system is displayed, real-time, within your system. In essence, you become your own aggregator as it relates to market data and analytics applying to your client's properties.
pk: I agree that aggregation, as a potential step towards complete integration, of web based applications into CRM is a timely idea and look forward to seeing this development on your system.> LinkedIn, Facebook and other social media applications have user-generated contact data and personal details - all that's necessary is to port the data into the CRM application.
This is assuming, of course, that the application owners allow you to export the data. Setting aside most social media applications for a moment, all vendor-hosted real estate applications I've analyzed do not let you export this data. Often you can export the most "base" data (names, addresses, etc.) but NOT export the truly valuable history and relationships data - that's how they keep you as a customer. If you can find a comprehensive export functionality in popular social media applications I'd be surprised. The term "port" (as it relates to data, not programming) generally means exporting then massaging or parsing the data then finally, importing the data into another system. This is a common capability in systems I develop.
pk: By creating an open framework for import/export from your system to other systems, your product seems already positioned to be customer centric, which of course is the hallmark of any 2.0 system.> It may be nothing more than dragging and dropping URLs containing the data or cut/paste the conversations in a contact timeline.
I thought you wanted it automated?
Seriously though, these are simple human functions that rely on the
analysis of the human - still a very important element in converting a
new contact into an income source.This is a great topic; there is much more I could write should you like to delve further.
pk: With a stopgap measure of aggregation of web based applications, at least the display of relevant CRM relationship data from these applications can be accomplished. I believe that one of the social media applications like Linkedin or Plaxo will get the idea that they could provide a more enterprise-focused application for CRM (under a different brand name) based on leveraging their existing client database.pk: Final note: the real estate CRM space is quite crowded. How does a CRM system vendor differentiate themselves in this space? With social media on the rise, won't CRM vendors need to actively address data interoperability? Or do they believe their customer base is still in the stages of purchasing the client based CRM they have been purchasing over the last 20 years?
Thank you Mr. Hardy.
How does something like this fit into the model where the Broker is running a CRM solution (NetAspects, Point2, SphereBuilder) that allows for lead assignment and management?
Reply to this
Broker distributed lead management systems would work similarly by defining permissions to various agent users who would conceptually share the same CRS system behind customized walls so other agents can't poach leads.
For lead management systems that are populated directly from broker lead generation inquiry sites, CRM systems might add a few functions that leverage contact data already on the internet. Obviously, asking for a Linkedin or FaceBook link as well as an email address/phone may be considered too intrusive, but there are other ways to identify leads.
I think CRM systems should automate the ability to Google or MetaSearch (via a set of search engines) on names, email addresses and phone #s input into inquiry forms. The returned search data might include social media based contact details like Linkedin, corporate website information and other lead identifying data. Even better would be automated / screen scraped population of these data into contact fields.
After enhanced lead contact details are captured, broker might be able to display data to agents who might bid on leads they want to work. This would make lead distribution more efficient than randomly assigning leads in order.
Reply to this
I met Matthew briefly at Bloodhound UnChained and was very impressed with what he had to share. I learned a LOT more here. Thank you both.
Reply to this