by Ben Hess, Managing Director, ThirdPool Recruiting

I spent some time with a friend last weekend who’s in the middle of troubled real estate transaction.

He’s the seller, and the buyer’s agent made several major errors executing his transaction.

I asked my friend what went wrong. 

The buyer’s agent is incompetent. He’s only completed one transaction per year for the last three years. My agent had to walk him through most of the steps, and he’s still screwing it up!

Low transaction volume contributes to the real estate industry’s poor customer service ratings.

The Redfin researchers found the median number of transactions to be 7 – 9 per agent per year.

Also, nearly half of agents work other jobs to supplement their real estate income.

Glenn Kelman commented,

It’s still one of our industry’s great challenges to bring the productivity of the average agent up, so that each agent earns more, and the consumer gets an agent with more transactional experience.

It’s impossible to get really good at something without repetition and experience.

As you recruit, set the expectation that focus and transaction volume are necessary ingredients to transform a new agent into a professional.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

In the consumer marketing world, net promoter score (NPS) measures how loyal customers are to a company.

Data to derive the score is collected by asking one simple question:

On a scale of 1 to 10, how likely is it you would recommend __________ to a friend or colleague?

NPS scores can range from -100 to +100 and NPS scores are frequently published by industry.

The best companies in world have NPS scores of 70+.  An NPS of score of zero or higher is still considered good, while those companies with negative scores have lots of unhappy customers.

In the recent Redfin agent study, the NPS metric was applied to agent career satisfaction.

The researchers asked: How likely would you be to recommend your current career as a real estate agent to a friend or colleague?

The NPS for all agents was reported at -17. Even more successful agents (those with 10 or more transactions per year) reported a low NPS (-9).

This data tells us that an agent’s career satisfaction is low and they’re generally not willing to recommend the career to others.

Why do agents feel this way? We’re not sure, the study didn’t cite causes. And, perhaps that’s a good thing.

Since you know this sentiment exists, you now have a good reason to personally collect the “why information” for your office or team.

“I recently read that agents are reluctant to recommend a real estate career to their friends or colleagues.  Why do you think that would be?”

The answers may provide new insight to the resistance you feel from your recruiting prospects.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

For the real estate industry, an attrition rate of 25% has been the “rule of thumb” for many years.

This means an office tends to lose a quarter of its agents each year due to failure, retirement, competitive recruiting, and voluntary career change.

According to new research, this estimate is now too low. The average attrition rate for all brokerages was 27% in 2016 and rose to 32% in 2018.

As a real estate leader, this data should motivate you to increase your focus on the core activities that will keep attrition from sinking your ship.

Work on Retaining. Attrition is a business metric too expensive to ignore. Why do agents defect to competitors? What causes new agents to fail? Are there patterns to your attrition that reveal underlying problems?

Wise leaders are constantly collecting data and making changes to improve their value proposition.

Work on Recruiting. If your attrition rate is at 25%, and you’re not recruiting, your office will be empty in four years. The best way to hedge against future attrition is to develop and maintain a constant influx of new talent to your team.

And not just bodies, but talented individuals who fit your culture and will make a long-term contribution.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

Here is a quick recommendation to check out Glenn Kelman’s post on The Next Generation of Real Estate Agents.

Glenn is the CEO of Redfin and shared the results of an agent survey his company recently commissioned.

It was an industry-wide survey and the findings are extensive. 

It covers information from agents about commissions, hours, sales volume, returns on lead-generation investments, income, career satisfaction, customer demographics, and diversity.

We’ll delve into some of the results next week, but it’s worth reading through quickly on your own.

From a high level, how do the results compare to what you’re experiencing in your company?

A big thanks to Redfin for commissioning this survey and openly sharing the results. 

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

A few years ago, the Gallup Organization published some interesting research on the importance of the first-level manager. The researcher found…

Employees are more likely to be engaged in their work when their basic needs are met — for example, they know what is expected of them at work, have the materials and equipment to do their job right and have opportunities to do what they do best every day.

So, how do they get these basic needs met?

Surprisingly, the first-level manager accounts for 70% of what causes an employee to feel strongly connected to their company or team.

From a recruiting perspective, this is valuable information.

The recruiting prospects most likely to make a change are those who have disengaged managers.

For experienced agent recruiting, focus your effort on competitors that are known to have poor first level managers. Agents are most likely to change companies when the agent-manager relationship is lacking, disrupted, or strained.

For new-to-real-estate agents, make sure your interviews include several open-ended questions about the candidate’s experience with their current and previous managers. Often this is where the pain and frustration exists.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

In a recent podcast, Silicon Valley recruiting expert Rick Girard makes the point that recruiting has never been easier.

Why? Because so many people are unhappy in their jobs. 

He cites a recent survey where 87% of LinkedIn users report being open to hearing about new career opportunities. 

A low unemployment rate does not mean workers are unavailable—it simply means talented individuals are swimming around in a sea of opportunity feeling less risk adverse about career change.  

Looking at recruiting through Rick’s lens, nearly everyone is a potential recruiting prospect.

The critical component for recruiting success is a genuine and contagious excitement about the amazing opportunities your company is offering.

Your best tools are referrals, networking, and eyes that are wide open for the talented prospects all around you.

Try asking: Do you feel like you’re in the best job of your life right now? Then see where the conversation goes from there.

Note: You can listen to this podcast here (20 minutes). This is a good opportunity to get an outside perspective on recruiting and see how other industries are solving their talent acquisition challenges.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

Yesterday, we discussed one of the tactics high-performing hiring managers use to be persuasive.

Anytime I address persuasiveness, I’m reminded of some thoughts Peter Weddle published in his newsletter years ago.

A recruiter’s job always involves the activity of persuasion.

We have to present a compelling argument that our opportunity is better than any other opportunity out there, and it’s worth the hassle of making a change.

Good recruiters know and use best practices to persuade.

But, the great recruiters go a step further by forming honest connections with their prospects.

Honest connections are built by convincing the prospect we…

(a) understand and respect their unique needs, goals, and values.

(b) have their best interests at heart.

These honest connections are built by learning about the prospect’s story and then integrating what we have to offer into their big picture.

If persuasive tactics are used for selfish gain (just getting another hire), the process breaks down.

The short-term successes will lead to long-term failures—especially if your objective is to engage and hire the most talented individuals.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

Yesterday we learned cognitive strain hinders the recruiting process and makes it feel like you’re pushing your prospects uphill.

When individuals migrate to a place of cognitive ease, they become less vigilant and suspicious of your ideas and suggestions.

So, how do you get your recruiting prospects to make this transition?

Daniel Kahneman, outlines a number of ideas in his best-selling book, Thinking, Fast and Slow.  Here are the three most relevant ideas that apply to the recruiting process.

Familiarity: The more familiar a person becomes with a topic or idea, the less threatening it feels. Craft your messages in terms the prospect is accustomed to hearing.  Also, connect yourself to ideas and people they find familiar.

Repetition: Geico repeats its famous “you can save 15% or more on car insurance by switching to Geico” so many times it makes consumers believe buying car insurance is about picking the company with the lowest price. Frequent contact with those in your recruiting funnel makes it seem normal to hear from you. Repeating a common message makes listening feel automatic.

Relatedness: Common experiences cause people to let down their guard. Connecting on personal experiences (ex. my parents owned a lake house too) or common cultural references (ex. do you feel like you’re being voted off the island?) help a person feel understood.

Skilled hiring managers and recruiters are effective at leading their prospects to a place of cognitive ease.

Once there, the recruiting process flows downhill.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

Daniel Kahneman, a Nobel Prize winning psychologist, defines “cognitive ease” as a person’s natural desire to make decisions and judgments in an intuitive and automatic way.

“Cognitive strain” happens when decision making requires more conscious judgments and critical thinking.

Dr. Kahneman describes the difference this way:

Your mind is like a cockpit with a set of dials that indicate the current values of essential variables. 

One of the dials measures cognitive ease, and its range is between “easy” and “strained.”

Easy is a sign that things are going well—no threats, no major news, no need to redirect attention or mobilize effort.

Strained indicates a problem exists which will require increased mobilization of [critical analysis resources].

When you are in a state of cognitive ease, you are probably in a good mood, like what you see, believe what you hear, trust your intuitions, and feel that the current situation is comfortably familiar.

When you feel cognitive strain, you are more likely to be more vigilant and suspicious, invest more effort in what you are doing, feel less comfortable, and make few errors, but you also are less intuitive and less
creative than usual.

By default, recruiting prospects experience cognitive strain during the recruiting process. In this state, it feels like you’re pushing them uphill.

Relieving the cognitive strain allows the process to move more freely.

How do you get a recruiting prospect to transition to a state of cognitive ease? We’ll cover this in the next Insight.

Until then, try looking at your interactions through this lens. Pushing someone experiencing cognitive strain produces a diminishing return.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

Before a recruiting prospect can even think about working in your company, they must become aware that the opportunity exists.

The number of people who really know who you are and what you offer is relatively small.

And, this small group has a normal distribution of quality.

Some will be smart and talented. Most will not.

Some will be focused and motivated. Most will not.

If you spend most of your time trying to convert a finite group of prospects into hires, you’ll experience a high level of frustration and poor results.

This is why high-performing recruiters dedicate a good portion of their time and resources to building awareness.

The engagements with high-quality prospects will multiply if you’re constantly growing the sphere of individuals who are aware of your opportunity.

How do new prospects become aware? Many ways.

Personal connections, direct experience with your company, advertising, interactions with your agents, radio programs, referrals, social media posts, networking, realty show, events sponsored by your company, and many more.

Every interaction your company has with your community is an opportunity to increase the awareness that you hire talented individuals and transform them into prosperous agents.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

Over the weekend, Carl Franzen of Inman News wrote his weekly commentary on the exit of Purplebricks from the U.S. market.

He did a great job of summarizing some of the factors leading to their demise. Perhaps the most important factor was the confusion consumers experienced trying to understand their business model.

The fact that Purplebricks offered a flat-fee, upfront, of several thousand dollars but only for certain categories of homes and ultimately pivoted its model to something else approaching more traditional brokerages (with variable fees paid at close) probably did not help it convey a coherent, clear, simple marketing message.

Simplicity and clarity will get you a long way in any business, especially one as complex and thorny as real estate.

This is a lesson we should apply to recruiting, as well.

Developing and articulating a clear and concise recruiting message enables the right recruiting prospects to successfully engage your team.

Here’s why agents are successful here….

If you join our team, here’s what’s in it for you…

Simplicity is not easy. That’s why those who develop it have an advantage.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

Two years ago (June 2017), Google launched Google for Jobs as a way of indexing job postings from around the internet.

Initially, Google partnered with some recognizable recruiting sites (ex. LinkedIn, CareerBuilder, ZipRecruiter) to get traffic flowing.

But over the last year, they’ve made a transition to delivering more organic traffic directly from employers in their search results.

According to industry experts, the increase in Google’s organically sourced job traffic was minimal in the first year (7% increase). However, organically sourced job traffic jumped 168% in year two.

As Google continues to incentivize more employers to feed their jobs directly into Google, there’s no doubt in my mind that it’ll become the dominant driver of traffic to an employer’s jobs and career sites.

What’s this change mean for you?

As an employer, you’ll either need to learn how to play the Google job search game on your own, or partner with someone who can play it for you.

None of this stuff changes overnight, but it does consistently evolve.

There is a broader lesson in play for our businesses in general:

When you notice the effectiveness of your favorite techniques starting to wane, it’s often a sign the underlying current has changed.

Effective leaders don’t fight it–they pivot and head in the new direction.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

This week we’ve been discussing the powerful affects a growth mindset has on your recruiting performance.

While there is still much to learn on this topic, there are some common ways the growth mindset concepts are misapplied in organizations.

Misapplications in business often stem from a common source—overemphasizing effort at the expense of results.  

In a recent HBR article, Carol Dweck warns leaders against falling into this trap.

Outcomes matter. Unproductive effort is never a good thing.

It’s critical to reward not just effort but learning and progress, and to emphasize the processes that yield these things, such as seeking help from others, trying new strategies, and capitalizing on setbacks to move forward effectively.

In all of our research, the outcome — the bottom line — follows from deeply engaging in these processes.

If you’re leading an organization or team, don’t give people a pass just because they’re trying hard. Hold them accountable for measurable results.

If you’re an individual contributor, make yourself accountable to someone who will help you achieve measurable progress.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

It’s Friday, so let’s take on a lighter topic.

As a recruiter or hiring manager, you probably spend a lot of time on written correspondence.

Since connecting on the phone is increasingly difficult, much of your communication happens via text, email, and an occasional handwritten note.

If you’re a stickler for grammar (or went to school a while ago), you may sometimes find yourself struggling to communicate with singular pronouns when gender is not known.

For example: When a candidate shows up for an interview, I make sure to greet [pronoun] with a warm smile.

Defaulting to the male pronoun (…sure to greet him) is the traditional convention when gender is not specified.

An awkward alternative is to use both pronouns (…sure to great him or her).

According to numerous reputable sources (ex. Merriam Webster, Associated Press Stylebook), the new, and most appropriate way to handle these situations is to use the singular “they/them” pronoun.

If you’re an old-school writer, this convention may not feel correct. However, it’s now the most grammatically correct option.

So when writing a note to a recruiting prospect, treat them with respect by using the appropriate pronoun.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?

by Ben Hess, Managing Director, ThirdPool Recruiting

Yesterday, we discovered some of the reasons agents fail when beginning their real estate careers or changing companies.

Considering the criteria that researchers outlined, the chances of hiring a high performer seem daunting.

In turn, it’s tempting to retreat into the shelter of selectivity.

I’ll only consider recruiting prospects who meet the high bar that research, my experience, and my gut tell me will result in a successful hire.

Taken to an extreme, selectivity will hinder your results.

The quickest way to fail as a recruiter is to hire no one.

It’s better to perform most of the tasks of recruiting (sourcing, screening, interviewing, nurturing, etc.) as if you’re non-selective, and then say “no” to those who don’t meet a reasonable standard at the end of the hiring process.

• • •

Search for other Recruiting Insight Postings

LIKE TO LEARN MORE?