This Week In Real Estate Video #106 – McGrath Takes Property Video To The Next Level

April 18th, 2014

McGrathOZOver the last six months or so Brett Clements of PlatinumHD.tv has been telling me about what McGrath has been doing with video marketing. But it  was just last week that what he was talking about finally sunk in so I now understand what he’s been talking about and I have to admit it’s pretty cool! This video is from last December and explains the general concept. Here is my summary:

  • PlatinumHD has a contract to shoot property video for ALL McGrath listings in AU.
  • PlatinumHD provides a McGrath property video portal at ins.mcgrath.tv.
  • PlatinumHD has hired 5 professional “presenters” (Camille Bianchi. Amber Wyatt. Angela Shallis, Margarita Nazarenko and the Australian actor Peter Mochrie) to be the presenting talent in the property videos. Some of these people were hired from local TV stations. All of them are top notch professional presenters.
  • PlatinumUltraHD has a corporate team of 22 that support this McGrath property video operation.
  • After 12 months operation of this new high intensity video marketing, McGrath has experienced a significant increase in sales. Brett is convinced that the increase is due all or mostly as a result of this new style of video marketing.

Leave it to our Aussie mates to take video marketing to the next level! This is no surprise to anyone that has been following Australian property video for any length of time. It’s also no surprise that Brett is right in the middle of it, although Brett attributes the vision and leadership for this big success that McGrath is having with property video to John McGrath.

When I look at ins.mcgrath.tv I’m struck by how much this looks like a TV channel; polished and professional presenters and top quality production. This appears to me to be a very powerful real estate marketing formula. It may not work everywhere but I’ll bet we see something similar soon in the US and/or CA. If for no other reason because PlatinumHD.tv is already operating both in the US and CA. Look out, the Aussie’s are going to show us how to do this!

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17 Responses to “This Week In Real Estate Video #106 – McGrath Takes Property Video To The Next Level”

  • Nice demo reel. They look to have brought together a very talented staff and have addressed some issues with videos I have seen posted such as poor narration and poor quality video. The downside is that is isn’t likely that the cost to produce the videos is going to be at a point where it will make sense for average middle class homes. Even if the videos will bring in higher prices and quicker sales, will it be enough of an increase for agents to make the investment on a regular basis for more than just the very high end of their listings? Even when an agent or seller makes the decision to use video to sell their home, still photographs are needed for online and printed advertisements. In the US there is still an overwhelming percentage of real estate listings that are presented with exceptionally low quality photos.

  • As good as Brett is I’m not sure he can show all of us here in the US how to do this. That’s not to say that he isn’t good enough, but while he was arguing for better production values with better equipment, more controversial messages, and the importance of number of “views” of his videos most of us were worried about getting the least expensive pocket jib, creating workflows for producing videos that are “good enough” to meet the expectations of realtors who are only willing to pay a couple of hundred dollars for a video about a 4500 square foot property.

    The idea of creating an intellectual library of clips that can be managed and shared across an entire group of realtors is a great idea. I imagine that it enables them to improve their production value by adding more expense, professional presenters for example, but spread that expense across multiple projects thereby taking advantage of economies of scale.

    While even though some of us might be able to arguably produce video with comparable production values, I don’t know any brokers willing to pay for this kind of programming, so in a sense this forces most of us trying to compete in this market to produce videos in the shortest amount of time possible. It becomes virtually impossible for us to develop a creative team to write, present and produce quality property videos on the scale necessary to remain profitable. In fact I’d be willing to bet that the average price of property videos has remained the same or possible gone down in the past three years.

    Good on Brett and his team for sticking with it, they have certainly earned their success.

  • Halstead Property in New York has embraced video in much the same way.

    http://www.halstead.com/propertv

    They use a backend from WellcomeMat.com to host all of their videos, but they jumped into video in a big way a couple of years ago.

  • Agree with Chuck on this one. Completely.
    Property videos, in my neck of the woods ( southeast ) have stayed the same or gone down in the last 3 years.
    Why is it that AU is so far ahead of the US in this market ?

  • @Chuck & Brett – Have you ever been to the Australian gold coast or Sydney area? It’s a different world and culture than the Southeast or California… the Aussie Gold Coast is sort of a cross between Honolulu and NY on steroids. My guess is NY or BC would be more likely locations to do this sort of thing… in fact Fred above points out above that Halstead is already doing this in NY.

  • Like everyone else in the US who is passionate about this business I’m trying to figure it out so I share my opinions with the intent to debate @Brett Martin’s question, Why is it that AU is so far ahead of the US in this market ?

    Its not just that this question is difficult to answer, it is, but I think there’s a fundamental difference between how real estate transactions are done in the US and in Australia. In the US it starts with the relationship between the seller and the listing agent. As long as the seller has an expectation that the agent will market the property as part of their commission it creates an almost adversarial relationship which is passed along to the vendors who work for that agent. An unintended consequence is that the media produced plays a subordinate role in the transaction, whereas in Australia media plays a more dominant role into driving perspective buyers to an auction fundamentally changing the role of the realtor in the transaction.

    This is systemic and tends to result in agents being very competitive so there seems to be little incentive for agents to cooperate even within their own brokerage. Often if you produce videos for the same agent, every video is like the first, there’s little, if any economies of scale. Most agents want to focus on the features, does it have indoor pluming, rather than addressing buyers concerns about lifestyle and community. Partly because its expensive to do, so its only done for the more expensive listings. Sorry but I forgot who it was but someone on this blog went out and shot the local community and was trying to charge agents to use that footage in their productions. That’s a good idea and it would be great to hear how that’s doing.

    In order to produce this level of marketing and make it cost effective for less expensive listings you need to be able to leverage it across multiple listings, which most agents don’t seem to be prepared to do so I believe you’ll start to see brokers taking on the marketing.

    @Larry, I’m Australian so yes I’ve been to the Gold Coast and Sydney.

  • Hi Everyone,

    I think that Larry is spot-on about NYC being a prime place for this type of video/photography to take off. However, as an agent I agree with Chuck that the way that sales are conducted in the US encourages the cutting of corners on marketing. The point about NYC and perhaps some of the higher-end surrounding areas is that it will be that once something like this gains traction, agents will have no choice but to invest because the demand will be driven by the consumer.

    The reason NYC is a likely place for something like this to take root is because the market is almost exclusively high-end…and consumers in these areas are a VERY demanding bunch. I know because I work about 20 miles north of NYC.

  • @Chuck – I agree with your take on seller/agent relationships. I would also say that sellers aren’t demanding better marketing. They just meekly go along with whatever the agent does or mentally hands off the entire process to the agent and doesn’t want to be bothered. In those cases, agents will probably just do the minimum amount of work to advertise the property and if it doesn’t sell, they’ll push for a price reduction. It takes a large price reduction to materially affect the agent’s commission.

  • Larry, I’m from BC and I don’t think BC is ready for this kind of production. I know they have PlatinumHD in Vancouver Island, but their videos is not much better than what is being offered around here. I’d say they produce much lower quality than what they do in Australia.

  • I’d say there’s less expectation from Sellers in the states. I hate to generalize here but there’s a bit of an adversion to realtors. Kind of like going to the dentist. So many sellers will just call ( the last agent used, the perceived “top agent,” or the one agent they know). Completely overlooking the importance of marketing with such things as video. Most sellers are unaware that there is a HUGE difference from realtor to realtor. And if you’re going to have your teeth cleaned just get it over with. But the reality is, the difference between realtors is as wide as the Grand Canyon. Sellers should interview a variety of agents and compare the list of services offered to them. The differences will be vast.

    It’s only a matter time before more sellers become knowledgeable of these differences and demand more.

  • I agree with @Charlie, if others here agree then doesn’t that make you wonder why that is? If there is an aversion to realtors how did it get that way, will that aversion change how property is sold, and what does that mean to how property will be marketed in the future?

    Real estate is no different that any other industry in that in order to develop a solution to a problem you must first correctly define the problem. Unfortunately, talking about real estate is a bit like talking about politics, if I challenge the effectiveness of shooting a house with an iPhone most realtors would question the efficacy of my concern, I couldn’t care less if an agent shoots a house with an iPhone, I own an iPhone so if I didn’t have to use a lot of light equipment etc., that would be great.

    I’m not envious that Brett shoots some of his videos on a Red, I’m jealous because he can afford to hire professional presenters and has a creative team that writes and produces such good property videos. Funny thing is I seem to recall him telling us how he was going to grow his business on this forum, this is where I learned about PlatinumHD, if memory serves me, most of us said it wouldn’t work, realtors wouldn’t go for it, sellers don’t want it, etc..

    I guess its a bit of the old adage: “Those who can do, those who can’t teach and those who can’t do either do social media..”

  • There does seem to be a difference in the way marketing costs are structured between Australia and the US.

    From what I can understand from discussions here, in the US agents pay for all the marketing.

    If that is the case, can someone enlighten me as to why marketing costs aren’t passed on to the sellers?

  • Good question Sharon. Maybe we’re just slow to adapt. The 3 P’s of selling a house (put in MLS, put up sign, pray) are still practiced by many agents. And that kind of marketing cost very little. So sellers have never been asked because cost were so low.

    Today, a minority of agent spend thousands on marketing. But keep in mind too that real estate values have increased dramatically over the last 15-20 years. And the traditional 6% (3/3) is still paid by the sellers. So sellers have always felt the cost to sell is high. Not knowing what the cost are for or how they are spent, many sellers feel the pill they have to swallow is large – I don’t disagree at times. But other times it’s more than justified.

    Today, if one offers professional pictures and video, that sets those agents apart from those that don’t. More service means more clients and a growing business.

    Passing along video fees would just make the commission pill harder to swallow. Yet the more sellers become educated on the benefits of video the more they will demand it and see the value. Maybe soon we can pass the fees along but right now asking for more money is not easy. Today my business is growing because using video sets me apart. To ask for more money might be shooting myself in the foot.

  • Thanks for the reply Charlie.

    OK, so the sellers pay a total of 6% as a standard selling fee? Have I got that right?

    The 3/3 split is for when another agent introduces the buyer – 3% for the listing agent and 3% for the agent that introduced the buyer?

    Our total commission on average in Western Australia for example is around 3%. If another agent introduces a buyer, they may receive a comm split of say .5% to 1%.

    Hope you don’t mind my persisting but maybe we can nut out the difference with how video is developing in the US as opposed to Australia, and if my understanding is correct, certainly the amount of comm you guys charge could be a big factor – no doubt, asking for additional marketing money on top of a 6% fee is a big ask.

    If I was able to charge my sellers a 6% selling fee, I would happily be investing in the best marketing money could buy – the benefits to both the seller and me as an agent are just to valuable not to take advantage of.

  • I agree Sharon. And you’re right on all fronts. 6% goes back before my time in real estate. Back way before the internet and before real estate values were such a significant portion of ones wealth. In many cities 6% is no longer the norm. In progressive markets where homes sell fast and thus little marketing dollars are spent, you might often see agents discounting commissions. But often that translates to discounted services too.

    With the advent of the internet and the advances in technology, I feel agents have a duty to their sellers to provide and utilize every technology available within their means. If that mean spending more money then that’s what needs to happen. 6% is a lot of money and sellers deserve the exposure one can achieve today with so many great innovations.

    Create a story today.

  • What’s that old saying, a broken clock is right twice a day? Maybe what we’re experiencing is partly generational, partly cultural and partly economic.

    What I hear from a lot from “old time” relators is not to worry, real estate is cyclical and it will come back, it always does. The same agents will go on to say that a large percentage of buyers (80+%) start their search online but aren’t willing to spend money producing media that has a hope of standing out online. If you try and educate them they get offended, that amuses me because their the ones telling me that the internet is changing how they do business. I guess that’s kind of how different generation view the same issue differently.

    I don’t know much about the Australian real estate market but I’d guess that however it is its that way because it has been repressed longer than the US market and they don’t have this expectation that it will come back anytime soon so there’s a greater need to market properties to buyers who are not only looking for a good home but is it in an area that supports their lifestyle, are there good schools near by, is this the place they want to raise their family for the long term?

    Here in the US prior to the recession people used their homes as ATM’s and didn’t necessarily take a long term view of their real estate investment, that seems to be changing and I think its trending towards the how real estate is thought of in Australia. Its almost what it might have been like in the early ’70’s.

    Right now the most often heard answer to why a property hasn’t sold quickly is because its priced too high, generally the price gets lowered significantly more than what it would have cost to market it more effectively but the truth is it seems that most realtors here in the US don’t see the value in the marketing and although they might take a small hit to their commission it the seller that’s the big loser. Where I find that realtors can be very good sales people is after they lowered the price by a significant amount they make the seller feel like they did a great job and the price reduction was for the best.

    I don’t think that Brett is the first to suggest the PlatinumHD model, nor do I think that quality property marketing has to be produced in the same way or the same level but I believe the market is changing and if we can’t figure out what those changes are then its pretty difficult for realtors to stay relevant. That doesn’t bode well for us since realtors are the ones who generally hire us.

  • All we’ve tried to do is bring the same standards applied to commercial television to real estate. Time to tell whether what we’ve done was the right thing or the wrong thing. There’s plus and minus on both sides of the fence. Thanks for opportunity Larry to present the discussion and for all the feedback.

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