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Should You Be Utilizing Online Social Networking in Your Commercial Real Estate Brokerage Business?

By Jim Gillespie | December 2, 2009

Online social networking is a phenomenon that has grown considerably in recent years. But is it something that you should be utilizing in your own commercial real estate brokerage business?

While many commercial brokers have begun to utilize online social networking, only a small percentage of them have actually made any money in doing so. So for most commercial brokers the payoff in terms of commissions earned vs. time invested really hasn’t been there for them. But this doesn’t mean that it all couldn’t change over the coming years.

In the early 1990s, the idea of using the Internet to market oneself and one’s commercial listings hadn’t really gone mainstream. Heck, back in 1990 I had my own desktop PC and I was utilizing ACT! contact management software for my own commercial real estate brokerage business. And other brokers would tell me that keeping stacks of business cards with rubber bands around them was working just fine for them.

They just didn’t see what was coming.

And now that we’ve experienced how much the Internet has changed commercial real estate brokerage over the years, the question then becomes, "Will online social networking finally catch fire in commercial real estate brokerage, much like the use of the Internet finally did?" And the only truthful answer I can really give to that question is, "We’re going to have to wait and see."

But I can almost guarantee you that over the next two years in your commercial brokerage business, you’ll make much more money from the time you spend prospecting, marketing yourself, and networking by other means than through online social networking. But this doesn’t mean that you shouldn’t engage in online social networking at all. Because if it really does catch fire over the coming years, you’ll want to be fully on board with it instead of beginning to start from scratch when that time finally gets here.

And in trying to determine whether or not online social networking will catch fire within commercial real estate brokerage, meaning whether or not it will begin making commercial brokers a lot of money, one arena we can look to in determining this is the residential real estate brokerage arena. Because as most of us already know, residential agents have been far ahead of commercial agents in terms of implementing new technology into their businesses. I mean, here we are at the end of 2009 and I estimate that less than 10% of all commercial brokers even have their own standalone commercial agent Web site up on the Internet.

But even on the residential side of the business, online social networking isn’t making the majority of residential agents a lot of money. And as one top Internet marketing expert for residential agents said to me, "Online social networking can be like a bright, shiny object distracting residential agents. It’s just one approach that should be utilized along with many other marketing approaches for them, and the truth is that there are other marketing approaches that are much more effective for them."

In addition, there’s another factor we have to consider in terms of where online social networking could be headed to in commercial real estate brokerage. I heard a future trends expert say when addressing a real estate audience, "We’re now entering the time when the people from Generation X are beginning to hold important decision-making positions within the business world. This is the first generation of people who were raised on video games, and when they want something they’re not accustomed to waiting for it. So when they look to hire a real estate broker, they won’t necessarily take the time to interview different brokers. They’ll gravitate towards hiring the first broker who responds to them."

And with this in mind, since the people in Generation X have grown up with both the computer and the Internet being a more normal part of their everyday lives, online social networking may become deeply ingrained in them by the time they begin making commercial real estate decisions. So while today’s commercial real estate decision makers may tend to be in their mid-40s to late-60s, the next generation will slowly be moving in. And if they’re dedicated to online social networking, you’ll want to be involved in it, too.

So while right now it’s very rare to see commercial brokers making very much money through online social networking, it’s possible that this could all be changing over the coming years.

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