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PricePricing

Pricing Strategy: Pay Nothing Until Close560

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DanSmigrod private msg quote post Address this user
Hi All,

I noticed that at least one Forum member's marketing strategy includes pay nothing for until the listing closes.

"That’s right, pay zero, zip, zilch, nada until the listing closes."

Hopefully, this member will post here about the Pros and Cons of making this offer.

Plus, any other Matterport 3D Camera Pros doing this and can share your experience with this pricing strategy?

Best,

Dan
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Conor private msg quote post Address this user
I got offered that by a real estate agent once, and refused, they had the money to pay. I could see the benefit of offering it to sale by owner. I prefer to say to leads/clients (real estate agents) that the first scan they don't pay for it if they don't like it... on the basis that they always like it!
best
Conor
eu3D.com.br
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josephthomp private msg quote post Address this user
Hi Dan,

Though we haven't been doing it long we employ this strategy. Realtors have responded really well appreciating that they don't have to pay for an important piece of their marketing until they are "cash rich".

A couple of caveats here though, I am in Denver which is currently one of the hottest markets so there is very little risk that a property won't sell and in addition they sell quickly.

Some things I considered before offering this is that there will eventually be people who don't pay, they lose the listing or it really doesn't sell for a ridiculous amount of time. But that is something that has to be built into the pricing.

I think if the conditions are right in the market and an organization can take the delayed cash flow this can be a good marketing tactic to set yourself apart.
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andyschwartz private msg quote post Address this user
How are you tracking the sales? Listings that expire?

I am curious. I happen to have MLS access, but I feel that could be a lot to keep track of. I would likely find it more difficult to manage cashflow, I think.
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josephthomp private msg quote post Address this user
I used MLS access as well. Pretty much just manually tracking by putting the property and link to MLS in a spreadsheet waiting 30 days and then just checking the status every one or two weeks.

Obviously as it scales the system for tracking becomes more important and it certainly isn't the best option for all situations. However if it allows you to charge X more then it may be worth the time spent on that tracking. I'm still testing this myself so time will tell.
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YairYepez private msg quote post Address this user
How about paying 30% upfront to scan and publish and the rest until the listing closrs? Wouldn't that be more dynamic and win/win for both parts?
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AltitudeCinematic private msg quote post Address this user
Lol I mean... if your just starting out maybe to get new clients and a portfolio???? or if the homes are selling fast maybe??? but no its unfair as its not a huge expense for them and its a 24 7 open house... no reason not to get paid.
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Jamie private msg quote post Address this user
Very risky way to do it. If the agent doesn't have enough to pay a few hundred for marketing until the sale closes, something is going wrong. You are setting yourself up for a default eventually and then you will have the added expense for collections.

Give them a 30 day account if they need time, but make sure they are aware the access to the model can be turned off if they don't pay their account. Be careful doing this however as you will then have a hard time collecting on a debt where the access has been removed. Use it as leverage and as a last result, switch to private.

If you deal with a successful agent they are aware that you are helping them make their money, so they will generally pay your account. It's the one timers you need to worry about.
Put them on COD until you are comfortable with them
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Mikesobay private msg quote post Address this user
I would't consider it unless they offered a premium above the standard fees. It's possible the house will not sell, in which case you will have taken a risk without the possibility of any premium for doing so. If they do sell, TVM would dictate a higher fee.
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EricThomas private msg quote post Address this user
As a Realtor I understand the logic but I don't agree with it. Asking you to perform a service and not be paid until closing seems ridiculous to me (although thats exactly what a Realtor's job entails...). My job as a Realtor is to market my clients property and get it sold. The cost of marketing is in most cases a no brainer. I pay for photo's ($150), marketing materials, email blasts, online advertising, etc. I think the "real/true" agents would not bat an eye at paying upfront, as long as the price tag is within reason. It is highly competitive in the Real Estate world to win over clients/listings. This tool helps differentiate you from the next guy.

I did a presentation the other day about these tours. 8 years ago HDR photos and touting the fact you work with a professional photographer for images was a huge selling point at a listing interview...Now its standard. Now if you tout you use these 3D tours thats a "one upper"....until it becomes standard practice; which i believe it will very soon. You have to stand out, this is it. I have learned quickly that in the luxury market if you break through with one agent the other agents come running. They can't afford not to offer the same services as their fellow Realtors. This technology is here to stay, they either get on board now or start getting passed up.
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Jamie private msg quote post Address this user
Well said Eric
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RealEstateReadines private msg quote post Address this user
I am a Realtor and Matterport owner. I typically only do tours for other agents in my office. For newer agents that are working hard and trying to get their business off the ground, I have offered to defer payment until closing. These are folks I work with daily in the office and have a relationship with. If I was a photographer and not a Realtor, I would not offer this as a pricing plan.
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franmts private msg quote post Address this user
For the realtors:

If an agent or broker is small to the point that paying upfront is unfeasible due to cash flow limitations, how do you see a matteport photographer becoming a licensed agent as well in order to share the comissions? (In Brazil this can take up to 6 months to happen, although I heard at ICSF that in the US it can take up to 2-3 years).

One party does face-to-face selling with his prospective clients, the other does technology marketing on his own risk. Are similar models running on the real estate market as of today or it would be too ackward a comission split 90/10, 80/20 with a contract between the parties?
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josephthomp private msg quote post Address this user
This is incredible feedback. Thanks to everyone who chimed in especially everyone who has been in the residential space for a while and those who are also Realtors.

Marketing is the biggest draw for something like this and even within this thread there are tons of great points about the marketing aside from any additional offerings like deferred payment.
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DanSmigrod private msg quote post Address this user
7 Tips for Getting Clients to Pay What You Are Worth http://www.pdnonline.com/features/7-Tips-for-Getting-Clients-to-Pay-What-You-Are-Worth-15059.shtml?utm_source=SilverpopMailing via pdnonline
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Dennis_N private msg quote post Address this user
Cant say I agree about this strategy. A scan service is a finished service once the broker receives the link or whatever add on service goes with it. From that point on, it is up to them to use it to their advantage in order to sell the property.
This sounds to me like deferred payment deal, which is something I've avoided like the plague for 15+ years now. It tempts people to scam you, and if that happens, well, good luck getting your money. I'm saying this of course cause I've been burned by this in the past, so I felt like sharing.
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DanSmigrod private msg quote post Address this user
When should photographers get paid?
http://photographyforrealestate.net/2016/03/17/when-should-real-estate-photographers-get-paid/
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