Moving is a nightmare for consumers. It’s expensive and requires the coordination of so many tasks. As it turns out, companies offering services for moving, utilities, phone, internet, and others really want to make the experience of moving a lot easier for the consumer. In a press release yesterday, ERA’s Simon Chen announced ERA Moves.
Franchises like ERA make partner announcements to bolster the services that they deliver to their franchise brokers and agents. In some cases, ERA supports the partner in distributing their product or service to the ERA Network. Sometimes the partner pays ERA a marketing fee and at other times, ERA gets a success fee when brokers and agents buy the product. Neither of these are the case with ERA’s new program, ERA Moves, which is based instead on mutual success.
With ERA Moves, MooveGuru will be white labeled as ERA Moves. The MooveGuru program is free–agents or brokers do not pay for it. MooveGuru gets paid by their utilities and advertisers. When consumers use ERA Moves to get moving related services at a reduced price, MooveGuru shares the revenue that they get to the broker as a referral fee. Simon Chen could have asked MooveGuru to cut ERA into the revenue share, but he didn’t! He felt it was important to funnel all of that benefit back to the brokers and agents!
Broker margins are under attack. The story goes something like this: if you want to make a little money in real estate, start out with a lot of money and become a real estate broker. After a while, you will have a little money left. Franchises would do well to take a page out of Simon Chen’s strategy book by starting to focus on how they can help re-margin the broker who is in the center of the transaction. Rather than thinking about how ERA can extract more margin out of their broker, they are thinking about how they can contribute margin to the brokers.
I would love to see a ranking of franchises that examines how well they perform against the broker’s retained earnings. Franchises should be selling brokers on that key metric. Brokers do not want to pay the lowest franchise fees. They want to pay franchise fees if they deliver value.
In the case of ERA Moves, consumers get access to discounts on the moving services they need exactly when they need them. The discounts are sent out on behalf of the broker and agent automatically (all branded). Broker gets a percentage of the referral fees from the moving partners, and MooveGuru keeps the rest.
I don’t know how much revenue brokers will get from this program, but they will get something. And whatever they get will be a bit more than they would get without ERA Moves. I don’t know how many other opportunities there are like this which will drive broker revenue, but evidently Simon Chen is on a mission to capture them.