Blog: Proptech market gap in Spain by Rishi Mancham
The real estate market in Spain has become very competitive for local realtors with all these online realtors, aggregators and of course the bigger companies that have grown fast in the latest “tech boom” after the crisis with many funding opportunities and market gaps for expansion. Local realtors have survived the last two decades and are barely able to keep up in their local market with some competition but without analysis in customer behavior and real estate data. Online competition is hard, and most realtors are lacking in the face of current market conditions where online representation has become important.
The market is saturated in terms of “innovative” solutions and it is getting more difficult to actually get a piece of the market with a new solution. The reason where many companies fail to understand is the lack of understanding and behavior of realtors and agents. Many realtors are spread out and survived their financially difficult years and have more than ever confidence in their old systems because of this. Putting solutions in the market that are too innovative and trending are a treat for the market as solutions are being sold to realtors, spread out randomly in the market promoting more leads, time-saving, and so on without the right guidance for sustainability, and that’s why it creates this “ resell a new solution” concept to the same customer from tech companies building solutions as their core business.
Sustainability is achieved when people work in a hybrid way with technology ( so not fully automated) to subsequently shape the understanding and vision from the person that fluids from his or her experience in the field and the piece of technology that has been brought into his or her business. This is the input, realtors in Spain need to leverage technology into adaptations and progress for their business parallel with market conditions or to even go in front of the market.
However, “ going in front of the market” is a tale told by many salesmen, trying to sell the next big thing. Basically, it is a created reality whereby the customer goes into “ a new world” with a new piece of technology or solution, making a customer blind for his or her surroundings, not able to achieve sustainability right after the implementation. The market moves fast where businesses try to push their solutions to realtors with the newest tech without any guidance and realtor empathy. Unless a business has a patent for a piece of technology that gives a business a competitive advantage automatically and on a short-term. The “small” local realtors are leaning towards a mindset where there is an eagerness for more market control and desire to sustain a business with technological improvements to stay in the market, which in my opinion needs and should happen in a method of gradual adaptations towards innovation.
Also, the market lacks in guidance and knowledge about how to innovate realtors from the current market positioning to become a more technological company with gradual adaptations as this is the market gap and secret sauce to jump in the market and assist in building sustainable realtors with technological improvements. For a realtor in Spain, to keep up with the market and “ be in front of it” they need to train their mindset with their behavior towards technology and the understanding of it , work smarter in the cloud with different devices, smart automated workflows integrated across different platforms but all connected to each other, understand the impact of technologies and integrate solutions like artificial intelligence gradually with the guidance for sustainability to understand the impact of those adaptations to their working lives and not just “ trust the new solution because it is new and it works”.
All this is to achieve a more fluent working behavior and become more hybrid with technology as synergy is the key to sustainability. That’s why tech companies with solutions will start to evolve into tech consultancy companies with more focus on training and adaptations of the customer with their solution, instead of training functionalities and integration in the company. Those will be basic services, but the method on how a tech company sustains a solution for their customer for future progress and personalization will be the next competitive advantage to benchmark. This is also why collecting data and analysis are important to have for realtors in Spain. Realtors need to make the decisions for themselves, instead of choosing between new solutions in the market as realtors know better at some point what they want, but only when they achieve a great synergy between their current technology in automation and their own working experience.
That’s why, to stimulate change in the Spanish Real Estate market, a company needs to showcase technology as an adaption instead of innovation with the required consultancy to aim for sustainability and shared knowledge in the market. In this way, a realtor becomes entrepreneurial to innovate their business with personalized improvements. This is the market where we are going to in Spain and that’s why realtors will have to adapt to market conditions with new solutions like artificial intelligence. These tech companies will have to guide realtors to understand the market, the technology and especially themselves to let real estate agents become more hybrid with available solutions like a.i. With personalized adaptations in proptech, the market will become an open market and open source with personalized market competitive solutions.
Furthermore, the Spanish Real Estate market is an interesting market to analyze digital-wise on the internet. It has become easier to map local realtors but especially to map the bigger companies. They are spending loads of money on advertising in google ads, facebook ads, and buying domains/websites for exposure. Local realtors are losing territory in the “yellow pages” (google) by those companies and marketing agencies. Customers are being directed into a tunnel vision and because of this, these customers are automatically being guided towards a realtor without even looking around to other competitors. However, customers are will see through this anytime soon and will look for more personalized services, solutions and recommendations.
The reason why it has become easier to map/categorize the local realtors is that they are all spread out, surviving with a few local properties, depending on their local brand recognition and with not a lot of focus in online marketing and technology. There is no unity to push each other to new boundaries with gradual improvements and risk-reducing decision making. Realtors are companies with humans, all spread out with their own needs but with the same passion. It is a market where realtors try to innovate independently with their own research or try to learn from old fashioned organizations to attend seminars or presentations whereby afterward, not much has changed, and the desire for stronger competitiveness is not growing hard enough to keep up with the market.
That’s why the market is screaming for a sort of kinship, where realtors can be a member off, to receive consultancy about managing a realtor business, market trends, marketing, and technology. But also, to actually integrate these technologies they are in need of (personalized), including trending adaptations in artificial intelligence from that same consultant or organization a realtor get advice from.
Creating and maintaining a kinship nowadays means; equal voting rights between realtors to change a common used system, sharing knowledge to improve for the better good, empathy for each other in good and bad economic weather and to stimulate realtors to stay independent leaders in a kinship with personalized solutions to stay competitive in a shared market where solutions and ideas are open source to create a business value for each realtor to stay distinctive. The market will become more interconnected whereby realtors need to personalize more, digital wise and mindset wise to create a unique value for their business and provide services to customers with more understanding of the customer and the general market.
Smart automated workflows across different devices and systems, data analysis and a.i. while understanding their own needs and understanding how technology can leverage themselves instead of their business, will create small utopias of realtors in Spain. Meaning, resources should be open source and experiences should be shared to benchmark and learn from each other and furthermore, realtors need to be more appealing online and towards customers physically, whereby realtors can build their own utopias in their region where there is more understanding of the local market’s needs and their own vision with proptech solutions like a.i., as this will trigger realtors to become fully aware of specific regions, customers and their own company identity where realtors are able to adapt and be approached more personally and emphatic by customers.
Concluding, to put this in realization, a proptech company should adapt as written above in regard to the market gap and the trend the market is going to, according to me. Realtor agents should not move into data analysis and cannot become a semi-tech company implementing all these new solutions without developing their own personal mindset to achieve synergy with those solutions to become a sustainable realtor.