Adam Hertz (Realtor in Missoula, Montana) shares how he and his wife Brittni "accidentally" built an extremely successful real estate team.
Adam Hertz (Realtor in Missoula, Montana) shares how he and his wife Brittni "accidentally" built an extremely successful real estate team.
Adam Hertz: On the flip side, when I was fresh out of college, it was difficult because there was no job market. Rates weren't super low, they weren't super high. The first interest rate, I think, was 5.5% or something, but it was just really hard to make money. It feels like it's a lot easier to make money now. I think now is a more difficult time to be a first time homebuyer but it's not like it was easy. People look back, “Oh, homes were so cheap.” It’s like, “Yeah, they were so cheap. I worked three jobs in order to be able to afford my first home.”
Tim Chermak: This is The Platform Marketing Show, where we interview the most creative and ambitious real estate agents in the country, dissect their local marketing strategy, and get the behind the scenes scoop on how they're generating listing leads and warm referrals. We'll dive into the specifics of what marketing campaigns are working for them, how much they're spending on those campaigns, and figure out how they have perfected what we call the Platform Marketing strategy. This is your host, Tim Chermak. I'm the founder and CEO of Platform. I love marketing and I talk too much, so let's dive in.
Tim Chermak: Hey guys, it's Tim Chermak. Welcome back to another episode of The Platform Marketing Show. I'm joined this morning by Adam Hertz coming at you from Missoula, Montana. Adam, welcome to the show.
Adam Hertz: Tim, thanks for having me.
Tim Chermak: Adam has actually become a pretty good friend of mine since he joined the PlatFam here. I think you officially joined at this point three or four months ago, but we've been friends over the last year. We were actually connected originally via Brandon Smith, who was a previous guest on The Platform Marketing Show, who also hails from Missoula, Montana.
Tim Chermak: It's cool to have Adam on the show. He runs one of the most successful, if not the most successful, real estate team, really, in the state of Montana. We were chatting earlier, his team sold over $60 million, actually almost $70 million in volume this last year with fewer than 10 agents on the team and several of those agents were actually brand new last year. That nearly $70 million production wasn't 10 people. It was actually fewer than that.
Tim Chermak: Adam runs one of the teams where the agents are actually selling homes. A lot of people have big teams and every agent on the team sells two houses a year, that is not the Hertz team. Adam, welcome to the show. I'm excited to dive into really how you've built this business and how you've got it to where it is today.
Adam Hertz: Thanks, Tim. Sometimes it feels like it was all on accident and then I look back on it and I'm like, “Oh, maybe we did some of these things strategically.” Also, I'm on the team. I think it's fair to say that Brittany runs the team and runs the show and is just in charge of the entire world but it is my last name, I guess.
Tim Chermak: For those who don't personally know Adam, Brittany is his wife. Probably should have actually had Brittany on this podcast episode too, but you and I have become friends so it was just easier for me to text you and interview you. Adam was a speaker at last year's Platform Mastermind. Just from the exit survey questions we did, people really loved your talk at the last Platform Mastermind. Your session was really more about investing in tax, tips of, “Hey, once you build a successful career as a realtor and your GCI is higher and you're getting to the point where, ‘How do I start investing my money? How do I shield some of that income from taxes?’” We're actually recording this episode on April 15th. That feels like a relevant detail to bring up. Adam's presentation was all about how he's been able to build a real estate business that has high GCI, high income, but he's also reinvesting that back into real estate in a tax efficient way.
Tim Chermak: That's actually not what we're going to discuss on today's episode. What we wanted to discuss in today's episode was how Adam built that business in the first place. How did you get your team to where you're selling $60 million+ of real estate a year? There's a lot of teams out there that think they're crushing it when they're selling $10 million or they eventually get to $20 million. You're with a relatively small team, again, fewer than 10 agents producing, and really fewer than that, because I know you mentioned several of those agents were brand new last year and weren't really producing a whole lot. You sold nearly $70 million. Adam, how did you get into real estate? What is your origin story of how did you become a realtor?
Adam Hertz: I was in college at the University of Montana, Missoula, and I was playing in a punk rock band. We started going on many tours and regionally and it got to the point where we were like, “Oh, we could do this full time.” I dropped out of college for a little while, was touring on a punk rock band, learned a lot about marketing and how to do marketing essentially for free and how to build a brand and name recognition on a very low budget, if not for free. That was a really good experience.
Adam Hertz: I eventually did go back and finish college, got a finance degree. I went to work in the wealth management industry, which I did not enjoy at all, but that was in 2008 when I graduated college. I was hired on a Monday in September, it was near the end of September, 2008, and that Friday was the day that the stock market had its largest crash ever. I think at the time, I don't know whether it was the largest crash by percentage or by points or whatever, but it was a massive crash.
Tim Chermak: Probably both.
Adam Hertz: Yeah, exactly. They laid off a quarter of the company four months after I was hired, which included me. A lot of people obviously were hurt by that and bummed out. I was stoked ‘cause I got a severance package and I really didn't want to be there anyway so I came back to Montana. That was in Seattle. I came back to Montana and I couldn't find it. There were just no jobs. The economy had just been crushed. I started in the mortgage industry because it was commission only. It was the only job I could find that I thought I could maybe make money at even though it was commission only. I started doing mortgages and I did that for a few years.
Tim Chermak: I actually did not know that you used to work in mortgages. I'm actually learning a lot about Adam right now. By the way, here's an important detail that our viewers need to know so that we can look it up. What was the name of your punk band?
Adam Hertz: It was called The Sharktopus.
Tim Chermak: A combination of octopus and shark.
Adam Hertz: Yes. It was before the B-movie. There's now a series of B-movies called The Sharktopus.
Tim Chermak: But important, you were first.
Adam Hertz: We were first, yeah.
Tim Chermak: Naturally, you started a punk band called Sharktopus and then majored in finance, which is great. When you say, “Oh, I went back and finished my degree,” I'm assuming you're going to say, “I majored in art history or sociology or music,” or something when you started a punk band. “I went back and finished my finance degree.” I'm like, “Okay. That was not what I was expecting, but okay.”
Adam Hertz: To me, punk rock is hand in hand with libertarianism. That's not the way that it has turned out ironically and hilariously. We could go off on a whole podcast about how silly that's gotten, but I was a punk rock libertarian and I feel like I still am. I know I look really clean cut today ‘cause I got dressed up for this podcast.
Tim Chermak: There’s obviously a lot of people that are listening to this on Apple or Spotify that aren't necessarily seeing the video, but Adam has just this sweet long haircut. Hair I believe is touching your shoulders right now. It's really a majestic mane. Again, it's just not what I think when I think of a guy who goes and majors in finance and then gets a job in the financial industry, but I digress. You left, or actually, this company left you, you got a job in mortgage, and what happened then? Obviously, going into the mortgage industry in 2008 wasn't exactly an ideal time to start there.
Adam Hertz: I had been laid off in early 2009 and so then got into mortgage in 2009 and that was the bottom of the mortgage market. I did mortgages for about three years and I did one purchase transaction. It was all refis and almost all of those refis were through the, what was called, the HARP program, which was if you had a Fannie Mae or Freddie Mac-owned mortgage, you could essentially just refinance it. It didn't matter if it was underwater. They were just trying to get people's payments lower and so appraisal didn't matter. In some cases, debt-to-income didn't matter that much. It was just a program to try and refinance Freddie Mac and Fannie Mae mortgages so that they didn't go into foreclosure because there were so many loans that were in foreclosure. That was the bread and butter of my business. It was very difficult, for sure. A lot of people had second mortgages on their house and generally, you couldn't get one of those HARP loans if you had a second mortgage because that mortgage company would need to agree to participate. It was a really tough time to be in mortgage for sure.
Tim Chermak: Being you had that experience, Adam, what would you say is the tougher environment to be a real estate professional? Whether you're on the mortgage side or the real estate side, would it have been 2009 or where we're at right now? I've heard some people say that now is almost more difficult in the sense that even a perfectly qualified borrower with great credit score, and maybe even they have saved over 10%, they still often can't afford homes now because interest rates are high and home prices are high, but at least what you had back then was the home prices were still relatively affordable relative to median income in 2009. If you had a job and you had your ducks in a row financially, it was actually a great time to buy a house because it was a buyer's market, where what we have right now is, even if you're doing well financially, nothing is affordable. Do you think it was harder back then or harder now? How would you answer that question?
Adam Hertz: It's a tough question to answer. I got into sales in 2013, I guess, 11 years ago. The interesting thing about the market then was, at least in Missoula, we didn't have a good job market so there wasn't a lot of people with strong income. There wasn't a lot of out-of-state demands like there's been recently but prices were definitely low.
Adam Hertz: The difference is, I would, at that time, go out and show somebody 30 homes, and this is the person that’s pre-qualified and the homes are affordable, a ton of options on the market, I'd go out and show them 30 homes and then the challenge would be, they'd be like, “My dad thinks the market's going to crash again,” or something like that. We were at the bottom of the market but hindsight is 20/20. People were like, “Oh, the market's going to crash again. It's just barely starting to recover and things aren't good.” It was a whole different challenge. Today, people feel more comfortable about investing in real estate. It felt like a scary thing to do back then.
Adam Hertz: When I hear people complain about the affordability today, there's no doubt, numbers-wise, our prices are very high, and now, our interest rates are really high. It is an incredibly unaffordable time to be able to buy a house. It's very difficult right now. On the flip side, when I was fresh out of college, it was difficult because there was no job market. Rates weren't super low, they weren't super high. The first interest rate, I think, was 5.5% or something, but it was just really hard to make money. It feels like it's a lot easier to make money now. I think now is a more difficult time to be a first time homebuyer but it's not like it was easy. People look back, “Oh, homes were so cheap.” It’s like, “Yeah, they were so cheap. I worked three jobs in order to be able to afford my first home.”
Tim Chermak: That was back in 2009. You got into sales, did you say in 2011?
Adam Hertz: 2013, I got into sales. In 2011, I was elected to the Missoula City Council. We built our first house and we started it in 2010 and we finished it in 2011, Brittany and I. I was frustrated by the process and all the permitting fees and things that we had paid and I'd always had interest in government. I wasn't involved in it. I didn't get a poli-sci degree or work on campaigns or anything but I was just really annoyed by that process. It was a spur of the moment, somewhat thoughtless thing. I was like, “I'm going to run for city council,” ‘cause I heard that there was going to be an election that year. I ran for city council and I unseated an incumbent by five votes. That was sort of a part time job, really. In Missoula, there's 12 city council members. It's probably 15 to 20 hours a week so I was doing mortgages at that time. I was also doing other stuff on the side like painting houses and stuff.
Adam Hertz: In 2013, my father-in-law who owned a real estate brokerage had been asking me to switch from mortgages to selling real estate for probably at least a couple of years. Finally, in 2013, I was like, “All right, I'll give it a shot.” I was the second agent in our market to be buying Zillow leads so it was very early on the Zillow leads, back when they were cheap and they were very low quality. They hadn't been scrubbed like they are today so I might get, no joke, for a few hundred bucks a month, I bet I was getting five to seven Zillow leads a day, an incredible amount of Zillow leads because there was nobody buying them and Zillow was exploding.
Tim Chermak: What year was this?
Adam Hertz: That was 2013.
Tim Chermak: Okay, yeah. I actually remember when we officially launched Platform, I guess legally, it became an official LLC or whatever in 2014. At that time, realtors were just starting to talk about, “Oh, I'm using Zillow.” For the most part, agents raved about Zillow in 2014, 2015, even into 2016, 2017. Zillow was still usually a pretty good deal. You would pay them X-amount of money every month, but you would usually be getting a 5:1 to 10:1 ROI on that. It did not have the stigma back then that it does today of being so expensive and not really getting a return on the investment. Your story there seems to jive with my experience at the time of agents. Agents liked Zillow. It was a good marketing investment at the time.
Adam Hertz: Totally. It is absolutely how I built my business originally because I didn't know what to do. I didn't really have a sphere. Yeah, I was on city council. I was really young. I had some name ID, for sure, but not a lot at that time. My ROI on Zillow was crazy. I was terrible at working leads. I didn't have a CRM system. I didn't have any of the tools that I needed. I'd get a lead and I'd call them and text them and send them an email. If I didn't hear back from them, that lead just disappeared into the abyss. I was really bad at working leads. Eventually, that is how I built my business.
Adam Hertz: A few years down the road, I'd gotten so busy that I wanted to hire a real estate assistant. My wife, Brittany, who owned a property management company at the time, who was not loving property management, she's like, “I'd really like to get out of my property management business and come work as your assistant.” We structured a deal to sell her property management business, which she owned with her identical twin sister, to another property management company in town and she was going to join as my assistant, which lasted, I wouldn't even say a day. I think it lasted about an hour. She immediately had business because she knew people and grew up around here and was so outgoing and so much better at sales than I am. Immediately, she hit the ground running and was crushing it and was calling these old Zillow leads. She was never an assistant. She was immediately the team's top producer.
Tim Chermak: Really, you were her assistant within an hour.
Adam Hertz: Absolutely. I was having to reign her in and help her transactionally because she was new, but on the sales side, she was crushing it. We eventually did get an assistant not too long after that because we really needed one and then we just built a team somewhat by accident.
Adam Hertz: Brittany's identical twin sister saw how well she was doing, wanted to get out of the property management business as well because after we sold it, she was still working there for a while. She joined the team, and then eventually, my sister joined the team and now our niece is on the team. In large part, it is a family team. We're a family team, plus we have a new construction. Not necessarily called a department, but a new construction, like a sub team that specifically works for one production builder, but that’s, by and large, our team makeup now is kind of family, the new construction side, and then some admin.
Tim Chermak: How many people live in the greater Missoula area?
Adam Hertz: The city limits are around 70,000. The county is a little over 100,000.
Tim Chermak: Okay, so the greater area you're serving is about 100,000 people total, just to give that context.
Adam Hertz: Yeah, ballpark. My sister's a little bit outside of that area. We do work in some other surrounding counties. We may be covering a population that's more like 150,000 or so.
Tim Chermak: Still, in the broad scheme of things, a somewhat small town. You're not in a major urban area where there's half a million or a million people.
Adam Hertz: There’s a million people in the entire state of Montana.
Tim Chermak: Exactly. Is Montana the only state that doesn't even border a state that has a million people or is that Wyoming? No, it's not Wyoming. I think it's Montana.
Adam Hertz: We do have a million now. I would imagine Idaho. Idaho has got to have a million, but we don't border any state that has an NFL football team or an NBA team or an NHL team. We're either Montanans or– their NFL team was the Seahawks or the Broncos or the Vikings, all of which are a full day's drive away.
Tim Chermak: I actually think it's crazy. I heard there's actually a lot of Minnesota Vikings fans in Montana. I know that Brandon is one of them. When Brandon told me he was a Vikings fan, I was like, “What?” I'm from Minnesota originally and Montana, it seems so far away from Minnesota. “You're a Vikings fan. What?” Someone on the internet is probably going to fact check me on this, but I think the statistic is Montana is the only state that doesn't even border a state that has a city with a million people.
Adam Hertz: Oh, yeah. That's absolutely gotta be accurate. I mean, we border Idaho.
Tim Chermak: The largest would be Boise. I don't think Boise is a million people.
Adam Hertz: Yeah, and eastern Montana's closest NFL team, to your point, is the Vikings. There's a lot of Vikings fans in eastern Montana, it's funny.
Tim Chermak: For those who are not familiar with US geography, if you look at a map, eastern Montana has several states that separate it from Minneapolis. It's still quite a drive. My family used to go hunting every year in eastern Montana, going back decades, and even that was a long drive from Minnesota, but I digress.
Tim Chermak: You built this real estate business and, really, it was your wife who was the driving sales force early on. Now, it's like a family business and you covered the Missoula area. You mentioned Zillow was how you first got started in paid marketing. What else did you do in those early years to roll the snowball and get your brand out there? What other marketing investments did you make? Whether they were organic free things or actual paid lead sources, were you using direct mail, Facebook ads, client appreciation events? What were the strategies that you guys used to go from zero to where you are today, selling nearly $70 million a year worth of real estate in Missoula?
Adam Hertz: Really, the only paid strategy was we did social media ads. I targeted them a little, they didn't really have lead capture. It was just a branding thing. We didn't really totally know what we were doing. We did a little bit of direct mail, but not farming. The direct mail was just to pass clients to our sphere. We didn't do it regularly. It was like Christmas. Send out Christmas cards and maybe one other thing a year. Honestly, it wasn't super measured or thoughtful, but when I look back on it, I can see that it works.
Adam Hertz: I didn't say no to anything. People asked me to come to an event and I went and I networked like crazy. They asked me to join a board and I joined the board. I got recruited to run for the state legislature and I ran for the state legislature and I was elected. I literally did not say no to anything, which obviously created burnout pretty quickly, but it also created a ton of name recognition, a ton of name ID.
Adam Hertz: You think about a political campaign, a $30,000 budget for mail and social media ads in a pretty geographically small part of Missoula, like out where we live, because the legislative district of Montana has about 10,000 people in it. Spending $30,000 in direct mail in a six-month period to a 10,000 person geography, frankly, if you look at just registered voters, it's probably half that or less.
Adam Hertz: Obviously, that wasn't what I set out to do, but looking back, the amount of name recognition that created and the amount of legitimacy, if I received a lead and they were a local person, they probably heard of me, which is good and bad. There's plenty of people who absolutely don't ever want to work with me and that's fine. I probably don't want to work with them either, but it created a lot of name recognition, for sure.I think that helped. I can't directly think of a lot of direct business that created, but I just know that it helped build a brand in addition to what we were already doing.
Adam Hertz: The most important thing is that we've always just sought to have absolutely the best customer service possible. We want to turn people into huge fans of our business. We want them to love the experience they had with us so much that they're going to tell their friends and family about it. I don't have a super bubbly, friendly personality. I get some repeat business and people recognize that I know a lot about the real estate market and there's some reasons I get repeat business, but Brittany comes out of every transaction being best friends with her new clients and she gets so many referrals. Our business now is almost entirely built on referrals..
Tim Chermak: The strongest real estate businesses always are. That's actually a pretty common trend on The Platform Marketing Show when I interview someone like, “Hey, how did you get your business to where it's at now?” It's pretty rare that someone says, “Oh, it was all Zillow,” or “It was all direct mail,” or “It was all Facebook ads or Google PPC,” or whatever. Very often, how someone became successful, how they initially rolled the snowball, is just with networking and referrals and building your business the old fashioned way with actual relationships. Later on, once you had some momentum, of course, you can supplement that with targeted Facebook ads, Google, YouTube, direct mail, whatever. If you don't have that strong foundation, that strong base where you're getting referrals, all of the extra marketing stuff isn't going to solve that problem.
Adam Hertz: Yeah, absolutely. We built our initial business on Zillow, like I said, and I would hear, see opportunities and look into them for leads. We're the Dave Ramsey-trusted advisors, they used to call them the endorsed local providers, Glenn Beck, RealEstateAgentsITrust.com, FastExpert, there's all of these different lead sources. If I would see a TV commercial that looked like it was some lead gen thing for real estate, I would figure out how to become the agent that gets those leads. Our business was built on a lot of that kind of stuff. Now, it's just supplemented a little bit by that. Some of the newer agents, we receive those leads and we'll hand them down to them. Those clients then became part of our database and then later on, they needed to sell a home and buy another home. You really have to do a great job of staying in touch with those people and making sure they come back to use you.
Adam Hertz: I know that you're familiar with the statistics. I don't know exactly what it is, but 80% or 90% of people say that they would use their real estate agent again and almost nobody does use their real estate agent again. It's not because they're unhappy, it's just because that agent didn't stay in front of them, didn't stay in touch with them. You have to at least stay in touch with your sphere that way.
Tim Chermak: You built it really just with hustle, hard work, staying top of mind with your clients, being involved in the community, attending chamber events, and you even ran for local office. You were on the city council in Missoula and just built your business the old fashioned way. You got connected. I know at Platform, I think you got started three or four months ago, so you haven't even really seen the full effect that Platform makes in terms of the local brand. I usually tell people that it takes six to 12 months to really hit its stride from when you start running the ads. Being here, let's call it 90 days in, what are you seeing so far in terms of social media awareness and brand in the first 90 days?
Adam Hertz: Yeah, definitely. We have a little bit of a split marketing plan. My niece, Madison, who's newer to the team, does a lot of the ads. She calls all of the leads and Platform’s her baby, but we are mixing Brittany and myself into some of the ads here and there like we did the Crumble Cookie ad. I run into people around town who make comments about it. The apolitical one was obviously very popular for me because I did run for office. I've run into people all over town, even other real estate agents who say, “Can I get one of those signs?” I'm like, “It's just photoshop.” I get a lot of comments. People are definitely seeing it.
Tim Chermak: For those who aren't familiar when he says the Apolitical Sign ad, we came up with this ad concept of Platform where you basically pose next to one of your signs, like a listing sign in the yard, and we photoshop the sign to have your big name on it. In way smaller font underneath the name, it looks like a political sign. It looks like you're running for state rep or mayor or something. It's edited to look like a political sign, but in the small subtitle under your name, it says, “Adam's not running for anything, but he's my favorite real estate agent.” It's just a picture of you posing next to that sign. I think the ad copy says something to the effect of “Does anyone want one of these signs for your yard?” We run this ad during election years.
Adam Hertz: It's a great ad. It was funny because I posed next to actually one of my political yard signs so they photoshopped it. They had to photoshop some of the details off of it, but mine actually wasn't posing by a For Sale sign because I had political yard signs. That one's been really popular. It was a lot of fun.
Tim Chermak: People are actually seeing you in real life and they're telling you, “Oh, I saw that poster.”
Adam Hertz: Yeah, definitely. Obviously, I've got some branding and a lot of name ID and awareness in our community because of having been in real estate for a long time, being on city council, and being in the state legislature. This is really just like a big reminder, “Hey, I'm also in real estate.” For a brand new agent or a new-ish agent who isn't known in their community, I can see how this just absolutely rockets them to number one, especially in a smaller community. It's just a brilliant marketing strategy. Even for us, even though we have all this name ID, it's still just this awareness, “Hey. Adam's not just a politician, he sells real estate too,” which is probably a pivot that would have been helpful for me to make several years ago when I got out of politics, but it's still super helpful. I think we're going to be really successful with it.
Tim Chermak: How are things going for Madison so far? You said Madison is the agent on your team who's taking the reins of Platform and she's following up with the leads that come in. Most of the ads actually aren't you, they’re often Madison is in the ads. How are things going for her?
Adam Hertz: Good. She's had good feedback on it. We got a listing appointment, it was over a million dollar commercial deal for a listing appointment, which she brought me along on because I do commercials and she's newer and doesn't have experience with that yet. We've already been on one listing appointment. I know that she's got some warm or hot leads that she's working with. The feedback has been good from her.
Adam Hertz: She's perfect agent for it because her previous career was as a tech recruiter. She spent a lot of time cold calling and having to manage a database and a CRM. She's totally cut out for this kind of a model. I understand not everybody wants to call leads or as comfortable doing that, but that's what you have to do if you want to be successful.
Tim Chermak: It is crazy to me how often real estate agents will just pick, “I'm spending money on marketing. Therefore people should call me. I don't want to have to call them.” This is a sales profession. Marketing helps to the extent that it makes sales easier. If when you call someone, they're like, “Oh, Adam. I recognize you. I know who you are. I've seen your Facebook ads,” or “I've seen your signs around town,” or whatever, that marketing makes sales easier by warming you up a little bit but you still have to call the leads. You can't just sit back and wait for them to call you. That sounds so stupid, me saying that out loud, and yet there's many real estate agents that forget that real estate is a sales profession. You have to pick up the phone and call people. If you don't want to do that, you might want to find a new career because it is a sales job at the end of the day.
Adam Hertz: Absolutely. That's the thing I was least comfortable with. I wasn't a very outgoing person. I was not the sales type when I started doing mortgages and real estate and I have a finance degree. I was more likely to be a nerd in a quiet cubicle crunching the numbers. I just couldn't find a job that allowed for that. I got thrown into the fire. Even when I first got those Zillow leads, I used to email them. I was too scared to even call them. I try to email them and not hear back from them. I eventually had to figure out that wasn't going to work at all. Yeah, you just have to jump out of your comfort zone and eventually, it becomes comfortable. With Platform, it makes it so helpful saying just, “Hey, this is Adam Hertz. You might recognize me from Facebook,” or that kind of a thing.
Tim Chermak: That's my favorite way to open a phone call. Once someone has been with the Platform program for even just a month, people are probably seeing your Facebook retargeting ads. When you call the leads, it's a so much easier way to start the phone call by saying, “Hey, it's Tim Chermak giving you a call. I think we're friends on Facebook,” or “I think we had connected on Facebook,” and then you go into whatever script you're using. Opening it with, “I think we know each other on Facebook,” totally drops the person's guard and makes them think, “Oh, okay. It's not a sales caller. It's not some cold caller. This person apparently knows me.” Even if I don't know them, I don't recognize the name, they think, “Apparently, we know each other on Facebook,” so it completely changes the vibe of the call right away if you open with that line.
Adam Hertz: Yeah, absolutely. I love it.
Tim Chermak: Adam, you built your business to where it's at now. One just small thing you mentioned before that I actually want to dive into is that you guys do a pretty significant amount of new home sales as part of your team's overall volume. You've built some relationships with builders in the Missoula area. How did you get your foot in the door there? That's one of the most common questions that agents will ask is, “What do I have to do?” or “What type of marketing campaigns can I create where builders will want to work with me and list their homes with me?” Obviously, if you can get those relationships, those are fantastic because it gives you a constant pipeline of listings to promote and sell. How did you get your foot in the door with these builders? How did you catalyze those relationships?
Adam Hertz: We have two different ways that we work with builders. I do some real estate development myself but small to midsize multifamily projects, do some townhomes, land subdivision. I got to understand the city's zoning code and subdivision regulations really well. You can rattle off whatever zoning district the property’s in and I can pretty much tell you what you can do with it and what the setbacks are and what the parking requirements are. I learned the zoning code.
Adam Hertz: Because I learned the zoning code, one of my biggest clients is a big multifamily developer in the area and I find him land because I can find the opportunities, whether they're on market or off market, I know what the zoning is, I know what he's looking for. He's not exclusively working with me. A smart developer is going to go out to every agent they know and can find and say, “Find me a deal and you're my agent.” If he signs an exclusive with me, I don't find him the deal. Probably 90% of the land he buys, I represent him on because I learned that zoning code and I learned what the path of progress was around the city. I became an expert in that field in order to be able to represent him. That's almost entirely on the purchase side because he's a multifamily developer and he does long term holds. He doesn't turn around and sell these properties. A lot of those developers do. It'd be a huge opportunity if he did sell these, but he doesn't.
Adam Hertz: We have the other side of the market. He does occasionally build some single family homes and stuff I'll represent him on, but the other side of that market is, based on that experience and based on the fact that we have a team that runs like a business, and that's one of the things I have to underscore. If you want to be successful in real estate, it's not a job. You're not just a real estate agent. I have to think of it as, “I have a real estate business.” That doesn't mean you need to build a team. Building a team is not for everyone. I'm not even sure that I want to have a real estate team, but I have one.
Tim Chermak: Somehow it happened.
Adam Hertz: Yeah, somehow it happened. I didn't even set out to do it, but you have to run it as a business. Even if you're a single agent, you have to run it as a business. It can't just be a job. You have to look at it as you set out your budget, you have a marketing plan, you have an admin, you learn how to use leverage, you just have to run it like a business. Because we run ours as a professional business, it does bring in those kinds of opportunities.
Adam Hertz: There was a big production builder coming to town, coming to the state for the first time. They're out of Oregon called Hayden Homes. They build about 2,000 homes a year in relatively smaller markets throughout Oregon, Washington, and Idaho, and now, Montana. They came into the market as a production builder intending to build dozens and dozens of homes a year and needed a team to represent them.
Adam Hertz: Now, in some of their markets, they use this company called New Home Star, which isn't a great cultural fit in Montana. They're super sales-y and just different than our market. Hayden Homes knew enough to understand that they were going to be better off with a local organic team connected to the community. They weren't out there seeking to interview an individual agent because an individual agent couldn't handle this particular opportunity. They need a team. Even us as a team, we didn't really totally have the team in place that was going to need to service them. We just had the ability to build that team. Really, that's how we got the business. They interviewed a few teams. They knew that we had the capability to build what they needed us to build. We have onsite seven days a week, one to two agents at a model home at all points in time, representing this builder.
Adam Hertz: I think part of what sold them on us was my experience working with builders. I knew the zoning code, the subdivision code, knew what the market was like. We had the ability to build the team that they needed us to build. It's a little bit different, obviously, than if you're just looking to represent. Maybe there's a smallish builder in the market that sells five spec homes a year, that's a different deal. I guess it's been a huge opportunity for us. It's a great market to be in.
Adam Hertz: We underestimated it a little bit in that it required us to have essentially two full time agents and an admin specifically just for this builder. We had to get set up for it, but it's been a tremendous opportunity and we've really enjoyed doing it. I'm not out there on a day to day basis. I might cover the model home every once in a while if there's an emergency, but I'm building the relationship with management and trying to find them new land opportunities as they expand through Western Montana.
Adam Hertz: I think if you want to work with builders, it's really twofold. Yes, you need to be able to sell the product that they're building, but what they're really going to appreciate is you bringing them an opportunity, off market land or some kind of a deal that sets you apart, because most of the time it's hardest to find the opportunities. They know that they could hire a lot of different realtors who could sell the product for them, but what's hard is to find that opportunity. I think if you show value on that end of things and then have it just be the agreement. “Hey, I found you this land. I'm going to be your listing agent, right?” That's the way that it generally works. It doesn't even necessarily need to be on paper. It can be a handshake kind of a deal. “If I find you an opportunity, will you build a home on it and list it with me?” I think that's a great way to get into that market.
Tim Chermak: What I almost hear you saying without saying is that it's not like there's a ninja sales tactic or marketing tactic of, “How I got this builder relationship was direct mail,” or “How I got this builder relationship was this genius Facebook ad I wrote that was reaching out to build.” No. You have to reframe it as, “How can I become the type of agent who's so knowledgeable about new construction and development that builders just come to you because you have the reputation of, ‘I really know what I'm talking about. I'm more knowledgeable on new home construction than the average agent?’” They can actually have an intelligent conversation with me about the economics of new builds, and like you said, zoning and setbacks, and you are even able to find off market type properties and bring it to them like, “Hey, is this something that you might want?” It's not just a, “Oh, there's a great Facebook ad I ran that caught the builder's attention and then they listed a hundred homes with me.” That's not how it works.
Adam Hertz: They actually have to show value.
Tim Chermak: They have to feel like, “Okay, Adam's actually smarter and more experienced and understands new construction better than other agents do. We feel more comfortable working with him because of that.”
Adam Hertz: Absolutely. It's just showing that value. There's other little pieces of value you could show. If it was a smallest spec home builder, a lot of times builders aren't great at design. Maybe you've got a great eye for design and you can recommend the finishes. I've seen new construction where someone will build a house, it's just ugly. They wouldn't even need to spend more money if they just had good style or some interior design insight. They could have spent the same amount of money and sold the house for $25,000 or $30,000 more because it's in style and it's what the buyers are looking for. I still see spec home builders in our market. They're building stuff that was out of style 10 years ago, or even it was barely in style 15 years ago and they're losing money because of it. Showing that value, whether it's an off market deal or it's design. Figure out how you can be a value to them and then prove that you are a value to them.
Adam Hertz: There's definitely ninja ways you could do it. You could go down to the city, look at who's pulled building permits, start making cold calls, trying to get an in that way. They're not always just going to come to you, for sure. There's some ninja tactics you could use. Once you have that foot in the door, you're going to have to show them what your value is, why you're going to be better to sell that than your competition. I think there's a lot of different ways you can set yourself apart. The way that I did it is through knowing the zoning code and the subdivision code and knowing the market really well. Brittany's fantastic at design. We make a good team in that regard too.
Tim Chermak: Again, it's like you are such a knowledgeable added value agent and so as Brittany on the sales and design side that, again, it's not that, “Oh, The Hertz Team had this genius marketing strategy and that's why builders go with them,” it's that you're just more valuable to them than the average agent is because you truly understand new home sales, you can even proactively provide advice like, “Hey, what if you did this with the design? What if you did this on this elevation? Or what if you added this type of countertop or this layout in the living room compared to what you're doing?” You're actually giving them ideas and insights and feedback above and beyond just, “Hey, we'll sit in the model homes and you put our sign out front.” Any agent can do that.
Tim Chermak: The level of value you're adding at that strategic business level, the interesting thing is when I look at your real estate career, people might say, “Oh, you and your family, your network is from the Missoula area so you go back decades. Of course you built a business there.” No, Adam knows enough about real estate that if you and Brittany packed up tomorrow and moved from Missoula, Montana to a completely different area of the country, somewhere in Florida or California or Arizona or Texas or something, I bet within six months you would have already established relationships with builders in those markets and you would have a successful business because that knowledge stays with you. It's not just specifically local to the Missoula area. You understand the economics of new construction and that's why builders are drawn to you.
Adam Hertz: Yeah, absolutely. We've thought about it. I want to move to Naples.
Tim Chermak: Please do. That would be fun. We can hang out all the time.
Adam Hertz: I would love to. No, it’s absolutely true.
Tim Chermak: I'm actually about to sell my house right now. If you want to buy it off market, you can actually demolish it. Most of the value is in the land anyways. You can build something super nice.
Adam Hertz: Perfect. The problem with me moving to Florida is that I would be on a fishing boat every day so I would not have a very successful real estate career, but Brittany would do very well, I'm sure.
Tim Chermak: We'll have to have that conversation off camera then. All right. Actually, fun story here. I'm gonna try to keep this quick, but we went out to dinner last year after the Platform Mastermind, Adam, myself, Brittany, and my wife, Bella, to a beach side, nice restaurant in Naples. It was on the beach. Adam and Brittany had gone fishing earlier that day and caught a bunch of fish right in Naples and they brought the fish with them because they were told that the chef would actually cook the fish that you guys had caught. I think you had called ahead and they told you, “Oh yeah, go ahead and bring it in a cooler and we'll fry it up for you at dinner.” You brought it and then the waiter was saying, “Oh no, we can't do that. I'm sorry. Who told you you could do that? We can't do that.” Brittany, switch is flipped, and she goes into sales mode and is like, “Oh, okay,” like handling objections as if she's on a cold call with a For Sale by Owner or something and just goes into sales mode. It was like, “Okay, under what circumstances would you do this?” Just all these brilliant sales questions. I'm just sitting there observing this masterclass in persuasion.
Tim Chermak: It went back and forth for probably 20 minutes and it was super cordial. She wasn't mad or anything. It wasn't heated, but it was this back and forth, “Who's going to give in first?” Clearly, the restaurant had the ability to and the capacity to, but it was just dumb from the top down. They said, “Oh no, we're not going to do that.” Brittany just didn't give up. She talked to this other person and eventually it got to the chef and the chef's, “Oh, okay. Yeah, we can do that.” I would have 100% just given up. I would have been like, “Oh, okay. You're not going to do that. I guess I'll order this.” Brittany just would not take no for an answer.
Tim Chermak: I want to repeat that she wasn't rude or anything. It was just her natural persuasion was on display. When you say that, “Hey, Brittany's this sales ninja and she's really good at sales,” I saw that firsthand because eventually, you guys got that fish cooked and then we all had fish for dinner that night because Brittany would not give up. Anyways, that's my Naples story with Adam Hertz.
Adam Hertz: I was ready to give up 30 seconds in. I was like, “It's okay, Brittany. No, it's totally fine.” “Who cares? We called ahead. I am going to close this deal.”
Tim Chermak: The server would go back and, whatever, talk to the manager. We're laughing whenever he would leave because she's like, “All right, here's what's going to happen next. He's going to come back and tell me this and then I'm going to tell him this.” It was like a live, in-person sales masterclass. She's like, “Just watch. What's going to happen is he'll say this. At the end of the day, they'll have to, you know.” She just totally called it and we had fish that night.
Adam Hertz: Yeah, you're not exaggerating too. It truly was 20 minutes. She spent 20 minutes with the server, the manager, the chef. She had to close the deal and she did.
Tim Chermak: Now I’m like, “Okay, of course, someone like that would be successful in real estate because she just understands human psychology at this deep level that almost transcends sales.” If you just understand people that well, you're going to be successful in an industry like real estate. I had never really talked to Brittany or met her before, but even just going to dinner with her that one night, I'm like, “Okay, yeah. I can see how she would crush it as a real estate agent.”
Adam Hertz: Yeah, absolutely. She's not a hard sale and not selling people something they don't need. She's just really good at objection handling and getting people to where they need to be, for sure.
Tim Chermak: Speaking of you moving somewhere, that was actually a question I wanted to ask you. If you were to pack up and move to an entirely new city state where you had no connections, you didn't have any of that social network and name ID that you had built up over the years in Montana, let's say you moved to Oklahoma, what would you do to rebuild you and Brittany's or your team's real estate business if you had to truly start from scratch somewhere? What are the sales or marketing initiatives or what would you be doing if you had to learn all that you've learned over the last 10 years? What would you do if you had to start over again this year somewhere?
Adam Hertz: I, for sure, 100% would hire Platform first and foremost just to get the name recognition out there, get the brand built, get some leads coming in, absolutely start networking. This is all stuff I don't want to do, Tim, which is why I'm not moving, but it's stuff I did for a long time. We've worked 60, 70 hours a week. I do not work nearly that much now. I don't even know if I put in 40 hours, but start doing the networking.
Adam Hertz: I definitely would get on some of the traditional lead gen stuff because that is how we built our business. I don't like Zillow and I don't think there's a good ROI, but we do very well as the Ramsey-trusted advisors. We do pretty well occasionally with the company called FastExpert. The Glenn Beck leads are really limited in our market because we're a small market, but in a bigger market, there's probably a pretty good volume of them.
Tim Chermak: Also, let's be honest, how many people are listening to Glenn Beck in Missoula, Montana?
Adam Hertz: Not that many. The thing I will say though about Glenn Beck leads or the Dave Ramsey leads, culturally, they're always a fantastic fit for us as well. I think that's why we convert them at a pretty high level is because, genuinely, we're going to see eye to eye culturally and get along with and have great conversations with people that are listening to Glenn Beck or that are listening to Dave Ramsey.
Adam Hertz: I might not agree with every financial advice Dave Ramsey gives, but I can tell you that somebody who's listening to his program or listening to his podcast, I'm going to get along with them a lot better than somebody who's binge watching CNN. My clients aren't binge watching CNN. We're not going to be a very good cultural fit. It's not saying I wouldn't work with somebody who's like that. It’s just they don't end up being my client.
Tim Chermak: Actually, it goes to show too, that if you're just really good at what you do and you truly are an expert in real estate or the new home genre of real estate, if you will, that even though you're known in the Missoula area, it’s like, “Hey, Adam’s the random conservative who somehow got elected to Missoula City Council and served in state government Montana,” Missoula is obviously a deep blue area. It's a college town. It's probably, by far, the most left leaning city in the entire state of Montana because of it being a college town and you're this random conservative there and you've still built a successful business.
Tim Chermak: Obviously, this isn't a political podcast. We're not going to get into politics, but I actually think it's related to marketing in that if you're really good at what you do, it can transcend all that. You totally could have made excuses of, “Oh, I'm this libertarian conservative in this very left wing city. I probably won't be successful here if I'm in real estate because everyone knows that they don't agree with me on all these political issues.” That hasn't made a difference at all.
Tim Chermak: Your team is going to sell almost $70 million in a town that's not that big. It's even more impressive that you're selling that amount of volume in a relatively small populated area. That just goes to show that what matters is your expertise and that people intellectually respect you and that you know what you're talking about. I bet you guys have worked with tons of people over the years that don't see eye to eye on political issues with you, but they want you representing them on a real estate transaction because they trust you and they know that you know what you're talking about.
Adam Hertz: That's absolutely true. I think that's just the most important thing, is just you need to be very good at your job, very good transactionally, know the market, and people will want to work with you. They might overlook other things that they don't care for, like your politics or whatever the case is.
Tim Chermak: Or your taste in music or your long hair.
Adam Hertz: People want to work with us because we're good at what we do. Perfect.
Tim Chermak: Let's just wrap up that final question I had asked you there of if you move to Oklahoma, you said you would do a lot of networking. I wanted to double click on that for a second. When you say networking, would you mind just getting really specific on what are some specific examples of that? You moved to a, I don't know, some random town in Oklahoma. What does networking look like?
Adam Hertz: This isn't really what I did, but for instance, in Missoula, there's a golf course called The Ranch Club. It's a country club or whatever. It's not super expensive to join. It's Missoula. There's a group of guys my age that if I wasn't already established in real estate, if I went out and joined The Ranch Club, I could convert a ton of business there.
Adam Hertz: I'm not a member, like I said, but I play poker with some of those guys. I guess I played in a charity golf tournament out there before, but those kinds of networking opportunities where you're making real genuine connections, it's not a business transaction, you're making friends and making genuine connections, every time I sit down at a small poker table with that crew of guys, there's some new connection that's made. There's some new business that comes out of it and I'm not even attempting to do it that way.
Adam Hertz: Joining an intramural soccer team, which is something that I play on, or coaching a kid's baseball team. Brandon Smith's podcast on that was awesome. Whatever it is that you like to do. It doesn't need to be forced. Joining the chamber of commerce, probably pretty lame. I don't think I've ever gotten business out of the chamber of commerce events. Not to talk down on them, but there's going to be 100 people at the chamber event and 25 of them are going to be real threats, but it might be a fun way to see some people you've already made connections with.
Adam Hertz: Just genuinely being outgoing and becoming a part of the community. Maybe it's not the country club that you want to join because you don't like golf like me. I don't really care for golf, but maybe there's a fly fishing club or a bass fishing club or whatever it is, I think you just need to get out there and make genuine connections with people, show them that you know the market and that you're useful and you might be useful to them or you might be useful to a friend or family member. If you're doing that kind of networking in conjunction with supplementing it with some leads, using Platform like direct for leads and branding, I really do think you could drop us into a random town and we could build a business pretty quickly.
Tim Chermak: I think that's a great spot to end because if you understand the principles of sales and building a local brand, it's going to work. It's going to work anywhere, whether you're in Montana, Oklahoma, or Naples, Florida. If you know how to go out and network, meet people, establish those relationships, then marketing is really just the icing on the cake. That is the foundation of building a successful real estate career is knowing how to go out and build relationships the old fashioned way. Adam, thanks for your time this morning. Guys, we'll see you on the next episode of The Platform Marketing Show.
Adam Hertz: Thanks, Tim.