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No-Frills Real Estate Model posted on November 30, -0001

Kevin Seney set out to change the face of the real estate industry, and so far it’s working

When CEO Kevin Seney started Bug! Real Estate in Coronado, he made it his mission to deliver a new real estate experience. In doing so, he would be the first to step out of the homogeneous mold. About today’s leading real estate companies, Seney says they don’t vary in the way they’re branded, how they advertise or how they service the customer. “When you see something like that in the marketplace, that spells opportunity,” he adds.

The first area that Seney addressed was advertising. Having owned a mortgage company for 10 years, Seney witnessed how much money agents wasted on marketing. “They run their $2,000 to $3,000 ad, and they don’t get any calls from it,” he says. Indeed, Seney’s theory was confirmed when he read the Purple Cow, which emphasizes that advertising doesn’t work anymore, and it hasn’t for years.

So if advertising doesn’t lure homebuyers, what does? Seney says the only three relevant factors in home selling are putting a sign in front of the home, putting the home on the MLS and pricing it right. “If you price the home at market price, it will sell,” he says. Without a need for marketing, Bug! has eliminated the expense from its budget and is a more efficient company because of it.

The other cost-guzzler that Seney identified was overhead. “I’ve surveyed hundreds of clients, and no one ever meets agents at the office,” he says. “They either meet at the property or sign the papers at the mortgage or title company.” In a laptop-friendly, work-from-home era, the majority of agents use the office only for meetings. That’s why Bug! agents work virtually. Using the latest wireless technology, agents have full access to the MLS and the company’s intranet via their wireless laptops and cell phones.

Show Me the Brand
With his business model fine-tuned from a cost standpoint, there was one major component left: How to get his company out to the marketplace. While Seney isn’t a big supporter of traditional advertising, he is a firm believer of creating a unique brand. “In business today, you have to stand out in an amazing way, and if you don’t, you won’t get any business,” he emphasizes.

Today, however, no one real estate company stands out from the other. “Their brands are stale, they’re institutional,” says Seney. “The communication they’re sending out to the marketplace is ‘we’re big, we’re fancy, and we sell estate homes.’ But that image doesn’t work anymore.”

So Bug! leaves pretension at the door. In fact, Bug! bills itself as the no-frills, no-hype real estate company, making it a fun, friendly real estate brand like nothing else that exists today. To live up to that image, all Bug! agents drive the Volkswagen Beetle, a car that not only represents a casual and fun vibe, but it’s also an icon when it comes to branding. “And by using the Beetle as our delivery vehicle for this brand, we get to borrow that history,” says Seney.

But Seney didn’t stop there in bringing the Bug! Real Estate concept to the fore. After working with some local graphic artists on the Bug! logo, an integral piece of the company’s branding, Seney came up short. It wasn’t until he saw TiVo’s logo that he got inspired. The only problem was that Michael Cronan, a branding guru who developed the TiVo logo and invented the word TiVo, is world famous and probably couldn’t be bothered with a small company like Bug! But Seney contacted him anyway. To his surprise, Cronan liked what he was hearing about this new breed of real estate and agreed to create the Bug! logo for one tenth of what he normally charges. Thus was born the look and feel of Bug! Real Estate.

Bug! agents drive around with the company’s logo front and center on their vehicles, so the cars double as billboards. “You see them everywhere because they’re so recognizable,” says Seney, “and that’s the essence of what we’re doing from a marketing standpoint—we’re famous without much advertising.”

Home sellers also benefit from the company’s cost savings. Not to be mistaken with a discounter, Bug! is a full-service real estate company that aims to redesign the way agents do business and is thus able to lower commissions for its customers.

Having launched in February 2007, Bug! is going strong. It has opened four new franchises, as well as one regional office, and receives 100 inquiries per month from eager real estate brokers who love the Bug! model and want to open a franchise.

It looks like Seney’s bold move to turn the traditional real estate model on its head wasn’t a bad idea after all.

The unique edge of Bug! Real Estate’s franchise operation:

• John Assaraf, featured teacher in the book, The Secret, and renowned motivational speaker, who was also one of the most successful regional directors for Re/Max, is spearheading Bug! Real Estate’s One Coach, a yearlong coaching and business development program provided to all new franchisees.

• Businessman and successful entrepreneur Chris Siow is the first Bug! regional director for the entire city of San Francisco.

• Bug! is looking for brokers who feel 110% about the company—not necessarily top performers, just people who are passionate about the concept.