Alvaro Erize: We've got a couple of great sessions to finish up the day with. And the first thing we're going to do is we're going to welcome back to the stage a thought leader in the industry, a force to be reckoned with. The CEO and founder of Workman Success Systems is going to come out here with a special guest and they're going to invite us to join them in a very intimate and informative conversation. Welcome Verl Workman!
Verl Workman: Thanks, brother. Alright I've got a great guest with me this afternoon, and Alvaro, come on out. I want everybody to meet Alvaro Erize is the CEO of CINC and he's in charge of M&A tech with Fidelity and we're just excited to have you. So thank you so much for having a conversation with me and have a seat.
Alvaro Erize: Absolutely.
Verl Workman: Okay, so I met Alvaro. How many years ago was it? I can't, I'm trying to ...
Alvaro Erize: Five?
Verl Workman: Five years ago.
Alvaro Erize: Something like that.
Verl Workman: So Workman Success Systems has had a long partnership and friendship with CINC. And we [00:01:00] appreciate your technology and all you do. These are the people who love all the leads you generate. Give Alvaro a hand. They create leads.
Alvaro Erize: Thank you.
Verl Workman: So we were having a conversation at dinner at a conference recently, and we just started talking about some of the things that are going on in the industry. And a couple of things that I know about Alvaro is he's a good man. He's a good father. He loves his two Children, and we both met our wives when they were too young.
Alvaro Erize: Yes, yes.
Verl Workman: But he's a strategic thinker. And when we started having this conversation, I thought this is a conversation that I wish there were others in the industry that our friends could hear. And so I invited him out. He graciously agreed to be here. And so we're just gonna talk a little bit about what the crap is going on in our industry.
Alvaro Erize: That makes sense. And you even pulled off my name. I'll start by, by apologizing for my accent. So if any, if you don't, if I talk too fast or anything and you don't understand what I'm saying, just interrupt me and or you interrupt me and I'll say it again.
Verl Workman: We'll just do our best.[00:02:00]
Alvaro Erize: That's okay. I'm just saying feel free to interrupt me. I'll repeat. I really love being here. I'm from Argentina originally. And who recognizes what this is?
Someone has to. Yes. Yes. There. So well, this is the Miami intern, international football in Miami. So this is the Miami soccer football team. Where Messi plays. So now you all have a piece of our heart. All of you that are here for Florida. You've taken a piece of our Argentinian hearts. So I was not going to come here without it. So thank you.
Verl Workman: I love that. My kids are already like, we have Real Salt Lake that will play against Miami. And it's already sold out next season. What he's doing for the whole league is unreal.
Alvaro Erize: Yeah, you're going to have to change the name of the sports after that.
Verl Workman: You're going to call it actually football?
Alvaro Erize: Yeah, you're going to have to find another one for the one that's not played with a foot.
Verl Workman: Out of [00:03:00] curiosity, so what do you think his being in the United States, what kind of impact do you think it's going to have on soccer here?
Alvaro Erize: I think, again, if you look at what happened with Beckham when he came a few years ago, that was great. And it gave love to something that understandably is a little bit lower in the US because you have so many sports, right? You have baseball. You have basketball. You have all these amazing sports. Soccer was just at the end of that. But Beckham at least made it visible to people. And you started having great female soccer teams in the US, which was great. But there is a difference here. Messi is, and I don't say this for being Argentinian, is really a world apart from everything else. No one else could bring the amount of attention this comes from the world. You also have a lot more Latins by now in the US, that keeps growing, we keep invading you. Hopefully, most of us legally, but, but still. It was funny I was seeing the game in Nashville. And [00:04:00] and I think the singing was, like, all the stadiums singing Vamos a Ganar. So it's suddenly it's a stadium with 80, 000 Americans singing in Spanish, which is pretty weird. That's awesome.
Verl Workman: No comprende. But I'm going to learn it. I'm going to learn it. My chat GPT speaks in Spanish.
Alvaro Erize: Good. Our AI speaks in Spanish.
Verl Workman: Let's get into the industry a little bit. One of the things we were talking about is we were talking about the class action lawsuits that are happening and one of the big concerns that a lot of teams have is how it's going to impact a buyer's agency. And if it really is, and I'd love to hear you. Have you been watching the last few days? Kind of the stuff that's going on?
Alvaro Erize: I have. And at the beginning, I must say that I thought, Hey, these are totally frivolous lawsuits that will have no, no impact whatsoever. And once you have some big player settling, even though that's not admission of guilt, it goes okay, so this is something we need to look at, right?
Now, I'll preface this a little bit by saying so that [00:05:00] you know where I'm coming, I'm traditionally, I'm a libertarian. I'm a free market thinker, and I believe in efficiency, right? So I think things always evolve towards efficiency. Unless we try, humans try to get in the way of it, especially government. But, generally, no matter what, things trend towards the most efficient model. And in most things, the US has the most efficient model. And so in the rest of the world, buyer's agent mostly don't exist. You have the seller agent, right? That's the only agent that supposedly represents both sides, but only one is paying. And so one would say maybe that's more efficient.
I haven't gotten divorced, but if I ever was, which I don't, I wouldn't want to use my wife's lawyer. And so that's just not, you have two parties that want to come to an agreement and it's a complex transaction that requires advice. And so it's logical that you'll have an advisor on each side.[00:06:00]
And the US actually discovered that makes everything better. Sellers sometimes reluctantly, but really are voluntarily sharing that commission because of the value that buyers agents bring. And the level of efficiency that the US real estate market has is because of that. So do I think that a frivolous lawsuit will break what efficiency trended to? No, I think it's impossible and we can go into that deeper. But now, will can it change the cosmetics of it? I think it could. So the biggest one is, So the argument is, oh, I didn't know that my buyer agent that has been working for me and taking 48 of my calls was not getting paid at all was, getting paid somehow, right?
And okay, so we're gonna need more transparency, quote unquote, even though in my opinion it's obvious about the buyer's agent's commission. So that could be just, it can be as, innocuous as, one more disclaimer out of the 4, 800 disclaimers that you put today on everything you do. [00:07:00] In the U.S. I take my kids to a birthday party and I have to sign my life away, like it's, insane. But, so it could be one more of those, right?
Or, in the most extreme case of reaction to this, it could be that you split the commission officially, right? It could be that, oh, now the seller is taking three percent, the agent from the seller, and then the buyer takes it from the buyer.
Money's money in a transaction when there's a price in the middle. The only real thing that would make a difference, that would break this, is if the buyer could not draw on the mortgage to pay that part, right? That would break it. That's not gonna happen. I cannot believe the level of stupidity that would be required for that to happen.
It's just not. But I do think it might happen that, in an extreme scenario, that you are seeing upfront, yes, the buyer draws from the mortgage an extra 3 percent that goes to the buyer agent or 2 percent depending on. And will that give you a little more [00:08:00] of difficulty from now? You have crappy agents that basically say, I'm free anyway, so don't ask too much from me. Yes, those are going to get hurt, right? Because now it's hey, I'm actually paying you and you cannot hide that. What are you doing for me? That's actually good for good agents, right? Good agents want to compete, want as much transparency as possible, and would rather people say no to the agent that is providing an odd value, because they're going to have to prove their value.
From our point of view, at CINC, what we think is, okay, we're going to have to give more tools to the buyer agent to make their value more explicit. The value's there, it's obvious, but we will have to. You go to a listing table, and you have to justify your value, right? You have to say why they should choose you as a listing agent. So buyer agents sometimes you don't. You probably are going to have to do it more often. But in my mind, that's only going to help good agents win business from bad agents.
Verl Workman: I think that the good agents, [00:09:00] and that we have a room full of great agents and buyers agents, that's what they've been doing.
They sit down, they talk about disclosure, they get buyer agreements signed. It's when there's no agreements and there's no statement of value and they don't know how to offer it here's what you get when you get me. It's not. It's not opening doors.
Alvaro Erize: It's not. The only place, the only interpretation of this would really be bad for the buyer's agents is if you truly believe that people were clueless about the buyer commission, right?
And the truth is, they were not, right? So it's all the same, unless the thing of the buyer commission and the mortgage changes, which I cannot believe it will. All the rest is just cosmetics. And usually, in my opinion, the more transparency, the more efficiency will always lead for the better people to come ahead, and it will take some people with it, but those are not the people usually sitting in this room.
Verl Workman: Yeah, I saw a clip that came out of court the other day, and it was they were showing a coach and an industry influencer having a dialogue on a podcast about [00:10:00] whether or not to discount commission, and, it was a total. It was an insult to the industry and who I believe we are. Like I watched that and I'm thinking I can't believe that somebody that we put in leadership positions because it was, it blew my mind the conversation they were having about commissions.
If somebody wants you to discount your missions, you effin say effin no. It's that kind of that kind of dialogue. I'm like, that's not it. We don't I'm not a big believer in discounting my fee. I believe in increasing my value. And so I want to give them so many, so much value that the price isn't the objection. And so it only becomes the objection of the absence of value in my opinion.
So let's talk about CINC for just a minute. How like how big is CINC? How do you have? Do you guys really generate enough leads? How many leads are being generated?
Alvaro Erize: Generate millions of leads. So we have some 4000 teams with us and depending on the team, we have teams that use us mainly for the CRM and get some leads and some 20 leads a month, to teams that are getting 1000 leads a month. And [00:11:00] so it's a little bit of choose your own adventure. I don't know if you had your those books here too, but that were you and... so yeah, so our and our goal, I always said for me, CINC or any of the companies that you could use for this kind of things is you need to find a way to profitably scale your company.
Usually the difficulty is the most profitable things in your company are the ones that generally are not scalable, right? Someone comes, they come from private equity and you go and it's do more of that organic business that has no cost of sale. Yeah, great. I would if I could, but that's difficult, right?
So what we try to do is and I think what every true, unified platform should do is try to give you a way of you're getting leads that you know how much you're paying, then you're working them. You can know exactly how much you're converting, then you're getting to know what your ROI is, and then you keep [00:12:00] investing on it so that you get more of that.
And eventually, that becomes one of your true pillars of revenue, where at the beginning is more of an effort and an investment upfront. It should become, for me, it's like cheating a little bit like you've go, if you go into if you're born into real estate and you have a roller deck of 20 years or three generations, then you can just do your sphere. Or if you move into a new city and you're willing to wait five years to, to become big, that's fine. You can, every day you do good business, you get more referrals from it, right? But if you want to skip ahead, if you want to be able to grow three years ahead of what you would have naturally organically done, then online lead generation, in my opinion, is the only way.
And unfortunately, online lead generation is very difficult and can only be done if you have a supporting system that allows you to tackle it in an efficient manner, right?
Verl Workman: You're a big numbers guy. You love the data behind it. Give me some numbers. Everybody has different opinions. It doesn't matter if you're a Boomtown or CINC or a KV Core or any of the high volume lead generators. Everybody tells you what [00:13:00] the numbers should be. What do you ex, what should an agent expect in conversion? And industry-wide, like when we, when a lead comes in off of a high volume lead generation, what's the value of that lead and when do we get to realize it? I'm very impatient. Anybody else impatient? Like I want 'em today.
Alvaro Erize: Impatience is good. It leads you to action, right? But, then it has to be with long-term vision. And so I will absolutely give you the, because I hate people that talk with abstract numbers. I will give you real numbers because we've looked at over ten million leads over five years, so I have very specific numbers.
But before I give you the numbers, I will tell you the numbers that I think you should be looking at. When people talk conversion, they don't even know, what are you talking conversion? Conversion from what to what? From lead to close. Okay, but from all the leads, or only the ones you did in trash, or only the ones that you actually got to have a conversation with.
And how do I compare that with a Zillow lead that is worth 300, or how do I compare it [00:14:00] with with a Zillow Flex that actually I'm paying zero up front, so it's magic money that comes without, without anything up front, right? And obviously it's not, it's actually very expensive because you're paying at the end of the transaction, but you're paying much more.
So the way that I look at business if I can leave you here with, one, at least, point of view from me is, The ultimate is to measure ROI, but that sometimes can be difficult because of time. The easiest way, if you want to grow your business through online lead generation, is to think of cost per sale.
So in your business, you have fixed costs and variable costs. The good thing about fixed costs is that the bigger that you grow. Who cares, right? Because by then they're liquefied between all your growth. Variable costs suck because those, the more you grow, the more that you get hit. And if you are unprofitable on a per transaction basis, then you're growing into bankruptcy, right? So, for me, how do I measure that? Again, cost per sale, because you're going to pay that every time that you make a sale.
So [00:15:00] what I do is say, how much money did I have to put to get one sale? So if you are in let's start at the end. If you are in Zillow Flex, how much do you pay?
Verl Workman: Thirty five percent.
Alvaro Erize: Forty now.
Verl Workman: Going up.
Alvaro Erize: Yes. So let's say thirty five percent. Which what's your average commission here? Someone throw me a number. Ten thousand. Okay. So you just paid thirty five hundred dollars. That's your cost per sale. Whether you paid it up front or at the end, we can discuss it. Always we want to pay at the end, but you have the money and the shoulders to pay up front if it makes more sense. And you shouldn't sacrifice that, but we can go into that.
Okay, so a Zillow Flex on a $10,000 commission is $3,500. We think a $12,000 commission, which is the average for the US today, is $4,000. You're paying $4,000 for each transaction. Okay, how much do you pay in a, Zillow normally? If you pay 300 or 400 up front?
Verl Workman: It's gone way up. The cost per lead. We just did the math the other day. Christie, what was your, where's Christie? What's that? She's in the back. [00:16:00] Oh, she's in the back? Yeah. Cost per sale, samantha, what was the number? Or cost per lead? $750.
Alvaro Erize: $750 a lead. And if I asked you what's your conversion, so how many leads do you get from Zillow till you get one sale?
Audience: Oh, right now, maybe 32 a month.
Alvaro Erize: Yeah, so you get 32, and how many do you close a month?
Audience: Five.
Alvaro Erize: So, that's a great conversion. She got 15 percent conversion, right? Five out of 30, even though you should measure it in time, but I won't go into that.
Verl Workman: That's probably what it is. It's the backlog of leads.
Alvaro Erize: But still, today if I forget about the problem of time, you're getting five sales out of 32. That's a 15 percent conversion. That is awesome.
But is it, right? It means, I'm going to put you at 20 percent conversion, so you're converting one in five, just to make my math easier. One in five, but one in five at 750 means you're again, you're paying $4,000 because you're doing, you're buying five times 750 to get one sale. [00:17:00] So that's great.
For me, a well done SEM play. So where you're paying Google leads, Facebook leads, which we can talk about that, at a very good price. You are getting a lead, you should be getting a lead for six, eight, ten dollars, depending of where you are, right? And now when you ask me conversion, I go they should tell you the real conversion.
Anyone that says, oh, it's a 5 percent conversion, is probably either lying, or or doesn't know what they're talking about, or they haven't specified from where to where they're measuring. If you go from every lead I bought, whether it's crap or whether it's good, to how many did I close in the end, I can tell you after looking at 10 million leads that if you're getting a 1 percent conversion, you're doing a great job.
And that, that 1 percent is not going to come in six months. You're going to get half of that. We can talk about that too. But you still need to work for two or three years to get that 1 percent conversion going. But 1%, is that good or bad? I don't know. Let's see. You have to buy 100 [00:18:00] leads to get one sale. If you're paying 10, 100 leads is $1,000. It's $1,000 versus $4,000. 000. And if you're a team that you're keeping only half, if your total pool of dollars is six thousand, paying a thousand versus paying four thousand is a huge difference. Your margin, there's so many teams today that are growing into bankruptcy by putting all of their effort into low margin sales.
Now, if you convert Zillow at fifty percent, one in two, then that's okay, because you're paying fifteen hundred dollars, right? You're paying two times seven fifty. So that's the way I look at it. How much money am I putting in for every sale that I have and that allows now are all sales made equal?
Some might be of course different prices. So if you have a source that has high price, that's good Are they all the same efforts? No. So SEM will take more efforts than that referral You have to work up front you have to risk up front putting the money all of those things that make you a team That's why your team's because [00:19:00] agents cannot do that on their own. That's why they come to you, and that's why it's also difficult for them to leave you While at a referral, it's very easy, right?
So again, I'm not trying to pitch an app. As a disclaimer, CINC has a referral program, like Agent Pronto, ProLink, which is just like Zillow Flex, and I always tell the teams that work with us, do it as a nice addition of an easier sale for some of your people. This is not what you grow on, because if you grow on this, you're paying me too much money for this closing and, I'll still charge you that full amount. But I'm telling you, you should be doing the other thing if you have the courage, the resources and the forethought to plan ahead.
Verl Workman: You talked about the long term to get to 1%. People think that if they turn on a platform in 90 days, they haven't got an ROI. They want to cancel it. How do you keep people engaged and what are some of the best practices long term that you'll keep people so they stay longer?
Alvaro Erize: So for us, our biggest learning out of these years of looking at this. Is we got the courage after [00:20:00] looking at these numbers to really put our playbook together and it's not, it's nothing magical. It's you need to do the calls. You need to put your notes, you need to classify the leads by their intention. So you need to look at why they came in as a lead that CINC, for example, tells you how they came in and that gives you a different ranking. And if you do that right and you're and you're calling in the right order, you're going to get to it. But I also now that we know more, we're able to give you milestones of by when you're going to hit what because I can tell you that a 1 percent is three years, but I can also tell you that within the first six months, you would convert 0.4 percent of everything that came in. So out of a thousand leads, you're going to make 40 40 conversions on, on, sorry, am I right? Yes. 40 conversions on the first six months, right? Now, what is misleading is people think, Oh so in the last six months I had a total of 1000 leads, so I should have 40 sales. No, because you got some of [00:21:00] them on month one, but many of them on month six, right? So what I've done is they've gone in the background in the dark room and I build the Excel and I go No, this is how you're gonna be closing. And so in your first year, 4 percent of everything that came in the first year, because most of it came in the second half.
And I do all that. And basically what we show For me, a good client doing online lead generation needs to be able to hit six figures by year two. So in year two, if you're not making $100,000. $200,000, $300,000, then this is not the bet that you should be making and we should be talking together on it, right?
Verl Workman: Is it not the tech or is it not the process? What usually is the factor?
Alvaro Erize: It would be easy for me to say it's them, right? But at CINC, it's easy for me to say the agents are not calling, right? I always believe when people make fun of oh, it's people that don't adopt tech or whatever, everyone adopted the iPhone, right?
If you do the tech easy enough, people are gonna adopt it. So I always think that, the blame is shared. And I think in the last year since we did the manual, it got much better. So [00:22:00] clearly there's something we could do that would help them out. What we are doing is actually not helping that much the super good ones, because those are already doing all those things. Our manual, our success manual has helped us bring the people that were at the bottom more to the middle, right? Because there is okay, if I do this, I'm going to get to the other side. And again, whether you use CINC or any of these things, knowing up front both what the effort needs to be in, but also what you expect. I'll give you an example. A typical client. comes in with relatively low spend with 500 a month of lead gen. Of course, there's a platform, but they're getting, let's say, 50 leads a month, 70 leads a month, to give you a number. In the first year, I only expect them to close one or two deals.
Now, those one or two deals will pay for the platform and the lead gen and etc. But with that same performance in the next year, they're going to close seven deals. Else, right? It's not that they got better in the second year, it's just the question of time, right? So in the [00:23:00] second year, you're closing leads from first year and you're closing leads for second year. So your, numbers accumulate and then ongoing. So I want you making a $100, $200, $300,000 in year two, and from there you're gonna get to your 1%. And once I get you to a 1%, which is another thing that I like to say, if I have a client that converts at 4% and a client that converts at 1%, does that immediately mean that the 4% is better?
Obviously, if I'm asking is because I, my answer is no, right? I'd rather have you converting at 1 percent and scaling your business than you staying super small. And again, I usually don't push clients to grow because I know that all the pain that comes for it. But if you'd for optimizing that one sale are going to stay this small, they're not going to go anywhere.
So I need to get you to the 1 percent and then help you to scale. And because think about it again as cost per sale. A 1 percent conversion gives you 1, 000 cost per sale. A 2 percent conversion means that you're only paying [00:24:00] 500 per sale, right? But you're making 10, 000 in a sale. Would you rather do 10 transactions at 1, 000 or 500 of cost?
Obviously, you would go to the, to, to doing, paying a little more, but go to the higher number, right? But if it starts eating where you're not making money on a transaction, that's where growth, that's where the curve turns against you. So I want you at a place where you're making good money per deal. And then I want you to grow as much as you can with that.
Verl Workman: So you guys like his thought process on leads? like thinking through it. See why I want him to spend some time with us. All right. So what about ROI? What what should an agent expect? I spend a thousand dollars in ad spend or a thousand dollars in social media, Facebook. What should I expect? In a, as a return, ROI?
Alvaro Erize: if I don't say anything else, if your cost per sale is a thousand and your average commission is 10,000, you got 10 times your money, right? If your cost per sale is 4,000 and your commission is 10,000, you got two [00:25:00] times your money and a half, right? And so I would want to be making six times my money or something like that. Now, four, four times is good if you're gonna grow.
But it's just. In my opinion, just more difficult. We talk about ROI and it's just a more complex math. As long as I'm doing sales, where I'm making good in I would measure if I was, all of you, and I talk with this with the clients where we have more of a personal relationship. I would go one transaction. If I forget all the fixed cost, one transaction, how much money ends up in my pocket in this transaction? Once I paid the agent, I paid my cost per sale, how much money did this transaction end in my pocket? If that number is at a level where you're happy with it, then just do more of that. If that number is too low, then instead of trying to do more, try to do better, right?
And I, my, my personal sweet spot is I like to have a cost per sale of around [00:26:00] $1,000 to $2,000 and grow from there, which is similar to saying, if you have a 4, 5, 6 times ROI I would focus on growing. If you're getting a two times ROI, you either need to change your lead source or you need to change your processes and get better.
Verl Workman: That's great. That's that's great advice. And a lot of people are trying to figure out right now, as the markets slow down a little bit, where do I cut? Who do I cut? And how do I figure out where it is? You just got a little, you've got a roadmap of what your ROI should be on your spend, whatever your lead source is from a general perspective, right?
We're going to run out of time. I want to ask you a couple other questions. So I want to talk a little bit about the future.
Alvaro Erize: Before you run on that, biggest mistake I've seen make and I want to preface this by saying like CINC doesn't make money on the lead gen. You pay our platform. That's how we make money. And then the lead gen week is more on what the client wants. And so but the biggest mistake I've seen and I saw it in 2020 is [00:27:00] people pulling back on lead gen and it's your and I've done this in our internal masterminds where I with permission of the client put it up in there.
It's like this client was spending 30, 000 a year and making some 500, 000 a year, right? This year was tough. So when they got to that decision, they said, I'm going to have to cut back and they cut from $30,000 to $20,000, in spend and they went from 500, 000 to 300, 000 in revenue. And I'm like, how, why? Like in, I understand in a tough moment you're looking and this is the most easy lever to pull. Because it's the easy lever to pull, you should really think before pulling it, right? That's the way life works. And if you're getting good ROI on your lead generation, whatever you cut is as ridiculous as it can be, right? Because you're going to lose four or five [00:28:00] times whatever you cut. So that's not going to put you in a good place.
If you're not getting ROI, I get it. or if you were launching into this is my first, I understand timing and I understand, cashflow concerns, but the idea of these are tough times, so I'm going to pull on this on this lever here, you're going to be hurting for every dollar you save, you lost $5 of revenue. So don't do that. And my clients go that's a facepalm moment when I put it because it's in media and the proportion maintains itself. Oh, I cut 10, 000. I got a third of my spend. I got a third of my revenue less, so I gave up $200,000.
Verl Workman: We're teaching our people to lean in and take market share right now. And so we want to grow. We don't want to go backwards. So just know that's a message and a theme of our conference.
So let's talk about what's new and exciting. What's coming up a new? What's how's AI impacting high volume lead gen as an [00:29:00] industry? Are you seeing some things in there? Are you doing some things that is going to impact the is gonna bring the cost of leads down and the conversions up, you think?
Alvaro Erize: So the cost of lead, I don't think it will come back through AI, come down. It's just the cost of lead has more to do with how many people are looking for houses at the same time and then how good it is the person that is actually doing the job for you, but that's a zero sum game. We're doing the different thing. I believe we're the best at lead gen, but that's because other people are worse than us, right? What I mean is, if AI brought everyone better, then the cost per lead should be the same. I think where AI is really going to make a difference, although I still don't think that it conceptually changes the game. But of course, today, if you don't have a texting service that is powered by AI, I don't know why you're not doing it. People want instant gratification. They want to be engaged at 3 a. m. They want all those. [00:30:00] Someone doesn't, but most do. If they're searching, they want to text.
And it's it's a great. Now we can talk about good AI vs. bad AI. If we had time, I would say why we believe in making our AI relationship building and not transactional. Most AIs are built in a transactional manner and we, they're training the AIs to do what you train your agents not to do, which is be purely transactional.
How many bedrooms? What are you looking for? Where are you looking for? But I don't think we have time. I think you have to have a good texting support. Now if, when you put in your texting support, you stop calling, then you just hurt yourself, and I tell that to clients all the time. This is additive. It doesn't replace you calling.
Do I believe that AI will replace the calling itself? I don't believe so, because I think relationship building is important. Once you get someone on the phone, you don't want to waste it on a robot. You want to be building a real relationship. Texting is fine. Where I think AI has done a stepping stone for us, and this is what we're releasing now, [00:31:00] is the ability to do SEO at scale.
So if you've ever talked with CINC, we always say, look, we do SEM. SEM means advertising, paid advertising, right? And we do that because it's predictable, because it's scalable, and if you give me more money, I'll get you more leads, and you'll convert and make more money in return, and we can all put a line from, A to C.
SEO, which means. Organic placement. It's Google decides to put your site at the top, and there's a lot of hocus pocus. There are a lot of wizards of the industry going Hey, I'll do this. And in five years, you're going to show up the front. And then in year four, they go like Google changed the algorithm.
So everything we've been building for four years is going to go out. And so for me, because it's so I'm not like that's great. There's people that are good at it, but it is a more it's a bed that is more difficult to predict, and it's something that we didn't feel was scalable. And so that's why CINC didn't focus on it.
Now, with AI, with the ability of us to have an additional [00:32:00] branded site that is optimized towards SEO. With the ability to generate AI generated content, so now I can set up a website for you that has A page on every school, club, neighborhood with actual content that is real and valuable. So this is not cheating. Because people think about this as, Oh, you're cheating Google. You're not. Google wants you to provide value. If you put a page that has super relevant information in a lot of super niche things. Now your SEO is going up and so now it's the first time that we see the ability to do it at scale. And that's why after seven years, this is the first time that you'll hear CINC say, Oh no, we're really going into SEO. And we're going to set you a site that without spending 10, 000 extra a month on that, it's going to get you SEO. Why? Because it can be done at scale through AI.
Verl Workman: Does anyone else think that's interesting? How everything's going to scale and change the AI? AI is going to help us, but it's not going to replace anybody. I'm not feeling that.
Alvaro Erize: [00:33:00] Again, we would go there more into politics, but if you think, everyone in the 80s, 60s thought that machines were going to replace humans, no, everyone was going to be out of a job, right? It's, fundamentally misunderstanding economic theory because what generates the job is the demand for, services. What does is people change what they do. There's not as many Americans working in factories as there were in the sixties. America still has had full employment for a very long time.
So that, that, doom of those jobs are going away never happens. Because if all of our jobs just went away tomorrow, we would just all have more time to dedicate to higher purposes, which is what the human being does. And so ultimately, if you ask me to predict, I'm not like you have guys that are in AI at the front. I wouldn't compete with them in doing predictions there. But what I'll tell you is, the more stuff we don't want to do that gets replaced by someone doing it. The more [00:34:00] time that we will spend on doing stuff that humans want, and there's always going to be more demand for that. The things that are easy and we take them out of the way, they become our bar, they become our table stakes, right? And we go for the next thing. That's why most Americans work in problem solving today. No one works in like super monotonous jobs in the US, or very few people do, right? That's a good thing. So ultimately, I do not think that.
Verl Workman: I think that's, I think it's fascinating. If there was something you could share with this audience of high performers, maybe what's, what they should focus on over the next 90 days, what would you tell them to focus on, or what would make the biggest impact on their business?
Alvaro Erize: So we're in a super tough market, right? We all know it. There's one reality of this market. There's one reality of real estate, which is it's different shows, right? But if we have COVID for a year and there's no shows, it's not that there's going to be more demand for shows after. There might be, but it's something that [00:35:00] if you didn't do it, you didn't do it.
Moving is not like that. Moving happens and you know it better than me because of fundamentally life altering reasons. You get divorced, you get married, you have kids, your kids leave your house or you're a kid and you suddenly become an adult, right? That didn't go away. If you're holding on to living with your ex wife for the last four months, you're still going to move out, right? And so, there's a small chance you might get back together but, more chance that you're killing each other. And, so those, that is, that demand is inelastic. And so the demand for moving is still there. And different than the crisis of 2008, the problem here is supply, because no one wants to move out of their 2 percent mortgage.
And so if, once construction catches up, All that demand is going to continue to hit and so I do, whether it's six months from now or whether it's nine months from now, I do not know, but what I know is that whatever business you're not closing today, someone, [00:36:00] not necessarily you, is going to close it six or eight months from now, which is what I said in 2020. If you look up a webinar of mine back then, it was like when everyone was like, stay home or don't do like I was like, just Whether it's on the phone, over Zoom, or in person, you choose your thing. But if you're not generating relationships at the moment, at the, if you're being transactional and you're going, Oh, if you're not looking for 12 months, I don't want to talk to you, then you're out of business when this comes back.
And so for me, what I'd say, the one thing that I would say today is you need to be creating relationships. I know that sounds obvious, but It's not in the sense of if you're being transactional and anyone that has a long time or has something that makes you think that they're not going to transact for a while, you're leaving them on the side you're preparing yourself to be out of business nine months from now. While on the flip side, you have, we know now that actual chances of starting new relationships, and we see it through our math are higher today.
So transactions are lower, but relationships we can build are higher. So invest in that. Okay. If, you don't want to go into [00:37:00] the Online lead gen game today, don't do it. Do your sphere, do your thing, but invest in those relationships now. You should be working harder than ever. And if you do want to go into Online lead gen, or if you are in it, this is a great moment to invest in it, even if the numbers seem a little tough in the upfront on the pickup rate, right?
Go invest in it because those relationships, those people are going to move. There's more 25 year olds living with their parents in the U. S. right now than since the 50s. That's not going to maintain itself for the next five years, or we're going to have a lot of people killing each other. So think of that shadow demand. You're already having demand here and supply here, and you have the shadow demand that you're not even seeing. So all of that is going to come. The question is just when. So the only thing you can do is be creating relationships and be ready for that moment.
Verl Workman: I love it. I hate that we're out of time, but I thank you so much. Can we give Alvaro a big hand and thank you so much for being here. And as, as you talk about relationships, I'm grateful [00:38:00] for the relationship that we have.
Alvaro Erize: Thank you and I too. And I think you do all like in these times that are scary, being able to get together in a place like this and take those leaps into making investments not just of money, but of time and of effort. And now losing faith is huge.
Verl Workman: Thanks Alvaro. Thanks every body.