Agents and firms battle over ads

From left: real estate agent Jay Flagg; Elliman chairman Howard Lorber; Jill Fleming, a partner at Long Island advertising agency blumenfeld + fleming; Corcoran Senior Vice President Gary DePersia; and Burke Smith, a real estate broker and founder of YourNetCoach

It’s a ruckus fit for “Mad Men”: a top Prudential Douglas Elliman manager was demoted in June after running a magazine advertisement he was told didn’t conform to company standards.

Real estate agent Jay Flagg, who at the time headed Elliman’s Southampton office, says the ads were approved by the company and attributes the demotion to a personality conflict with Elliman chairman Howard Lorber. Elliman said there were no personality issues involved; the only problem was the ads (see one of Flagg’s advertisements below).

Regardless, the case brings to light the challenges agents increasingly face as they promote themselves and their listings while adhering to legal and company advertising rules.

Lynn Blumenfeld, a partner at Long Island advertising agency blumenfeld + fleming, which designed Flagg’s ads, said it’s important for companies to build their brands, but the downside for agents is that many of their ads end up looking virtually indistinguishable.

“What they’re often given to work with looks like the same thing,” she said. “If you take away the name in the corner, it’s hard to know which one’s which.”

In the old days, customers relied on real estate companies to find homes for sale; the best companies had the best listings. But now consumers can see thousands of real estate listings online, so choosing a real estate agent is more about the individual.

“The consumer is no longer interested in the corporate brand names,” said Burke Smith, a real estate broker and founder of YourNetCoach, a company that specializes in Internet marketing strategies for real estate firms and agents. “It’s more about having a local real estate expert who has the modern-day tools to service their needs.”

Building individual identities within a company isn’t always easy, since real estate agents often have very specific restrictions on what their advertisements can say. The New York Department of State, which regulates the licensing of real estate agents, mandates certain rules for advertising. For example, all ads placed by brokers must indicate that the advertiser is a broker, or give the broker’s name and phone number. Also, property ads must accurately represent the town where the home is located. For New York City firms, the Real Estate Board of New York also has additional guidelines.

On top of that, real estate firms each have their own guidelines, requiring certain disclaimers and trademarks as well as rules about the colors and designs that agents can use.

Hamptons agent and Corcoran Senior Vice President Gary DePersia began advertising heavily a decade ago, when he was an agent at Allan M. Schneider & Associates (since purchased by Corcoran). DePersia started putting his picture on ads, which was rare at the time, and spending more of his own money on ads in addition to the advertising budget supplied by the company. These days, he distributes his own 44-page listings brochure and has a 90-second commercial on Plum TV.

Many agents spend money on advertising in proportion to how much they stand to make on the sale. But DePersia said he takes a more holistic view, focusing more on his brand than the specific listing. “The more [advertising] I did, the more listings I got, the more money I made,” he said. Now, “anywhere I go in the Hamptons, I have tremendous recognition.”
When Corcoran purchased Allan Schneider in 2006, he said, it was initially difficult to adjust to stricter guidelines.

“With a smaller company like Allan Schneider, it wasn’t difficult to walk that line between your own brand and the company brand,” he said. “A company like Corcoran, which has a lot more of a definite brand recognition and guidelines about what you can do, it’s been a little tougher.”

DePersia has a dedicated staff member who is responsible for creating his ads, which are then submitted to Corcoran’s ad department for approval. “We work with them to make it something that’s company-approved,” he said, adding: “They’ve allowed me to be creative within their look.”

One way that agents can develop their own unique brands is on the Internet, since companies tend to be more lenient with online ads, said Smith of YourNetCoach (although that, too, could be changing).

Smith recommends that his clients set up Facebook pages or websites that associate them with a niche market. For example, one client who specializes in prewar co-ops set up a Facebook page dedicated to prewar co-ops to help generate leads. Another client, Manhattan real estate agent Carol Levy, markets herself as the “Makeover Maven,” since she specializes in renovating and staging apartments.

The key is the right balance between flexibility for agents and quality control for firms. “You certainly have to have guidelines to protect the corporate brand,” Smith said. “But I think that agents have to be given the ability to establish their own identity. It will help both of them.”

In the Flagg case, both sides agree that Elliman needs to have its standards. (The New York Post first reported Flagg’s dispute with Elliman.)

“We can understand why Prudential would be upset if a broker went outside of what was considered Prudential-approved,” said Blumenfeld, of blumenfeld + fleming. “It’s important for them to have consistency.” At the same time, “we understand why brokers would want to promote themselves as individuals,” she said, emphasizing that her firm would not “arbitrarily or randomly go outside of a campaign without permission.”

The ads in question featured the name “Flagg” in large red letters on a blue background, with the Elliman logo in the bottom corner. The ads also featured slogans like “Flagg knows the Hamptons you want to know” and “Flagg it.” Blumenfeld said: “We wanted people to remember his name and to convey that he is a Hamptons insider.”

Only one of the ads ran in Hamptons Magazine before they were pulled, Blumenfeld noted, but Flagg had already started getting calls from it. “Apparently, it was too good of an ad,” Flagg told The Real Deal by phone shortly after he was demoted.

In a statement issued at the time, the company said: “Prudential Douglas Elliman has made it clear to its agents that all advertisements should be within company branding standards,” the statement read. “The advertisement run by Jay Flagg did not conform to those standards.”

Flagg, a longtime agent with a list of celebrity clients, is now an executive vice president at Elliman, but no longer a manager. He is currently listing Christie Brinkley’s $15.75 million Sag Harbor home.