So a lot has happened over the past couple weeks.
Below I lay out a few things I believe to be true. They are all debatable, of course, and may, in the end, prove to be completely wrong. Be that as it may, my overall approach inclines toward practicality.
There’s a problem between brokers and online publishers, and both parties stand to get hurt if it’s not solved.
Let’s get to work solving it. Shots will be fired, but ultimately this comes down to negotiation.
So, for your consideration…
1. The manner in which Trulia and Zillow currently handle buyer agents on listing detail pages is unreasonable.
Realtor.com allows brokers to kill the “4-headed monster” on their listings without paying. This is better, but there’s got to be a way to monetize a listing that respects those who provide them while still allowing online publishers to generate revenue.
2. Perhaps a consumer shouldn’t be urged to contact the listing agent. And an airline shouldn’t charge me to check a bag, either. But that’s the way it is. It’s business.
Sure, there are discussions to be had about the future of the brokerage business model. But in the meantime, we have a more immediate matter to address: content owners don’t like how their content is being used. Let’s work on that.
3. Brokers that cease syndicating without a countervailing digital strategy in place will probably get hurt.
We are at an interesting point now with technology, where what we think of as “online” is shape shifting before our eyes. Soon, more people will view listings on smart phones, tablets, e-readers (and whatever voice, gestural or neural interfaces emerge in the not-to-distant future) than on the web pages we’re all focused on now.
The unprepared brokerage, by ceasing syndication, is not just removing its listings from a website. It is vanishing them from a digital world that’s just dawning.
Brokers may not like their digital partners, but these partners have the capacity to take them to places they’ll need to be in the future.
And, sure: If you’re a big broker with significant share, loads of brand equity, low dependence on out-of-market buyers, solid digital assets and a good internal marketing team you probably will not mortally wound your business by ceasing syndication. But these companies are the exception.
4. The costs of cooperation, long-term, are lower than the costs of retrenchment.
Though there are very important differences between IDX and syndication, there’s an underlying reality those who participate in both confront: buyers will approach listings from many places, through many people.
It was nice when sign calls drove most inquiries to the listing agent. But I don’t think we’re getting that back. I also think the power of the listing as a vehicle for agent marketing and brokerage branding never will be what it was pre-digital. These are realities driven by consumer expectations unlikely to be stifled, for long, by industry maneuvers.
So, yes, when brokers cooperate with online publishers through syndication, or with competitors through IDX, some buyers agents will essentially free-ride by using listing inventory to secure clients, some of the agents shepherding buyers through their listing may not be area experts, and they will lose some control over lead routing and monetization.
But having been inside hundreds of brokerages, looking at the numbers, the metrics and the conversion funnel top and down, the costs of cooperation, while real, are usually (yes, there are exceptions) less than the costs of retrenchment.
5. Love the one you’re with. Your next relationship may be even worse.
If syndication is pulled apart like a piece of string cheese, and if IDX unwinds next, Zillow, Trulia and Realtor.com may go away and big brokers will have achieved something that won’t feel like victory for long. Because what replaces them may be even more odious.
Compelling consumer behavior (in this case, “you will come to my website or app to view listings”) is difficult unless your brand, your product and your user experience are all superior. Apple and Southwest Airlines make such demands of consumers, and we tolerate them, because, well, they are Apple and Southwest Airlines.
Most brokers aren’t in a position to pull this off right now. So what will arise, once the beasts of today are slain and consumers cry foul, are marketing and distribution partners that will likely charge much more for access to consumers whose expectations fly beyond the average broker’s reach.
Remember: the rest of the world is pay-to-list. Negotiation now seems smarter than rolling the dice.
And, on the flip side… online publishers may gripe about unreasonable brokers now, but trying to aggregate 4 million listings from agents will make today look like a walk in the park.
6. What we need, quite urgently, is a new online listings compact.
Such a compact must be more respectful of listing owners, yet still allow the online publishers to invest in innovation from which brokers and agents can benefit.
Invective is easy and sometimes gripping; cooperation, while much harder, is still possible.
If you want to work to make this happen, drop me a line.
[Disclosure: Realtor.com is a client of 1000watt Consulting, though we have no involvement in their listings policy, or the manner in which they sell products].
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Brian,
You made so many excellent points and I can’t help but think of the unintended consequences you raise and how information while once “controlled” – today is more “curated” and real estate as an industry, seems struggling with what this means to different players in the channel – brokers, brands, listing agents, buyer agents, 3rd party service providers, aggregators and more. Thanks for your efforts in moving the constructive conversations forward.
Excellent analysis – one of the more constructive articles I’ve seen that is focused on moving the discussion forward. The one question that it leaves me asking is who is responsible for negotiating the deal – each individual broker, associations, MLS orgs, NAR, a third party? It doesn’t seem constructive for each broker to negotiate their own deal, but then again, I may be missing something since I am not an industry “insider”.
Hey Brian – Brad from Zillow here. You make many great points in your post so thanks for taking the time to produce a civil and level headed article that I personally feel takes a very constructive and productive approach to this topic.
Speaking for myself (and our company), we do hold consumers and agents/brokers in the highest regard and are always looking for better… no.. make that the “BEST” ways to accommodate and provide top shelf value and services to both sides.
We are all over this stuff with open eyes and ears, we take our site and service very seriously. Don’t think for a second that Zillow isn’t always listening, watching, and making important decisions and moves that produce the best results for all our partnerships (including consumers) it’s what we do each and every day.
Bravo! Well done – and as Brad says – Zillow is listening. I think that Move, Homes.com, Trulia, and Homefinder are listening too. I think that the industry is coming to a point where the new compact will evolve.
In many situations – brokers, franchises, and mls have already arrived at new agreements – but they are private agreements. An easy first step for publishers to consider is spreadiing these covenants across all data relationships. What is good for some is probably good for all.
I applaud you for raising your hand Brian – Good Man!
We might be wearing thin of reading blogs on this topic right now but your suggestions are right on. In fact your suggestion for a compact sounds a lot like what Clareity suggested as a Listing Bill of Rights. Yes, a few might seem a little heavy handed and in the end I think a negotiation that leaves each party feeling equally dissatisfied could be considered a successful one that allows everyone to move forward.
Brian, good input. Just a couple detail corrections. Trulia does make it very easy for listing agents to make the “four headed monster” dissappear, and its free. A listing agent just needs to create a free account, on Trulia (so that we asssure consumers have the correct contact info)one time and that will assure any listing that appears on Trulia from tht listing agent will only have them displayed to consumers.
Trulia has also developed a pledge to assure consumers and REALTORS are connected in the best way possible.
Trulia Data Pledge for Listing Syndication and Display
1. We will make it easy for consumers to contact the listing data source and the listing agent based on the information provided to Trulia.
2. Trulia will display the listing data source at no charge and will link to the listing data source.
3. Trulia will always provide a prominent, free option for listing agents to receive leads from their listings.
4. Trulia will provide listing performance reports, at no cost, to the broker and the listing agent(s).
5. Ads will be identified as ads to distinguish advertising from listing content. We will remove ads that confuse consumers about the official agent or broker for a listing.
6. While Trulia’s listing ranking algorithm remains proprietary, we value accurate listing data and will share the criteria we use to present the most complete and accurate information to consumers.
7. Trulia will not syndicate listings to other sites.
8. We condemn fraud and misuse of data. Trulia will take reasonable steps to prevent misuse of listing data and to fix inaccuracies.
Thanks.
Lloyd -
Are you saying that *all* buyer agent ads are removed when the listing agent creates a free Trulia profile?
Brian
Brian,
All non-listing agents are removed from the listing. There is the possiblity that a Local Ad purchased by a broker or agent can appear outside the listing.
Thanks. I want to get this right, so bear with me:
By “all non-listing agents are removed from the listing” do you mean the entire listing page?
By “outside the listing” do you mean the search results page that led the user to the listing?
Brian
I am differienciating between the listing content area of the page, that might list 3 other agents for contact by the consumer if the listing agent has not registered, and the non-listing content areas of the page. All non-listing content ads are clearly marked as a “Featured Local ad”. Hope this helps clarify. I’d be happy to send some screen shots for illustration if that would help also.
In that case, the assertion in my post stands and my detail need not be corrected.
Brian, I thought this thread was about the assertion “Realtor.com allows brokers to kill the “4-headed monster” on their listings without paying.” The 4-headed monster you reference only appears in the listing content area and is not about ads outside the listing content. To that end, Trulia does not charge listing agents to assure other agents do not appear in the listing content area.
Wow Lloyd, what a totally specious reply. As if consumers know any differently from the agents showing up in the zip code program vs. the listing agent on the same page.
Capitalizing on the ignorance of brokers and consumers will not serve Trulia in the long run.
-J
Am I the only one who notices how fast the paid Trulia and Zillow shills (and the occasional CEO)come out of the woodwork these days when “syndication” is discussed? And they always have their talking points at the ready.
They are scared. They should be. Brokers and MLSs are waking up.
Jeff, you’re right that we at Zillow, up and down the org chart and all the way up to our CEO, do care deeply about these issues. That’s because we adamantly believe that these are important issues for THE CONSUMER.
We believe that the home seller is well-served by having their listing on the most visited real estate website in the nation, and on the most used mobile apps.
Be honest: if you were selling your own house, wouldn’t you want it to be listed on the sites which had the most visitors? That’s why we comment in places like this. Because we’re concerned that in all of this industry back-and-forth, too many people are losing site of the consumer.
Boom! Right to the implied blackmail. “If you don’t give me your work product for free, in return for nothing, I’m going to spend $$ millions convincing the public that you are a bad person”
3.2.1… Countdown until ZTR starts bombarding the public with anti-brokerage, pro-ZTR adverts.
Next up?
Accepting listings directly from the public, and funneling the buyer leads exclusively through ZTR “Certified Buyer Professionals”.
Oh, and BTW- you couldn’t care less about the public.
Lloyd-
Not to to fine a point on it, but at GoodLife Team we did not find # 5 to be true at all. And we were paying customers, not unsuspecting firms syndicating without advertising with your company.
5. Ads will be identified as ads to distinguish advertising from listing content. We will remove ads that confuse consumers about the official agent or broker for a listing.
We were *paying advertisers* of Trulia. The ads *confused our broker* and made it look like buyer’s agents from other companies were part of our firm, offering to show our homes. We called, we complained, we got the run around. We said we would de-syndicate and pull our ads, and we were told “changes would come, be patient”. The next day inman covers the story -
Ref: http://www.inman.com/news/2012/05/2/austin-brokerage-pulls-listings-ads-trulia
And I quote: “Shuman said Trulia did not plan to make any changes to entice the brokerage to come back to the site.”
So – somebody over there at Trulia was blowing smoke to us – or to the industry.
My comment on this appears here: http://youtu.be/3K5aNS6F24I
Excellent post.
Publishers need to remember where the listings originate. CLRSearch started out with a simple premise, provide consumers with access to as many listings as possible and don’t lose sight of whose listings they were in the first place. We’ve worked hard to create an efficient portal to our contributing broker’s listings and have quietly watched as larger sites continued to obscure access to the listings origin.
The financial motivations are clear. Most of these companies have invested heavily with an eye toward the future payoff of a successful IPO. Most business models that alienate their customers are doomed to fail.
We rely on syndication and as a publisher we need to be cognizant of the ramifications of putting our financial goals above those of the market we serve.
Bravo, Brian. Thank you for posting such a well-written piece that doesn’t point fingers or play the ‘blame game.’ The future of IDX and syndication is uncertain, but I think you’re right on, “…respectful of listing owners, yet still allow the online publishers to invest in innovation from which brokers and agents can benefit.” Aggregators of content that then turn-around and sell advertising is proven business model (Google and FB are examples). The question, to your point, is how can we all play together in the same sandbox and *make it easier for the customers to do business*.
I agree with you Brian that it may be best in the short term that brokers and online publishers (syndicators) figure out how to play together. Part of the power that major syndicators have lies in the fact that they have smartly invested heavily so that they can be found where the homebuying consumer is, which is on the search engines.
For example, here are the first page results for a search on “new homes in culver city” on Google:
Listing #1: Trulia.com
Listing #2: Homes.com
Listing #3: Homes.com
Listing #4: Redfin.com
Listing #5: Realtor.com
Listing #6: LATimes.com
Listing #7: Move.com
Listing #8: realestate.yahoo.com
Listing #9: realestate.yahoo.com
Listing #10: Zillow.com
This doesn’t mean that brokerages can’t rank above the aggregators in the search engines (many do), however few have the resources or the expertise (or partners) to do so.
Corey
[...] Today I read a spot on post by Brian Boreo over at 1000Watt. [...]
From a brokerage owner who was an early adopter of syndication, and a believer in online marketing of listings let me very briefly explain why I want to see very MLS in the country pull their feeds from Zillow/Trulia/Realtor.com (ZTR):
1- We do not need you, ZTR. Period. You need us.
2- I am giving you my listing data/photos/descriptions (aka your lifeblood). You no longer give me anything of monetary value. This is an abusive relationship.
3- Due to NAR’s patently ridiculous IDX rules ZTR has an inherent advantage in the ways that they can display my listings and attract eyeballs, to the detriment of my own business.
4- Due to the fact that ZTR do not comply with the Realtor Code of Ethics in the way they display my listings, and bogus listings, and make believe foreclsoures parading as listings… ZTR has an inherent advantage in the ways that they can attract eyeballs, to the detriment of my own business.
I have been in commission sales most of my adult life, and I say “Sure ZTR, let’s negotiate, after we’ve pulled a huge chunk of Our data off Your parasitic websites. Then we can work on a “solution” where you pay me.
Not interested. Again… let’s pull the data and see whose business suffers. Not mine, I don’t get jack from you now.
So Jeff, I assume that you would like to return to the old days. Perhaps have a public facing MLS that is listing agent friendly, that way you wouldn’t have to pay any marketing costs, and the buyers would be encourage to call you. Interesting thoughts.
Correct me if I’m wrong Jeffrey… but don’t I already pay office expenses, franchise fees, licensing and training costs, utilities, website development costs, print advertising and pay-per-click… and of course I pay for the MLS itself.
Those are all marketing costs.
Of course, the DIFFERENCE is that in all of those… I get SOMETHING of value in return.
Most of those are business expenses, not marketing expenses IMHO.
No Jeffrey. I make all those investments as part of a marketing strategy to first attract agents, then to get listings from/for those agents and ultimately to get buyers from/for those listings.
A smart business man invests time/money in order to receive measurable, tangible benefits. I am no longer interested in leveraging my substantial investments to attract agents and listings in order to make ZTR rich.
ZTR does not have an inherent advantage. Because most brokers believe they do though, it leads to brokers not leveraging the inherent advantages they have.
The way to fix this issue is not to stop syndicating data. The way to fix it is create Internet destinations that are better than those ZTR do. As long as brokers think this is an impossible task ZTR will continue to win.
Of course they have inherent advantages… in attracting web traffic. They follow no rules!!
Can I display sold homes in my IDX?
Can I put a rate the realtor function on my IDX?
Can I co-mingle FSBOs with my IDX?
Can I pull public record filings of lis pendens filings and call them “foreclosures” to attract leads to my IDX?
Can I paste my name and face and contact info all over someone else’s listing on my IDX?
Get back to me.
Not trying to frustrate you here. Your thinking is just too bound in IDX. Thats such a small part of what would make an amazing local brokerage site.
You have the inherent advantages. You just need to find them and leverage them. If 100 brokerages start doing that ZTR will lose some market share. 1,000 brokerages and it becomes interesting. 10,000 great local brokerage websites and it’s over. How long does it take to go from a handful to 10,000?
An amazing brokerage website does not begin and end with IDX though. If it does you are right they have inherent advantages, otherwise all the advantage is yours.
I am coerced into adhering to NAR’s IDX rules by my MLS, otherwise I have no IDX, and ultimately no MLS membership. Sans IDX rules, I agree that brokers could theoretically compete on at least more even footing.
“The way to fix it is create Internet destinations that are better than those ZTR do.”
Bingo. But I’ve yet to see a brokerage/agent who can execute on this. Many have tried. Many have failed. No offense to the industry, but I don’t think the majority have the faintest idea on what it takes to build a website better than TZR…or how much it would cost (hint: a LOT).
Brian, first let me say this is the finest piece I have seen on real estate listing syndication. I sincerly hope you and others can get the players to the table and come to some compromises. Must of the inaccuracy stories are from years long ago, a while there is certainly room for improvement, both within, and outside the MLS, it’s best to work them out.
Second, here is a comment on your post and a peek into listing syndication in 2017, should we all insist on continuing down this road. For those that say a national MLS does not exist today, I would rethink that. It’s closer than you think if you take away the alternatives.
http://www.realtyv2.com/2012/02/oh-and-on-other-thing-about-real-estate-listing-syndication-in-2017/
Jeffrey, even if your vision turns out to be false, it’s good to think about these things. I know I ponder the manner in which the rug may be pulled out from under me almost every day.
I know it is an extreme view, but how many industry see the collapse from within, they are normally too stuck in there ways to see the signs?
My hope, like yours, if folks will get together and find a solution. The arrogance of agents that seem to think they can control where the consumer wants to look and gather information is foolish. Anyone that has looked at recent statistics should realize the the industry is involved in a very high percentage of homes sales and purchases. Why return to the gatekeeper days when clearly data is but one small part of what we do as real estate agents?
Jeffrey- your post above “The arrogance of agents that seem to think they can control where the consumer wants to look and gather information is foolish” seems to imply that agents should be more humble, or perhaps subservient… to the wants and desires of “the consumer”.
I own nothing to the web surfing masses. Nothing. I have an obligation to my clients to use “skill, care and diligence” in their home sale. I have a further obligation to my agents and family to earn a reasonable return for our efforts and investments and to protect our collective interests by staying in business.
This is not arrogant, it is business. I say lets pull the feeds first and see what we can negotiate after that. Right now we have a 3 legged stool and only two of the three parties are getting what they want. “Consumers” give nothing and get everything, ZTR gives something (websites) and gets revenues, brokers/agents give everything and get nothing.
I am a successful Broker/Owner in a relative high-end market.
Bottom Line my company is a new listing source of data points.
I have a physical office of 10,00sf and have 70 agents
My agents generate the listings which are the data points which everyone wants. Listings in volume do not happen without cost on the agent’s or office’s part. I must admit that if I divide my annual operating cost by the number of new listing and sold data points I create that number is very large, for which I am required to give these data points away to third parties who then profit from this data. This is a tough concept for me.
The third party vendors say they are marketing my properties for me and therefore they are a value add. The problem is for the value add to be a valid point my market share would have to increase which it has not. We have been the #1 office in our county for 20 plus years and that position has thankfully remained but has not increased. In addition we also track where our leads come from as well as phone calls. These third parties web sites are really low on the list. Bottom line the old yard sign is still the most powerful lead generator, next would be agent Blogs ( we actually have 3 good ones ).
So do I believe my sales volume would go down if i was not on those sites the answer is no. So why am I still on those sites? because my agents see it as easy marketing and agents in general do not think past their own personal interest. Which is fine and I deal with it but they do not look at it from my company perspective which would include protecting our intellectual property rights ie listing and sale data points.
Just my $.02 worth
This! => “My agents generate the listings which are the data points which everyone wants. Listings in volume do not happen without cost on the agent’s or office’s part. I must admit that if I divide my annual operating cost by the number of new listing and sold data points I create that number is very large, for which I am required to give these data points away to third parties who then profit from this data. “
Jim – thanks for the input. Do you pay the online publishers for more prominent display?
If I may push a little more,
Jim,
In the long run, do you think that brokers would be better served by competing with publishers (whether traditional newspaper publishers on new-era consumer websites) for lead generation or coopt/leverage them and focus on lead conversion?
As our industry “emerges from the ashes”, all of us have to take a hard look at what we are uniquely positioned to be the best at.
– Alon
We do not pay anyone for any enhancement on any site.
One or two of my agents did pay Realtor.com but the fees got to high so they have stopped.
Most of our agents have their own private or third party web vendor for web sites, 3 have blogs 2 of which are very successful ( ie 60% of the $400,000 income is from their blog ).
Our company web site is very typical of a real estate firm, you can search, we can recruit, their are bios, we basically duplicate the MLS – as a company we have a professional photographer that shoots a minimum of 10 high res stills and 3 virtual tours. Basic stuff in our market
Do I think we can come together, be creative and build a site that will compete with the others, probably not. Why,most brokerage leadership would not know what to do or what they want, it is just not their area of expertise. So what happens we hire consultants who then give us the same old shit and nothing changes.
Creativity is what is lacking in our industry, as everyone does what ever the latest hot idea is, no one starts with a blank sheet of paper and creates an intriguing and interesting consumer experience. Second real estate is boring in of itself, “Hi wana buy a house”, or OMG look I have a new listing will never get a second look. From my research you have to be intriguing enough to get them to click then you have to be interesting enough to get them back. 99% of company real estate website fail at both. If you doubt me go to your own site and see what is intriguing or compelling enough to click a second time.
We are in the process of trying to create Intriguing and interesting, if it works I will let you know if it does not I will lick my wounds and slink back into my cave. I will tell you it will not look like any real estate web site and it will be a blog based because of the flexibility the Word Press Blog provides.
Once we have something to see I will post a link
Makes sense Jim…I look forward to seeing the link.
In the interim, let me make my question more explicit:
If a good consumer destination gets .5%-2% engagement and a good broker site gets 12%-15% conversion, do you really want to compete in the “engagement” space?
Is it wise to invest your resources to reach the kind of scale required to be ROI-positive on “engagement”?
Bob Hale advocates focusing on ways to “harness” the publishers to serve brokers and MLSs, and it is hard to argue with the success his focus brought to his members.
– Alon
BTW web leads are a myth, if you get them then 3 out of 100 are real and it costs to process 100 leads to get 3. You make more money from a yard sign than you will ever get from a web lead.
I would never develop a web presence for web leads. Your web presence should be used to communicate to the consumer not capture them. If they want to deal with you they will and they will call or email you. Capture is a marketing concept not a communication concept.
The consumer wants information which is beyond 3 bedrooms 2 bath 2,500 sf $799,000.
What they want is our knowledge as to the market, and is that property worth it? and why?. This is our key assest and is what third party websites try and do with programing and algorithms. We all know how effective a general program is as applied to a home with bad neighbors or smell in the back bed room.
If we continue to want 100% of all transactions we will always be prey to those that offer a .0001% advantage.
Brian, great post. I want to work to bring about the next model of cooperation too. When and where? Count me in.
Great article. Several posters here have made the point that the aggregators are not in fact “value add”. I believe this is true for most agents, i.e. business (sales) is not coming from the aggregators. And it is rather galling to be sold leads produced by your own data (I personally do not buy). That said, I know there are a few agents out there who do receive business from the aggregators. Any of these agents care to enlighten us?
Good point, Mark. I have done an informal survey of my 25 agnets. We had 1 verifiable ZTR lead that lead to a sale in the past year out pf out of 279 transaction sides.
I am planning a countywide survey.
Today internet is revolutionizing our lives in much deeper way than what printing press did to our society about 400 years ago. It is high time that all actors i.e. listing agents, their brokers, Syndicators (On line publishers), MLS operators, and consumers (home owners and buyers) must realize that the new technology has much deeper impact in the way we shall be conducting our business in future. Search, aggregation are only the basic technologies that have made some inroads in our lives so far. Mobile, social presence, interactive TV, video are the new emerging technologies and there is no end in sight as to what technologies will emerge and how they shall shape our liuves. We are just seeing the impact of SAAS, Cloud, micro blogging and Symantic web in other areas of our lives like news, retailing, banking and many others. Those who do not learn from the history, history tends to raze them. It is in the financial interest of all players to embrace technology whole heartily as soon as feasible, because the new technology is that million pound guerrilla that forces itself, weather we like it or not. Ebay, Amazon, Redfin (real estate) and many other websites are a proof to where the consumer is migrating to. Can the listing agents, their brokers, MLS operators etc; operate in the old ways, if their consumers tell them that they must have their listings published in a certain way, for certain results? Home owners are the ultimate listing owners who will decide which way to go and neither the agents, nor syndicators will be able to stop that. Technology will the ultimate winner and the end consumer will be the dictator as to who gets, how large a share of his dollar pie.
I agree
Jay, that perspective is missing in this debate. The short-term debate about syndication and IDX ignores the concept that the information wants to be free. The consumer will come out on top.
Here is some data that may help this discussion.
Brokers who syndicate their data and do not enhance (pay) publisher services receive about 1 listing detail page view per listing per month per publisher. The top online publishers like Zillow Network, MOVE Network, Trulia Network, Homes.com, and Homefinder account for more than 85% of the traffic to publisher sites. The other 290 or so syndication sites divide up the other 15%.
Anyone who pays for reports from Listhub can see how they perform against this benchmark – and see their exact data. Any broker may also look at their Google Analytics or other web analytics program to measure their impact. There are plenty of brokers who perform better than this, and plenty of others who perform worse.
If you enhance your listings (pay), it is a whole different story. Enhancing listings on leading third party websites is a proven and effective online marketing strategy. It costs most brokers about $1 – $2 per listing per month per site for advertising – hardly a bank buster. The top sites mentioned above will then become lead generation engines and traffic engines to the broker. Some brokers get as much as 12% of their overall traffic from a single publisher from the list above.
Your results will vary. But suffice it to say that non-paying brokers get little more than a lottery ticket to a transaction from listing syndication. But there is a winner every day!
Paying advertisers get what they pay for.
It is up to each broker to make a strategic decision about their online strategy. I think that for the first time since syndication began, brokers have their head in the game. They are carefully considering their options, looking at online performance, considering short term and long term benefits, weighing risks. Its all good. There is no single answer.
“Paying advertisers get what they pay for”- no they don’t Victor, not in my experience. I won’t get into the data that I have collected on this, but in my brokerage it is clear that they do not.
I would throw this thought out there to anyone who thinks that ZTR leads are worth the costs. In my city of Melbourne, FL… one of the ZTRs charges $856 to get 100% exposure to an agent on the rightside display box as a Premier Agent or whatever. In Melbourne 150 closings took place last month, with an average sale of $161k. That means that ONE average buyer referral at 30% could potentially pay (.30 x .03 x $161k) $1449, almost double what ZTR is charging for 100% exposure.
IF the page views/leads were of even moderate quality, ZTR would work on a referral business model.
@JeffBeck – I trust your data is accurate. My comments are exclusive to Featured listings. How many listings do you or does your brokerage currently have?
I tried to find your listing count on http://members.floridarealtors.org/1110611 – but it did not show any listings. You may want to check into that if it is an error.
Hi Victor. LOL at Florida Realtors. Yesterday our brokerage had 59 Active/Contingent listings. I do not typically list properties.
My point was that:
Since- we all know that ZTR have sophisticated tracking, and that they have done some pretty extensive research and surveying of site users and agents… then it tells me that their data says it’s more profitable to take $856/month for a whole small city rather than offer the leads on a referral basis. Logically, that says to me that they only generate one or two real buyers total per month from all those page views.
“it tells me that their data says it’s more profitable to take $856/month for a whole small city rather than offer the leads on a referral basis. Logically, that says to me that they only generate one or two real buyers total per month from all those page views.”
I disagree completely. I could be wrong, but don’t you have to be a broker to collect referral fees? Zillow is not a brokerage (http://www.zillow.com/blog/2008-11-13/zillow-drops-brokerage-licenses/), and therefore, that’s not an option.
Victor, you have hit the core of the issue here. This should be an election of where to pay to advertise or not. Utilization of the so called free syndication is actually marketing dilution at both the personal and brand levels. It makes no more since than letting someone else hold an open house in your listing. Why would you give your data away so others can get the leads and perceived credit for the listing? If we make this about advertising the actual return on investment will drive informed decisions and shed light who can deliver or not. The online world holds vast opportunities and syndication portals are just one small piece of every growing world.
Great post – Frankly I’m surprised more brokerages don’t use the Apple or Southwest solution. Especially with the way that Google and Facebook are changing the search game. A strongly branded personal site could succeed brilliantly in a specific market, especially if the +1 algorithms are applied. It would be like going back to the days when signs in front of houses drove leads, except virtually.
How? Because the influence of friends on searching will become a much larger force in the coming months. Google is already incorporating this into their searches. Your friends are already influencing your search results. Most web users probably don’t even realize this yet.
I foresee the strongly branded, local-centric Real Estate blogs making a strong showing.
Good point, Eric. A well-done blog has never stopped being effective.
[...] week Brian Boero from 1000WattConsulting has written an excellent article on the state of play between the US realtors and the 3rd party portal sites such as Trulia and [...]
What lessons will the public reflect on from training by Wikipedia (free crowd sourced information vetting), Angie’s List (free crowd sourced service vetting), Craigslist (free asset promotion) considering their needs and wants of real estate service business models? Will they expect to participate in the real estate industry’s information management for their own good? Will the Broker-MLS market information management of today effectively resist? Will listing information control be increasingly valuable? Doubt it. I see listing information control value falling. There are hundreds of agents in my maket. There will be stakeholder haggling over its ever diminishing value per listing. But value per listing will never rise. There will be haggling over permissible aggregation. Aggregation will never reverse. What will rise in value to the public? Service information and service value. What will rise in value to brokerages and agents? Business modeling to better use free or almost free information and public participation in the service value chain.
Jim, some really excellent points. Our argument as an industry about how valuable the raw data is gives the public the wrong idea. The agent of today and the future does not need to be the gatekeeper of the information, they need to offer an analysis of data, market knowledge, negotiation skills, sales abilities, and guidance. They are not going to be able to kill 3rd party sites, just return them to pre-syndication days. As Brian says, best that we all work together to get the most accurate information out there. One only has to look at the commercial industry to realize what the wild wild west and good old boy network look like.
I suggest that the real estate industry needs one data site – a broker chaperoned real estate dating site — where seller listings are created by the seller and/or their agent, and wanted listings are created by buyers and/or the buyers agent. The listings are put on the database for a very tiny fee, all uniformly displayed. No one can pay to have their listing in any better position on a search. And then have both buyers and sellers pay for brokerage services separately, stop the co-brokerage paradigm. Buyer’s need to pay for professional services, and so do sellers. Think about how much advertising and syndication dollars would be saved with this new paradigm? Compete on your services, your knowledge, let listings speak for themselves based on data, not fancy photos, and stop spending money making Zillow, Trulia and all those sites rich.
Tina, the last time I checked we were living in America with the freedom to make our own choices as independent real estate agents. Part of that involves marketing, and offering the consumer different value propositions.
Reading the posts above got my day off to a roaring start and thanks, Brian, for the great starter post. I appreciate a number of the comments as substantive to the debate, especially the interchange with Messrs. Beck and Lund.
But that’s my point — we’re in very early stages of this battle — and battle it is — for the heart and soul of the real estate business: data.
Every day (and on multiple global top-shelf news services like the New York Times, Wall St. Journal, FT and the like) I read about how data, and the derived business intelligence connected to it, is the “holy grail” of any business. The Brad Pitt movie “Moneyball” is yet another example of how applying data analysis to a business challenge can be a “game changer”. Even with the Presidential election campaigns, data is king.
So just like the record labels of the pre-2000 entertainment era, our industry reaction is defensive, proprietary and, well, is so ‘old school’ and predictable. Especially given the lessons learned by the entertainment business when confronting the “downloader generation”.
I’m not saying this is a replication of that situation but, rather, that we can learn and prosper from how the producer and owner of the data (artists and labels) have created alliances and thriving business partnerships with the iTunes and You Tubes of the world. Is it a level playing field? Hell now. But, hypothetically, is X% of something better than 100% of zero? Of course.
This is American capitalism and every stakeholder in this process has skin in this game. The real estate broker owns the data (the artist in my analogy above), the Associations/MLS produces and promotes/markets the record (the record company) and the consumer websites are a major part of the marketing and distribution mix (iTunes, You Tube etc.).
We need to sit down as adults and business people and create a new industry platform and ecosystem. And maybe, just maybe, the end consumer gets a better product as a result and real estate professionals can thrive?
We’re working on this very intensely @ MRIS and look forward to creating an environment for our customers (of all stripes and persuasions) to succeed. Please feel free to engage me directly by email with suggestions/insights/comments on how we can make this happen in 2012. (john.heithaus@mris.net)
Good morning to John Heithaus, and thanks for providing a pretty decent analogy. I am proposing that brokers and MLSs take a somewhat similar tack as performers and record companies took. First we put our foot down and pull OUR data, then we negotiate from a position of strength. I would suggest that monetary compensation and compliance with IDX and/or VOW rules be a cornerstone of the negotiations.
Thanks for the reply Jeff. The analogy is not what’s important. It’s creating the new world order where all can rightly prosper. No data, no listing; no listing no upsell/ads, no business. Just like the world can not just create another Whitney Houston (or substitute any artist), you can’t lip-sync a listing!
Actually, the analogy IS important for someone like me, who is looking for ways to make this issue (more) easily understood by the average realtor and broker.
Agreed it’s communication/education/industry framework/negotiation. I’m a third generation real estate kid and my money is on the agent/broker to come out back in control. But because of past behaviors and actions (well intentioned but in hindsight not so smart) it’s a long road and we need to get started on it rather than debate applicability of the analogies that people like me put out there to gain, as you rightly state, knowledge and develop action.
If you want market evidence of where things are heading, compare the recent sales price for Prudential Real and Estate and Relocation (my former employer) and 100 year old parent company brand and Zillow’s market cap.
Let’s rock!
Disagree on one point… the notion that the “broker owns the data.” Sellers and Buyers “own their data,” — the person who makes the market for this information can monetize making a market.
Tina, you’re 100% on that – I am referring to the property data/promotional copy and derived tracking and market analytics. But the personally identifiable data (PID) is, as you rightly state, is the property of the person. Sadly, the folks at Google and Facebook may take a different view …. John
If I may, Tina (and John),
Putting my Intellectual Property lawyer hat on – while consumers certainly have the ability to grant legal permission (for a broker or an agent) to assemble all the legally available data into a listing, I am not entirely sure whether consumers “own their (house) data”.
To use John’s analogy, an artist that wants to sing a song does not necessarily own the rights to a song if the lyrics and music were actually composed by hired professionals, recorded in a studio owned by a third party, and curated by a record label that paid for registering the copyright.
IP ownership complexities aside, what is clear to me is that the folks who are willing to do the work to make the property marketable, facilitate its marketing, and to facilitate transactions through a market exchange, need to be recognized as valued market actors.
Any new Online Compact has to align the incentives of consumers, agents/brokers, online marketers (whether newspapers or websites) and the MLSs towards facilitating an information-efficient market which buyers and sellers can trust.
If it takes ongoing work to make the market function, all the parties have to be valued based on their ability to excel in their niche, and be compensated accordingly.
– Alon
JB, lose the golf outing — excellent! Re: Congress, it has to be community-driven. Typically this is trade association sponsored, but in our case, as noted above, NAR may not be the best host. But let’s not let that hold us back from a redefining and implementing a new world order.
Alon, you’re far more articulate — that’s really what I advocate: “Any new Online Compact has to align the incentives of consumers, agents/brokers, online marketers (whether newspapers or websites) and the MLSs towards facilitating an information-efficient market which buyers and sellers can trust.” The NYSE and NASDAQ in the US provide for very efficient trusted markets and, in concept & theory, they are designed to address the needs of all stakeholders” perfect, real time data promotes market liquidity on steroids. But gaining industry agreement on this has to rank up there with “Don’t Ask Don’t Tell” with multiple trips and traps along the road. The smartest guy I know to design this would be Brian Boero. He can be the Thomas Jefferson and write our Constitution!
It does take work to make a market. And in the case of real estate, it takes coordination and that is why syndication and third party sites are competitive threats. Right now third part aggregator sites are trying to replace the MLS co-brokerage paradigm with one large internet database that makes the rules of how leads are channeled. Imagine a dating site that coordinated all the guys. Wouldn’t more women go there first? But if all the women went, would guys ever want anything else but to be on that large site? The coordination feature of third party sites gives them power to extract profits. One of these third party sites could become the “google of Real Estate Search.” It makes more sense for the 95 percent of real estate firms who have less than 9 employees to ban together and create one uniform, not for profit, data base than to keep feeding listings to third party sites. The problem is coordination of all the brokerages, if OWS can do it, so can you all. Take back the data, make it free. Fancy photos on iPads won’t change my mind about a home. I’ll love it or I won’t when I walk the property and sit in the kitchen. But fancy photos do bring people to a site — so allowing third party sites the get my attention first, could direct me to a particular home or brokerage from the get go.
The sellers don’t own the collective data, they own their home. They have hired us to market and sell property through the MLS. Multiple listing systems are not free, someone needs to pay for them.
One more point (and sorry about the typo above: NOW instead of NO in the 4th to last paragraph)
I created a term that merged a couple of consumer website names last year and now I see many permutations of that above and in the press. It was cute at first and got some chuckles from the audience. But it’s a cheap shot, IMHO.
These are serious ongoing legal business concerns, some publicly held, and they deserve to be called by their proper and given company brand names. They don’t impair the MLS or brokerage brands, and we should not either.
So I, for one, will use Zillow, Trulia, Realtor.com and Yahoo! and the other names properly going forward. And thanks, Mark Weiss (from Trulia) for bringing this to my attention in a professional manner.
You raise many good points John – from acknowledging that the different consumer portals are (indeed) different, to using the iTunes analogy.
The iTunes analogy can be sharpened further in that:
- The brokers (artists) have to continually work to maintain the quality of the listings (status, prices changes, new photos).
- The MLS have to continually work to maintain the quality of the entire data set and the uses of their intellectual property in a rapidly innovating space.
- The consumer portals have to continually work to reduce the cost of customer acquisition for agents and brokers by improving the quality of the user experience in a super-competitive space.
In this new world of online real estate, every specie in the ecosystem has to work hard in order to excel in their areas of competence and earn their keep.
I agree with Brian completely – “The costs of cooperation, long-term, are lower than the costs of retrenchment” – so what does the new Online Listings Compact look like?
– Alon
Hi Alon — good to see your name added to the debate and I appreciated your additions. I think an impartial industry resource like NAR, COVE (MLS) or some other group needs to host a 2-3 day meeting, a constitutional convention if you will. We need to decide individually and collectively on the industry policy platforms (like the Bill of Rights) to being to hash it all out. John
John –
I agree with the idea, John – except the NAR part.
Brian,
Do you feel “safe enough” in this context to elaborate on why (NOT) NAR?
Who would be (or what are the attributes for) a good candidate?
– Alon
Too big, too slow, not enough trust with brokers, and not enough trust with online players because they have a dog in the fight.
John,
I am not sure that any “industry resources” are or can be impartial, but the record labels did not need to be “impartial”…they needed a Steve Jobs (hint, hint Brian
) to HELP them face the fact that they have ALREADY been disrupted so need to come to the table if they want to remain viable players in the game
Once at the table, he showed them an (economically viable) “honorable path” forward, and a system of licensing and compliance to gain (and insure) their trust.
Once consumers knew they were getting the “real songs” and “legal title” to them, the market for music exploded.. to the benefit of everyone in the ecosystem.
– Alon
Brian – thank you for your thoughtful analysis / recommendations. A constructive dialog is what is absolutely needed for this situation. Data Quality / Presentation must improve to improve the consumer experience. Standards at the national / international level would be a huge help here, or as you so nicely worded it…a compact.
As a broker, the piece that I am most focused on is how can I improve our clients’ experiences (both on-line and in person). My agents and I should always be able to differentiate from ZTR by providing context, local knowledge and expertise, our business values / approach, negotiating skills and strategy…the list goes on.
At the end of the day, people will choose to work with us because we provide them the experience they are looking for when buying or selling homes. I’d like to get the data squabble over sooner rather than later so that I can focus on what I personally believe are the areas where we can excel as a brokerage.
Brian, I’d be happy to help with this, but I’m a small fish with little time. Please let me know if there is a way I can contribute.
I would also add that a big part of the problem (to use the “dog analogy”
) is that the dog which NAR has in the fight “won’t hunt”
So, if NAR is “Too big, too slow, not enough trust with brokers, and not enough trust with online players because they have a dog in the fight” to lead the quest for the new compact, who is?
Does REN have the qualifications? Is it positioned to gain the trust of thousands of local brokerages?
Personally, the only possible candidate I can see moving the New Online Compact forward (at least at this point) is the Council of MLSs…
– Alon
I think you’ll need a level of broker participation that CMLS alone cannot deliver.
I agree Brian – CMLS cannot do it alone.
However, I don’t see how the few broker networks and franchisors that might come to the table could really represent the voice of the brokerage community….which leads me back to CMLS.
Since so many MLSs are governed and/or owned by brokers, and since MLSs are fundamentally accountable to their brokers, aren’t they in the best position to facilitate broker participation?
CMLS also happens to be a non-threatening entity, does not have a “dog in the fight”, and has a considerable amount of collective knowledge and goodwill.
I can think of several (very) amiable folks at CMLS who might be able to build trust.
Just a thought,
– Alon
Great debate so far. But let’s step back in time a couple decades to an era when consumers used newspaper classifieds as the primary source for aggregated information on homes for sale before reaching out to an agent. In that model, agents & brokers paid lots of money to have their listings advertised in the newspaper. Many consumers only bought the Sunday paper to view the for-sale listings. The newspapers were actually PAID by RE professionals to accept content. Regular folks bought the newspapers to consume that content – making it critical for RE Pro’s to advertise. While consumers had access to only a portion of the available listings via the papers, at least it started a conversation with a RE Pro.
Fast-forward in Internet speed. Publishers like Trulia & Zillow will promote every listing they can get their hands on (not always a good thing, but I believe the better publishers genuinely strive for quality data) and have built destinations consumers love. Every agent with a listing on these sites gets some level of exposure at no cost – more exposure than they ever had through the local paper; those that pay get more/better exposure (and apparently find it worthwhile per Victor’s research). Both consumers & RE Professionals have more choices than ever before, and the publishers have to strive harder every day to build a better mousetrap for both consumers & RE Pros.
This kind of innovation, competition & choice is a huge consumer benefit, and those publishers, RE Pros, vendors, and especially the MLS’s that embrace and adapt will succeed. The path forward needs to recognize that each of the aforementioned stakeholders ultimately has to answer to the consumer. MLS’s need to step forward and partner with their members on one side & the publishers on the other to provide visibility and accountability around data usage. Brokers have to push for transparency, but acknowledge that for most firms engagement will yield better results than unilateral retrenchment.
I agree with John, Alon & Brian that some kind of organized “constitutional convention” could go a long way; a Congress of sorts with a clear agenda, rules of participation, representatives from across the spectrum of stakeholders and most importantly – a very clear results mandate. Please – just don’t call it a “conference” and let’s skip the golf outing. CMLS has done a very good job as of late bringing in a wide array of industry participants, though as Brian points out the Broker side is not quite there. Is there some analogous broker group that could partner with CMLS to pull this off? Obviously would need independents (Leading RE?) and Franchisor representation.
Let’s keep the ideas coming!
Makes sense to me Jonathan.
Do you think Bob Bemis (formerly CEO of ARMLS) would be the one to bring the publishers to the table…now that he is Zillow’s new VP of Partner Relations?
– Alon
Alon, this move can be interpeted several ways. Interesting that Zillows states the move was underway far before the controversy started. My guess, it started after the Edina announcement. Either way, he has his job cut out for him.
I agree completely Jeffrey.
On the one hand you have the folks who suspect he went over to build and run the “national Zillow MLS”.
On the other, you have the folks who hope he will help Zillow work constructively with the MLSs.
As Brian said at CMLS, “Zillow is two data fields from being an MLS”…only time will tell, but I wonder how the incentives could be aligned for everyone to do what they do best and cooperate so we can all work together to revive the real estate market.
– Alon
Jonathan -
Good thoughts. I think it would be useful for more MLS/Brokerage industry talk at a high level. Tension is building there and it’s going to be hard to get much done if the “industry” side of this debate is riddled with distrust.
Alon – I can’t think of a better person to help bridge the gap between publishers, MLS’s and brokers than Bob. He’s been an outspoken thought leader on these issues for some time, but always in a calm & rationale manner. Great coup for Zillow.
Brian – it would be great to hear from Brokers & MLS execs who have successfully managed to partner on these issues. They’re out there, and could help everyone else see there is a collaborative way forward.
I think the syndication discussion is crucial esp. in light of syndicators buying IDX companies. Allowing Trulia and Zillows to grow makes them perfect targets for takeover. Brokerages need to come up with a better way to coordinate and create one “homes for sale information market” — other than spending tons of money on syndication. Take a look at my recent blogpost on homingCloud and keep in mind that Google invested in HomeAway.com.
http://www.homingcloud.com/blog/bid/52714/Would-Google-or-Facebook-want-to-takeover-buy-Zillow-or-Trulia
Sometimes a thought experiment can stimulate creative solutions. So here’s one: how would listing distribution work if we started with the premise that sellers own their property info and any who want to display it must license it from the seller, possibly for a fee?
Ray, I don’t know how it works where you live, but in California sales prices, square footage, bedrooms, bathrooms, and mortgage data are all in the public record. The seller is hiring us to sell their home, not make $5.00 to license the data.
I agree with you on that. Sellers hire agents to sell property.
Nevertheless, plenty of brokers keep reciting the “we own the data, give it to others, then they profit from it” orthodoxy.
Every player who shows a seller’s listing data is expecting to profit from it in some way. This is quite separate from and irrespective of whether a given home sells or not.
Has anyone noticed that Apple is actually going into Wallmart? Seems that even a company with as much brand recognition and loyalty knows exposure is a good thing. Why do we think otherwise?
Apple is not “going into Wallmart” [sic] for “exposure”. They do it for a profit.
They have negotiated a deal wherein they are paid a fair price for their products by Walmart. Then Walmart => sells it to the Public for a profit.
Apple gets $, Walmart gets $, Public gets Ipad
The ZTR plantation system has us giving them our product for free, which they use to attract the public, and in return they tell me I should be happy with “exposure”… aka page views.
Remember when the dotcom bubble was being fueled, not by profits or even revenues, but by “hits”? Investors soon learned the hard way that “Hits” aka “exposure” have no inherent value. Now realtors are catching on too.
[...] Love, listings and some thoughts for the long-term Brian Boero of 1000Watt Consulting has a unique talent for seeing the big picture and distilling the fundamental questions from complicated issues. He does so again in this post about the growing tension between brokers and real estate sites (“aggregators” as they’re increasingly known) like Zillow, Trulia, and Realtor.com (the biggest three among many others). I don’t agree with all of his positions — I’m of the opinion that syndication and greater visibility on the Web ultimately benefits sellers, agents, and brokers — but I think he offers some good, sensible, let’s-try-and-find-common-ground recommendations for moving forward. We’ll be hearing more about this topic in the near future, I’m sure. [...]
If their is truly a demand by the brokerage company”s to do something, and if they can get organized, properly funded, come up with a compiling concept – I will provide the domain names
BuyYourHome.com
ListYourHome.com
That is a start – I am available to meet, contribute and participate, hopefully we can start online, as technology does not require physical meetings anymore.
Remember this would not be about any of our brands, would not be designed to capture web leads directly, would be driven by consumer wants and desires for information, and would have to include some form of live video communications to be different enough to work. This is more than write a check and let someone else do the work. Projects like this need to be driven by passion and casual involvement via meetings is a distraction to the goal. For anyone considering this your time involvement is more critical than your financial investment, but both are required. All the technology exists, it just need to be packaged correctly to work.
Howard Hanna worked it out with Zillow – great video from the company president about their decision to partner with Zillow. All Howard Hanna listings will be promoted and featured on Zillow. Here is a link to the video http://www.youtube.com/watch?v=ec2kJj-z2_I&feature=colike
Here’s another announcement and post that went out yesterday regarding the Howard Hanna partnership: http://www.zillow.com/blog/2012-02-13/zillow-and-howard-hanna-team-up-in-marketing-partnership/
Sounds like fair exchange. Can we all get that deal now, Brad?
Hit me up, bro.
Great example (in my humble opinion) of how a smart broker can leverage/co-opt a publisher rather than squander resources trying to out-compete a highly specialized entity while also trying to win at their own specialty – which is running a successful real estate brokerage.
Focus on your core strengths, press your own competitive advantages, and…negotiate your own terms DIRECTLY with the publisher – that is how you get the service you need from others and how you win the game YOU are in!
– Alon
In many ways much of this argument is secondary. As much, if not most traffic going to ZTR is coming from Search. If ZTR didn’t have the listings to create links from (and Realtor data on the subsequent landing pages) or a higher organic search placement than brokers whose listings are being “utilized” they would not be delivering any value worth paying for. If they don’t deliver value they don’t get revenue. No revenue – makes it difficult to stay in business.
This type of business is quite Darwinian. Do a better job than ZTR and they will a dead branch on the Real Estate Tree of Life. Stop syndication – with a solid replacement in place and you should hasten the extinction. Stop syndication – without a solid replacement in place – something else will take its place.
The abject travesty of the how bad Realtor.com’s early programming was and how slow the national brokerages were to see the effect of the internet on their business (even today) has given the smart players an opportunity. If an industry can’t outsmart and out-compete their competition when they have a near monopoly on something (real estate data) – it will have to live in an environment not of its own choosing.
Looks like an opportunity to me with a clear choice if an industry wants to retain control over its own future.
The cost of creating aggregation services like ZTR has crashed, never to rise again, and only to continue falling. Talk on this blog of brokers squeezing out, starving out aggregators such as ZTR,…too late. Consequence of ever lower cost to form digital aggregators: there will forever more be several. They will have different models to monetize their aggregation. They will have different value propositions, and overlap the MLS/Broker agent client focus in different ways. There will be new aggregators. When MLS emerged as aggregators of data, there were already newspapers. Now there are MLS, ZTR, and Craigslist, and if not google/youtube/maps, others are forming as I write. Newspapers mostly failed to compete as print based real estate data aggregators. More efficient digital media aggregators eclipsed their role. There will be competition between the models.
Talk in this discussion of brokerage stakeholders consolidating to negotiate is laudable. Fundamentally negotiation will be over monetization of hosted software services, at the expense of traditional professional services, the Realtor centric model. Fail to consolidate and you yourself will be marginalized by higher scale, lower cost, digital service aggregators that marginalize your average and below average agents. Brokerage and MLS leaders would be wise to not hesitate. Regardless when industry leaders start, they will be negotiating with ever more frequently. Because there will be a growing number of aggregators to negotiate with, never to be zero or one or two or… again.
There’s been talk in this blog about ZTR lead generation service value. This is a matter of ZTR lead pricing. It’s sometimes unattractive. Same as broker and agent services. The more fundamental topic is new service and value development. Contrast MLS/brokerage/agent new service development speed to ZTR new service development speed. Consider the number of new web service additions ZTR brought to market for consumers on their sites in the last 3 years. Pick any MLS and brokerage. How many new customer services did the agents role out….consistently….to every consumer? Further, ZTR cycle time and cost per cycle to improve service should have been falling. How about for agents’ customer service development? How did brokerages do at lowering agents’ costs and increasing their customer value add? ZTR will not provide all agent services or price right all places. But focusing on these misses a bigger picture. The end game is competitive value creation, particularly speed, cycle time to create value, cycle time to lower consumer costs, and agent costs. MLS and brokerages that shun fast cycle value creators to celebrate tradition instead will compromise agents. Should you love all the ones you’re with equally? To each according to their merit.
Jim Bilbao- you sure use a lot of obtuse jargon.
In one 170 Word stretch above, you dropped the following mind bogglers: “lead generation service value” “service and value development” “new service development speed” “web service additions” “cycle time cost” “per cycle customer value add” “competitive value creation” “cycle time” “create value fast cycle value creators”.
Just sayin.
I can’t help but think about the role the loan originator plays going forward. Not 1 comment in all 98 responses about where they fit into all of this. Maybe that’s another post…idk. it’s just I’m reading so many of you going off on a tangent about listings…listings…listings.
Seems to me that everybody is driving and 99% of the time they’re looking in their rearview.
Caution —-> bad drivers ahead.
Jeff, sorry for the jargon.
To Eric’s question about the mortgage side of the real estate, will brokerages with affiliated mortgage companies be more or less interested to support negotiating a new compact over listing data? Or will brokerages without lending affiliates? Brokerages I’ve been in have always had affiliated lenders that suggested where to help clients shop for mortgages more than how to shop for them.
I have no idea what you’re talking about Jim.
All I’m sayin is you peeps prolly have no idea what it takes to finance a home…most of you can’t even put together a decent website.
I couldn’t agree more that agents can damage themselves by ceasing syndication unless they have a certain scale and reach (which implies the ability to invest in their own digital strategy).
Smaller agents would just be shooting themselves in the foot and no-one would notice.
Hi James- if those “smaller agents (and brokers)” aren’t getting any leads from ZTR, how do you think they would “damage themselves” by not syndicating?
The whole ZTR house of cards is built on the premise that you give them your listings for free, and in return you get “exposure” for your listings. But if that exposure never seems to turn into anything tangible, of what value is it?
A learning experience. Probably ignored.
By now most agents and brokers have encountered comments by others in the trade saying they measurably benefit by syndication. Which is to say they find it profitable. Note the decision by Hobie Hanna to go “all in” and — gasp — PAY for it. A wild and crazy guy!
Others who find syndication persistently unsuccessful should wonder if that difference of experiences tells them more about the skill of the rider than the capability of the horse.
At the depth of the American revolution, John Adams wrote to Abigail “We cannot guarantee success, but we can deserve it.” Unfortunately, a very large amount of real estate “advertising” casually created and dumped onto the web by agents is basically, ummmmmm — crap. It doesn’t deserve success in that arena and rarely finds it. Five will get you ten many of these agents’ respective brokers won’t notice this possible cause-and-effect relationship, either.
A real estate license certifies an agent with no greater skill as an advertiser than as a commercial pilot. Not to say there aren’t agents and brokers out there who are highly skilled in the craft of selling with written words. They are pros who invest hard work in getting it right. They also seem to know who Claude Hopkins was.
Most others don’t — two minutes appears to be about the right time they think necessary to knock out some brief, bland copy (maybe even with lots of exclamation points!!!!!!! or ALL CAPS TEXT, FROM END TO END to stir excitement), attached with amateur color photos of the house taken at high noon on their way to lunch on a sunny day, and call it good.
Crap work produces crap results. The surprising thing is how many people find that surprising.
First off, I find it curious that most people with a dog in this fight (like syndicator “Bud Hovell”) fail to disclose that fact when commenting. Weird.
As one of those pathetic souls who has found “syndication persistently unsuccessful” I would counter your helpful tips by pointing out that:
* I started syndicating our brokerages directly to Trulia about 3 years ago via XML, and that it was of value then.
* I was also a “Trulia Pro” for 2 years of those 3 years.
* We average 60 to 100 listings. I crop, color correct and photoshop every listing primary photo for all our listings.
During those 3 years, we had sometimes generated in excess of 25k page views per WEEK.
From all that “exposure” I can verify ONE buyer transaction.
My conclusion: ZTR attract tons of eyeballs… of “people who don’t want to deal with a Realtor. They (like Bud Hovell) are far superior to any stupid Realtor. And they, for the most part, are not particularly interested in buying a house right now. When they are ready to buy a house, they will choose a buyer’s agent, or call the sign.
ZTR do not facilitate sales, and if brokers withdraw their listings, they will lose nothing of value.
Since there’s a direct link to our site in that posting, it’s hardly a secret we’re a syndication firm.
If you believe that alters the accuracy of my comments about crap work commonly submitted to the search engines, you haven’t shown how. I suspect that’s because the high proportion of unadulterated dross is plainly obvious to anyone who frequently reviews property listings on search engines.
I also said there are a lot of agents who provide excellent listings content, but not effortlessly.
It’s the casual, drive-by tossers who litter the webscape. I’ve seen million dollar properties described in a few short, boring sentences with a barely OK set of maybe ten photos. Hard to say whether the agent or the property owner who signed on were more daft. The broker implicitly approved or failed to supervise. Take your pick. But they both anticipate being paid.
@Jeff Beck: “From all that ‘exposure’ I can verify ONE buyer transaction.”
I’m not arguing with your experience. It is what it is and is as valid as anyone else’s. But it remains that your reported experience with syndication differs from contrary experience reported by others in the trade. It doesn’t seem unreasonable that you might wonder why. That’s a business question, not a personal one.
Please when you get a moment, Bud Hovell, link to a few independent, verifiable testimonials from agents who are getting sales from syndicating their listings to ZTR. I want to talk with those folk. Very much.
Please Bud, I beg you. Help me.
First of all, let me say the focus on the three sites under discussion in this OP does not define “syndication” of US listings. I don’t know of anyone who has posted a specific reference about syndicating to those three sites (and only those three) because few people are confined to those narrow limits.
There are any number of blogs out there with postings on this subject, and its likely these are well known to you — e.g. Active Rain, where a cloudburst about syndication breaks loose periodically. They provide a search box for your convenience.
As to Zillow and R.com (sans Trulia), there are a couple of references (with links) to the decision by Howard Hanna to PAY to get their listings on Zillow and — by PAYING for it — they join in a reciprocal agreement for a more successful engagement. You commented on this above, I think, so you’re perfectly aware of this recent announcement.
If you watched the YouTube presentation, you surely cannot have missed Mr. Hanna’s clear statement that the basis for their decision was their past experience with syndication, which led them to dispense a million bucks of their advertising budget on this venture. A multi-generation business with ~20,000 listings on hand, they obviously didn’t just fall off the tomato truck.
Theirs was a calculated business decision. Just like your calculated business decision to not syndicate yours.
There’s no right or wrong about either decision, IMO. It just shows their accumulated experience differs from yours — exactly the news you said you were eager to pursue, and conveniently located right on the same blog page, to boot.
The comments were so long in this blog that I couldn’t begin to read every word so I hope this is not too much repetition.
The way I see this, there are many issues with ZTR and other aggregation services besides the marketing aspect. The data quality leaves much to be desired. We hire an assistant that spends much of her time correcting the errors that are published on just the major websites. There has been discussion about NAR making us responsible for the data that is published on our listings. If that happens, how do you think Realtors will react?
When I approached Zillow and Trulia about these issues, they swear it is not their problem. We suggested they pull only from our MLS so the data would not have such issues. They both indignantly say that they are PUSHED the data from other sites and they don’t pull that data from our MLS. GAD! Can you envision about 30 sites out there PUSHING data to each other? What confusion!
Try putting your email address in Zillow & Trulia so that you will receive seller reports. You won’t believe what happens from week to week. You go in and correct a problem and the next week, some other site has Pushed incorrect data to them again and so….it is wrong again.
Recently, I had a new listing that appeared on Zillow and it had pictures from a year before that belonged to this home when previously listed. The difference was astounding because when I got the listing, it was a short sale and was now distressed. A client complained that I misrepresented the condition of this home!
Estimates of value are another HUGE problem for us. We are a non-disclosure state in Texas. There is NO WAY that ZTR knows what a home is worth because they have do not have our sales figures. They claim they take a percentage of the listing price and that percentage is derived from what they know listings sold for as compared to the listing price. Again….they do not know the sales price so that equation doesn’t work either.
You are so right in wanting to bring a group together to resolve it. I think it needs to be on a national level and I think NAR should be involved. In May, NAR will have their Mid-Year Conference and I am sure all of this will be discussed at length anyway. Many of the Board Directors and Realtor executives will be attending. If the aggregators don’t get involved, there will just be escalating frustration from the Realtors.
We have a small Realtor Board in our area and we are a drop in the bucket compared to the larger cities but I would be willing to get myself and my Board involved.
I’d like to leave a postscript here: yesterday I pulled up one of our agents’ oceanfront listings on R.com to review how listings are being presented, and if they are in compliance with the Realtor Code of Ethics. Next to the listing “detail” display is a box where a “buyer” can request a showing, more information, recent sales, schools info or neighborhood info.
There is no information about who will be getting these inquiries, although I’m sure a large majority of “buyers” assume it is the listing agent. There IS a very small notice: “Serviced by a real estate professional”.
I inquired. The “professional” receiving the lead works in an office 40 minutes away from the house, has never sold an oceanfront house… and has not responded to the request after 24 hours.
To all the ZTR apologists, I ask again:: How is this “exposure” (the new coin of the realm) helping my home sellers again?
R.com update: 48 hours passed, still no response from the “professional” receiving the leads on our $1M+ listing.
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