Listing portal sites like Zillow, Trulia, and Realtor.com essentially package listings they assemble from Multiple Listing Services around the country, or by large real estate company syndication feeds, or by agents themselves. Brokers often have the ability to override their MLS syndication. For instance, and agent or a seller may not want certain listings to go to certain listing portals, or perhaps none of their listings at all. Pulse syndication marketing could be the real Zillow killer.
When you think about it, large listing portals don’t really help agents sell more homes. All they do is come between the agent and the public, and for that they charge a fee. You see, listing portals true customer is the agents and brokers. That’s who pays the advertising to these sites in hopes of picking up leads. If these sites didn’t exist, those leads would go directly to agents and brokers themselves without the middle-man.
So how did these listing portal sites come to prominence? Many agents and brokers aren’t tech savvy, and some are just plain lazy. They don’t have the time, money, or inclination to manage the online process. So, they abrogated lead generating to outsiders who were more than happy to pickup on that. And the worst part is, agents gave them their data, only to be charged back for leads their data creates.
I say some agents were lazy (and they still are) because even when given a lead they find a reason not to call them. Speed to lead is the name of the game, because statistically the first agent that reaches a buyer or seller is the one that they work with. If you’re not going to call a lead from your own website, why in the world would you want to pay for leads and not call them right away.
This is where online tech companies are learning. They used to farm out leads to 3 or more agents, and agents would compete for the lead. Only the most aggressive agents would win the lead, so the other two quit paying. Zillow eventually came up with a system to combat this where instead of charging agents a monthly fee, they would charge per qualified lead, and agents would bid on them. Keep in mind, the only reason Zillow got the lead in the first place is because agents gave them their data, and Zillow charged agents back leads. The only winner was Zillow. The consumer isn’t really any better off. Buyers thought they were dealing with the listing agent and didn’t realize several agents would be calling them.
So, the only thing these online listing portals really do is get in between consumers and agents and charge a fee to agents for the privilege. Truth be known, agent websites like ours www.LeeCountyOnline.com also known as agent IDX websites, and company websites like www.kw.com, www.remax.com, www.coldwellbaker.com, www.centruy21.com and others have better data. I say that because the data is timelier and include all the data versus just some of the data. The data is just more accurate too.
Zillow Has a Plan
Part of Zillow’s plan is requiring agents to upload consumer data into their database. In addition to collecting a referral fee, they want the data. Why do they want the consumer data if they already have the MLS data? Because the next step is to cut the agent out of the next deal. By accumulating consumer data, they can market directly to consumers making the MLS data that Realtors hold valuable less valuable. The one with the most data wins. Right now, Realtors have the MLS listing data and the consumer data, but not for long. Once companies like Zillow complete this process, it’s game over.
MLS’s and brokers have tough decisions to make. On the one hand, they want to turn off sending their listings to these large listing portals. This avoids public confusion. It’s frustrating as an agent to have to explain why the home a consumer is seeing on Zillow isn’t even on the market right now, has wrong information, or the estimated value is $100,000 or more off. On the other hand, agents are afraid they may suffer backlash by consumers who want to know why their home isn’t listed on one of these sites. We have a solution that solves both options.
Pulse Syndication Marketing Could Be the Real Zillow Killer
If brokers and agents would pulse their listing data to online listing portals, it would satisfy sellers and disrupt the online portal advertising model. By pulsing we mean turn on the syndication and send listings one day and turn off and withhold the next. This could be done on daily or weekly basis. In any event, if enough brokers, agents, and MLS’s used this technique, sellers would still receive the perceived added exposure, and online listing portals would have fewer page views and listing clicks because the listings would be there half the time.
Online listing portals like Zillow, Trulia, and Realtor.com solicit Realtor advertising based on property ad views, and/or leads derived from the ad views. Mind you, the leads don’t necessarily go to the listing agent that provided the data but rather the agent or broker who pays to be the premier agent listed on a listing. And this is the crux of the discussion. The listing agent isn’t necessarily receiving any benefit from the exposure, while other agents who pay to play are. The seller isn’t either because that lead went to another agent besides the listing agent who has no incentive to sell that property, nor knowledge of that property. That next agent doesn’t mind shifting that buyer prospect over to one of their listings, or another listing they are more familiar with. It’s one thing to pay per click on Google or Bing, and quite another to have to pay to play on your own listing where the listing agent freely gave up the data in the first place.
By pulsing the data, the online listing portal essentially has its free inventory cut in half. This would inevitably lower adverting rates because there would be less hits and less leads per zip code, further lowering the already suspect data of these online portals, and increasing the value of MLS public facing websites, broker websites, and agent websites.
In a perfect world, I don’t think these public online portals are even necessary. Some MLS’s have contemplated just cutting their entire feed to the portals, and I don’t see a problem with that. Let consumers get their data from the MLS, broker, or agent websites which are more regulated and tend to be more accurate.
Agents Need to Wise Up
These online portals are providing services in attempts to make life easier for the agent, but are they really? They’re really trying to get the agent’s data. I don’t think they really care to make the agent’s job easier. This is just the candy they offer Realtors to use their service. By providing online transaction management, they learn buyers and sellers’ names, phone numbers, email addresses, and much more. That information is as valuable as these DNA companies offering familial lookups. They’re really after your personal data. With your DNA they can tie your family tree to history. Wouldn’t a health or life insurance company love to know if cancer runs in your family, even if it’s 3 generations removed? You bet they would.
And what about errors? Who fixes the DNA database errors once they’re out there? When data gets in the wild, good luck fixing that. Do you see a pattern? Real estate data is just as valuable, and agents and brokers are just giving it away.
It doesn’t have to be this way. We must start somewhere. Online listing portals are getting so big, they might just decide the agent is replaceable, because they have the data.
Right now, they don’t. Agents and brokers do, and right now agents and brokers can do something about it. They can cut off the feeds or pulse the feeds and take control back of the data.
Copyright Brett Ellis 2018