As Trulia and Zillow fight for King of the Mountain...

By
Real Estate Agent

...the real estate industry leaders of old watch from their box seats with nice, cold beers in hand.

On Monday, I published a blog post drawing attention to the fact that the founders of Zillow and Trulia are known for successfully leading companies that dis-intermediate industries.  My intention, by posting in such a sensationalist manner, was to draw attention to my belief that the long time leaders of our industry have not done their part to stay ahead of the innovation curve. Now, because of that lack of new innovation, outsider-led companies like Zillow and Trulia are among the most powerful and influential companies in our industry.

I have always supported the real estate practitioner's use of these outsider-led, venture-backed companies because I believed that the innovation and competition offered by these companies would compel the traditional real estate companies to step up their game and in the process, provide benefit to everyone involved: the consumer, the industry and of course, the businesses involved.

However, the issue traditional companies and leaders face now is that they have not stepped up their game and presented adequate new ideas to compete with these larger, new innovators who are encroaching on their territory.   Instead, they have rolled over to these companies, given up their listings to these "newer and better versions of themselves", and in the process, created a power-shift to those who seek to change the real estate business as we know it.

Do these leaders have a genuine interest in the real estate professionals, or did they choose this industry solely because they viewed it as vulnerable to a major business model change? 

To Trulia and Zillow: Continue what you're doing.  The new empowerment and value you are bringing to the consumer is admirable.

To the Traditional Real Estate Leaders: Step up your game.  Invest in in-house technological developments and force the new generation of real estate innovators to see you as serious competition.  Give them a run for their money!

 

*It's interesting to note that Trulia moved from last place in the group to #2 in less than a one year time-frame.

**I've been working in this industry since I was 14 years old, and have been an agent since I was 18. I've written this post as a plea to my industry leaders, the people I have looked up to for more than the last 10 years, to fulfill their fiduciary responsibility to their agents, and brokers, and re-enter the fight to create the most cutting edge real estate technology that our collective home buying and selling clients deserve.

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Anonymous
jf.sellsius

Until Zillow or Trulia posts a profit --any word on that Pete or Spencer? they are not threatening anyone. (They face extinction if the VC money runs out. ) If they allow brokers/agents to get traffic/make money, the brokers/agents will continue to use them & support them. You can't argue with a free listing service that has SEO guns.  Change that equation and things can get nasty -- the brokers that giveth, can taketh away.

Both these companies were built by technologists, not industry people, and they are VC funded, meaning they will sell to the highest bidder or go public.  The VC investment virtually decrees it.  The VC end game, as in real estate, is a closed sale.  It's the new owners the industry has to worry about.

 

Jul 31, 2008 01:04 PM #18
Rainer
188,704
Laurie Manny
Long Beach CA Real Estate - Long Beach, CA

And once they go public the stockholders will demand that the company be put to its highest and best use, to generate the largest possible profits.  They WILL sell leads.  Advertising costs will skyrocket.  Realtors will be on their knees, once again. 

Jul 31, 2008 02:37 PM #19
Rainmaker
61,246
Kevin Tomlinson
One Sotheby's International Realty- Miami Beach Real Estate - Miami Beach, FL
Miami Beach Real Estate

How long will it take from traditional brokerages to scan Google and see what/how Zillow/Trulia are doing?

Who cares if Zillow or Trulia sell leads?  Traditional real estate companies get what they deserve. They did not innovate and let these companies actually take the food right out of their hands.

It's funny actually.  These VC companies are already running out of cash.  Did anyone notice at Inman this year that there was NO swag.  No t-shirts, stress balls, pens...nothing!!!

This is one of the MOST important posts that have been written in AR this whole year---and only 19 comments?  I guess if Blogging Bertha authored this post there would be 300 comments.

 

 

Jul 31, 2008 02:53 PM #20
Rainmaker
61,246
Kevin Tomlinson
One Sotheby's International Realty- Miami Beach Real Estate - Miami Beach, FL
Miami Beach Real Estate

Laurie

I'm actually happy that this is going down the way it is.  If REALTOR.com is basically not relevant, why would we worry about other "competitors." 

Why do so many people worry about Trulia and Zillow and not Realtor.com?  They are all the same thing to me EXCEPT that WE pay for Realtor.com to turn around and charge us AGAIN.  That is the REAL CRIME, NO?

Jul 31, 2008 02:58 PM #21
Ambassador
890,730
Lane Bailey
Century 21 Results Realty - Suwanee, GA
Realtor & Car Guy

This is kind of humorous.  The big guys aren't innovating at all.  They are just farming out to smaller companies and their franchise holders to do the innovating, while they sit and watch. 

Any of these big companies would be in a much better position to push the envelope than little brokers around the country.  Instead, franchise holders and local brokers are having to buy solutions and put together mash-ups on their own. 

Where is C21 on A|R?  RE/MAX?  CB?  They aren't here talking to agents.  They aren't here to see where technology is going.  There are scores of their brokers and franchisees... but no corporate.  Heck, like the NAR, they are showing that in order to get current they will have to be dragged kicking and screaming...

Jul 31, 2008 03:02 PM #22
Rainmaker
387,816
Lola Audu
Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate - Grand Rapids, MI
Audu Real Estate~Grand Rapids, MI ~Welcome Home!

IMHO, one of the most challenging issues here is that real estate industry leaders are still trying to figure out the nuances of web-speak.  It's not just a numbers game, it's a totally different philosophy of business that requires an understanding of the fundamental strength and weaknesses of the real estate industry AND the dynamics of web based search and social interaction. 

At a time when the real estate industry is facing some of it's biggest challenges, it's not easy to see one's way through the fog.  The fact remains that brokers still are the primary access points for real estate data; without their implicit or complicit cooperation in data gathering, most of the sites mentioned have a much bigger hill to climb...for now

Where brokers have failed most is in their failure to harness this capital to capture the conversation around the real estate transaction.  Huge data pools which don't provide additional Value to the mind of a consumer tend to stale quickly in the online world.  When consumers see listings online for a year or two, they want to know about WHAT this means for them...translate please! And now...not days later when my lead is finally routed to an agent who contacts me.

Conversation takes cooperation online and in real life.  Traditional norms in the real estate industry have trended towards competition.  In this new world, that may turn out to be an unscalable wall...or at least an endeavor which will require a whole new mind.

Jul 31, 2008 03:05 PM #23
Rainmaker
61,246
Kevin Tomlinson
One Sotheby's International Realty- Miami Beach Real Estate - Miami Beach, FL
Miami Beach Real Estate

One would think that the large brokerages would like to get on board with this "stuff" to add value to their agents.

In my opinion, there is a huuuuuuuuuuge opportunity for a VERY tech forward brokerage to open up.

People are missing the boat.  If a brokerage opened up with all this available technology in place to make it easy for their agents, that would be huge.

Jul 31, 2008 03:07 PM #24
Rainmaker
387,816
Lola Audu
Lola Audu~Audu Real Estate~Grand Rapids, MI Real Estate - Grand Rapids, MI
Audu Real Estate~Grand Rapids, MI ~Welcome Home!

Absolutely Kevin.  But the longest distance between 2 points is sometimes between our ears.  It's a mindshift issue and until there is real comprehension, it won't happen.  In some ways, it's like counting pennies and letting dollars float away.  It's also about being willing to be humble and explore another approach....

Jul 31, 2008 03:13 PM #25
Rainer
111,655
Carole Cohen
Howard Hanna Cleveland City Office - Cleveland, OH
Realtor, ePRO

I especially love the kudos you give because it's appropriate, they got out there in full entreprenuerial style (Trulia and Zillow).  I also like what you say at the end....continue, traditional companies, to step up your game.

My perspective comes from working with a company aligned with Trulia.  Guess what that has done? It has opened up our top brass to new ideas.  So instead of it winding up that Trulia does all the work, our company is now doing things apart from the IDX aspect of it, and are enhancing our web presence in ways that four yrs ago I would have said would be unheard of.  I'm so happy with the changes (tech)(and web) happening in my company.  Oh and btw I get leads from my Howard Hanna site, my outside blog, my AR blog, and yes Trulia!  As far as I'm concerned, it's all good.

Let me just be clear; competition has always allowed those who wish to succeed to step up their game. My company has become so much more agent centric in the last year and I am so happy about it.

Jul 31, 2008 03:14 PM #26
Rainmaker
61,246
Kevin Tomlinson
One Sotheby's International Realty- Miami Beach Real Estate - Miami Beach, FL
Miami Beach Real Estate

Carole

"It's all good" is what continues to keep us Realtors behind the 8 ball.

Jul 31, 2008 03:21 PM #27
Rainer
111,655
Carole Cohen
Howard Hanna Cleveland City Office - Cleveland, OH
Realtor, ePRO

I'm sorry if you feel you are behind the 8 ball but I don't! I hear what people are saying, that companies need to be providing the tech services and embracing technoogy not ignoring or running from it.  Kevin, I am saying that my company is embracing it, not hiding. 

Jul 31, 2008 03:30 PM #28
Rainer
111,655
Carole Cohen
Howard Hanna Cleveland City Office - Cleveland, OH
Realtor, ePRO

And Kevin I also agree with Bob's comment above. There are things I can do that don't require my Company to provide me. And the 'stuff' my Company is doing for me is so much more useful to me than them spending a ton of money on what Trulia is already doing.  Zillow is a different story, I don't think they have done as good a job as they should have by now..

Jul 31, 2008 03:35 PM #29
Rainer
8,583
Jeremy Rivera
Buy Your First - Nashville, TN
Nashville SEO

I agree that the traditional real estate industries have stagnated while 3rd pary companies have filled the creative gap. I personally think that this is more of a misunderstanding of the new consumer by traditional RE. The new consumer actually wants to be asked to interact, and not just fill out forms. They want videos, photos, community and interaction. I say that Trulia jumped up the ranks because they listened to the VOICES of the consumers.

Jul 31, 2008 04:34 PM #30
Rainmaker
61,246
Kevin Tomlinson
One Sotheby's International Realty- Miami Beach Real Estate - Miami Beach, FL
Miami Beach Real Estate

Carole

I didn't say I feel that I am behind the 8 ball---the attitude that most agents have with regard to "I'll take what I can get---" keeps "them" behind the 8 ball.

I don't really look to Trulia or Zillow to help me get something.  I can do more, better on my own.

As REALTORS we gave all of our info to REALTOR.com and they couldn't make it work. Now we are giving it to Trulia and Zillow in hopes of them making it work.  We don't WE JUST KEEP our own info and make it work for ourselves???????????

 

 

Jul 31, 2008 04:47 PM #31
Rainmaker
61,246
Kevin Tomlinson
One Sotheby's International Realty- Miami Beach Real Estate - Miami Beach, FL
Miami Beach Real Estate

The ONLY thing that Trulia did was max out the search engines.  They aren't this great consumer advocate.  The made themselves findable on the internet.  Period.

Jul 31, 2008 04:48 PM #32
Anonymous
Anonymous

Interesting discussion.

Jul 31, 2008 04:55 PM #33
Anonymous
Anonymous

What has Trulia done that is so innovative?

It's just for sale listings on a googlemap. Big whoop. I agree with Kevin -- their secret sauce is SEO, not product innovation.

Jul 31, 2008 04:56 PM #34
Rainmaker
78,137
Kevin Wood,
Keller Williams Southern Arizona - Tucson, AZ
Tucson, AZ Realtor

Jonathan,

This is all too familiar. Kelly Blue Book accomplished the same feet for car values beginning five years ago. Their (KBB) inaccuracy in values took more time to materilize than zillow. Your point is well taken that marketing is perception. We must be prepared to constructively dispute this information with the clients best interests in mind.

Aug 02, 2008 05:24 PM #35
Rainer
103,088
Angie Vandenbergh
Crye-Leike, Realtors - Memphis, TN
A Crye-Leike Blogger

Hi - Just sharing thoughts from someone who works in technology for a larger firm... When I hear questions/comments about this I think we are not really comparing apples-to-apples. On one side you have a technology company in real estate and on the other side you have a real estate company offering technology. Their budgets and goals are very different.  If some of the 'larger' companies stepped up their investments in technology... yes there could be some cool stuff - but I don't know if their investment could ever compare to the investments of the 'technology' companies. I love competition. I definitely think it brings more out, but at the same time... I think there is a place for balance and partnerships. Mutual benefits. I don't think the existing set ups/api offerings have that worked out yet (and I don't know what it would be), but wouldn't that be cool if it could be more of a collaboration instead of a battle?

Aug 04, 2008 09:55 AM #36
Rainmaker
136,180
Frances Flynn Thorsen
Cross Channel Marketing Consultants - State College, PA
Author | Educator | Custom Video Creator

I think that Carole Cohen hits the nail on the head. I welcome the chance to use real estate search platorms that make life easier for a real estate agent.

Take another look at the post and comment thread. The original poster and most of the commenters focus on what is best for the real estate professional. What serves agents and brokers best?

Perhaps a better question is, "What serves real estate consumers best?"

I think that a large measure of the success at Trulia and Zillow is meeting consumer needs and expectations for rich property search better than Realtor.com and better than our little IDX solutions. The fact that their business models invite real estate professionals to share their success in ways that are no cost and low cost is an outcome we should greet enthusiastically.

The real estate industry's attempts to be the gatekeepers of information have failed. It is a new world. You do not have to be a card-carrying member of NAR to be a member of the real estate community. The online world connects members of the community in a far reaching fashion. Who really constitutes the real estate community?

  • Some 50% licensed real estate agents do not belong to NAR but they are members of the larger real estate community.
  • Buyers are members of the real estate community.
  • Sellers (including FSBOs) are members of the real estate community.
  • Homeowners are members of a larger real estate community even when they are not selling their homes.
  • Vendors who meet the needs of all these groups are members of the real estate community.

Real estate agents and brokers using Trulia and Zillow are not "rolling over" to anyone. Smart brokers and agents are assessing excellent new business tools and they are using them to attract buyers and sellers. Vendors and sales professionals are collaborating to create better tools to make agents more productive with a happier client base. That is a reason to celebrate, not denigrate newcomers to the industry who make our jobs more fun and profitable.

Sep 18, 2008 06:54 AM #37
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