A NoGeek Primer for the Rest of Us How Trulia, Zillow, and Rupert Murdoch are Changing the Real Estate Internet Marketing Arena The surest way to put a Broker to sleep is for a Geek to start talking about computers and the internet. It works better than Ambien. This article is written from a Non-Geek perspective in hopes you aren t snoring at the end. Here we go Who is Trillow? First things first a little background. Trulia and Zillow (from here referred to as Trillow so I don t have to type it over and over) are internet marketing companies specializing in Real Estate. They collect information from many sources most of which begins with real estate tax records. Tax records are open records everyone can access them. The Trillow s both started around the same time in 2005. Zillow announced the acquisition of Trulia in July, 2014. They collect tax data, neighborhood data, homes for sale by real estate agents, foreclosure data, homes for sale by owner, for rent, etc. Essentially all things real estate in a nice and neat package. They re a technology company not a broker, lender, handyman, or anything else. They advertise stuff. That s it. In Trillow s infancy, they were small players. Then along came the Great Recession. Real estate brokers having desperate sellers during the time, gave their listings to anyone that would take them. The more the locations a listing landed, the better or so it seemed. To Trillow s credit, they created whiz-bang websites. Not being brokers, they created a niche that goes something like We are not Brokers Brokers work for Sellers. Mr. and Mrs. Buyer, we got your back! And so, Trillow grew exponentially. Whether this is true is certainly a point of argument, but that argument is another column entirely. There was once a real estate behemoth website sponsored by the NAR called Realtor.com. Realtor.com was the key player in online marketing the Big Kahuna. Realtor.com has to play by a different set of rules. Unlike Trillow, they were bound by rules of the National Association of Realtors (NAR) like the Listing IDX policy. In short, to conform to NAR s policy, Realtor.com was not as nimble as Trillow, and the user experience on Realtor.com grew stale. Online users began their migration to Trillow. Realtor.com remains a force to be reckoned with, but the sites influence is dramatically smaller in the online real estate marketing arena. Fast forward a couple of years The Divorce Through the Great Recession, online and technology firms suffering from declining revenues began to merge. Move.com is now the parent company of Realtor.com and also, a deeply misunderstood company called ListHub. For those of you wondering; How do sellers listings actually get to all of these websites? ListHub is the answer. Page 1 of 5 Author: Tom Woiwode Email: Tom@mycbpp.com Website: www.areec.com
Think of ListHub as the wizard behind the curtain. When a Realtor enters a home for sale in the local Multiple Listing Service (MLS), magically that home appears on thousands of websites. ListHub is the magical engine that takes homes for sale from MLS s and sprays them across the internet to websites like Realtor.com, Trulia.com, and Zillow.com. These sites then present them on their websites, who then spray them to their online partners for display on those websites located further down the food chain. In the real estate industry, this is referred to as syndication. There are other players in the syndication world, but ListHub is the Big Kahuna. Rupert Murdoch, the business and media titan, purchased Move.com (the parent of Realtor.com and ListHub). In Mr. Murdoch s mind, the agreement to send listing information to Trillow websites in direct competition with his website Realtor.com seemed a little odd. Mr. Murdoch announced the agreement to send listings to Trillow would end on April 7, 2015. With that decision, the ground in the online real estate arena began shifting. This is referred to as the Divorce between Trillow and Rupert Murdoch that has the Geekosphere all a flutter. We are not quite sure who is divorcing who in this relationship. The Billion Dollar Question Trulia and Zillow are not brokers. They are advertisers. Their business model is to collect listings, display them on their website, and sell space to agents on those listings. This is based on the idea that users of Trillow will click on the agent they see on the listing, resulting in online leads to the agent. Trillow thinks of listings as billboards with no faces on them a HUGE advertising opportunity. Trillow sells zip codes to agents, and their faces and contact information are displayed on those billboards within their purchased zip codes. Real estate agents pay top dollar for zip codes. In my area, (Savannah, GA), agents will pay as much as $2,000 per month for their face to appear on other brokers listings. Agents will purchase a zip code, but Trillow will sell the same zip code to a multitude of agents. Trillow collects home data from tax records. Tax data is often stale, and in most cases does not reflect current market value and can be inaccurate with basic things like square footage, number of bedrooms, etc. Trillow relies upon the real estate industry to update their databases and offer current information. In fact their direct feed contracts specifically state they own the data once they get it, with hair splitting exceptions. Back to the divorce. With the ListHub agreement concluding with Trillow on April 7 th, the interface from ListHub to Trulia and Zillow will cease. For those brokers wanting to send data to Trulia and Zillow, they must find other means than with ListHub. With the business model of Trulia and Zillow based upon selling top dollar ad space to real estate agents on other brokers listings, Trulia and Zillow are on a mad dash to get brokers and MLS s to set up direct feeds to them bypassing the need for ListHub. This is where we get to the root of the problem. Who Owns The Data? Real estate brokers are licensed by state licensing agencies. Among other things, Brokers are licensed to promote property for sale or lease. In Georgia, the license law requires property to be advertised, with the name of the brokerage and phone number of the brokerage as the most prominent name and contact information on the page/webpage/email/etc. If this is not done, it is the Broker who is in violation of the law not Trulia or Zillow. Since Brokers do not control Trulia or Zillow, they are forced Page 2 of 5 Author: Tom Woiwode Email: Tom@mycbpp.com Website: www.areec.com
into a conundrum pay a fee to Trulia and Zillow so their listings comply or risk issues with their licensing body. MLS s find themselves in an odd position as well. MLS s were originally chartered to provide a venue for brokers to share information with each other about their listings and offer cooperating fees if another broker brought a buyer to their listing. Brokers and their agents pay monthly fees to their MLS to house the data and images, and provide them historical data in the sale of homes. This cooperating agreement amongst brokers is the foundation for the MLS. MLS s are now being placed in the position to decide if they will send listing data to Trulia and Zillow in direct feed agreements. Again - the purpose of the MLS is to share information and offer cooperation amongst dues paying members. It is the dues paying members who must individually decide where their listings will be advertised. The Cookie Conundrum As brokers begin to look closely at this whole process of listing syndication and online advertising, some are becoming more enlightened with tactics employed by Trulia and Zillow. Cookies have been a longstanding debate in the Geekosphere. Consider the following familiar situation Let s say you go to ebay and search for a designer purse. Then you go to your Gmail and oddly, you find designer purse ads to the right of your messages. Cookies are one of the reasons. Cookies deposited on your computer by websites are stored in a common Cookie file. This is just part of browsing the internet. As you browse the internet, cookies are left on your computer by websites you have visited, and your user experience gets tailor-made for you based upon where you have been. My Google experience is therefore different than your Google experience. Some say this is good others consider it invasive. No matter your thoughts, your browsing habits stored in your cookie files reveal a lot about you. Just an FYI you CAN disable your cookies talk to your closest Geek and they will show you how. So why do cookies matter with Trulia and Zillow? Let s say you are paying $500/month for your picture to show up on other broker s listings in a given zip code. To do this, you must have an account with Trillow, and you must log into their site on your computer. When you log out, the cookies left behind will tell Trillow who you are when you visit the website again. If you are an agent, every time you pull up a listing your picture will be there. Don t Trust Me, Test it Yourself! If you are paying Trillow for a zip code, go to a computer you have never logged onto and start looking at some listings. Now, log in and log back out, and pull up the same listings you looked at before. One of my agents did this. He pulled up the zip code he was paying for and began clicking listings. He found his picture on the 287 th listing he clicked on. Surprisingly, when he called Zillow about this, the first thing they asked him to do was log into his account on that machine. He informed Zillow he would no longer be paying them for the zip code. Cookies alter everyone s reality on the internet. Consider the following. Your seller is looking at their listing on their computer at home, and they don t see your picture. They call you. You pull up Zillow on your computer in your office that you have logged on to, and there is your picture! You tell your seller Problem Solved! It s on MY computer when I pull it up! You and your seller go on your merry way, never understanding what just happened. Page 3 of 5 Author: Tom Woiwode Email: Tom@mycbpp.com Website: www.areec.com
The Big Boys Realogy is the parent corporation / franchisors of Coldwell Banker, Century 21, ERA, Sotheby s, Better Homes and Gardens, The Corcoran Group, ZipRealty, and the brokerage behemoth known as NRT, Inc. Realogy negotiated a direct feed agreement with Trillow over a year or so ago. They agreed to let Trillow have ALL of their listings under one simple caveat if Realogy is the source of the listing, Trillow cannot sell any ad space to competing agents. In fact, the only brokerage that could appear on a Realogy sourced listing is the Broker who has the listing. The Realogy contract is proprietary. This means that any listing coming from Realogy is a loss in potential revenue for Trillow they cannot sell these listing billboards to competing agents that have purchased a zip code. If the primary source of the listing is a direct feed from Realogy, it is hands-off to Trillow. The Bait and Switch When one of my agents gets a listing, we put the listing information in our back office software. When it feeds to the Realogy servers, it then flows to Trillow. As soon as it lands on Trillow, my agents phone rings. Then rings again, and again, and again. They get emails, and more emails. Claim your listing! Log in and enhance your listing! Its FREE, Just Log In! Remember the proprietary contract? This protection is in place so long as the listing remains unchanged from the Realogy feed. If one of my agents logs in and makes a singular change on the listing, the protections are voided. Whammo! Trillow now has a new listing billboard to sell to competing agents. Many brokers are surprised to hear this. Because of cookies, the proprietary nature of direct feed contracts make verifying the protections in the contracts exceedingly difficult to monitor. Trillows incessant dash to entice agents to enhance their listing voids any feed agreements that protect those listings, and puts brokers in an endless merry-goround of check / verify / login / logout / Give Me an Ambien madness! So What Do I Do Now? If you are reading this, that is your very first step. You must become educated in this subject. You must understand it in order to make decisions that suit the needs of your clients, your agents, and your own. I recommend the following: Find out what your MLS is doing. Are they opting in or out of direct feeds with Trillow? Understand the decisions your MLS makes will have direct consequences to you and your brokerage. Are you part of a proprietary agreement? If so, what protections does that agreement provide? If you log in to Trillow and make changes, does that very act void your proprietary protections? Do your agents understand changing information directly on Trillow voids proprietary agreements and will open your listing to competing agents? Page 4 of 5 Author: Tom Woiwode Email: Tom@mycbpp.com Website: www.areec.com
Is a Direct Feed Right for You? Trillow is approaching MLS s and Brokers throughout the country for direct feed relationships. If your MLS has signed an agreement, you need to get involved and understand what this means for you and your listings. If they have NOT signed an agreement, get involved in the decision. You may have the option of creating a direct feed agreement of your own. If this is the case, make sure you understand the total cost, and if your listings will be sold to the highest bidder in given zip codes. Also, make sure you understand if there are any protections to your listings and what voids those protections. Finally, take a real estate computer Geek out to lunch. Ask them about cookies, RETS feeds, and interfaces. Pizza pockets and Mountain Dew may be their staple lunch cuisine, but no Geek can pass up a chance to eat something that didn t come from a microwave and served on a real table. Just bring sunglasses, they haven t seen the sun in years. Tom Woiwode is the managing broker of Coldwell Banker Platinum Partners. He is a certified real estate instructor in Georgia and teaches real estate pre-license and post graduate classes. He can be reached at Tom@mycbpp.com. His real estate school website is www.areec.com and blog is http://areec.wordpress.com. You are authorized to reprint this information. Please give credit where credit is due. Page 5 of 5 Author: Tom Woiwode Email: Tom@mycbpp.com Website: www.areec.com