Amid the nationwide slowdown in real estate, Internet traffic continues to pour through the new breed of real estate Web sites. Consumers race along, fueled by loss-leader offers of services once provided by Realtors. Gas is free these days on the Internet’s superhighway courtesy of the new no-strings-attached policy.
These sites — including Trulia, Redfin, Yahoo, craigslist and Google — appear like mega stations that rise from the meridians of our terrestrial highways. They’ve all but replaced mom-and-pop establishments found on frontage roads, establishments that once thrived but now lie in the shadows, hoping a traveler on his way to somewhere else pops in for a visit.
Today, the Route 66 of the Internet is lined with these castaways. Their Web offerings are shopworn, their service propositions hidden behind aged exteriors, and their value imperceptible to consumers too fast, too furious and too impatient to uncover it.
Naomi’s question
At a recent conference I was asked how these new real estate sites amass traffic in such short periods of time, quickly surpassing established real estate companies that have been on the Web for years. It’s a simple question with difficult answers. It requires us to accept the premise that at its core, real estate, like early human societies, is a hunter-gatherer culture. It doesn’t plant or produce; it hunts and gathers through cold calling, door knocking, telemarketing and rudimentary Internet lead capture. Few have leapt ahead of the pack.
The traditional real estate industry has yet to leave its primitive drudgery.
Conflicts between hunter-gatherer and production societies are an age-old occurrence. Jared Diamond documents this in his anthropological study, “Guns, Germs and Steel,” published in 1999.
His conclusion: Societies that produce conquer; those that hunt and gather stagnate or perish.
The no-strings-attached service propositions (which include home-value estimates, listing data and heat maps with neighborhood data)offered by the new online real estate sites have the potential to do for their investors what food production and weaponry did for various societies of early man.
The rise and spread of results
The proper way to view many of the new innovations coming upon our industry today (heat maps, home-value estimators, neighborhood data, podcasts, blogs and widgets, to name a few) is to compare them to man’s earliest weapons. These are initial attempts, full of quirks and not yet perfected. But if you regard the first spearhead as the precursor to a modern day missile, the implications of what today’s new tools will become tomorrow is worthy of dialogue. These innovations grab consumers’ immediate attention because they generate results.
As these innovations launch, some in the real estate community wisely understand their ramifications; they take action. Others remain dismissive, unaware or defensive. The latter are unfortunately similar to the indigenous hunter-gatherer. Consider how their mutual fates may intertwine.
The future of real estate as a science
Some traditional real estate societies have begun to develop their own “production.” In other words, they now develop business by means other than hunting and gathering it. The tools they are using include better branding, CRM, advanced Web sites with mapping and results-driven Web applications.
The real estate industry is earth 10,000 years ago. It’s populated by different brokerage societies sharing the same genetic strain. New societies from BlueRoof to Redfin are making the leap out of hunter-gatherer mode. Several already powerful societies from brokerage companies like Real Living, and Prudential Douglas Elliman have followed. History indicates that they will divide and conquer. For the traditional hunter-gatherer, the choices are apparent.
From this day forward, if you’re doing business the “old-fashioned way,” the implications on the anthropological board game of business are not rosy.
Marc Davison is a national speaker and vice president of OnBoard, a real estate data provider based in New York. Davison previously served as vice president of VREO, a provider of electronic signature and Web site software for the real estate industry. He can be reached at mdavison@onboardllc.com.