I was meeting with a friend of mine who works in real estate. Our conversation, as so many real estate conversations do, drifted into the whole issue of listing syndication.
You know the drill: Trulia, Zillow, Realtor.com, MLS listings on competitors’ sites, and so on.
You also know the various arguments that take place around these practices. It’s good for consumers. It’s bad for consumers. It’s good for brokers. It’s bad for brokers. It’s good for agents. It’s bad for agents. And so on.
It seems that everyone has a feeling about syndication and has been having that feeling out loud for about five or so years. My friend and I both agreed, however. We agreed that syndication is a distraction.
Many of the syndication arguments end up being emotional. Some of them end up being moral. As in, you are a bad person if you do/don’t syndicate.
That’s why it’s such a hot button topic. No one likes to be told their business practice is immoral. No one who is in a service industry (for very long) wants to listen to someone else tell them that they are somehow harming their customer for syndicating/not syndicating.
These emotional and moral approaches to syndication cause a great deal of distraction. If someone is calling your way of doing business immoral, it is difficult to let it stand. You’re sort of forced to defend yourself. Your defense is likely to cause someone else to feel as if you’ve named their business practice as immoral and then they have to defend themselves. It’s sort of a nuclear fission of syndication issue distractedness.
And it costs people all sorts of time and focus. While arguments pile on in Facebook and Twitter and YouTube and over emails and letters to editors, nothing really changes. And I really do mean nothing. People who could be working to improve their corner of the real estate market are stuck dealing with emotional questions and the resulting fallout.
Syndication issues are a distraction in all parts of the real estate industry.
Syndication issues distract brokers
Brokers have an interesting stuck-in-the-middle situation with regard to syndication. Some would love to maintain relatively tight control of their own listings, as brokers in New York City or outside the U.S. do. But pressure from agents who want to tell their customers that the listing will appear everywhere on Earth makes this difficult.
Other brokers would like to get their listings in as many different places as possible. They end up fielding issues with agents who are wondering why someone else’s face is on their listing on some other website that no one has ever heard of. Or these brokers end up dealing with all of the other brokers in their MLS in some sort of proxy argument about syndication.
Big distraction. There are things that brokers are not doing to improve life for agents and real estate customers because they’re dealing with syndication issues.
Syndication issues distract agents
Agents have a bad rap of being pretty distractable. But syndication definitely holds the attention of some of them.
On one side are agents who believe that leveraging aspects of exclusivity and status will result in a better prospect for selling a house. On the other side are agents who believe that getting the greatest number of eyeballs on listing data will help sell a house.
Both of these groups of agents get distracted. They get distracted by telling each other that the other way of doing business is morally corrupt. Or they get distracted because they are with a broker who is similarly distracted trying to manage the various points of view of all the agents.
These agents are distracted. And while they’re distracted by syndication issues they are losing valuable time that could be used to help their customers sell their house. They’re also losing time that they could spend building their business.
Syndication issues distract MLS people
Navigating all the various viewpoints around syndication is a major distraction for MLS people. There are agents and brokers calling and complaining all the time. There are "innovations" that can’t be implemented because the moral outrage from one camp or the other would be too great.
One approach to this has been to outsource all the syndication issues entirely to a vendor. But then the vendor gets all wrapped up in the distractions as well, and the issue gets compounded.
MLS people are distracted by syndication issues. And while they’re distracted they are stuck in a logjam and unable to spend time making their business work better for their constituents.
Syndication issues distract vendors
At first blush it might seem that all this syndication distraction stuff is helpful for vendors. While agents, brokers and MLS people duke it out in a moralistic sideshow, the vendors can wander off with all the syndication they need to make quite significant businesses.
But the truth is that approach isn’t really working. Evidence of it not working might be found in the rash of high-profile industry hiring being done by the aggregators. All of this syndication bickering is taking up a lot of resources.
Stop the distraction
The truth is that listing syndication issues aren’t moral. And business issues that are emotional take up a lot of time.
Everyone involved in business has a little spreadsheet somewhere, even if it’s just in their head. That spreadsheet will tell them if it makes sense to syndicate or not syndicate. If people make money on commission by selling a house, would they stay in business very long if they didn’t do things that sold houses?
The truth is that different businesses follow different business models — even within real estate. The brokerage down the street makes its money doing the same general activity, but they do it differently. That’s what’s cool about business. We can watch and find out what works.
And if vendors make money from the aspect of real estate data, would their business have much longevity if they irritated the people who produce that data? Would it make any sense for them effectively turn off the pipe that flows data their way? Wouldn’t their investors get a little anxious that their business was built on a foundation completely outside their control?
The syndication stuff is all just a distraction. Understand your business model and whether syndication makes sense for it or not. Understand that your business model is right for you, but it might not be right for someone else. Understand that your little spreadsheet of what makes sense isn’t the same as the next person’s. If they go out of business doing something that doesn’t make sense, it isn’t your fault.