NEW YORK — Big data tools in real estate may be suffering from “shiny object syndrome,” according to Todd Carpenter, managing director of the National Association of Realtors’ data analytics group.
Charmed by such systems’ promise to pinpoint prospective buyers and sellers, some real estate agents who use them end up underwhelmed, he said.
Members speaking at a panel on big data at Real Estate Connect said that’s because agents often have unreasonable expectations about the tools’ effectiveness, and may not appreciate the extent to which actually they do improve prospecting efficiency.
But even if big data tools are mumbo-jumbo, they can still benefit brokerages by instilling confidence in agents about the potential of leads they’re encouraged to pursue, according to Carpenter.
“There’s still a level of confidence that can be sold,” Carpenter said. “If you’re showing them that you’ve invested in a system to give them better leads, they are more likely to work those leads and are more likely to convert more of those leads.”
He’s seen this placebo effect at work before.
One broker built a system that scored the hotness of leads, Carpenter said.
“It got his agents excited. They started closing more deals and they were like, ‘This system is awesome.’”
But the tool didn’t really do what the broker said it did. It just assigned scores to leads in a completely random manner.
“It was actually a sham,” Carpenter said.