Transaction management firm zipLogix is appealing to the board of directors of the National Association of Realtors (NAR) for its support for continuing to fund its software to the tune of millions annually. NAR currently has a funding agreement in place with zipLogix in which it pays the company more than $12 million a year in exchange for zipLogix granting use of some of its transaction management software to NAR members.
However, as NAR’s midyear conference approaches (May 14-19 in Washington, D.C.) and the organization prepares to vote on where it spends its funding in the future, zipLogix wants to secure continued funding from the trade group.
In an email sent to the 800-member NAR board Tuesday and obtained by Inman, zipLogix asked NAR directors to “voice your support for continuing zipForm as a NAR member benefit” in a three-question survey whose comments the firm said would be compiled and submitted to NAR.
The questions ask how valuable the directors consider zipForm, giving them the option to provide a testimonial and asking if they would continue to provide zipForm as a NAR benefit if they were to vote today.
However, the first question may make some wonder whether zipLogix is indeed seeking honest feedback, as it only lets respondents vote for options that portray zipLogix in a positive light.
Asked why it did not include an option for negative feedback and how it would respond to attendant charges of bias, zipLogix avoided the questions and instead noted that the company regularly solicits feedback “on an ongoing basis” from its customers.
Asked whether any negative testimonials would be shared with NAR, zipLogix spokesperson Mark Giberson told Inman via email, “We are in the initial process of gathering all survey results and will determine how feedback is disseminated at a later date.”
In November 2015, the NAR board approved a deal to provide all million-plus Realtors with zipLogix’s zipForm Plus software at no additional cost to members. That deal has cost the trade group more than $38 million over three years. NAR has proposed raising its annual dues by $30 in 2019 and by 2.5 percent every year starting in 2020, in part to continue funding transaction management software as a member benefit for $7.5 million a year, a proposal that has already incited controversy and dissent.
That proposal has attracted opposition in some quarters, in part because many state and local associations do not use zipForms and provide their members with competing transaction management products such as those from dotloop or Instanet, therefore, their members will receive no benefit from NAR continuing to pay for zipForms. Nearly 600,000 Realtors use zipForm Plus, zipLogix said.
NAR’s board will vote on the dues increase proposal on May 19. At the same time, NAR’s agreement with zipLogix is up for renewal this year, and the email sent to NAR’s directors indicates that the outcome of negotiations is not a forgone conclusion for zipLogix.
“As with any NAR benefit, not all members use [zipForm], but no other benefit provided by NAR has the usage zipForm has. More than 30,000 new transactions are created daily, and millions more are in process on any given day. We’re concerned that this message is being lost in the broader budget discussions now underway,” zipLogix said in the email sent out to NAR directors, warning of “disruption” that could occur for NAR members and state and local Realtor associations if NAR stopped funding zipForm, or if new transaction management software were selected instead.
According to zipLogix, “transactions” do not refer to unique property sales but rather “[a] transaction can be created in multiple ways — every time an offer is made on a property, for example.” The company said it does not track unique property sales.
The company said it was sending out “a variety of communications over the course of several days” to a variety of groups in its customer base, including the NAR board. Asked whether board members who said they would not vote to continue funding zipForm would be targeted for additional lobbying, zipLogix said they wouldn’t be, and in any case, survey responses were anonymous. The company said NAR had not given them the board members’ email addresses, but did not immediately respond to who had given them the addresses.
“We are confident that our technology and the value we provide to Realtors nationwide will prevail,” Giberson said. “When a contract is up for renewal, it is a standard business practice for any business to demonstrate the benefits of a product or service to decision makers so they are able to make an informed decision and are aware of the processes involved in making that decision.”
Asked whether NAR was considering not funding zipLogix as a member benefit further or going with a different transaction management provider, NAR declined to comment.
ZipLogix is a joint venture between NAR and California Association of Realtors subsidiary Real Estate Business Services Inc. (REBS). According to zipLogix, REBS owns 57.4 percent of zipLogix and NAR owns 30.2 percent. ZipLogix itself holds 11.6 percent ownership (not owned by any Realtor association or subsidiary) and several other state and local Realtor associations hold the remaining 0.8 percent interest. NAR and zipLogix have declined to name the other associations.
Editor’s note: This story has been updated with additional comments from zipLogix.