The final 15 minutes of ICLV’s CEO Connect was supposed to be a broad discussion about the country’s biggest companies — Facebook, Amazon and Google — and whether they would ever substantially enter the real estate business. That was, until this morning, when Amazon and Realogy announced a new lead generation and referral partnership.
The final 15 minutes of Inman Connect Las Vegas‘ CEO Connect event was supposed to be a broad discussion about the country’s biggest companies — Facebook, Amazon and Google — and whether or not they would ever substantially enter the real estate business. That was, until this morning, when Amazon and Realogy announced a new lead generation and referral partnership.
Instead, the more than 30-minute conversation focused almost solely on the announcement, with every corner of the industry giving their thoughts on Realogy and Amazon’s new program.
Sherry Chris, the CEO of Better Homes and Gardens Real Estate — a subsidiary of Realogy — faciliated the discussion and opened the talk by reporting that, on the first day the platform was live, the company generated more than 500 leads.
Many in the audience compared the new program — which gives consumers a value package of $1,000 to $5,000 of Amazon goods and services for getting a Realogy agent through the platform — to other affinity programs that have existed in the past, whether it was through partnerships with Costco or programs that gave consumers airline miles for working with a certain brokerage.
“This is not like Costco, this is not like an airline deal,” Boomsma said. “These people have really strong relationships. I think we’re all going to be competing with it. It’s the new closing gift.”
Boomsma implied that people were underrating Amazon’s presence, noting that there are more than 100 million Amazon Prime members, many of whom are using the platform weekly. He said consumers are going to start going to brokerages and saying, “I can either do this with you or with Amazon, what are you going to give me?”
Jed Carlson, the CEO of digital marketing company Adwerx, echoed Boomsma’s sentiments, saying he believes Realogy and Amazon just set the standard for closing gifts for the industry. Realogy agents will pay for the Amazon benefit from the commissions it earns from the home sale transactions, according to a Realogy spokesperson.
“It seems to me the implication was that the closing gift has now been pegged for the industry,” Carlson said. “How does everyone else in the room not offer up a closing gift that’s worth the referral fee back to the client? Is that what just happened?”
Bernice Ross, a real estate coach, speaker and Inman contributor, praised Realogy for thinking beyond the transaction, at a time when the industry is so focused making a seamless experience from the beginning of the search to the end of the sale.
“What Amazon is doing here and what Realogy is seeing is a big opportunity to capture is to deliver value at the end of the process,” Ross said. “I think we’re going to see more opportunities like this.”
Many leaders, including Mark McLaughlin CEO of Pacific Union International, believes that the quality of leads is more important than the number of leads generated. And furthermore, many wondered if Realogy agents would even be able to close a high volume of the leads that would be generated from the platform.
Chris confirmed that the agents chosen in the early stages of the program — there are roughly 3,000 — are agents that work with Cartus, Realogy’s corporate relocation company. Agents will pay roughly a 30 percent referral fee back to Realogy for the leads, although Chris declined to disclose the exact amount.
Some in the industry also wondered about the presence of the other industry heavy hitters in Facebook and Google, both of whom were overshadowed slightly in the discussion. But Howard Tager, the CEO of real estate marketing startup Ylopo, said, both Google and Facebook have been in the industry for a long time — but Amazon getting into the industry is an entirely different story.
“I personally spend $800,000 a month with Facebook, but Amazon is a different beast than Facebook,” Tager said. “Something in the room that nobody talks about, is it’s all direct-to-consumer.”
Tager said he personally believes Amazon’s presence in the market place is the biggest threat to Zillow.
“If I’m Zillow, that’s who I care about – whose got the coffers to go in and buy market share,” Tager said. “Is it Quicken Loans, is it Amazon homes? That’s the game right now.”
“Zillow needed the data to get the direct to consumer,” Tager said. They’re the winners of direct to consumer. But that’s the next threat to the likes of Zillow, controlling that consumer.”