Ever since the News Corp. acquisition announcement of Move Inc. back in September, my wife (Julie Harris) and I have been predicting that ListHub would cut off the flow of listings to Zillow.
And last Tuesday our prediction came true when Inman broke the story that ListHub will no longer be providing listing leads to Zillow after April 7.
Just like you, we read it here first in “Rupert Murdoch playing hardball with Zillow” by Andrea V. Brambila — and I’m sure we’ll see plenty more stories providing us with additional information as the story progresses. We wanted to discuss what we know so far and offer our thoughts on what it could mean for the industry, agents and brokers — so it was the highlight of two of last week’s radio programs, below:
Breaking news: Is this the END OF ZILLOW?
Breaking news: Is this the END OF ZILLOW? (Part 2)
For those who don’t know, it works like this: ListHub is the primary syndication channel that agents and brokers use to submit their listings to many major listing portals — including Zillow, Trulia, and scores of other specialty portals and online real estate services across the country. So agents and brokers submit listings to the MLS, which passes them into ListHub, which then syndicates out the new listings online. It’s a relatively simple system, but in order to make it work across hundreds of MLSs across the country, it requires a large, established data aggregator (like ListHub) to bring it all together.
Move owns ListHub — it has for several years now — which puts it in an interesting position: Even though Move competes with Zillow directly through realtor.com (another Move subsidiary), it’s also a major supplier of listing data to Zillow. It’s an awkward position to be in, for sure — especially when Zillow has used that very same listing data to dominate the online market and then sell the leads it generates back to agents at a premium.
Now that Rupert Murdoch’s News Corp. owns Move, the situation has only become more awkward — particularly with increasing agent complaints about the quality of both Zillow listing data as well as the buyer leads that it generates.
So when Zillow’s chief revenue officer, Greg Schwartz, announced, “We’ve not been able to come to terms with News Corp.” and “the ListHub agreement will most definitely expire” in April, we weren’t exactly surprised. In fact, as I said before, it’s something we’ve been predicting for months. It raises some big questions — ones worth discussing.
First, what happens to Zillow now? It has been working diligently over the last few months to create direct relationships with brokers and MLSs in order to bypass ListHub, but it’s a giant undertaking, and from what we’ve read, it’s not something they can build before the April deadline. Will Zillow make the decision to quietly display the increasingly outdated and inaccurate listings already in its database as it scrambles to add new data sources, and how will that affect agents who buy leads from Zillow? Judging from recent statements, this “data quality” sleight-of-hand game is exactly what will happen in the short term.
Schwartz alluded to Zillow’s push toward direct enrollment of MLSs and brokers in a recent statement: “As we enter a new year, we are cementing our commitment to be the best industry partner to the MLSs and brokers who send listings to Zillow.” This raises two more questions: Why didn’t Zillow pursue this strategy years ago? And are agents, brokers and MLS systems willing to give Zillow a second chance now that the company is in a position of need?
Second, Zillow isn’t the only company relying on ListHub for listing feed data — there are hundreds of other companies in the same position as Zillow, and many of them are also competitors to realtor.com. Listing portals like Trulia, Homes.com and many others use ListHub data to populate home search portals, generating buyer leads that directly compete with leads generated by Move subsidiary realtor.com. Zillow is the biggest competitor, but it’s not the only one — so will we see ListHub cut off more listing feeds to its smaller competitors over time as data agreements expire?
If that’s the case, then Rupert Murdoch may be single-handedly saving agents from a forced financial reliance on buyer leads. I say “forced” because when the top five Google search results are dominated by listing portals, it means that most online users won’t browse down to individual or brokerage websites like they did in the days before Zillow. While coaching organizations like ours teach numerous lead generation strategies that don’t rely on Internet leads, the fact remains that many agents who lack this education have felt pressured, coerced and even forced into spending hundreds of dollars a month on buyer leads.
With all this uncertainty in the industry, there is one thing we can say for sure: Learn to generate your own leads, and create multiple lead generation channels. The industry is changing rapidly, and the agents who will continue to succeed are the ones who remain flexible, educated and willing to invest time into developing lead generation expertise, not just investing money into buying leads.
Editor’s note: A previous version of this story incorrectly stated that ListHub is the primary syndication channel for Realtor.com and that Yahoo!Homes uses ListHub data to populate home search portals.
Tim and Julie Harris have over 20 years’ experience in real estate. Learn more about their real estate coaching and training programs at timandjulieharris.com, or tune in to Real Estate Coaching Radio every weekday at realestatecoachingradio.com.