An MLS is attempting to deliver slimmed-down listing feeds to portals. Others are keen to follow.
The MLS wants the portals to provide prominent, direct links back to listing brokers’ sites. Fewer photos on the portal’s listing pages will create more direct traffic to their agents and brokers, the thinking goes.
Zillow doesn’t want to accept these “degraded” listings. They want improved content to increase traffic and exposure for their investors and advertisers.
Neither side’s stance is in defense of consumers — so we can all stop posturing as if they were.
We all want to improve consumers’ real estate experience, but there are very few players in our industry who are actually required or incentivized to make the real estate world “better for consumers.” Let’s skip the capes and white stallions: Public companies are trying to maximize investor returns, and MLSs are trying to help members meet clients and sell their homes. Neither of those groups is likely to make decisions based on general consumer preferences unless they’re first beneficial to their investors or members.
If MLS members found that uploading fewer photos actually created more direct contacts, in-person showings and faster sales, they would do it for their clients whether or not consumers said they wanted more photos. Portals would make the same decision for their investors if they believed that fewer photos would actually improve their profits by increasing direct consumer inquiries (leads).
Degraded or leveraged listings?
Both sides of this dispute are trying to leverage listings to maximize profits. MLSs understand that by limiting listing information on national portals and requiring links back to the listing broker, they’ll capture more direct consumer traffic. Their members will pay less in advertising to portals, and come into contact with more consumers whom they can market their clients’ homes to.
The money, for portals, is in the property inquiry. If the consumer leaves a portal too quickly to the broker source of the listings, there are fewer impressions to sell and fewer leads to keep their customers happy. The consumer has to stay long enough to contact an agent. The strategy of providing unending consumable (if not always credible) content has created that long-term consumer traffic for Zillow. The consumers’ Zestimates may be off by 20 percent, but their soon-to-be agents might spend 40 percent of their incomes on the leads. Any changes to their content that could direct traffic away will be bad for the bottom line.
Agents serve buyers, not browsers
No one is the white knight here, even though there are a lot of chivalrous corporate quotes floating around. If real homebuyers (not real estate browsing hobbyists) are asked to click through from a portal’s listing to a broker’s site to see 25 photos, the marketplace will not break down. If they’re truly serious buyers, they won’t skip their potential future home just because there weren’t enough photos. It’s true, though, that the consumer probably would have preferred to stay on a single website for their information, and the process is less efficient for the consumer in that sense.
At the same time, buyers might even end up talking to an agent who actually knows something about the property. They’ll take the time to view the broker’s listing, which will be more accurate and timely than the portal’s because it would come directly from an IDX feed. Wouldn’t a consumer-friendly strategy attempt to lead consumers to the true source of the most accurate data?
Strategy for the long term or daily survival
A listing with few photos often generates the most calls. A home seller wouldn’t call that “degraded” — they’d call it great strategy by their agent.
The billion-dollar question is where that listing sits, and whose contact information sits next to it. Will MLSs succeed in creating a wave of limited listing feeds, or will brokers undercut it with their usual “every man for himself” attitude and adopt their own feeds to portals?
The latter is probably more likely. MLSs have data strategy policies, while most brokers have “Get these angry agents out of my office and put our listings wherever they ask” policies. The broker data agreements being signed across the country with portals are unbelievably poor for those brokers’ and their agents’ data rights, but they’re not in the business of data strategy so they just sign up and move on.
Ironically, the MLS began this process to give more power to its brokers, and brokers may short-circuit it for lack of organization. Whichever direction this trend goes long term, it will be because one business organization was better at negotiating, strategizing and marketing its intentions, not because anyone was selflessly fighting for consumers.
Sam DeBord is managing broker of Seattle Homes Group with Coldwell Banker Danforth, and a Director for Washington Realtors and Seattle King County Realtors. You can find his team at SeattleHome.com and SeattleCondo.com.