In a nutshell: it’s a total reversal of the normal online mortgage quote process. At Zillow, consumers fill out a RFQ for a loan anonymously and the lenders compete for their business. Consumers have the option of choosing to work with the best offer and then can rate the experience afterwards.
As a consumer, I love that Zillow is taking on the established business model head on; that is, taking my info and then selling it on (as a lead) to the highest bidder. That business model should be taken out behind the woodshed, shot and disposed of appropriately, in my opinion.
But keeping my consumer hat on for a sec I’m going to think this through a little bit more.
Huh, Zillow is in mortgages now?
Zillow was absolutely phenomenal with the PR when they launched. Full credit to their PR department and to Community Relations ninja David Gibbons for doing an absolutely bang up job firmly establishing the Zillow brand.
Problem is; I think they may have been too successful. Zillow has now become virtually synonymous with its Zestimates and most people just think of the site as a place to see how much their home is worth. Something some people definitely aren’t too keen on doing anymore (see Using Twitter to Listen to Your Customers)
Bottom line: It’s going to be tough to break through that legacy without some aggressive marketing and/or advertising. The LendingTrees of the world spend a bucketload of money advertising online establishing their brand (see Storms Ahead for Real Estate Sites); Zillow’s stepping into an expensive world, no matter how good their product.
What’s it in for Zillow?
Obviously, hopefully more traffic and according to their media model, more advertising dollars. (They do charge a nominal $25 fee for lenders to join the service, mostly to cover the background screening).
The Zillow guys said this new marketplace product (the “first of many”) is going to move them beyond a traditional CPM model – i.e. serving ads to the anonymous Internet user.
What does that mean? Mortgage apps get them some deliciously juicy demographic data to which they can then serve up highly targeted advertising later on.
Basically, based on the type of loan application you submit, you’ll get a cookie in your browser. Then, when you come back to Zillow you’ll start seeing the appropriate ads based on that collected info. Submit a loan request for $800K and you may get an ad for a Cartier watch, go for $200K and you’ll get ads for Casio.
Bottom line: As a consumer it makes me a little uneasy I’m getting sliced and diced this way, but it’s all in the name of relevance I guess.
Do I really want all this attention?
OK, so I submit a RFQ and the lenders can jump in and respond to me… but I get the sense there’s a lot of hungry lenders out there right now though. And I’m not sure I want to wade through the umpteen dozen responses I may possibly get; part of me is still wedded to the idea that I only want work with the best, most fair, most reputable lenders (is that naive?) – if I have to do too much work trying to figure out who that, is I might bail.
Bottom line: Research is fine, but when it becomes work, it’s not much fun any more. Zillow straddles a fine line here.
That said, I suppose that’s a problem Zillow would like to have.
Even with these questions in mind, I’m going to submit an application to the Mortgage Marketplace. I’m toying with the idea of a move right now and personally, as a prospective home buyer, this product hits all the right notes for me. I’ll let you know how it goes.
In any case, this news will surely be endlessly dissecting across the media landscape and I definitely look forward to reading all the opinions this will no doubt generate, especially from those lenders who choose to participate and those who don’t.
Update – I created a thread in my Real Estate Marketing 2.0 group on Inman.com where lenders and consumers can discuss their experiences with Zillow Mortgage Marketplace. Let’s hear what you have to say.