Listings, Leads and Losers, Oh My!

Mar 31, 2007 Michael Wurzer

Larry Cragun wrote a brilliant post against being led to being a lead, advising consumers: “To give yourself the best opportunity to select a great agent: don’t respond as a lead from a major website. Instead, find an agent’s website, most have them. Better yet, find an agent that blogs. Visit these sites regularly, you will get to know them, even though it is only in your computer.” Shortly after Larry posted his article, Kris Berg posted an excellent article over on the Bloodhound Blog, divulging her analysis of the pros and cons of single property web sites and how her broker’s relationship with Yahoo! can direct traffic away from her site. These two posts presented a slight contrast, with Larry cogently explaining why consumers should focus on agent web sites and Kris explaining how her broker’s relationship with a listing portal was making it harder for consumers to do just that. Hmmm.

Of course, consumers want to see listings, whether they are on a listing portal, a broker’s site or an agent’s site. Sure, they’re more likely than not going to need an agent at some point, but both buyers and sellers start by looking for listings. Buyers want to see what’s for sale and sellers want to see comps so they have an idea what their house might be worth. Let’s call this the exploration stage. The potential buyers and sellers aren’t ready to commit to anything, they just want to inform themselves. They want to learn. Learning is what the web is all about, getting people information quickly, easily and more comprehensively than ever before. At this “exploration” stage, people don’t want to be bothered. Just like in the retail stores, when asked by the clerk if they can be helped, most respond, “No thanks, just shopping!”

Also, when consumers are learning, they want to know that they’re getting the full and complete picture, which may be why the listing portals get most of the traffic in any given geographic region and broker or franchise web sites don’t. With IDX and the ability for brokers (and agents, in many areas) to put the MLS listings on their web site, the perception of their sites as being incomplete or biased may be wrong. Of course, this depends on the circumstances, the local market, and the MLS coverage of that market, which is exactly why many brokers are clamoring for regionalization. They want to show the consumer a complete picture.

The IDX (internet data exchange) policies of MLSs across the country have gone a long way to help brokers and agents present this complete picture to consumers, but the objective and the result was muddied along the way. (IDX was one of those balanced decisions I discussed in MLS is More Than Technology; a decision which could not have occurred, most likely, without a bit of representational democracy.) First, some brokers decided not to participate (opted out) because they had legitimate questions regarding whether the data was going to be misused to generate and sell leads back to them. Then, to get around the opt outs, some argued that they were just operating a “virtual office” and so should be able to show all the data, including those who opted out. Controversy ensued, NAR tried to reach a compromise with the ILD policy, and the DOJ sued. The DOJ lawsuit created a vacuum, freezing many MLSs, brokers, and agents from innovation. Of course, vacuums get filled, and the listing portals like Trulia, Google Base, Yahoo! real estate, and others have only been too willing to accommodate. While the industry was battling legal challenges, others were innovating and now they’re in front of the consumer. This leap of innovation and consumer mind-share grab has resulted in franchises like Realogy concluding that they need to get the brokers’ listings on these portals (as long as the franchise gets the leads or the broker pays for them, apparently). Thus, the fear that caused some brokers to opt-out of IDX in the first instance is now true — someone else is collecting the leads off their listings. Oh my!

IDX was a great idea. Larry Cragun and Kris Berg have it right, the agents should be delivering the listing information to the consumer. Importantly, this argument should not be confused with those who think agents make a living simply by hording the listing information. I seriously doubt that ever worked as a long term business model, but, if it did, there is no question that such a model won’t survive today. No, what I’m suggesting (and what I think Larry and Kris are suggesting) is that the agent is on the front lines and there should be as little friction as possible between them and their potential clients. Isn’t that what the web revolution is all about, efficiency, knowledge, and power to individuals? That was the promise of IDX and I think it can still be brought to fruition.

Here’s how we can revive IDX. Brokers and agents should be allowed to put all the listing information on their web sites. The IDX data set should be complete (which should get the DOJ off the NAR’s back) and brokers should be assured that someone else isn’t going to sell leads from their data (this is called compromise). Once data standards are established, promising a strong and comprehensive data product from brokers and agents to consumers, NAR should create and heavily promote a branding and logo program for legitimate IDX sites so consumers can have confidence they are seeing everything. (No, I’m not crazy, this is a really good idea, if you pause to think about it. See, the NYSE and NASDAQ for examples.) Consumers should be able to shop till they drop, without being bothered, until they’re ready to engage. But, when they are ready to engage, they should be one click away from the agent who is going to serve them. Getting funneled through lead site after lead site before getting to the agent is not efficient and is not consumer-friendly.

I would be remiss in this post about consumer shopping if I didn’t mention Jessica Swesey’s recent post on Inman Blog asking if sites should require a “lead form” (submission of contact info) or not. The comments to her post have been great and most respondents said, nope, don’t ask visitors to enter contact info in order to search. Requiring contact info just produces bad leads, false information, and frustrated visitors. Kevin Mazur from the Tropical Realty Blog had tried it both ways, and found that, without the lead form (giving the customer a choice), they received fewer but better leads. Others suggested a balanced approach, where you give some info for free, and then ask for registration for access to further information, worked well.

One possible cause of the disparity in the comments is that each was focusing on a different stage of the consumer’s decision making process. If everyone agreed that they were talking about a consumer who was “just looking,” I suspect most would agree that those are bad leads and forcing them to register is a bad idea. Similarly, most would agree that giving the visitor an opportunity to register is a good idea once the consumer has moved past the “just looking” stage. The transition from shopper to someone who is more serious may be as easy as providing an opportunity to save searches and get automatic updates, which necessarily require registration of some sort. I still don’t think site owners should spam people who register, but there certainly isn’t anything wrong with asking a few questions when the person does register to determine their interest.

The value proposition seems clear: (1) consumers need listings to learn more about the market; (2) brokers can supply the listings; and (3) agents can help educate the consumers on what the listings mean. The technology needs to facilitate this value proposition in as complete and unobtrusive manner as possible. If we can do that, there need be no losers from listings or leads.