The Internet has been growing on the mysterious side of the American real estate experience for well over ten years now, and every inch of our exploration of that mystery has brought with it the pain and joy of the following discoveries:
- It was a significant achievement for the industry to initially accept the Internet as a serious business environment
- In many cases, underwriting the expense of developing the initial brokerage website was a “leap of faith”
- That leap of faith grew even wider when it was discovered that, once established, websites had to be redesigned and reconfigured every other year
- Early on, combining a firm’s URL with their brand took courage
- It took additional time to accept the idea of placing listings on the Internet rather than in newspapers
- It took a long time to reach the point that over 89% of consumers make use of the Internet search
- There was a time when the term IDX was seen as a subversive plot
- Year after year, we watched with alarm as the Internet conducted what seemed a relentless attack on the traditional agent
But even with all of this enlightenment, nothing, at any point in this struggle, has been more of a challenge than tracking the emerging real estate consumer. Accordingly, it should come as no surprise that, as we near the midpoint of 2011, it is this issue that now threatens our ultimate migration to the Internet.
Some things about the Internet consumer have, until recently, remained shrouded in mystery. When and where do they search? What are their favored sites and what attracts them? Some real estate practitioners added to the folklore of the Internet by divining answers that were rooted in traditional practices and relationships.
Thanks to the structured research efforts of a host of web traffic experts like REALTOR®.com, Google and Yahoo much has been learned about the behavior patterns of today’s real estate consumer. For instance by 2008 we knew that:
- The American consumer had little to no trust of institutions, including real estate brokerages
- Consumers were likely to be researching the real estate experience several months before contacting an agent
- Despite plunging levels of trust and satisfaction, over 90% of consumers would continue to use real estate agents as part of their real estate transaction, although not their search experience
- Consumers had gained an insatiable appetite for information and could not be denied
- These consumers were demanding a relationship of equality with their agent
With this knowledge, MLS operations around the country began to create “public (or consumer) facing listing websites.” The purpose of these sites was to provide consumers with “REALTOR®” branded “MLS” information. From the very beginning, these MLSs encountered hostilities and conflicts with brokerages that believed that, absent these MLS sponsored sites, consumers would naturally migrate to their websites.
Charges of “leveling the playing field” and “unfair competition” became commonplace, along with threats to abandon MLSs and even the REALTOR® movement itself, despite the fact that both MLSs and brokers share a common commitment to support REALTORS®. But, alas, the ultimate discovery that would solve the mysteries of the Internet real estate space remained in the dark.
Into the fray came a team of inspired knowledge and data experts whose unique grasp of these issues and the real estate process was just what the moment required to solve the mystery of the Internet experience. The founding partners of the WAV Group, Marilyn Wilson, Victor Lund and Mike Audet came together because they shared a common vision of business values and how to create success for their company and their clients. All three had been successful executives with major companies, bringing together complimentary talents in sales, marketing, business development and product management. Since it’s founding in 2003, the WAV Group has developed an impressive client list in the United States, Canada and Europe.
When the public facing listing website debate descends on a marketplace, many of the arguments, pro and con, are based upon unfounded allegations regarding where consumers are, could be or ought to be during their Internet property search. The secret of the WAV Group’s success is simple, but powerful. They use robust technologies and research tools to bring transparency to the mysteries of Internet real estate search behaviors.
One of the WAV Group’s strategic competencies is their ability to use sophisticated technologies to access advanced and costly databases to demonstrate exactly where consumers are searching for real estate listings and information in any given dedicated market area (DMA) in the country. The detail and accuracy provided by a WAV Group research initiative immediately takes the dialogue to a whole new level. It puts the parties on a level knowledge field and sets the stage for an enlightened discussion regarding how best to facilitate the consumer’s property search so that it will end up benefiting the brokerages and agents within that marketplace.
When examining market level data in the WAV Group WIN Reports featuring Hitwise data, notably the most accurate measure of online search traffic available today, WAV Group has observed that in nearly every market in the United States, third party sites now dominate online search engine traffic. Many brokers believe they have the strongest sites in their marketplace and, with rare exceptions, this is simply not the case. Those markets with successful MLS consumer websites or “Lead Generation Engines” have captured consumer eyeballs enabling these sites to send hundreds of thousands of leads to their members every year. Leads generated from MLS sites do not cost agents anything other than their regular MLS dues. There are no referral fees and no “platinum” packages. When a consumer finds a listing they like, they simply contact the listing agent or broker directly.
“It is unfortunate that the Consumer Facing Listing Website debate so often gets off on the wrong foot with inadequate or incorrect information,” says Marilyn Wilson, a founding partner in the WAV Group, “Our research process almost always discloses that this is actually a rare opportunity for all concerned to work together for the benefit of the area’s REALTOR® professionals.
Consumers today are looking for objective third party sites so that they can be free to conduct their own property research before engaging with an agent. That’s why Realtor.com, Yahoo!, Trulia and many others enjoy so much consumer traffic. These sites recognize that potential home buyers want robust, easy to use tools to narrow down the neighborhoods they like and the features of a home that are important to them. Once a consumer has completed their own property research, then they engage with an agent. Today’s searching consumer is looking for the authority and dependability of the REALTOR® trademark and the advanced technologies that make the real estate search process exciting, satisfying and, frankly, fun.
This mystery is now solved. Thanks to the WAV Group the industry’s knowledge regarding consumer search behaviors understands that:
- Many consumers want to conduct their own research before engaging with an agent or brokerage. They do not want to waste the agent’s time. They want to have a good idea of where they want to live and what kind of house they would like before they begin the final process of putting in an offer on a home.
- Despite their reticence to get engaged with a brokerage website early on in the process, consumers do place great trust in a website that carries a REALTOR® moniker. They believe the data is more accurate and up to date. They’re right, of course!
- Where no such REALTOR® sites are available, consumers will migrate to listing sites being operated by non-REALTOR® entities. That’s why third party sites have gained so much traction. Every time a brokerage invites or enables a consumer to visit a site other than one they own and control, it is going to cost them money or even a customer. As traffic increases for leading third party sites the cost of participation is continually increasing as well. MLS Consumer sites need to be thought of as an extension of the broker site, not a competitor. These sites are simply another tool in the broker’s lead generation tool chest.
Interest regarding this subject is strong enough that the Houston Association of REALTORS® is conducting a national seminar, in June, designed to assist both brokers and MLSs make their public facing listing websites more effective. This will be a “must attend” for anyone dealing with the issue.
Oh by the way, there is something else we now know. Neither our competitors nor our distracters, moving forward, will be wearing a blue REALTOR® “R” on their shirts, nor will they be playing by the same rules that have built this great industry. Take heed of NAR CEO Dale Stinton’s recent writings on the subject of cooperation and common directions. Your survival depends upon taking the time to understand the threats and opportunities facing this industry and responding appropriately.