Once a fat, dated company that rested on its laurels (and a sweetheart deal with NAR), REALTOR.com® has recently reinvented themselves; they had to. Despite key competitive disadvantages, Zillow and Trulia passed RDC in unique visitors and are poised to widen the gap. Still, RDC has a lot going for it. They have the operational rights to use www.realtor.com, institutional relationships will nearly every MLS, and an awesome development team that has proved they can create user experiences that are every bit as good as the mobile and web offerings from Trulia and Zillow. To highlight some of these advantages, RDC has launched a new campaign called, “Find It First.”
I like the concept. For now, RDC’s access to the majority of MLS sourced listings can be viewed as a competitive advantage over Zillow and Trulia. They have the technology to pull a feed from most MLSs as often as every 15 minutes. In addition, RDC’s agreements with most MLSs are of the opt-out variety by default. Meaning if a broker does nothing, their listings go to RDC. The broker has the option to opt-out of syndication, but very few do. Because of these two factors, they get most MLS listings and they get them fast.
Meanwhile, Zillow and Trulia get most of their listings through a syndication company called ListHub. By default, ListHub requires a broker to opt-in to send listings. Meaning, if the broker does nothing, no listing is syndicated to Zillow or Trulia. In addition, ListHub only syndicates listings a few times a day (4 times a day to Trulia as recently as of February 2013).
Because of their institutional relationships with MLS boards, RDC has a serious advantage in publishing MLS sourced listings. But the biggest advantage of all is that RDC owns ListHub. Well, technically Move Inc, the operator of RDC own’s ListHub, but same difference. Perhaps it’s a coincidence that the same company that call pull data from an MLS four times an hour only pushes listing data to their competitors four times a day, but I doubt it. Perhaps the default opt-out agreement for RDC isn’t appropriate for Zillow, Trulia and everyone else, but it sure seems like RDC is handicapping. As long as Zillow and Trulia have to depend on ListHub for the majority of their listings, RDC can leverage this advantage.
RDC is leveraged heavily in securing their listings from MLS sources. That’s not a bad strategy. Because they are willing to work exclusively with MLS boards, those boards are more willing to work with them. However, MLSs are not the only source of listing data. They might be the best source, but no one really owns a complete data set here, and there are other market forces brewing that could disintermediate the MLS as the best syndicator of listing data.
For brokers who believe that the best way to sell the home for the highest price is to put it in front of as many eyeballs as possible, syndicating listings to Zillow and Trulia is a no brainer. For now, most of these brokers are comfortable in syndicating through the MLS/ListHub channel. However, as data expectations move closer to real time, a broker may decide they don’t want to wait for two middle middle to syndicate their listings. ListHub only pulls a few times a day. Some MLS systems only update their own data a few times a day. Brokers who want their listings online right away may decide to syndicate directly to Zillow and Trulia. In this scenerio, Zillow and Trulia may be receiving the data before RDC. Is this common today? No. Could it be more common in the future? I think it depends on how much of a handicap ListHub continues to deal Zillow and Trulia. Both companies have been very active in the last year in establishing diversified listing security .
Of course, not all brokers follow the shotgun approach to marketing listings. Some think they are better off without their listings on Trulia, Zillow, and even REALTOR.com. Depending instead on the MLS to market their listings to other agents. However, there’s another growing group of brokers who are opting out of the MLS. Pocket listings always seem to make a comeback in hot markets, but things are different this time around. Social media has made it far more easy to form private listing groups to share listings. Beyond that, some brokers are opting to send listings to sites like Zillow and Trulia without submitting them to the MLS at all. Finally, some brokers are employing a staged approach to their listing syndication. They share listings internally for a short period of time before submitting the listing to the MLS. In some markets, this is all against MLS rules. But there’s a lot of grey, and for MLS boards who try to enforce these rules, they risk alienating these brokers altogether.
Where does this leave REALTOR.com? It’s going to depend. If more brokers begin to view the MLS and ListHub as bottlenecks, the way listing data is syndicated will shift to a more broker centric model. It’s entirely possible that consumers will eventually “find it first” on some other channel.