You can’t be a pimp without…

                    

Real Estate 2.0 has a great post about Trulia being a pimp, which is true, but they certainly aren’t the only pimp walking the real estate streets.

And, I’ll tell you what- a pimp is not a pimp unless they have “employees”, people who are willing to pay them even though they are the ones doing all the… (ahem)… work.

Sites like HouseValues and RealEstate.com and AgentConnect take Realtor-driven (MLS) info and then sell leads back to the agents. And the agents buy it all up as fast as they can. It’s stupid because they’re cannabilizing their own industry. Instead of paying $1000/month to HouseValues why not spend that money building your own site and getting your own leads?

        

HouseValues figured out a long time ago that agents in general are slow adopters to technology, so they took advantage of it. I remember when the MLS went online and the agents were freaking out because they thought it would be the end of the industry and the information would be stolen and the technology would break down and no one would be able to access it.

When fax machines came out many agents actually petitioned against them for the same reasons. And with the advent of lead-generation sites, the real estate industry has not protected itself and its interests by shunning them and beating them at their own game, but rather by paying into them and creating a zero-sum gain for the industry.

Follow me on this- here’s how it looks now:

Brokers/agents take listings

Lead-gen sites use listing data to get leads

Lead-gen site sell leads to brokers/agents

Lead/gen site makes lots of money to buy more ads

Lead/gen sites get more leads

Brokers/agents become dependant on lead-gen sites for leads

Lead-gen sites charge more for leads

              

It could look like this:

Brokers/agents get listings

Lead-gen sites go out of business because nobody pays them

Brokers/agents get all their own leads

Brokers/agents make more money

       

And I agree with RE 2.0 that Trulia looks good while they are free, but once brokers/agents are dependant and need them because they have grown big and maybe even relevant… will they still be free? I mean, is Trulia a non-profit that just really wants to help agents?

Trulia says,

“Coming Soon! Offer optional enhanced/branded listing features and performance-based text advertising to create additional exposure for your listing information with home buyers and sellers”

So once their website becomes cluttered with listing ads, the way Realtor.com has, will the next step be to limit vital information about listings unless the listing agents pay, the way Realtor.com does?

Remains to be seen. What is certain is that so far the score is lopsided in favor of lead-generation sites. And that includes Realtor.com… but that’s for another post.

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3 thoughts on “You can’t be a pimp without…

  1. This is the fine line I’m dealing with while creating a new MLS at the moment. This is precisely some of the fears that other Board Members have. Letting the vendor have the data, only to see the vendor sell leads back to agents. Yeah it sucks, and yeah I could see how only the few could benefit, few agents that is.

    I’ll admit that I’ve been duped by a lead generation company (it sucked but luckily it was during the good times). However I’ve never given REALTOR.com a dime nor any other advertising type lead generation company (since that one mistake).

    Still though, if I’m the client… I want my listing on the Internet.

    I’m set to argue on this again at a Board meeting. I’m going to argue on behalf of the client on this, but I’m hoping to work out some kind of solution that is more of a win-win for the MLS and the client.

    Oh and Greg, thanks again for including my article. Banner day for visits at my site yesterday.

  2. While it would be nice for every agent out there to have their own website, and indeed many do run or are in the process of obtaining their own sites, there is one thing that the LeadGen sites can do that no small agent site can. Market. Marketing on the Internet is not as easy as many would think, nor as cheap as some would hope.

    Having a site on the internet, in this day and age, should be a given and every single agent should have one. They are great information portals and can be awesome contact management centers for the agent. But relying solely on that one small site for lead generation would be foolish. If your site doesnt list up in the top 10 on the major search engines, it can be useless is some respects. the larger LeadGen sites out there have the budget and knowhow to drive in thousands of visitors with a focused interest. They can cull through all the dead-wood out there and provide you, the agent, with the contacts that are most likely to perform for you. Not that every LeadGen sites do this, but the ones that do, do this well.

  3. Pingback: Realtor.com to Lose More Listings? « BlueRoof.com Blog

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