I’m talking to you.

Yes, you.

The person who thinks you will start an Australian real estate portal that will shoot right past domain, dethrone realestate.com.au and become the new number one.

Or, maybe you’re an agent who for some reason (perhaps because you have to send them a check every month?) doesn’t like realestate.com.au and wishes the industry would start a portal as a realestate.com.au killer.

I have a message for you: you’re dreaming.

I tell you this because of a very interesting discussion that developed in the comments of Ryan’s excellent post on FarmBuy.com.au. I thought I’d pull out the topic and expand on it.

Face it. realestate.com.au is the dominant market leader in online real estate listings in Australia. It would be very hard to beat them at their own game. What’s more, you cannot expect to copy realestate.com.au and win without their help, in the form of massive, ongoing self-destructive behaviour. They are not likely to give you that help.

All those hopeful entrepreneurs trying to create a new website to knock realestate.com.au out of its top spot and take it for themselves are on a fool’s quest. That goes for everyone from domain.com.au and on down. Domain can aspire to a profitable second place. Smaller, later comers can aspire to make a living, maybe, but certainly not to kill the giant.

The plain truth is realestate.com.au is the leader and will be the leader in online real estate listings in Australia as long as there are online real estate listings in Australia. There have been instances in business history when a player with a dominance similar to realestate.com.au’s was displaced by a competitor, but not many.

I say this as someone who has worked at realestate.com.au and with other real estate related web businesses on three continents, and as an entrepreneur.But, if you think I am missing something here, please enlighten me in the comments.

How to Make Money

Tell them they're dreaming!

Instead of leadership, go for a niche and establish a strong brand as the first and best in that niche. Here are some niches that are already in play, with varying degrees of success:

• Farms: FarmBuy
• Rentals: Rent.com.au
• Regional: AllHomes
• Premium property: Million Plus
• Free listings: The Home Page
• Chinese buyers: Juwai.com (a client of mine)

If you can be content with a niche, you could possibly be profitable, or at least one day sell out at a profit. It will be hard, because the Australian market is so small, but it seems possible. A niche could also be an add-on to another real estate-related business, giving that other business strategic advantages — like domain.com.au does for Fairfax’s newspapers.

Still Dreaming?

If a niche is not enough for you, and you want to beat realestate.com.au, there is only one credible strategy. You must dominate a new niche. This new niche by definition cannot be dominated by realestate.com.au and must be able to grow big enough to one day eclipse realestate.com.au. The flaw in this strategy is that you have to be riding a wave of history for it to work for you. Those waves don’t come along often.

For an example, look at realestate.com.au’s own history. The major media businesses had print real estate classifieds locked up prior to the realestate.com.au’s rise. They were unassailable. Classifieds were so reliable and profitable that analysts called them “rivers of gold”.

Then, three friends in Melbourne registered the domain name realestate.com.au and began persuading skeptical real estate agents to put their listings online. They chose a real estate classifieds niche the big players had overlooked: online. And they made themselves the leader in that niche.

(It is true that News International has a stake in realestate.com.au today, but that only goes back to 1992, when Simon Baker in his wisdom convinced News to buy it. realestate.com.au was a pure, independent startup in the classic mold. I reckon if you did the numbers, you would find realestate.com.au has been a much more profitable investment for News Corp than myspace.)

Over time, little realestate.com.au grew and grew by riding the growth of the internet. realestate.com.au won online and rode the internet’s historic growth into the very backbone of our economy and culture. The big media companies still dominate print classifieds, but print is sliding into irrelevance.

As of today, realestate.com.au has reported record revenue for six consecutive half-years, while the newspapers are struggling.

The lesson to draw from this history is simple. real estate portals should not take on the established leader head-on. Find a new niche and become the leader in that niche. You can make a living, and you may even get lucky enough to ride a historic trend into great riches.

The new Shopping Application Programming Interfaces ( API’s) have two main components : Content and Search. As part of this launch, we’re are (sic) also sunsetting the Base API and replacing it with these new shopping API’s.

Sunsetting the Base API ! Not only sunsetting but…

We are deprecating the Base API and will fully decommission it on June 1, 2011.

And they go on to say…

There are a few non-shopping data types that won’t be supported with new Shopping APIs, such as jobs, real estate, events, and activities. We hope this won’t cause too much disruption, …

So, is this it Google and Real Estate ( other than being a search engine) ?

Will they still be accepting Real Estate feeds in to Base but not allowing them out?

Have they decided Real Estate is a white elephant from within, or has there been some outside pressure applied?

There are so many questions to ask…

I guess it’s up to Google, they way they want to run their business, and we just accept their conclusions, but I do find it interesting they have chosen to not pursue two highly active markets such as Jobs and Real Estate.

The strange thing is though,  recently out of the blue was a new look Google Real Estate look which like the Loch Ness Monster appeared in my browser and within hours was gone again. It distinctively showed a a cleaner look and gave me the impression that they were about to get more serious with Real Estate.

and then it was gone…but i did get a photo !

Was is it a bluff?

Are they serious?

What do you think?

There are some interesting connections going on here. Firstly Nestoria is an aggregator of property listings. They receive listing data from a range of other companies. Ultimately they are just a listing service for other portals and real estate groups to display their property on. They compete for the eyeballs looking for real estate and then distribute them to other “destination”.

They specialise in creating a better and more simplified user experience. Nestoria also offers a range of widgets and an api for third party webmasters to utilise their data and embed functionality in their website ultimatley driving traffic back to Nestoria.

If this all sounds familiar it is and that’s because it is basically Google’s model to Real Estate although there are of course still some differences. Nestoria’s user interface is far better than Google’s minimalistic mapping approach but Google also brings synergies with its search integration that Nestoria can’t offer. Another difference is that Google’s income stream is through the display of ads on every page whereas I believe Nestoria is charging the data providers for generating traffic.

Now Domain has signed up as one of the foundation partners for Nestoria. That seems a little hypocritical when you consider that Domain has not partnered with Google over their real estate solution. Domain obviously does not have an issue with the aggregation model itself more the fact that Fairfax is a huge user of Google for its advertising products and thus they believe it should not be interfering in their “space”. Clearly they dont have those issues with Nestoria.

So what we have is the ex CEO and still a major shareholder of the Australian number one portal doing a joint venture (or white labelling) with the UK’s 4th largest portal to create a new Australian portal and partnering with Australia’s 2nd largest portal and others to generate them more traffic. Confused yet?

Something has obviously changed in Simon Bakers thinking. As the man behind REA’s stunning success he operated a strictly subscription based portal that now talks about increasing their “share of wallet” from real estate agents. At the end of Simons reign at REA it was a truly corporate beast complete with executive and middle management levels and a huge administration and sales force.

Nestoria on the other hand is a lean mean fighting machine that operates on minimal overheads and uses smart user friendly design and SEO to create substantial traffic.

Only days before Google launched the first stage of their Real Estate solution Simon was publicly stating on his propertyportalwatch.com blog that Google would not be effective and not enter the mix. In contrast we have him behind a remarkably similar portal whose current partnerships are actively working against his previous employer and his substantial investment in REA.

So can Simon Baker make Nestoria.com.au a real contender in the real estate space? Yes I think he can.

Nestoria certainly has a good pedigree and an established and proven site design, user interface combined with widgets and an api. Simon also brings a wealth of experience to the table and the combination should certainly provide some fireworks.

Although the Gold Coast is not a capital city it is still the 6th largest city in Australia. The Gold Coast Bulletin is a daily News Ltd Newspaper that services the city. The weekend real estate section is the cash cow for the Bulletin and every saturday it dwarfs the rest of the paper combined. At its peak it can be close to an inch thick. This real estate section is cobranded Realestate.com.au in print just like many other News Ltd papers around the country.

Unlike Brisbane, Sydney and Melbourne we do not have a network of a regional or community based newspapers who focus on real estate providing pressure on the Gold Coast Bulletin. The southern end of the Gold Coast does have an independent in there providing competition but in the central and Northern parts of the Gold Coast the community newspapers are owned and operated by the Gold Coast Bulletin themselves. As you can imagine they provide virtually no market pressure to their parent company.

The Gold Coast Bulletin use to operate the website www.gcbulletin.com.au but in recent times they acquired the premium domain www.goldcoast.com.au which they have setup as portal. News features heavily on the site as you would imagine but there is also a substantial amount of other content such as locality guides, tourist information, accommodation bookings and much much more. The www.goldcoast.com.au website is clearly labelled “Copyright 2009 News Limited” and branded with the News Digital Media logo.

The portal also features a suburb profile on every Gold Coast suburb complete with suburb description, demographic information and property statistics. Included on the pages is a Google Real Map displaying properties for sale on Google Real Estate. There is absolutley no mention of the RealEstate.com.au connection at all on these pages. In fact links on the page to “All Properties For Sale” are linked to SuburbView.

The lack of Realestate.com.au branding on the site is really confusing considering their alliance and the fact that News Limited is a major shareholder in REA. Google Real Estate Maps on a News Limited website is a perfect example of how Google is making inroads into the industry because the top two portals are stuck in their old ways of doing business.

The web designers naturally wanted to add rich content for their website showing off property for sale in each suburb of the Gold Coast and realestate.com.au (or domain.com.au for that matter) dont offer any tools, widgets or api’s for websites to integrate their data, even sister websites in the same stable. But Google does so rather than have nothing they chose to use Google!

Gold Coast subscribers to Realestate.com.au who dont have their properties on Google Real Estate should be more than dissappointed.

Red faces all round I bet!

This again highlights the necessity for the top 2 portals to stop being so myopic and provide widgets and api’s for other websites to use which is something that we talked about a lot over the years here at Business 2.  Real Estate Agents, community websites and other local businesses would appreciate the opportunity to integrate property information into their website using these sort of tools. As far as I can see everyone is a winner in this sort of relationship which is why it is has been so popular with a range of websites including US real estate portals like Trulia and Zillow.  Apparently some News Ltd web designers would appreciate the opportunity as well!

Why? Because not doing so will slowly end their dominance and when the decline occurs it will be so fast that no maneuvering will make a difference.

Some may argue that Google Real Estate has not made a difference as yet, but these people live in complete denial and it will only be a matter of time before visitor numbers begin declining and Google Real Estate begins its upward March.

Remember, Google only has to get comparative data to make a difference. Google also have a far greater capacity to let people know about it than all other real estate portals in the world combined.

Recently a number of videos have been produced that well and truly show how serious Google is about maps and real estate.

Finding a house on Google Real Estate Maps

Here is one to showcase real estate listings throughout Australia

Here is one on how to refine your real estate search on Google Real Estate.

Real Estate API’s
Realestate.com.au and domain.com.au must open their databases up to the general public to create a whole new wave of web and mobile applications.

I have been pushing API’s with these portals for over 2 years and yet we still have nothing. Maybe Realestate.com.au’s big announcement will include an API?

What can an API do?
As an example any website would be able to carry listings through this API, so community websites, industry websites, councils, agents, even business2.com.au would be able to carry listings, sales data etc. Portals do not need agents permission as agents have signed away all rights to the data when they join these sites.

Signing up should be simple and approval rapid and it should be accompanied by rapidly evolving documentation and examples.

Boon for portals
One other thing we will see is innovation across the board, even things we have not even thought of will take us by surprise, but the biggest boon will be for the portals. It will extend their listings and sales data reach and allow that data to be ingrained across 10′s of thousands of websites across Australia and the world.

Versions
There should be two versions of the API, the free version which carries 3rd parties adverts from the portals and is a little limited and then a paid version that carries no advertising and allows the user to do whatever they want with the data!

Flow on
The flow on effect of this will flow across the industries to jobs, cars and classifieds.

Will this happen?
Don’t hold your breath, large organisations are slow at moving on these opportunities, usually waiting until it is too late. We are fast approaching a time where I think realestate.com.au and domain.com.au will start going backwards unless they really innovate with API’s.

One only has to look at the music industry and the movie industry to see how stubborn incumbents completely ruin their own industries by not embracing and innovating.

When several sources upload the same property to Google they apparently use the Pagerank system to work out who is the default page to display. Whilst all options are available when you press the “more info” option the majority of the traffic would be to the default link and in most cases the default link is not back to the agent, but to one of these portals. Ideally an agent wants this traffic to come back to their own website.

Many agents found the only way to guarantee their own link was seen on Google Real Estate was to stop uploading to these free portals. This was a little bit like cutting your nose off to spite your face. The free portals might not bring you the same enquiry levels as the top 2 subscription portals but as a value proposition it’s hard not to use them. It really became an either/or situation and unfortunately for the Free portals the power of Google’s reputation won out and they were shut off by an increasing number of agents.

We currently use Portplus and it’s as easy as unticking a box to shut off a feed to one of these portals.

There has been enough agents switching them off that Homehound now offers the option not to re-upload your properties to Google if you ask them and Myhome should have the option in place by next week.

If your considering canceling the free portals to improve your own results on Google Real Estate then I would suggest you give them a call first. Now you might be able to have your cake and eat it too!

I recently wrote about using Google Insights to compare the relative strength of each real estate brand in Australia. I showed how you could compare each brand against each other and how you could also see the strength of each brand across the states.

When I shared this, it was in fact the second way I had found to independently compare the major brands around Australia. As I chose to explore the first option a bit more before writing about it I shared here about the Google Insights method.  It’s now time to share the first method I found which uses Google Maps Real Estate and approaches it on a completely different basis.

Realestate.com.au and Domain will have you believe that Google has only a small percentage of the total number of listings.  From my experience that is not the case and Google has far  more listings than domain and much closer to Realestate.com.au. Back in August I actually spent a bit of time analysing the matter for an article on our agency blog about the subject. In our area at least the numbers were very close.

The one group of real estate agents that  are all featured on Google Maps are the major real estate groups. Now using Google Maps, or even the maps sections of any of the portals you could always view all the properties in an area, but there was no easy way to determine which listings belonged to which agents. Ideally each agency should be in a different colour much like different coloured pins on a large wall map.

In a little know addition to Google Maps you can now plot multiple searches on the one map.  To show you how to do this I have created a video comparing some real estate major brands first in South East Queensland and then scroll  down to the  southern states.

Very soon to be released on the market is a free online tool that will take this concept to a local level and allow you to plot individual offices against each other. You will be able to view the property your agency has in one colour and listings for sale each of your competitors have in other colours.

*****UPDATE*****

I was just sent this update on the mapping service I referred to above. This will go down to the local agent level and allow  you to identify hot spots and opportunities and will provide excellent market intelligence for the agents that use it right.  I believe the service will be free with possibly some advertising on the side and your settings can be saved so you can look at it live any time you want.  More details when it launches and I think that is goign to be early next week.

In case your interested we (Nerang First National) are the green, LJ Hooker Nerang is the Red and Ray White Nerang is the blue. There are about another 7 other agents in the area but ourselves and Hookers are the dominant market players.

Click to Enlarge

But what if the customer reviews actually appeared right beside your company website?

Google’s Sidewiki is about to change the way your customers can use the internet.

In an announcement from the Official Google Blog:  Sidewiki “allows you to contribute helpful information next to any webpage. Google Sidewiki appears as a browser sidebar, where you can read and write entries along the side of the page.

In developing Sidewiki, we wanted to make sure that you’ll see the most relevant entries first. We worked hard from the beginning to figure out which ones should appear on top and how to best order them. So instead of displaying the most recent entries first, we rank Sidewiki entries using an algorithm that promotes the most useful, high-quality entries.”

At this point the comments or customer reviews are only visible to other users of Google Sidewiki.

Sidewiki users can post a comment, but can’t edit the comments of others.

Michael Arrington of TechChrunch explains that “Other users can read and vote comments up or down. All those votes will create a user ranking for each individual that will determine where their comments fall on the Sidewiki. The higher the ranking, the higher comments appear. The goal, Google says, is to help move better content up and move spammy stuff to the bottom where it won’t be seen. Website owners who have claimed their sites always have the right to the first comment on any URL they control.”

Almost every real estate company relies on their ability to promote their websites & their listings via a one way conversation across the web, but now Google’s Sidewiki allows public commenting on your site & your listings whether you like it or not.

You can find the Google Sidewiki download link here

Several of the questions required choices to be selected against 16 real estate portals.  I tried to include a collection from the subscription, free, state based and niche portals, specifically the luxury portals.

Performance

It’s probably no surprise to anyone but the portal with the overall best result on performance was realestate.com.au with less than 15% of people indicating they were dissatisfied by their performance and over 68% claiming they were satisfied or very satisfied with their performance. The small remainder had a neutral response.

In contrast Domain had a significantly larger 27% of people dissatisfied and a lower 40% satisfied. Still we are talking about performance  here and Domain still delivers so all in all fairly good results in comparison to the rest of the portals. Domain Prestige on the other hand gave a pretty poor result. Despite the fact that only 20 people actually provided a rating only one person indicated they were satisfied by their performance.

Homehound and Myhome came in pretty similar with around 50 people providing a rating. Both have a few more people dissatisfied than they do satisfied but the most popular result response was in the middle with Neutral. I guess you can read into that they are doing an Ok job!

Google Real Estate had just 20% of participants indicate they were dissatisfied but a massive 37.5% indicated they were satisfied. That performance satisfaction rating was nearly as good as Domain’s and is really quite surprising. In just a few weeks I cant see how Google would be close to Domain on a performance level. Then you have the fact that Google just passes on the inquiry to their own website or one of the other portals so it would be pretty hard for the average agent to quantify the results from Google Real Estate.

Whilst the number of respondents for the two free luxury portals were a lot lower those that did respond did not find much to be satisifed about the performance in either Millionplus or Luxuryhomes.com.au.  The three state based real estate portals provided a mixed bag of results. The number of respondents for each was naturally much lower but Realestateview.com.au was the standout performer followed by REIWA and a relatively poor results for realestateworld who struggled with only two people wishing to record satisfied results.

Value

The standout performer in this category was Google Real Estate with just 6% of those that answered the question saying they were dissatisfied and a leading 58% saying they were satisfied.

Realestate.com.au had 1 in 2 respondents indicate they were satisfied but with nearly 30% dissatisfied the results were fairly polarised.

Domain’s results confirm the trouble they are currently having in the marketplace at the moment with just as many dissatisfied with their value as there are those that are satisfied at just over 30% each.

Given their free base subscription levels it is probably no surprise that Myhome and Homehound showed just 8 to 10% dissatisfaction levels on a question based on value. There satisfaction levels were around 3 times that which left fairly large Neutral vote. Results not quite as good as newcomer Google but something they should both be happy with as the industry obviously sees them as a value proposition. They both just need to do something about their perceived performance.

Realestateview was the clear leader in the state based portals with nearly half those that gave a rating saying they were satisfied with the value of the portal in comparison to just 5 saying they were dissatisfied.

Subscription Plans

Of the three different suggestions the survey offered of Flat rate unlimited properties, price per property and price per enquiry, they all had their fans but it was the unlimited option that garnered the most support. Price per listing also had good support but I was surprised by more than 40% selecting “Strongly Disagree”  for the “price per enquiry”.

Next 12 months

With the portal landscape in Australia entering a new phase and free options like Myhome, Homehound and Google starting to stack up and provide serious alternatives I thought it interesting to look at where the respondents see the future lies. There are a couple of standout messages from the results and the first one is not so good for Domain and to a much lesser extent realestate.com.au.

56 respondents indicated where their future lay with Domain and 10 of those, representing close to 1 in 5 said they will be cancelling their account. As the number two portal this has to be a very worrying indicator of a bad year to come for subscriber numbers. On top of this another 11 indicated they would be reducing their investment with the portal totally close to 40% reducing their investment or cancelling the portal totally.

Realestate.com.au also had 4 people indicate they would be cancelling their account but because they had a lot more respond in the survey which meant that it represented only a fraction of the cancellation rate of Domain at about 5%. What was particuarly high though was more than 25% of respondents indicating they would be reducing their investment in the portal. This is certainly better than the cancel rate experienced by Domain but indicates that the REA sales team is probably going to struggle to sell the add on features to the base subscription over the next 12 months.

Overall I think the top two subscription portals would not be too happy with those results.  It seems to indicate that many agents are looking to reduce their expenditure to subscription portals. Those with two portal accounts seem likely to drop the second subscription and in most cases that is the domain account and a few agents seem to think they dont even need a subscription portal at all.

Other than these there were two other standouts. For Google Real Estate there is a strong indication that agents will increase their investment in the portal. On a state level despite reduced numbers of respondents RealEstateview.com.au showed a very high percentage indicating they would be increasing their investment. This is a great endorsement and something that they should be proud of.

For the rest… it was generally a matter of “No Change” that stood out.

Industry Trends

In a general sense the majority of respondents believe the trend for the next 2 years will result in a reduction of market share for the subscription portals in favour of the free portals and in particular to Google Real Estate. In fact a massive 85% of those who responded believe Google will increase their market share and only 1 person believed that they will decrease their market share… What was that person thinking?.. Was that you Simon?

The majority also believe that subscription costs will increase but their value to an agent will decrease. Another thing that really stood out in the results was the strong belief that Free Portal will become more effective over the next 2 years.

Percentage of Buyer and Appraisal Enquiry and Source of Sales from Portals.

The survey asked respondents what percentage of buyer enquiry did Real Estate Portals generate. The answers that could be selected were across 7 categories. Generally most people responded that real estate portals provided between 45% and 90% of all buyer enquiry. This was broken up into three categories covering 15% increments that returned 20. 25 and 30% of the. responses respectively. This really shows that there are some agents who rely very heavily on portals to deliver their buyer enquiry and just how economically tied to the performance of Real Estate Portals they have become.

Real Estate Portals were a lot less capable in generating appraisals with 31% responding 0 to 15% and 34% responding that the portals generated between 16 and 30%. That certainly represented the majority of respondents but again some agents indicated just how much they rely on the portals with nearly 11%  suggesting that portals were responsible for over 60% of their appraisal enquiry.

Next we asked what percentage were the real estate portals responsible for sales in an agency and there was again 7 categories. This was really a mixed bag. Whilst 31-45% was the most popular category with over a quarter of the votes all other categories  up to 90% received a significant response. Only one person indicated the 91-100% category. Whilst they are clearly a significant buyer source for just about every everyone the percentage of actual generated business really ranges quite significantly.

Quite clearly there are offices that through other initiatives have strong sources of buyer enquiries, appraisal enquiries sales such as emarketing, CRM and print advertising fully outside and away from the portals.  For these agents the business traffic generated by portals is significant, but still only a part of their overall business. On the other hand there are offices that rely just about totally on the portals for all their business.

Real Estate Portal Issues.

Someone who chose to remain anonymous implied that because I asked about issues I was trying to skew results. I left these to the end of the survey so they played little effect to the survey responses. The issues raised were what I personally believe are the major issues today facing the industry relating to real estate portals. If the questions were skewed the results any then discussing the issues on sites like www.business2.com.au would do even more so. Unfortunately its a case that if you want to see whats important you have to bring that to the fore.

Saying that, these things were clearly issues that concern many agents so as you would expect this was evidenced in the results.

The increase of subscription costs was nearly a clean sweep with around 85% of those that responded saying they were concerned or very concerned. In comparison only 52% of people were as concerned with the value of subscription portals decreasing.

The increasing add-on costs was also a concern with 72% claiming to be concerned or very concerned. The biggest single response was left for the matter of Private Sellers on Realestate.com.au where by a massive 57% of respondents indicated the single category of “Very Concerned”. When combined with the “concerned” response this means that nearly 7 in every 19 agents will be very displeased if RealEstate.com.au ever considers allowing private sellers to their site.

Over the past 12 months the changing economic situation has meant that the majority of agents have seen dramatic reduction in revenues whilst portal costs have increased significantly. Even a promoted price freeze was not really a freeze at all, merely a price cap and that cap had been increased inside the 12 month period anyway.

Google did not escape this category though with 1 in every 2 agents concerned about Google controlling real estate information online. Since Google only shows limited information provided by third parties and is about passing that traffic on to those that actually host that information I can only put this down to a lack of understanding how Google fits into the mix. They are a path not the destination so their control can only ever be limited and the concern in the industry is probably from a lack of communication. I think all they have done is one press release that never really made the papers whilst the media groups have released a us versus Google articles.

Overview

The market leader, realestate.com.au comes out pretty strong from the survey however there are messages loud and clear that they should be listening to. In short terms agents are concerned over some key issues and more importantly, agent believe that their current market position and value to an agency will erode over the next 12 and 24 months.

Domain on the other hand obviously has some problems to look at and they need to start thinking outside of the square and come up with something that changes their image in the market. Some good stuff has come out of there recently but this needs to continue to make a real impact.

Google is generally seen to be adding significantly to the industry over the next 12 and 24 months. They are the new kid on the block and because of their pedigree they are being given a remarkable amount of support from the industry. Time will tell if they live up to that support.

You can view the results page for the exact responses numbers for each question here http://bit.ly/zXY1h . As promised anybody who wants the raw data which provides a better detailed view of the responses needs to send me an email at glenn@nfn.com.au.

The survey resulted in quite a lot of comments so here is a small selection of them

“Realestate.com.au have too much power”

“I still believe these mediums are cheap considering the return. We carry a mix of approx 40 listings at any given time (Sales + Property Management) meaning each listing costs approx. $17 a month to advertise. Beats any alternative, and REA and Domain provide us with huge results. No complaints here…so long as the prices don’t skyrocket (thanks to Google, they shouldn’t) , we’ll stay on board.”

“Subscription costs are getting out of hand, need to ensure no private sellers allowed”

“realestate.com.au have been increasing their costs by large percentages each year – way above the CPI. They claim they are delivering more visitors but are individual agents receiving any more inquiry. Monopolies are not good, we have been down this path with newspapers which have had monopolies in cities and agents have no bargaining power on costs because there are no alternatives. We must keep portal competition alive and ensure there are enough major portals to keep prices fair.”

“With google coming in as a real player ,the power can be regained by agents as they are always the source of the primary content”

“REA is our standard portal. The costs are beginning to become inhibitive and we would welcome a less expensive yet effective alternative.”

‘Far too high subscriptions and no customer service. Agents are their customers but they don’t seem to see it that way”

“Cost – That being said, it is much cheaper that the old days when print ruled”

“They are completely over priced and the problem is you really dont have a choice but to use them”

“Portals play one agent off against the other for things such as “Guaranteed top stop”"

“Subscriptions on the main portals are good value”

“I think Google shows alot of potential but was surprised that there were many glitches in it – hopefully that’s not a reflection of their commitment to make it excellent”

“To be blunt, i believe Domain sh*ts all over REA with regards to customer service, their site is cleaner, arguably more user friendly, and they don’t give everyone 5-10 FREE Feature Listings, so ours genuinely stand out on Domain. The other portals are non factors to us, as we don’t invest in them.”

“They are giving too much information to the public that we as agents provide after working extremely hard! We also pay them for the privilege.”

“if every portal and every property was listed the same way without any priority listings in date order the market would move a lot smoother and everyone would have a fairer go.”

“I think the real estate portals have a rough road ahead, some will survive, but many will fall by the way. We do, however, need some competition to keep the playing field level to some extent.”

“I have a growing concern that our industry will simply hand Google all our relevant information again on a FREE basis then head lock our industry – before charging us a fortune in 2 years time.”

“The dominance of REA the others need to get their act together. to many ads on their site, we are paying for the properties to go onto the site, no need for the ads all over the pages.”

“They are like the newspapers- the customer is unimportant and only there to be milked”

“RE portal owners see agents as a huge income source. They have done a fantastic snow job on the majority of ‘technically uneducated’ agents. Agents don’t appreciate by subscribing to these sites they are helping those sites grow and thus taking business away from those agents”

More Surveys?

If anybody is interested in assisting with further surveys over the next year I would be interested in talking with you.

My initial thoughts are that we would need the assistance on two levels:

1. The first is wider audience. Ideally I would like to get a survey in front of a much wider audience to all agents and salespeople and someone that could assist in that would be appreciated.
2. The second is financial. A higher featured survey system allowing for conditional questions, branching and break the survey into smaller sections. Also prizes for those that enter would increase the take-up rate.

I am open to assistance from anybody including industry magazines and even real estate portals.  Whilst somebody might choose to sponsor a survey it would remain independent and as transparent as possible. I have a range of survey topics in mind including:

• Mobile technology looking at smartphones, mobile phones, laptops and tablets.
• Technology in the office looking at the number and type of computers, internet connection, network topology and ancillary equipment like printers etc.
• Print Advertising

Realestate.com.au released their statistics on the prior month as they always do but something was different this time. It wasn’t that it was a record month, they have claimed many records in past fact sheets.. highest visitors, highest gap, highest percentage… You name it – they have found every way to claim they are number 1.

What is interesting is in this latest email they have ONLY compared themselves to Domain.com.au. In the past they have always included at least one and sometimes up to to 3 and 4 other real estate portals. Here is the last 5 months results but everyone I still have access to is the same.

You would have thought that Google’s entry to the market is the hot topic so they would have tried to claim a dominance over those that uploaded to Google rather than pick on their old foe.

Why is this so significant? Because realestate.com.au and domain.com.au are the only significant sites not uploading to Google Real Estate and that has been the “new phase” over the past month.

Could it be that some of those portals that jumped on the Google opportunity have started to show results already and they don’t want to flash it around?

Unfortunately I don’t have access to any July stats  so lets just a take a look at June on Google Trends.

As you can see realestate.com.au has remained fairly flatline. This is typically what you would see over any 30 day period as trends in website traffic are normally more evident over longer periods but lets take a look at myhome.com.au

There is a clear trend upwards here so they entered July on a significant increase in the prior 4 week period. The beginning of the month the average was about 2.4k unique visitors per day and by the end of the month the average was about 3.3k unique visitors per day. This would represent an increase of 37.5% in just a few weeks. I am not aware of any special campaign or promotion that myhome.com.au has been running so this must be a natural increase as myhome gains further popularity.

Now Realestate.com.au is going to argue that their traffic is massively larger and increase or not it does not matter to them. It certainly is but you have to view everything in perspective. Their traffic is certainly about 40 to 45 times greater but they have to share that amongst far more properties and far more agents. Now realestate.com.au claims that Google has only 20% of the total listings available in Australia. When you consider that Myhome is only one uploader to Google they obviously have far less than 20% of the property numbers of realestate.com.au.

So if they have 1/40th of the traffic being distributed amongst just 1/5 of the properties it means that your traffic per property is at least around 12.5% of realestate.com.au. That gap is actually not as far away as REA would have you believe and if Myhome can continue that sort of growth then it will close significantly. If all of the free options start making up ground its going to make an interesting marketplace over the next 12 months.

It will be interesting to see what adding the Google factor into July’s results did for Myhome but since REA did not want to share, we will have to wait a month.

On an associated matter, I really cant stand the use of the word property seekers. It implies individual people which in turn implies that nearly 5 million Australians looked at realestate.com.au. In fact nothing could be further from the truth. Their monthly statistics are formulated by adding the daily unique visitors. If somebody checks realestate.com.au every single day from their home computer whilst they are looking to purchase they could represent as much as 31 of these “Property seekers”. If they check it from home and from work then they could represent as much as 62 of these property seekers. Since it is daily uniques that is what they should quote. If they want to quote property seekers for a month then they should quote unique monthly visitors. Because some people will visit daily, some will visit a few times a month and others will visit from work, home and mobile… my gut feeling is that will be much closer to 400-500,000 people.

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UPDATED

I have had some interesting feedback from realestate.com.au’s PR department today questioning my take on how the 4.8 mill in the last paragraph is calculated. The state that the 4.8million is monthly unique browsers but the catch is I have to take their word for it for now but they are trying to find something to confirm to send me so we can clear it up.   If they were to quote the figures the way I have suggested it would be more like around 12 million. I suggested she post her response to the article.. but she declined.

For those that use Google Analytics it now shows something called an “Absolute Unique Visitor” figure for the report. If you click on that report it will show you the unique visitors for each day that make up the report but if you add up the individual numbers for each day they do not equal the total for the month of the report.

Google provides a definition though:- Unique Visitors represents the number of unduplicated (counted only once) visitors to your website over the course of a specified time period. A Unique Visitor is determined using cookies. The Absolute Unique Visitor report counts visitors to your website (counting each visitor only once in the selected date range).

Why do I think that they haved added up the unique browser for each day?  Two reasons :-

The number they quote is just unrealistic. If you start with the Australian population and remove all the kids and all the elderly then 4.8 million would have to represent close to 40 or 50%. Ask the next 10 people you speak with outside of real estate and see what percentage has used realestate.com.au in the past month. This article covers the same argument but looking at the leading newspaper sites. http://www.crikey.com.au/2008/05/26/are-nielsen-net-ratings-bunkum/

This has been discussed several times before and I have asked for more stats from realestate.com.au before on this blog and we are never provided with anything more than these huge numbers churned out by the PR Dept.

HOWEVER!!!

How the stat is calculated is actually not the main point I was trying to raise and is essentially irrelevant. Realestate.com.au uses the word property seekers which gives a misleading impression that 4.8 million real people visited the site.  No matter what the answer turns out to be it will never represent 4.8 million people.

Why do the do that?.. The excuse offered was because the stats were “dumbed down” for agents. Despite the terminology used I dont have a problem with dumbing down of statistics as long as the essence remains the same same.

Just so its crystal clear Realestate.com.au is number one by a clear margin. I do not dispute that and I dont think anybody would. They simply do a far better job than anybody else right now, but that does not mean I have to accept the job they do nor any statistics that they quote.

The relative relationship between the traffic of the top portals is probably represented pretty accuratly by the Neilsens figures. No dispute here at all. But whether you dumb down the data or not suggesting 4.8 million people viewed the site over the period of a month is misleading. They should quote their stats and not make them out as something they are not.

The method the data is collected has severe accuracy limitations. Those limitations would apply across all portals of so a common error factor would mean that the relationship still remains the same. ie. realestate.com.au is kicking butt in most markets.

Why are the figures not accurate? In 2005 Jupiter Research found that 34 percent of “newbies” said that they’ve deleted cookies themselves, with that number reaching as high as 60 percent for experienced users. How does Neilsens track people.. through cookies!

How this relates specifically to Neilsen NetRatings statistics is discussed in more depth here

http://www.siliconvalleywatcher.com/mt/archives/2005/04/the_emperor_has_1.php

In short.. the Jupiter report found that “17 percent of consumers delete cookies weekly, 12 percent monthly, and 10 percent daily — behavior that “cripples sites’ ability to track users and make critical marketing measurements.”

Whats interesting is that Neilsen’s own report on the issue found a cookie deletion rate that ranged between 7% to 50% with the average visitor to Google deleting at a rate of 25%.   It’s even worse than that as the cookies that are targetted the most for deletion by antispyware and antivirus solution are specifically tracking cookies… exactly the type Neilsens use.

So the company that realestate.com.au dumbs down stats from to create a “property seekers” number admits that it is up to 50% of its visitors could be counted more than once, and an external company believes the rate could be as higher as 60% for some user groups and that in a worse case scenario a person could be counted every single day (10% that delete daily) and antispam and antivirus software is even in more wirespread use today than it was back then.

The stats can be used to compare against other companies in the same report.. but you cannot convert them into “Property Seekers” because it sounds good from a marketing perspective. It just does not work that way!