New Portals New Rules of Engagement

With the launch of realestateworld.com.au we have seen yet another site just not get it quite right. Whilst the site is a far better step forward than most of the rubbish thrown at us it still leaves so many questions unanswered.

Whilst Domain and REA launched their websites years ago and agents were hungry to embrace the web not many questions were asked, in fact many Real Estate Institutes opened their doors to these portals (with 10’s of 1000’s of $ of kickbacks mind you) and had them provide talks on how to optimise their presence on the web. I attended a couple of these hosted by one of the majors and I was flabbergasted at all of the rubbish being pilfered (and I wrote about it 5 years ago) to agents. It amazed me that no questions were being asked at all back then.

Today new real estate portals think that because they are cheaper they can gain agents attention and dollars. This WILL NEVER WORK unless you get the basics right. You are now dealing with agents that have seen it all before. Agents do not care if you are ‘the Google of real estate’, ‘saving agents money’ or by the industry for the industry’ they are so much better informed these days, so stop the marketing guff and get into the nitty gritty.

What new portals must do is clearly spell out:
1. Ongoing Costs (cost per month? or if Free is it Free forever?)
2. Ongoing Fee Increases (are the fees capped at a % increase per annum?)
3. Future Packages (are you going to be offering other listing packages in the future?)
4. Free Trials (I am sick to death of pathetic 1,2,3,4,5,6 month free trials, you cannot start charging until you get results)
5. Terms and Conditions (who owns what and what %)
6. What are you going to do with sales data and will agents share in this revenue or will they get free data back for supplying it in the first place?)
7. Reports (how are listing reports fed back to agents. Agents do not want to spend their time calling your office to remove listings that were sold/leased months ago)

These are not fun things to spell out and Domain and REA are very lucky little puppies for not having to do this all those years ago, but, this is a new era, perhaps 40 – 50% of agents now a lot more than they did all of those years ago. We are also operating in an property environment that also means agents don’t have wads of cash to throw at new things. Time is precious and in this environment their time must be spent making money not on other things.

Google, Yahoo and MSN will not have such problems when they launch because we know how they operate these web based systems, everything is free for content providers, advertisers pay. New Portals must clearly spell out the above and for the love of whatever God you believe in (or don’t) stop these short trials.

If you have a plan it better be a long term one or you will fail.

If Real Estate World can get the above right then you should support them (as with many portals that get the basics right) but it has to be a ‘Slow Food Site” slowly gaining property data and slowly informing consumers. It will take 2-3 years for a site like this to gain the attention – if it has the property data. But like any site, you have to ask the question – why will people go there and not REA and Domain?

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22 Comments

  • Elizabeth
    Posted June 14, 2007 at 8:51 am 0Likes

    Good Morning Peter,

    Help this old boiler understand. You keep saying that MSN will be free. However MSN is a partner in Myhome, a website which is charging $175pm now, and in a years time will be $275.

    Are you suggesting that MSN will BONE myhome?

    E

  • snoop
    Posted June 14, 2007 at 9:05 am 0Likes

    Same owners elizabeth
    Myhome is there to stay on MSN.

    Lets face it.
    Its a two horse race.
    Its media
    Theres always a number one and Number 2 with daylight to the rest.
    Well managed regional plays excluded.

    REA nearly 4m Unique users
    Domain About 1.5

    Nothing else over a million

    Nothing short of a miracle will upset this pecking order.

    Jeez I have seen nothing ,that is industry leading or world beating out of any of these real estate sites,they are all just me tooos in a very crowded space with poorly constructed business plans.

    Now Take Zillow in the US
    a Startup 18mths ago now around number 7 in USA real estate sites.

    The collective developer brains trust need to stop just copycatting and selling hourly rate web designing and think outside of the box.

  • Peter
    Posted June 14, 2007 at 9:42 am 0Likes

    Elizabeth, Microsoft would not think for one second about a regional plan when globally it has to compete with Google and Yahoo, Microsoft already operate a Google base competitor in Microsoft Expo (FREE also) which will hit our shores in the coming months. Yahoo also have an online classifieds site and they are all 100%v free.

    http://expo.live.com/default.aspx

  • Peter
    Posted June 14, 2007 at 9:45 am 0Likes

    Snoop. Some may think a two horse race. One only has to look in the many industries to find that a leader today has to do so much work to stay there. I can see nothing in the current batch that will compete with the big two, but in understanding the nature of the Internet well shows that something will come along and challenge!

  • Glenn
    Posted June 14, 2007 at 10:41 am 0Likes

    Zillow just successfully fought for its http://www.zillow.com.au domain name back from a cybersquatter here in Australia.

    Last year they were quoted as saying that they would love to come to Australia but wanted to get their US site right first.

    http://www.trulia.com.au is also being cybersquatted as well by another Australian real estate agent but she does not appear to be using the domain name as yet.

    If somebody like Google, Trulia, Zillow etc etc does not come along and dominate the Australian landscape then I forsee that realestate.com.au will follow the path of realtor.com. All of these startups will dilute their market share, and that in effect will still put the same pressure on their subscription fees..

    Checkout this graph on pageviews. http://www.alexa.com/data/details/traffic_details?site0=realtor.com&site1=trulia.com&site2=zillow.com&site3=redfin.com&site4=homesalez.com&y=p&z=3&h=400&w=700&range=3y&size=Large&url=realtor.com

    and the same sites on market reach
    http://www.alexa.com/data/details/traffic_details?site0=realtor.com&site1=trulia.com&site2=zillow.com&site3=redfin.com&site4=homesalez.com&y=r&z=3&h=400&w=700&range=3y&size=Large&url=realtor.com

    So yes whilst realtor.com technically is number 1, their market clout has been eaten away since the begining of 2006 which market the emergence of these new websites like Trulia and Zillow. None have caught realtor.com but it is only a matter of time.

    I bet realtor.com and its fans never thought anybody would knock them from their mighty position in the US but right now they are a shadow of the market player they where just over 1 year ago in fact their market reach is just 25% of what it was back then.

  • snoop
    Posted June 14, 2007 at 10:54 am 0Likes

    yep
    and realtors problem is
    its a collective!!!

  • Craig
    Posted June 14, 2007 at 10:38 am 0Likes

    Snoop, REA and Domain might have huge leadership now but that means nothing. One slip up and it can be all over. Some examples of near monopolies that are no longer around are WordStar, WordPerfect, VisiCalc, Lotus123, Altavista, the list goes on. I would be very suprised if 5 years from now the market is unchanged with REA and Domain on top and no other challengers.

  • Andy
    Posted June 14, 2007 at 10:35 pm 0Likes

    ‘If it has the property data’ – it has

    Why will people go there? – because people go where the content is – whether a week old or 10 years old. Where the content is, the consumer will follow. The consumer is not the subcriber to a real estate portal – they have freedom of choice and no loyalty – if the site has content, they will visit it above all other sites.

  • Peter
    Posted June 14, 2007 at 10:59 pm 0Likes

    Well having the property data is one thing, but having a friendly easy to use website is another. We don’t really have a test case because no one comes near REA for content at the moment, maybe Google Base will change this, maybe not!

  • Elizabeth
    Posted June 15, 2007 at 8:36 am 0Likes

    Good Morning,

    Andy, are you looking into the future in saying that realestateworld will have the content. I can assure you that at the moment it does not.

    Myhome spruiked to have more content than domain at launch and look where it is now.

    I have to agree with Peter, it is all about design of the website. The design alone should create a level of service and then loyalty from consumers will follow if the service is appealing.

    Interesting to hear you say consumers are not subscribers to portals. I myself subscribe to the email alerts of realestate and domain, it is not fee based, but a subscription none the less.

    I hope you are not involved with this realestateworld, as some of what you say conflicts with the limited knowledge this old boiler has.

    E

  • Stephen
    Posted June 15, 2007 at 10:00 am 0Likes

    The link provided by Glenn showing US stats comparing Realtor, Zillow, Trulia etc. is interesting however it identifies another point. The sum of trulia, zillow, redfin and homesalz does not equal the loss Realtor has sustained. Assuming the total RE traffic has not dropped there must be many other players who have picked up some of Realtors loss?

    The greater the fragmentation of the RE marketing market place on the web the more confusing it is for the consumer and the greater the cost to the agent and the vendor.

    If I have to put up my tent in a market place to sell my product and all my competitors are there as well, we have a level playing field with the only differentiator being my product and how I present it. If you open another market place around the corner I have to make a decision to move my tent or open another tent at additional cost. The number of market places that I can present in is limited by my means and ultimately by the results generated by the particular portal.

    Realestateworld.com.au is just another site and represents even further fragmentation of the RE marketing market place in Australia. Andy states that consumers have no loyalty, why should they? The more confusing you make it the more consumers will gravitate back to what is trusted and what works for them.

    Yes, I believe that Google can change the landscape. However, if a portal does not generate leads back to the agent, and the agent has to pay for the privilege of having the agents Intellectual Property presented to consumers then it is useless regardless of how good it looks.

  • Glenn
    Posted June 15, 2007 at 10:33 am 0Likes

    Stephen,

    The reason the sum of the 4 smaller players I selected does not equal the loss by realtor.com is because there are hundreds of these new style web 2 mashup sites.

    As you said there are other players who have picked up the loss. Each taking a piece of the action. That graph only allowed me to select 4 sites which I tried to be representative of larger and smaller plays into the market.

    If realestateworld is a subscription based service IMHO it will fail to make an impact.

    I took Damien’s comment of “With the likes of Google looming on the doorstep, the viability and success of any new subscription based internet portal only service would be questionable” to mean that it would not be a subscription based service.

    But what he seems to mean is that they are going to be a subscription based service BUT because they are going to allow agents access to the sales and listing data as part of that subscription they believe they will be successful. Rubbish! Realestateworld in my opinion still falls right smack under Damien’s definition of questionable.

    With player like REA and Domain dominating the landscape why would you try and compete on very minor adjustment to their business model. Why wouldnt you compete using another model that has proven to be very successful in other markets and thats a service free to the agents with targeted marketing on pages similiar to adwords. In fact, why not adwords. Realestateworld could signup for an adwords campaign today and roll it out on their site and have revenue coming in right from the get go. As their site gets more successful there revenue climbs and they save money by not needing a sales force out their trying to justify their subscription model.

  • Kitchen Designer
    Posted June 15, 2007 at 10:10 pm 0Likes

    I think Glenn is spot on with that last comment though I think he means implementing Adsense as a means of revenue generation.

  • snoop
    Posted June 16, 2007 at 8:24 am 0Likes

    You need farly significant traffic to make money out of adsense.

  • Elizabeth
    Posted June 26, 2007 at 8:34 pm 0Likes

    Good Evening,

    Whilst we are talking about the New Rules of Engagement for New Portals, perhaps we should be telling the existing portals what to do as well.

    http://www.smh.com.au/news/web/nontechnical-glitch-shuts-down-real-estate-site/2007/06/26/1182623860210.html

    It seems someone at domain forgot to pay an $83.00 bill from company with an over zealous finance department, who in turn turned off commercialrealestate.

    I agree with the article that turning off the site was a harsh reaction, still, not paying a bill to keep your site up? When you are a portal?

    Perhaps a new category for your site Peter, the ‘Biggest Bloopers of 2007’.

    E

  • Peter
    Posted June 26, 2007 at 9:33 pm 0Likes

    Read my mind Elizabeth, I do have a Dumb and Dumber Awards published each year, we have a growing list already!

  • Elizabeth
    Posted July 5, 2007 at 8:18 am 0Likes

    Good morning,

    There is a rumour going around that myhome has paid around $50 000 to Elders in recent days.

    It is with interest that my local Elders outlet tells me their conference was earlier this year and there are no events coming up.

    Which leaves me asking the question as to what this payment is all about?

    If myhome are about to start paying people to advertise on the site I may well sign up.

    E

  • snoop
    Posted July 9, 2007 at 9:41 am 0Likes

    Domain Redesign?
    Just had a browse of the domain site.
    Seems to have had an upgrade in terms of look and feel.
    So much cleaner than Realestate.com,which just gets noisier and noisier.
    What does the panel think?

  • Elizabeth
    Posted July 9, 2007 at 8:15 pm 0Likes

    Good Evening,

    Snoop I cannot see any changes to domain, well nothing in the last month. What is it that you can see.

    I agree that there is a lot of space on the domain site, perhaps sometimes I feel like things could be closer together and there could be more content.

    Generally, if domain are making changes to create a better website then I am all for it. None of the rules listed require anything new for my business.

    Did anyone else read the article on myhome in the financial review today?

    A domain spokesman said that they had written legal letters regarding myhomes claim to the ‘number two’ position. It seems domain are starting to pick up their game.

    E

  • Under the Radar
    Posted July 16, 2007 at 3:48 am 0Likes

    >> 4. Free Trials (I am sick to death of pathetic 1,2,3,4,5,6 month free trials

    I don’t entirely agree you have to be considered a major portal to charge for membership and offer limited trials.

    One of my property portals gets just 40,000 visits per month, perhaps a tenth of what RealCommercial claim? Yet it offers a MAXIMUM 1month trial and users join happily. They don’t even get locked into a minimum term membership. Our biggest problem is getting lazy agents to actually make use of their free trial in order to experience the benefit. So it wouldn’t matter if the trial period was a month or a year.

    Registered users pay up to $1000 per month for membership… why? Because the site gets considerably more response than any of the ‘major’ portals. The fact that it ISN’T a major portal actually means the audience is comprised of far more informed/serious buyers and not timewasters who just stumbled onto the site. Major portals have limitless development resources – so by ‘doing it better’ yet staying under the radar of majors ensures they can’t steal your concept and knock you out of the game until you’re big / strong enough to go them head-on.

    I think the lesson for start-up portals is: Be inovative!!! Don’t do the same site RealEstate.com.au did in 1995 or you’ll fail. Target a narrow segment of the property industry, service it better than the ‘big guys’ THEN slowly widen your audience from here.

  • real estate
    Posted September 29, 2009 at 10:21 pm 0Likes

    This is an interesting discourse when reviewed as I write this in September 2009. The two years since this initial debate has not seen many changes at all except the languishing of realestateworld and the change of ownership and direction of MyHome

    Andrew Blachut
    PropertyNow

  • Robert Simeon
    Posted September 30, 2009 at 7:40 am 0Likes

    Andrew,

    You are correct and thirdly, I have never before heard of PropertyNow. Thanks for bringing this to the readerships attention. Just where do you languish?

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