How the Little Guy Can Beat the Giant Portals

We’ve been hearing from our customers about the proposed Zillow/Trulia merger. Who can blame them for being concerned? As Bloomberg quoted Steve Murray of REAL Trends, “Zillow has locked up the absolutely dominate position in online real estate in the United States.”

We’ve been hearing from our customers about the proposed Zillow/Trulia merger. Who can blame them for being concerned?

As Bloomberg quoted Steve Murray of REAL Trends, “Zillow has locked up the absolutely dominate position in online real estate in the United States.”

When No. 1 gobbles up No. 2 to control nearly 50 to 70 percent of the online lead market, there is cause for consternation. Traffic stats vary. For August 2014, comScore, which tracks online visitors in the real estate category, reported Zillow got 43 percent of 95.8 million monthly visitors, Trulia pulled in 25 percent (combined 68 percent), Realtor.com attracted 19 percent, Homes.com 9 percent and Redfin about 5 percent of total traffic.

On September 1, the top 15 most popular real estate websites ranked by eBizMBA reported estimated unique monthly visitors at 123 million and Zillow received 29.3 percent, Trulia 18.7 percent (combined 48 percent), Yahoo!Homes 16.3 percent, Realtor.com 14.6 percent and Redfin 4.9 percent. The remaining 10 had 16.2 percent of estimated visitors combined. Which ever way you count visitors, clearly Zillow/Trulia will be the giant that captures most of the property search leads out there.

What’s The Little Guy To Do?

The answer lies in a comment by Zillow CEO Spencer Rascoff in an interview with RE/MAX’s Dave Liniger after the Zillow/Trulia announcement in July. Rascoff noted that out of the $12 billion a year agents spend on property advertising and marketing, only 4 percent is spent with Zillow/Trulia in online advertising. As Rascoff pointed out, 96 percent of agent marketing is spent elsewhere, and mostly offline. (REAL Trends estimates the real estate marketing pie at $6 billion annually, according to The Wall Street Journal.)

How can the little guy beat the giant portals to prospects? The one-word answer is: pre-leads.

The secret to survival before the “Zulia” deal closes sometime next year—and after—is for local agents to work their local databases harder and smarter than ever before. Pre-leads are early-stage local people who need a lightning-quick response to their inquiry from a local agent to buy or sell, as contrasted with a virtual website visitor.

Where Do Agents Find Pre-leads?

Pre-leads are simply past clients, sphere and local prospects that agents already know, or want to know, in the case of expireds, FSBOs and targeted farms. Connecting intelligently to all three local databases simultaneously is the key. When agents work their postal database, where people live (address, city, state, zip) and their email database, where people communicate (via email), and their social networks (where people share viral referrals) the little guy can beat the giant portals every time to pre-leads. These are the local people who are most likely to buy and sell with an agent.

 The essential technique is to fish upstream because that is where the fish are hungriest. The secret is to connect with local prospects before and after they click on the listing portals to see homes for sale. And, click they will. Don’t get me wrong. Refreshing a database with new buyer prospects is certainly smart, and, after all, some buyer prospects will have a home to sell too. Capturing buyers from home search registrations is what the advertising portals do best—just like the duty desk captured calls from classified advertising back in the day.

Focus on People, Not Property

Capturing early-stage prospects, or pre-leads, will be even more valuable to the most successful rainmakers tomorrow as the advertising portals siphon off more buyer search leads.

After all, generating hyperlocal pre-leads is what the little guy does best. How? The little guy has local fingers on the smartphone and local shoes on the street to help local sellers learn the true value of their homes and help local buyers negotiate for the dream homes they saw online.

Nobody engages local prospects better than the little guy. Nobody guides buyers and sellers every step of the way through closing better than the little guy. No listing portal can compete with that personal relationship. To specialize in people—not property—successful real estate agents must work the only target that is truly valuable: the customer.

Simply put, agents must focus on local pre-leads who rise out of the people they already know. Work your postal database, your email database and your social networks together, and you’ll catch a boatload of local pre-leads before the giant portals get a chance to sell the leads back to you. n

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