Future of the MLS

Brian Larson, just wrote a 3 part series for Inman News on the Future of MLS without interbroker compensation. It's a great read. In part 3 that was published today, he discusses a potential new model he calls FLS, Future Listing Services. He notes most MLS participants percieve the main value in of the MLS lying in lisiting and data organization and management, rather than in the core purpose, interbroker compensation. Without interbroker compensation, he discusses what an FLS might look like.

It is important to note that Larson states, "...I suspect that readers will find as many solutions as they will problems and will probably offer more compelling potential models as well." So he is not trying to provide the definitive model, but I want to talk about a couple fascinating talking points.

The first question Larson asks: "What if as FLS merely viewed itself as an aggregator and distributor of listings on behalf of brokers?"
- Why would Larson limit this description to brokers.? More and more consumers want to participate in the selling of their home. It seems that an FLS would need to consider consumer, FSBOs, in some capacity if it wants to be an authoritative source of homes for sale. Many MLSs will include FSBO listings today. Well the reason Larson provides is one of data quality. The FLS would have no leverage over the one time consumer in its quality control efforts. But according to one of his own solutions, if some data is backfilled, or corrected, by checking 3rd party sources such as public record, many potential missing data points such as sold price, date etc, can be eventually updated. Secondly, I feel that the power of online community can compel most people to voluntarily participate in a desired way. You don't have to look much further than Craigslist to see this.

More importantly is the issue of representation. What does allowing FSBO's to enter data into an MLS or FLS do to the organized real estate industry? I don't have the answer for that but my feeling is that the way to connect all home sellers and buyers to organized real estate is to ensure they use the same interconnected platform rather than having them go to 3rd party solutions such as Craigslist, FSBO.com and any myriad of the FSBO or classified search engines available today. For every FSBO that eventually lists through a Realtor, there are ones that are successfully selling their own home.

Larson discusses access. His idea is that an FLS would provide free access to brokers and the public to view listings, but visitors must register. My first reaction is that this makes the FLS a second class source to vertical search engines that do not require registration. Why require visitors to register? The data is out there, it has been liberated and in my opinion that train has left the station. Now, if registration is something that the industry just must have, the issue of user adoption can probably be solved by using solutions such as federated identities, allowing users to use accounts they already have for other online services.

The 3rd set of comment I have to mention are those of listing control.

"The principal broker in each listing firm can pick and choose which registered recipients receive that brokerage's listings, checking a box for each entity she wants to receive the data... If a broker does not like the way a data recipient is using her data, she can complain to the recipient, and if dissatisfied, she can stop sending her listings to that recipient..."

Cooperating brokers in an FLS with full control. There is no discrimination of any kind. Brokers own the listings and in order to use a broker's listing content, a party needs to maintain a good relationship with that broker. This is exactly the reasoning that lead to the development of Point2's Handshake platform. And now other's like Mr. Larson are talking about the very problems it solves and the sense that it makes.

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Future MLS, Point2 Agent Handshake, Brian Larson

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Back from Inman

Now if I was a real blogger, I would have been blogging from Inman... I'm working on it! I've got to say that blogging is a commitment.

Brendan was on a panel for the Boot Camp opening session on sourcing Internet leads. The discussion went well, Brendan represented and we got a chance to distribute our second copy of BrokerAge magazine. The magazine was heavily read and well received... i'm trying to upload some photos here but Blogger isn't letting me :-(

Whilst there here are a few things we accomplished:

We met with almost all of our feed partners. We're going put together a case study with LiveDeal who reports some awesome results to us. I hope to have it together in a couple of weeks and i'll post it here first. We met with Oodle, who by the way has a very cool new office, Trulia who has a big presence there, Propsmart, and reps from Google. The boys at Google are nice and laid back... must be all that $ they're rolling in. We communicated the urgent need for better reports on upload failures and the publishing of URLs so we can verify a listing has been accepted by our feed partners.

The most important feed partner meeting we has was with Yahoo. Their current classified system is old and in need of a complete overhaul. It appears that they are in the middle of an overhaul and we hop to participate with feedback and user testing. Their reps, Michael Yang, Brian Rothenburg and Vivin were great to speak with and seemed eager to work with the right partners.

We've just signed a significant co-marketing deal with a industry leader that'll we'll announce publicly soon enough (sorry to do that). We enjoyed a celebration dinner at Silks. The food was amazing, but I wouldn't recommend going if you have a big ol hunger on.

We met with some Bus Dev's from Zillow. I've got to say, they're a very humble bunch over there. Smart guys that I think are doing some good things. They recently partnered with Yahoo in integrated the Zillow API into Yahoo Real Estate. I'd love any feedback on what our members would think of such an integration with P2 sites?

We also met the guys from Active Rain, Matt and Caleb. I really like what they are doing... smart guys. I'd like to find a way to work with them and I

We met with a bunch of new, potential partners and I expect that we'll return next year with a similar presence.

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Point2 and Yahoo Organic Search

There was a post on Realtalk indicating that Advanced Access sites and Point2 sites were dropped from Yahoo. I had heard of the AA dilemma, but not ours. The first search I checked was "Calgary Homes for Sale". I found 4 Point2 sites on the front page. So time to breathe easy. I checked the Yahoo referrals over time and this is what the trend line looks line from March to present.

It's not going up quickly, but it certainly hasn't fallen off. Having said that, Yahoo has not been kind to real estate sites in general and their overall strategy in the real estate vertical is questionable. Why would the Internet's largest portal and second largest search engine align itself with one franchise (Prudential) and alienate the entire rest of the industry? Strategically, it does not make sense. The Prudential affiliates represent only a fraction of the 1.2 million Realtor population that is prepared to spend advertising dollars online. The IDX feeds they have from Prudential do not represent a sufficiently high enough percentage of the total homes for sale. Thus the consumer search suffers. According to a Prudential Executive at the recent Inman Connect Conference, Prudential affiliates can not handle all the leads that Yahoo is sending, exclusively to them. Again, the consumer experience suffers. Their natural search index is yet another example where I feel the consumer experience is inadequate.

As for Google, which is where any online business should focus the majority of their attention, their search results are becoming more relevant and their index is including better and better content to improve consumer search.

Point2 Agent websites have been performing well in Google which is by far the largest referral source. Growth over the past year has been steady. Natural search is more relevant today for consumers who are conducting targeted local neighborhood searches such as "Capital Hill Denver Homes for sale". If content is indexed, a consumer can find their target faster than going to a real estate website. And thus natural search is more beneficial for local Realtors who target local content. This is known as the 'Long Tail of Search'.

Point2 Homes has experienced massive growth this year and it is the most effective portal at getting local neighborhood content indexed. Conduct a search for any neighborhood, city with the keyword term homes for sale. Try this search - "north denver heights homes for sale". Our goal is to get listings indexed and drive consumer inquiries directly back to the Realtor. This provides our members a 2 fold strategy for natural search. If their website is not ranked high enough to have listings displayed prominently, there is a good change Point2 Homes will be found.

But it brings up a good topic of natural search. How much time should the average Realtor be focusing on natural search? The search landscape is changing fast. The newest and fasted growing trend is vertical search and online classified services. Vertical search refers to serach engines that focus on a specific vertical market. In real estate, vertical search is exploding with new 'pure' sites like Trulia, Extate, Edgeio and Point2Homes, emerging to compete with the traditional vertical search like Realtor.com, Realestate.com. Complemetary to this trend, classified search sites such as Craigslist, Oodle, Google Base, Yahoo Classifieds and LiveDeal are growing just as quickly. Together, these sites provide a way for for consumers to search through structured data better than traditional search engines. Data is organized bettter, the search has appropriate filters, maps are commonly provided for local data and the data is updated better by publishers providing a better consumer search experience.

As search becomes more and more competitive for large meto marketplaces (city and state level searches), it will be more and more difficult for Realtors to compete for broad search terms (like: Denver Real Estate) with sites like Realtor.com, RealEstate.com, Homegain, other lead generators and the main sites for large brokerages. It is clear that Realtors should use tools to get indexed for targeted local searches, and them focus on getting their most valuable marketing assets, listings, into as many vertical search engines and classified sites as possible. A major focus for Point2 is helping our members follow these 2 strategies.

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