Every time I read an article or a comment criticizing one of the evil media portals, I can’t help but think of an age-old issue we have as an industry. All too often we seem to suffer from memory loss about the not-so-long-ago past.
I can vividly remember when the newspaper charged usurious prices for the placement of real estate ads. There were no options besides the newspaper, and our industry was forced into an ad section that was shared by other brokers, agents, and (worst yet) by car sales and job listings. We paid for every printed word.
We also knew that consumers bought newspapers primarily to read the news, not real estate ads. But we were sold on the concept that our property-for-sale ad was an “added benefit” for those who got the weekend edition. (You needed the eyesight of Superman to read the liner ads we placed during the week.)
Nevertheless, we paid for those ads, and we paid dearly. Whether on a liner ad or a full page, a coveted inside double-truck or even a front or back cover, we spent literally billions of dollars a year as an industry for ads that garnered a whopping single day’s exposure. And the media exposure provided by the newspapers for this investment? A handful of subscribers in the local market.
Then came the economic downturn. And we all thought, “Oh no. Not that!” What about the ad costs needed to market a listing for greatly extended listing periods? Now what?
We had no idea how we were going to fund the marketing costs in a downturn, but we did know that the consumer had no intention of letting up on their demand for such expensive ads. Then along came the portals.
It was perfect timing for our industry. Thanks to the real estate media portals, we had a viable alternative to the newspaper and magazines. Online display ads of listings literally saved the day. That’s right: realtor.com, Trulia and Zillow supported our value proposition with the consumer, and they cut our display ad costs to nearly zero. The ads on their sites were, after all, free.
And better yet, they provided us with the ability to expose all of our listings to tens of millions of consumers, worldwide … for, you guessed it, free, as well.
So now, looking back, we say, “Damn those portals!” Really?
Exactly what do you think we would have done with the advertising costs for listings with a shelf life equivalent to the half-life of uranium if we had only newspapers and magazines to advertise our listings for sale? The ad costs charged by those types of media for that duration would have bankrupted most of the brokers and agents I know in this business.
You think not? How many sellers would have been content with a marketing plan that consisted of open houses, an empty brochure box, an MLS tour and a yard sign?
Today, agents and brokers continually and often make noise about these same portals, which, by the way, still provide free display for our listings to tens of millions of consumers worldwide. We have issues. And lots of them, it seems.
Wind your memory back again.
In those newspapers and magazines, there was a plethora of competing agent and broker ads. Huge ads with big phone numbers and lots of pictures lured the eyes of consumers from your paid ad to their paid ad. And the crazy reality? We paid those core costs, and we still competed with the other ads for the consumer’s attention. Nuts!
So then the multiple listing service consumer-facing sites arrive in our business and propose to save the day, and you need to ask whose day they are saving?
I am more and more convinced that the MLS industry, which is under heavy attack from the brokers these days, suggests that the consumer-facing sites are the fix. The plan appears to be to create something of value (MLS consumer-facing websites), cut off the portals, make the local brokers dependent on these sites, and then “keep on keeping on” as an outdated industry.
It’s not a bad strategy, especially if having more than 900 separate MLSs in this country makes no sense at all. And it does not.
Meanwhile, back in your local market, you allow your direct competitors — the brokers next door and down the street – to display all of your listings on their sites with minimal attribution for the actual listing broker or agent on all of their sites.
Talk about the ultimate competing ad strategy — that is it.
Just join the MLS and by the order of the federal government (the Department of Justice and now the Federal Trade Commission), you get all of the listings in the MLS to advertise on your site, and all brokers in the MLS are mandated to cooperate. That, my friend, is the MLSs virtual office website or an Internet data exchange strategy, and in contrast to the benign rules of competing advertising that the portals employ, this practice is simply ludicrous.
At times, I think because our industry loves to hate something, we have focused the same aggression we had for the newspapers and magazines on the media portals. It’s uncalled for and unfair, in my opinion.
No matter how you dice or slice this argument or how much noise you make about the perceived rights and wrongs of the portal value proposition, I learned one thing a long time ago: Once there was a powerful man in ancient Rome who protested too much. And from what I recall, when he did so repeatedly, the story did not end so well for him.
Kenneth Jenny is an expert in the residential real estate brokerage industry and real estate marketing.