Read the first part of Andrea V. Brambila’s coverage of ListTrac’s plan to sell consumer data.
Multiple listing services across the country have made what they believe is a worthy trade on behalf of their agent and broker members.
About 30 MLSs representing 425,000 or so agents and brokers have chosen to allow real estate startup ListTrac to track and sell behavior data from people viewing their members’ listings online. Many of these MLSs have had a monitoring code installed on their members’ IDX (Internet data exchange) websites without the vast majority of its members knowing the code’s full purpose.
ListTrac parent company Vendigi intends to aggregate the anonymous behavior data it is currently culling from these sites to split consumers, agents and brokers off into “audiences” that can be sold to third-party advertisers such as Wells Fargo, Home Depot and, yes, Zillow and realtor.com.
In exchange, agents and brokers get access to a free dashboard that shows them how many views and leads their online listings are generating, and MLSs get a tool they hope will show members the value of MLS-powered sites as compared to third-party listing portals.
MLSs also stand to get a cut of the proceeds once ListTrac starts making money — which MLSs may or may not decide to pass on to members.
Agents and brokers in the dark
Agents and brokers might well decide the trade-off is worth it, but it appears none of the MLSs have told their members about ListTrac’s business model and have therefore made the choice for them.
“There is no reason we haven’t said anything [to our members],” Greg Manship, CEO of Boise, Idaho-based Intermountain MLS, told Inman in an email.
“Our volunteer committees and board of directors review all types of products and services and make decisions on what they think is best for the membership. That is the process. I fully support the process.”
IMLS, which has about 4,400 members, has had the code implemented on its members’ IDX sites, its MLS system and its public-facing website.
MLSs have had ListTrac’s monitoring code installed on MLS-powered websites on an automatic opt-in basis. Due to the templated nature of most IDX websites, agents and brokers cannot generally opt out unless their IDX provider does. Should a provider do so, that provider would deny the ListTrac service to all of its customers in a particular MLS.
Moreover, IDX providers have an incentive to install ListTrac — the tool could help them show their value to agents.
“[ListTrac] puts metrics behind the notion that IDX sites provide a steady, high-quality stream of leads,” Joel MacIntosh, CEO of WolfNet, told Inman in an email.
“If ListTrac’s business model proves out, it will be a big win for IDX vendors and, more importantly, agents and brokers who are the owners of the content.”
WolfNet has deployed ListTrac on thousands of its websites at the request of MLSs, he said.
And there could be more tracking tools besides ListTrac that MLSs aren’t disclosing to agent and broker members.
“We have implemented other tracking codes for a number of MLSs that required us to do so,” MacIntosh said. He did not respond to additional requests for details about these codes.
Inman contacted a dozen MLSs that have signed deals with ListTrac for this story. MiRealSource and Arizona Regional MLS did not respond to requests for comment. Greater Alabama MLS, Northern Alabama MLS and Georgia MLS declined to comment.
Of the seven that commented, none had told their members about ListTrac’s business model and the harvesting of behavior data — even if the monitoring code had been installed for several months.
The seven include Sandicor, REcolorado, MLSListings, San Francisco Association of Realtors MLS, Information and Real Estate Services (IRES), Intermountain MLS, and Cape Cod and Island MLS (CCIMLS), which collectively represent about 70,000 agents and brokers.
“[ListTrac] is only tracking [the data] on an aggregate basis, so I’m not sure why [members] would care,” said Kirby Slunaker, CEO of REcolorado, which has about 17,000 members.
“For the most part, if our brokers and agents are paying for something, then they are aware of what the costs are. We don’t think we’re giving away anything [to ListTrac] on an individual listing basis,” he added.
Thus far, ListTrac is tracking listings only on REColorado’s public-facing site, not its internal MLS client portals or its members’ IDX sites, Slunaker said.
Jay Pepper-Martens, director of MLS at the San Francisco Association of Realtors, emphasized the tech chops of the area’s real estate professionals and consumers to explain why they had not been told about the behavior tracking on its members’ IDX sites, its MLS system and its consumer site.
“Many San Francisco brokers and agents are aware of the practical considerations of how their data is used on the Internet,” he said in an email.
“Internet-savvy consumers are aware of their fairly anonymous metadata being used for targeted advertising on a regular basis,” he added.
Consumers also have the option of implementing the “Do Not Track” feature on their browser if they are concerned, he said.
Revenue share
Currently, most MLS agreements with ListTrac allow ListTrac to sell the behavior data it collects, though the company does not anticipate doing so for three to six months — after it has gained enough MLS coverage and explored its model further.
The MLS deals require that “ListTrac and the MLS shall enter into a revenue-share agreement between the MLS and/or its member,” usually after a $2,000-$4,000 threshold has been reached.
That reference to “member” does not mean ListTrac intends to do direct deals with agents and brokers. That is not in the company’s plans — ListTrac has always meant to compensate brokers through MLSs, Trent Gardner, CEO of Vendigi, told Inman.
The amount of revenue share with MLSs has yet to be finalized because ListTrac doesn’t know what the value of the data will be or what it will cost to sell the data, Gardner said.
Lauren Hansen, CEO of Northern Colorado-based Information and Real Estate Services LLC (IRES), said her MLS’ agreement with ListTrac was not a secret. IRES has more than 5,000 members.
“I’m not sure there is any big secret to uncover here. Are our members aware of any of our revenue sharing arrangements? Likely not,” she said in an email.
“Instead, their focus is on doing business — listing and selling properties in this crazy market, while our focus as the MLS is on providing reliable and robust services.
“If any of our customers were curious about the arrangement, we would be glad to provide an overview and answer any questions they had. Brokers are frankly more interested in the metrics ListTrac provides than the details of our agreement.”
Echoing other MLS execs, Hansen said IRES did not sign up for ListTrac because of the revenue share, which she did not anticipate would be “a significant revenue source.”
Using ListTrac, IRES has found that more than half of prospective buyers in Northern Colorado are getting information on listings from MLS-powered websites.
SFAR’s Pepper-Martens noted that ListTrac is providing a service unavailable elsewhere: performance measurements for MLS-powered sites, including IDX sites.
“By using ListTrac’s data collection, we can soon offer an interface that helps brokers and agents get a clear picture of how their listings perform across all platforms, a true ‘apples to apples’ approach,” he said.
“That has significant business value, and will enable brokers to make decisions based on information about listing performance, instead of hunches or product sales pitches.”
Sandicor CEO Ray Ewing believes ListTrac will show brokers they are getting more leads and views from the MLS’ public-facing site and brokers’ own IDX sites.
“Hopefully it will de-emphasize how wonderful Zillow is,” Ewing said.
The premise behind ListTrac’s business model is that it is both providing free listing performance metrics and a way for brokers to monetize their listing data.
The company emphasized this in a press release it sent out Monday, when Inman first revealed ListTrac’s business model. The release declared, “Just as musicians are compensated each time their song is played on the Internet, ListTrac wants real estate professionals to be rewarded every time their listing is viewed on the Internet.”
But the company’s deals are with MLSs, not brokers or agents. It will be up to MLSs whether they cut any of their members a check.
“It’s truly in the MLSs’ court,” Gardner said.
Four of the seven MLSs said that if they did receive a revenue share, they would likely pass it on to brokers in the form of better services or lower dues, rather than cut brokers a check.
Privacy
When consumers considering the biggest financial investment in their life visit their real estate agent’s website, should they expect more privacy than if they were visiting any other website? Do consumers expect to be tracked when following a link their agent has sent them to a listing in an internal MLS client portal?
As with countless sites across the Web, visitors to ListTrac-enabled sites are tracked without their explicit consent, which is assumed via a privacy policy.
ListTrac’s privacy policy mentions an “opt-out button” consumers can use if they don’t want to be tracked, but there is currently no actual button.
“We will be updating this to utilize the standard industry approach, which directs the end-user to the Network Advertising Initiative’s (NAI) opt-out page,” Gardner said.
ListTrac plans to join NAI once revenue generation begins, he said.
The company’s terms of use require all publishers implementing ListTrac to have a privacy policy in place notifying users of its data collection practices. ListTrac plans to use the time it has before it expects to start generating revenue to make sure publishers have included that notification, Gardner said.
Is tracking consumer behavior data consistent with agents’ and brokers’ fiduciary duties?
Ralph Holmen, associate general counsel of the National Association of Realtors, noted that real estate professionals have fiduciary duties only to actual clients — a consumer who went to their website and became a buyer client, for instance.
“[M]erely collecting and providing to others generic information about the places on the site visited by that buyer client would not seem to adversely affect the buyer client in any material way and thus not likely violate any duty of the broker to that buyer client,” Holmen said in an email.
“And if the broker’s site disclosed via a privacy policy that such data was being collected and provided to others, that would likely address any objection the buyer client might have in any event.”
The privacy concerns of ListTrac’s model — a rapidly growing type of advertising called programmatic buying — are unclear at this point. Programmatic buying has attracted some attention from the Federal Trade Commission in recent years.
What is clear is that the vast majority of agents and brokers have not been told that they are facilitating programmatic buying on their own websites. ListTrac didn’t tell them, and their own MLSs didn’t tell them.
And it will be up to them to decide what they want to do about it.
Editor’s note: This story has been corrected to note that the seven MLSs that commented for this story collectively represent about 70,000 agents and brokers, not more than 100,000.
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