If you are a company that sells products and services to people who sell real estate, how big (really???) is your market?
To represent someone in the sale of real estate, requires a real estate license (Broker or Salesperson) issued by the governing jurisdiction (state, province, or territory).
There about 2,000,000 real estate licensees in the United States (ARELLO). Not all licensees sell real estate (as an agent, earning commission). Some are appraisers, mortgage officers, investors.
Of those 2,200,000 licensees, about 1,100,000 are members of the trade association know as REALTORS. A licensee who joins the National Association of REALTORS also joins the state and local association in their license jurisdiction (“Three Way Agreement”).
Most licensees who sell real estate for a living are members of the trade association. Of the 1,100,000 REALTORS up to 50% completed no transactions last year, and this has been the case for a number of years.
Of the remaining 550,000 potential REALTORS, many have fewer than 6 transactions per year.
With all of the competition for the advertising and marketing dollars of this small group of commission sales people, billion dollar enterprises are being born.
Today, with the aid of the Internet, consumers can find timely and accurate information about homes available for sale, at the push of a button, at the speed of light…without the inconvenience of a conversation with a real estate agent. Millions of available properties are displayed on many different real estate sites, the largest being Zillow, Trulia, and REALTOR.com
In the United States, we have a real estate marketplace that is the envy of the Free World. It is not perfect, but billions of dollars of residential real estate business is transacted year after year). A KEY ingredient to the success of our real estate marketplace in North America is MLS, or Multiple Listing Service. What exactly is “MLS”?
MLS is the coming together of Brokers (competitors) to share their listing inventory. A listing is the contract with a seller, allowing the broker to offer the property for sale, and it includes an offer of commission. MLS provides access to its inventory to brokers who represent buyers as well as sellers. An MLS in not a publicly accessible data base, unless it elects to be such.
National Association of REALTORS MLS Model Rules states:
“A Multiple Listing Service is a means by which authorized Participants make blanket unilateral offers of compensation to other Participants (acting as subagents, buyer agents, or in other agency or nonagency capacities defined by law); by which information is accumulated and disseminated to enable authorized Participants (Real Estate Broker Licensees) to prepare appraisals and other valuations of real property; by which Participants engaging in real estate appraisal contribute to common databases; and is a facility for the orderly correlation and dissemination of listing information among the Participants so that they may better serve their clients and the public. Entitlement to compensation is determined by the cooperating broker’s performance as procuring cause of the sale (or lease).” (Amended 11/96) NAR MLS Model Rules.”
The National Association of REALTORS MLS Handbook states:
“Through the facility of multiple listing, information concerning individual listings can be made known to all Realtors® who participate in the activity. In associations of Realtors® with few members, the actual operation can be very simple. Each Realtor® can duplicate enough copies of the information concerning his listing to distribute to all other participants. However, when many Realtors® are involved, the distribution of information becomes more burdensome and may require reasonable rules of procedure and efficient central office management to expedite the service. Regardless of the method, however, the basis of the multiple listing activity is the creation of a facility whereby Realtors® may most effectively invite other brokers to enter into cooperative agreements with them for the sale of their listings and provide information necessary to permit such cooperation; by which information is accumulated and disseminated to enable authorized participants to prepare appraisals and other valuations of real property; and by which participants engaging in real estate appraisal contribute to common databases. (Amended 4/92) “
MLS was created decades, maybe a century before the Internet. It was not created for the purpose of distributing MLS data for advertising, or for the creation of revenue streams with third party vendors.
Since the introduction of the Internet as a means of providing MLS information to consumers in the early 1990s, some MLSs across the country have gone beyond the original stated purpose of MLS, to the benefit and pleasure of some, as well as to the dismay and disapproval of others. In addition, the movement toward larger MLSs and regionalization has been fueled by promises of economies of scale and other potential benefits to MLS users, which may or may not materialize and there really is a question as to the power of the data, who should control it, and how, for the benefit of whom.
New Consumer portals featuring inventory received by the MLS are being met with great consumer success, making many MLSs ponder the idea of making some of their database of inventory, directly accessible to the public?
Information is the currency of the Twenty First Century, and Jeff Bezos has taken another step forward in online publishing and three-dimensional marketing with his purchase of The Washington Post. What we may now begin to see will be traditional newspaper content used in the sales process, if Mr. Bezos is successful.
The devil will be in the detail and execution…But that is nothing new and the results could be revolutionary. Especially as entities continue to collect information on what we like, what we do, what we read and what we think.
Think about every noun (person, place, or thing) in any/all articles in The Washington Post potentially linked to more information and sales for products and services mentioned directly or indirectly in the articles. The four key elements of successful marketing are that the marketing be frequent, anticipated, relevant, and personal. The marriage of these two entities, Amazon and The Washington Post (granted, under separate ownership) will allow for amplification of these four key elements in a way never seen before. It is exciting to think about the possibilities.
The Newspaper Industry has been on a downward spiral over the last 15 years. The Newspaper Industry failed to identify and utilize use the power it possessed at the dawn of the Web to carve out its place in the future. This is a critical lesson for the real estate and MLS industry. Determine and utilize your strengths today, to secure your place in the future.
Three dimensional marketing and linking to additional information has been around since the creation of the Web. What is different here is the degree to which it can be done, in a timely and relevant way. When the CEO of a leading, innovating, technology giant personally purchases a major brand newspaper in the DC market, the possibilities stretch one’s imagination.
For example, consider each Section of the newspaper as a product or service category (Sports, Business, Homes) which can lead a reader/consumer through a series of clicks to a purchase.
Maybe The Washington Post will be looking for a syndication data feed to go along with its online “Home” Section.