For years, I’ve looked very closely at the traffic data for Zillow, Trulia, and Realtor.com, and it seems the race to the top is built on some very faulty assumptions because it doesn’t compare apples to apples. Yesterday, we broke the story that Realtor.com is severing ties with all search portals, even MSN Real Estate, stating that real buyers search through their site and mobile apps, not through third party portals. A lot of money goes into buying traffic, but if the traffic numbers game doesn’t work, companies must transition.
A few years back, ActiveRain had to clean their subscription house down to actual users versus ghosts in order to establish a real value. Despite going IPO, Zillow and Trulia avoided this very step, but why?
Let’s talk about the metrics that matter
There are several factors Zillow and Trulia have most in common in the reporting of traffic with Realtor.com, it’s a blanket total traffic number, but how those metrics break down is not made public, and therein lies the rub.
The data provided by third parties like comScore show desktop search versus mobile, but what percentage of those users are actual customers (buyers/sellers)? Further, in the reporting of subscriber accounts, what percentage are ghosts?
Realtor.com’s move makes a lot of sense because the aim is to go directly after actual buyers and sellers, which is likely smaller than the total number of views/users of any of the three. Also, it will give their customers (Realtors looking to make a spend) a better idea of actual users and behavior.
In the traffic metrics, I also wonder what percentage are actual Realtors or Professionals, versus actual real estate buyers and sellers.
Even more, I wonder what percentage of real estate listings on Zillow and Trulia are actual ghosts. Have you personally ever searched Zillow for rentals? The real listings versus scams nears that of Craigslist. Not to mention, dubious real estate professionals post listings that are pretty pictures, but the house is not available or worse, never was available.
Why would Trulia move ActiveRain into their domain, if the intent wasn’t to score another metric for traffic (not to mention the SEO benefits of the move (but that’s another story))?
I also wonder how many users of mobile apps are consumers versus agents in the field who use real time geolocation to continue to show properties while on the go.
Urging the big three to offer meaningful stats
Here is what I’m getting at. None of us really knows the total numbers within the traffic – real subscribers, and real listings on site are the determining factor of the quality of the lead opportunities provided to professionals.
These are the new metrics we’ll be asking about. Traffic is irrelevant except that it does increase odds in the numbers game of getting a real buyer, or a consumer uploading a listing.
My suspicion of why Zillow has moved to the top in traffic metrics is because Realtors are out to sell, not lease. Renters aren’t looking for Realtors, they’re looking for a house. Zillow takes renters very seriously, knowing full well the nation is in an inventory crunch. Obviously, Zillow or Trulia focusing resources on rentals gives a giant advantage to their total metrics score, but again, we don’t know, because the real estate world has us so focused on one big number to please investors and sound competitive.
How to compare apples to apples, not apples to BS
By now, most Realtors have invested in their own website, and understand that their internal metrics never match that of a third party company’s like comScore that takes data and extrapolates it. Further, they know there are many more metrics available aside from total traffic numbers.
That said, in order to compare apples to apples to help Realtors and brokers determine where they should invest their marketing dollars, the big three should report the following:
- One traffic metric that strips out all visitors to rental properties, FSBO properties, forums, or anything that is not directly a real estate listing for sale.
- Then, that metric should include two numbers: traffic from Realtors vs. traffic from real estate consumers.
- We’d also like to see mobile users broken down into consumers vs. agents.
- Eventually, the portals will need to report the number of user accounts that are inactive, just as social networks can, rather than reporting the whole number.
- Also useful is reporting the number of ghost listings versus legitimate listings (especially for Zillow’s rental section), or dumping them altogether, which they’ll say they do and have, but we know better from experience.
What the industry is desperate for is specificity and we’re not getting it. Personally, I believe that stripping out FSBOs, rentals, and real estate professional users, Realtor.com is still in the lead with consumer traffic looking to buy or sell a home (if you truly compared apples to apples). If Realtor.com spent as much time focused on renters as their competitors and more, Realtor.com would swallow them whole. Renters are future buyers after all, and this market is temporary.
The bottom line is that it’s time to change the paradigm on what we consider metrics, which should be similar to how professionals break down their own internal traffic data on their own sites. This way, real estate professionals and brokers know where their dollar is best spent.
Why does this matter? It’s your money.
