I’m talking to you.
Yes, you.
The person who thinks you will start an Australian real estate portal that will shoot right past domain, dethrone realestate.com.au and become the new number one.
Or, maybe you’re an agent who for some reason (perhaps because you have to send them a check every month?) doesn’t like realestate.com.au and wishes the industry would start a portal as a realestate.com.au killer.
I have a message for you: you’re dreaming.
I tell you this because of a very interesting discussion that developed in the comments of Ryan’s excellent post on FarmBuy.com.au. I thought I’d pull out the topic and expand on it.
Face it. realestate.com.au is the dominant market leader in online real estate listings in Australia. It would be very hard to beat them at their own game. What’s more, you cannot expect to copy realestate.com.au and win without their help, in the form of massive, ongoing self-destructive behaviour. They are not likely to give you that help.
All those hopeful entrepreneurs trying to create a new website to knock realestate.com.au out of its top spot and take it for themselves are on a fool’s quest. That goes for everyone from domain.com.au and on down. Domain can aspire to a profitable second place. Smaller, later comers can aspire to make a living, maybe, but certainly not to kill the giant.
The plain truth is realestate.com.au is the leader and will be the leader in online real estate listings in Australia as long as there are online real estate listings in Australia. There have been instances in business history when a player with a dominance similar to realestate.com.au’s was displaced by a competitor, but not many.
I say this as someone who has worked at realestate.com.au and with other real estate related web businesses on three continents, and as an entrepreneur.But, if you think I am missing something here, please enlighten me in the comments.
How to Make Money
Instead of leadership, go for a niche and establish a strong brand as the first and best in that niche. Here are some niches that are already in play, with varying degrees of success:
- Farms: FarmBuy
- Rentals: Rent.com.au
- Regional: AllHomes
- Premium property: Million Plus
- Free listings: The Home Page
- Chinese buyers: Juwai.com (a client of mine)
If you can be content with a niche, you could possibly be profitable, or at least one day sell out at a profit. It will be hard, because the Australian market is so small, but it seems possible. A niche could also be an add-on to another real estate-related business, giving that other business strategic advantages — like domain.com.au does for Fairfax’s newspapers.
Still Dreaming?
If a niche is not enough for you, and you want to beat realestate.com.au, there is only one credible strategy. You must dominate a new niche. This new niche by definition cannot be dominated by realestate.com.au and must be able to grow big enough to one day eclipse realestate.com.au. The flaw in this strategy is that you have to be riding a wave of history for it to work for you. Those waves don’t come along often.
For an example, look at realestate.com.au’s own history. The major media businesses had print real estate classifieds locked up prior to the realestate.com.au’s rise. They were unassailable. Classifieds were so reliable and profitable that analysts called them “rivers of gold”.
Then, three friends in Melbourne registered the domain name realestate.com.au and began persuading skeptical real estate agents to put their listings online. They chose a real estate classifieds niche the big players had overlooked: online. And they made themselves the leader in that niche.
(It is true that News International has a stake in realestate.com.au today, but that only goes back to 1992, when Simon Baker in his wisdom convinced News to buy it. realestate.com.au was a pure, independent startup in the classic mold. I reckon if you did the numbers, you would find realestate.com.au has been a much more profitable investment for News Corp than myspace.)
Over time, little realestate.com.au grew and grew by riding the growth of the internet. realestate.com.au won online and rode the internet’s historic growth into the very backbone of our economy and culture. The big media companies still dominate print classifieds, but print is sliding into irrelevance.
As of today, realestate.com.au has reported record revenue for six consecutive half-years, while the newspapers are struggling.
The lesson to draw from this history is simple. real estate portals should not take on the established leader head-on. Find a new niche and become the leader in that niche. You can make a living, and you may even get lucky enough to ride a historic trend into great riches.
198 Comments
Bill
Dave, I totally agree with your proposition, realestate.com.au will remain dominant as things are. It “may” lose it’s domination if the Internet structure as we know it changes. I for one believe it will change, I don’t know when but I know that change is certain. I don’t think there is a person alive today who knows for certain what the Internet will be like in 5 – 10 or 20 years from now. For example there’s a guy called Mark Zuckerberg out there tracking the movements and preferences of nearly a billion internet users and I for one don’t think for one second he’s not trying to work out how he can keep them within his kingdom.
May I refer back to Andy Del Vecchio’s excellent article http://www.business2.com.au/2010/12/the-allegory-of-the-cave-and-real-estate-shadows-of-the-web/
Dave Platter
Bill, you are right. I can’t improve on your comments, so I’ll just say I agree with them.
Bill
I would be interested to know peoples opinions on what a user will see when the day arrives that we’ll not use keyboards a mouse or a browser as we know them now and all our Internet experiences are controlled by voice and touch screens.
For example I’ll look at my device, whatever that will be, and say: “show me the homes for sale in Manly”.
What will I see on my screen.
Results from Google? If yes why?
Results from REA? If yes why?
Results from some other data repository not yet available?
I think the latter but I don’t know why other than it make sense that change will dictate that it will happen. It will be the time that search as we know it will have faded into memory and the real estate agent industry will have gone through a paradigm shift that will probably have seen it’s demise.
I have no doubt REA can see this coming and that’s why they have introduced the wedge that is pushing the agent from between it’s portal and the vendor.
Mrs Jeanette Howle
Hi Dave and thank you so much for this absolutely wonderful article which gave me a great belly laugh.
My first thought after I stopped laughing, and for the record I was laughing at myself NOT YOU, is this ……… ‘so you are telling me there’s a chance” ” I hear ya ”
You see David, you could have been writing this article and directing it specifically at me!
I am the epitome of the person that your article is about, the one you say is dreaming.
Please let me introduce myself.
My name is Mrs. Jeanette Howle.
I am the Director of Real Estate Match Making Australia – REMMA
I have had the ‘dream’ for sometime to give my industry and all agent across Australia a great alternative to re.com.au NOT to usurp their advertising and marketing strategies but to complement them.
I have had my dream brought to reality and launched this new, innovative and job specific website which has been developed and engineered completely from my own ideas and concepts.
Also, this website is completely industry job specific and has features included that are based on my many years of working in the real estate industry and listing and selling real estate.
I officially launched http://www.remma.com.au on the 1st July 2012, after years of going through the development stages of my ideas.
REMMA is a social media networking, match making and property website.
REMMA is unique and the very first website with this platform of it’s kind.
I have spent a lot of time and money to get it perfect for our industry.
I still might be dreaming about REMMA making a difference in my industry but I believe you need to follow your dreams and believe that others should too.
Geoff Brand
Any organization that treats its clients as poorly as REA stands a great chance of not only being beaten by its competition, but becoming extinct!
At some stage REA should realize that it would not exist without agents pumping them with content. The reason agents pay REA so much each year is because they fail to realize the importance of their own agency website. It’s really a quite unique situation – agents provide REA with content and then pay them for the privilege, so that REA can make huge profits!
Our website regularly gets significantly more views of properties and enquiries from customers than is generated by a far more costly REA. REA’s advertising charges are quite simply out of touch with reality. Gumtree, Google, Facebook and e-bay could quite easily wipe REA off the face of the planet if they wanted to.
REA allows our competitors to not only break the law and breach copyright of our images, but also to display properties that are not for sale as being for sale. Its own compliance division does nothing to ensure its paying customers comply with its own policies, let alone State & Federal Laws. Why the ACCC and Fair Trading allows this to happen is completely beyond me. But it is unlikely to be a situation that continues for an extended period of time.
If every real estate agent in Australia invested an equal amount of money in their own website and their own online marketing, there would be no need for http://www.realestate.com.au or any other portal for that matter!
Dave Platter
Geoff, you’ve made several points. I’ll try to respond to them all:
I have to agree that if a large number of agents are angry, that would be a problem for REA. Enough to allow a competitor to knock them from the number one spot? Not yet. But, it is a possibility. I refer to it when I say anyone who wants to beat REA would need REA’s help.
Regarding their prices, I would love to hear your thoughts on this post: http://www.business2.com.au/2009/05/why-you-think-advertising-costs-too-much-and-why-it-doesnt/
I don’t think REA is charging more than their service is worth, simply because agents still find it makes sense to pay. That is the best evidence possible that the price is appropriate. I know it can be hard to get used to paying $10 for something that used to cost $5. If only life always went our way!
Yes, REA would not exist without listings. But agents don’t send them listings as an act of charity, but in a self-interested effort to build their own businesses. REA also profits. I call that a “win-win” situation, even if it is a cliché. I don’t agree this is a unique situation. In fact, it is the same situation as you have in the print classifieds.
Gumtree, Google, Facebook and e-bay: I think if they could easily “wipe REA off the face of the planet”, they already would have. It’s just not that easy to beat a company that is the established leader in the customer’s mind. Customers need a very good reason to change, and just launching a competitive site is not enough — even if you are a big brand in another online business.
Finally, you are absolutely right that agents should spend more time on their own websites. That is a very good business strategy! Here’s a good model, courtesy of Robert Simeon: http://www.rwm.com.au.
Greg Vincent
Dave, you don’t have to go very far back in history to see an example of someone who dominated a market and got caught with their pants down. If REA keep drinking their own kool-aid then they’ll leave themselves wide open and could go down a similar path to MySpace v’s Facebook.
I must say that I’ve never come across any company that is so despised by their subscribers as REA? (Telstra & Vodafail come close). It’s got to the point where some of the agents simply don’t want to talk to the reps anymore. How can that be good for business long term?
Social Media is now providing an opportunity for a more collective voice and REA really are nothing without content from subscribers so saying that people are dreaming may be true for the moment but it could end up that the nightmare looms because plenty of agents are ready to jump ship if/when a better alternative comes along.
‘To be number one, you must train like you are number two.’ from Maurice Greene comes to mind.
Nick
Another really good example of a radical shift in consumer behaviour was a little university project called BackRub. Everyone reading this today has probably used it and it caught Yahoo completely off guard.
Yes BackRub is now called Google and it completely revolutionised online search in a extremely small amount of time.
Dave Platter
Greg, thanks for the post. I always value your insight.
I’ve often wondered exactly how many agents “despise” REA. I sometimes think this blog attracts those who feel very emotional about the subject, and that there might be proportionately more REA-haters in the comments section of this blog than in Australia at large.
It would be very interesting to do a comprehensive survey. Maybe our buddies at Real Estate Business could add that question to their quarterly survey of the industry. I will email them to ask.
Dave Platter
Just want you all to know that I did email the guys at Real Estate Business. They won’t single our realestate.com.au in a survey, which is fair enough. But there is a possibility of asking some questions about the portals. I’ll keep you informed as I learn more.
Guy Robinson
Hi Greg, I haven’t had any issues with REA. If you are talking about the company drive for profits, well I can understand that. The CEO and board need to answer to shareholders AND Rupert Murdoch, that is not a job I would particularly enjoy.
If you are talking about the reps then I guess it depends on who your rep is. Bernard Holz does our area, and does a great job, so cannot complain there.
Dave Platter
Guy, thanks for your thoughtful comments.
You are right, realestate.com.au is traded on the ASX, and the White’s have sold down their stake.
Unlike some other publicly traded companies, with the REA Group it’s not easy to buy large numbers of shares. That’s because News has more than 50% and it seems that most of the rest is held in largish chunks that don’t get traded often.
That’s why I talked about buying them when they are available.
Also, Guy — nice comments about Bernard Holz. He is a good guy.
Peter S
I know this is stating the obvious, but the biggest advantage that REA have is simply their domain name. Had they been called something else, they would probably be second to domain.com.au. It is my understanding that In the USA, there are many real estate portals that rank higher than the USA realestate.com eg zillow.com and trulia.com. So Dave, it is not inconceivable that realestate.com.au can’t be knocked off its perch. I for one am anxiously waiting for that day – especially considering that my subscription fees have increased by 15% per annum over the past 3 years – based on their supposed huge increase in property views.
Greg, you are so right about REA being despised by their subscribers – however it is a catch 22 situation. I cancelled my REA subscription when they jacked up the price by 15 percent for the 3rd year in a row – but my protest only lasted 3 months – if everyone cancelled their subscription then REA might stop their profiteering ways, but then again profiteering is the Murdoch way!
Ryan O'Grady
That is the unfortunate truth Peter S, that if you cancel your REA subscription your competitors will use this against use in vendor pitches. I no many agents in Sydney who receive 90% of their enquiry from Domain but won’t cancel their REA subs because of this.
However, in Property Management this is not the case and I know of PM businesses who only list on Domain.
Dave Platter
Peter S, thanks for the comment. I don’t think REA’s biggest asset is their name. In fact, some brand experts would tell you a generic name like “real estate” is too hard for customers to remember.
That doesn’t matter any more, however. Today, realestate.com.au has the number one position in the minds of the consumer and the agents. That positioning is their most valuable asset and it is what makes it so hard to beat them at their own game. They are the leader because we all think it.
Ryan O'Grady
Dave, excellent post. I too believe the space is in niches whether they are geographic or content.
Another factor eager new portal entrepreneurs forget is they are going up against media organisations with print publications across Australia. These publications play a significant part in pushing these portals brands. You only need to look at the areas across Australia where Domain are more popular than Realestate.com.au and you will see it is where Fairfax owns the print publication.
Dave Platter
Great comments, Ryan. This post started from the comments stream on your story about Farmbuy, so maybe I should list you as co-author!
Peter Ricci
Dave, it’s good to have you back in full swing, without a doubt one of the better contributors we have, articulate with a touch of dry humour and I like it!
Oh, I think you maybe a little wrong and am writing a rebuff right now 🙂
Dave Platter
Thanks for softening me up with a compliment before knocking me out, Peter! 🙂
Peter Ricci
This is what we do!
Trevor
Interesting to contrast the comments on this post and those on Andrew Blachut’s recent post.
I think Dave is correct, although not so much for the reason he outlines in his post. I think the main reason “You’re dreaming” is the inability of the industry to unite itself in any significant way. The general thread of comments on many posts now and in the past is that agents use REA and domain.com.au because they feel they have to and will be disadvantaged in some way if they don’t (see Ryan’s comment at 7.40am).
Yet, as the comments on Andrew Blachut’s post and others in the past have shown, it’s really difficult for the industry to unite itself in any way, despite the calls from many agents and contributors/commentators on business2 for it to do so.
Happy to be shot down on this, if I’m wrong.
One important reason media companies, large and small have existed and will continue to exist (whether in print or online) is that they are specialists in their field, just as real estate agents are specialists in theirs. Before we had the internet, it was not uncommon for agents who were unhappy with their local newspaper to start one of their own. Most of these (although not all, I admit) failed or were taken over by the existing newspaper. The most significant reasons for their failure were that, despite starting the newspaper with a common goal, philosophy etc, the agents had their own businesses to run, knew little or nothing about publishing a community newspaper. Also, they generally grew weary of having to invest in a newspaper and still have to pay for advertising. Add to this the aggressive self-promotion campaigns from the existing newspaper and the grand idea fails in a relatively short time.
The usual disclaimer: I work for Fairfax and have, over the past 30+ years, also worked for News Ltd.
Dave Platter
Trevor. Very interesting perspective. Thank you for sharing.
forsaleforlease
http://www.business2.com.au/2011/12/fairfax-buys-in-to-the-weekly-review/
The article is an example of a few influential agents getting together and taking your employer for what is equal to a minimum $70 million in just over 12 months.
Craig
I agree that realestate.com.au will never be toppled, just like Lotus 123 will never be toppled in the spreadsheet market! But to do it is unlikely to be by a startup, they don’t have the finances. But if a mega company decides to sink a few hundred million into doing it then it certainly can be done.
Dave Platter
Craig, thanks for the comment. Two responses:
1. The Lotus 123 example is a perfect case! Thank you for bringing it up. Lotus 123 dominated the spreadsheet market in the pre-Windows operating system. MicroSoft never told Lotus that Windows was coming. Thus, when Windows and Excel launched, Lotus had no product for the Windows environment. But inasmuch as there is a pre-Windows speadsheet market today, Lotus 123 still dominates it – for what it’s worth. realestate.com.au will continue to dominate online listings and will only lose preeminence if there is a historic change in the way people access and advertise their listings. A pre-Windows to Windows-type change.
2. A big new player won’t succeed, absent the above conditions. PBL tried with myhome and even had a TV show and its magazines in play to market the site, too. The reason is, realestate.com.au has positioning in Australian’s minds as the site for online listings. Consumers see no reason to try a new site.
Craig
I think it is not unreasonable to think that some time in the next 5 years the web is no longer the primary method for searching for real estate. Personally I use the iPad much more now and the Domain app which is much better than the REA one.
James
Dave I think you are spot on and there will be no change for the foreseeable future.
Ask Enzo from realestateview.com.au how much he has spent and what subscription levels he has achieved outside Victoria.
To understand why is to understand the Industry and the thinking of the Agents.
Dave Platter
Thanks, James. Well said.
George Savva
The only way to keep REA and domain in line would be for the Real Estate industry to choose an industry site and delay streaming listings to current ” majors” by say 48 hours.
This will stop this nonsense of 15% annual price hikes!!
Rob
Would that be acting in the Vendor’s best interests?
Dave Platter
And pigs will fly. 🙂
Geoff
Good to see that Dave has made some sort of a credible comback in his responses after his initial “blast”.
James, Love your work (or at least your words). Interestingly, definite statements such as in this article stating that things can “NEVER” happen could be contrued as brave but unfortunately, when they do happen, as they often do, articles like this are lost with all of the other daily tripe that journaists throw out to attract comment (yep, the trap caught me too) and the writers rarely remind us of his/her incorrect predictions. Apart from all that, I’m not aware of a current new site or individual (“you yes YOU!” proposing to knock REA off their mantle. There is one however that is proposing, via a unique but long overdue structure, to offer a viable alternative to give our industry some control over its online destiny. go to http://www.viewproperty.com.au for info or better still agents, register to feed and you’ll be given access to the beta test site that is receiving brilliant feedback as we “speak”. Oh, and “NEVER” can sometimes be a lot sooner than we think!
Dave Platter
Geoff, thanks for the comment and the (backhanded) compliment. 🙂
I would love to hear more about viewproperty. What is its unique but long overdue structure? Take care.
Glenn Rogers
Peter S – I agree about the domain name, Simon Baker once said to me that it didn’t matter but I doubt even he understood how powerful it was, that was in the relatively early days.
REA are as safe as houses as long as the ones that try to challenge them see the money but are absolutely out of their depth when it comes to understanding agents, the Internet, usability and customer service.
Unfortunately those with the means to mount a challenge have been successful elsewhere and therefore think they know everything but when it comes to this business they know bugger all, the past is littered with their remains.
You would be surprised at the enthusiasm shown by some to get into this business and shake it up, most don’t even get to first base, they are lost and discover they have no idea how to make it work.
Money doesn’t do it alone, it takes knowhow.
The only serious challenge out there could be REV if their funding was quadrupled at least.
Dave Platter
“Money doesn’t do it alone, it takes knowhow.” Well said, Glenn.
Luke Woollard
There’s still opportunity to become market leader in online listings in the form of mobile and tablet computing.
Mobile internet could become more prelevant that desktop web access in the next few years.
But take note of this. When I run searches on google for addresses of our listings, our website comes up number one
Try these:
3 stefans court skye
110 prince street mornington
2/54 hayes avenue, rosebud
The end goal is to get the property sold for the best price for the vendor. If the cost of advertising is too high with one supplier, I believe most vendors and agents will look for more cost effective alternatives.
vic Del Vecchio
Great to see you having a go at giving your website a chance to get up there. Just a tip though- try “owning” the niche of “Mornington Peninsula homes, property or real estate”.
It is hardly likely that a searcher will put an exact address in to find a property and more likely to want to search and area or even a suburb. If you haven’t already done so talk to a good SEO person and concentrate your efforts on being the number one agency to come up in google searches for “Mornington Peninsula homes, property or real estate”
Good luck
Luke Woollard
Thanks Vic. I used to be a web designer & software developer before I was a real estate agent… I actually designed and programmed our website (which is simple yet effective)… I’m probably unique in this respect..
Thought you might be interested to see some of our Jan 2012 referring search engine results so far…
For 3 stefans court skye 5 visits (25% of visits attributed to SEO)
For 2/54 hayes avenue skye 6 visits (more than 50% of visits attributed to SEO)
Sure we’ve had more views on a major real estate website we advertise on in January 2012 for these properties, but I dont think it’s substantially more. however I am quite impressed at how the direct views are tracking…
vic Del Vecchio
Hi Luke,
Thanks, checked out your links.
Just imagine the views you would get if a searcher googled “Homes for sale in Mornington Penisula” and found your site on page one of Google.
But it seems to be working for you so well done.
Cheers Vic
Dave Platter
Mobile and tablet do make an interesting development, Luke. They seem to be happening too fast for any new portal players to use them to gain an advantage over realestate.com.au and domain. No one has their act together to do so. But, the game is not over yet.
Marc
Realestate.com does have a mobile app for iphone and tablets and its awesome
john
I think this is where most agents miss the point Luke. Consumers don’t search for a property by the address very often unless they are standing in front of it looking at the agents sign board. But even then they will use QR codes or visit the agents website or a portal to search the property or just call the agents number straight away. So it’s pretty irrelevant.
In most cases of properties I’ve sold the buyers have never even been in that specific street before they found the property, regardless of if it was in print or an on-line portal.
vic Del Vecchio
Great post Dave.
The reason we got into niche portal establishment was purely because we saw a gap in the market that was not being serviced. Not for one minute would we have ever entertained going against the two web based giants in the industry that were supported by the two giants in the print media industry.
There have been some who have tried and only one has really made a large payday from it (My Home) and we all know that this was a result of Packers crowd wanting to enter the market. As we all know this one has now faded from the scene.The IPO for On the house has not been a sucess and questions are being asked as to how they intend to effectively hold out for eventual success. The OTH business model is quite different to the subs based and in principle is a valid model (pay per lead). The big issue they are facing is their lack of capital to 1. market their concept effectively 2.maintaining a costly sales team for agent education/sales and service.
The big question for Niche portals is whether to vertically integrate, latterally integrate or both. We are aiming to do the latter and have progressed pretty well to the stage of relaunch later this month.
In my view “Niche” in internet advertising should not be restricted to a vertical solution of one single industry.
Dave Platter
Thanks for sharing, Vic. Keep us informed as you go!
vic Del Vecchio
I posted above that we were about to go lateral. We did this with WatersideHolidays and Marine sales. Tried it for 9 months and found that we were at the mercy of google in that our content became confusing for them and we could not rank well for holidy searches.
Our aggregate search numbers kept steadily rising but the holiday content was largely ignored.
We are now in the process of separating Waterside Holidays from our Watersidepropertysales site and hope to relaunch later this month.
We were wrong with the lateral approach.
However, we keep on trying and it has now been over 3 years since our Niche site launch and fundamentally we now own this space.
Money helps, but sticking with what you believe is better.
Dave Platter
Vic, good for you sticking to it and trying new things to keep making it work.
Guy Robinson
Who wins or loses at this game is not something that occupies a lot of my time. Before portals we had a large number of newsprint and glossy magazine print to put our properties in. We have never used all of them, but there was always a string of reps that would line up outside our office insisting we list in this publication or whatever. We went with the ones that worked. The ones that work also seemed to work for the other agents, so we all ended up in there. This works for the purchasers because they could just buy publication x and see 95% of the properties for sale in the one spot. This works for the vendors, who then demand and would pay a premium for space in publication x, and the cycle continued. Economics 101 there.
I have been around long enough for agents 15 years ago in our area getting tired of paying so much money to someone else when we “the industry” controlled the content. So a whole heap of agents got together and created their own newspaper. It soon went broke.
Press is of course still with us, I have just been quoted nearly $10,000 for a strip advert in the Financial Review, where the cheapest colour module is about the same size as a playing card and will cost about $2,500. Not complaining, just saying that supply and demand is still relevant to press even today.
Most agents still have press presence, and it hasn’t got any cheaper. I find that the main portals, for a business of our size, are incredibly cost effective. The arguments about winners and losers are no different to those paper based versions of the past. We will continue to “push” our content where purchasers are, and therefore we will be acting in the best interests of our vendors. If REA (or Google or FaceBook) become so ingrained that they can charge $2,500 as a minimum advert, that my vendors are prepared to pay, then the very best of good luck to them.
Bill
Well said Guy
Dave Platter
Excellent comments, Guy. Thank you.
Troy
How is acting in the best of the vendor squandering $10,000 – or any sum – on advertising hat is proven top not and no longer work?
When then you occupy your time, and not profile through print media, the interest shines.
And not in dollar terms.
Just thought from actual evidence.
Troy
Troy
How is acting in the best of the vendor squandering $10,000 – or any sum – on advertising that is proven top not and no longer work?
When then you occupy your time, and not profile through print media, the interest shines.
And not in dollar terms.
Just thought from actual evidence.
Troy
Your comment is awaiting moderation.
Guy Robinson
Hi Troy, for a business our size we use the press very little. We advertise less than 10 properties per year in the national press. The demand for this is almost always driven by the vendor.
You need to understand that the trustees of certain sales, and the receivers or banks have a fiduciary responsibility to ensure they do everything they can to prove that they have exposed the property to the widest market possible. This often means we will run campaigns that we would not recommend.
My point is really the same as yours. I am saying that for a dying medium it is still extremely expensive to advertise in the press, and comparably cheap to advertise on-line. These economic positions are not sustainable.
Dave Platter
Thanks for the comment, Troy. As Paul mentions below, sometimes your vendors simply insist on print advertising.
Antionette
It’s not the other way around!
Trustees, receivers and owners look to the agent, to tell them what in fact works: Dave, Troy, and Paul.
As print is 18Cth.
Online portals are also expensive.
Costs in early 2000 were wonderful.
Now, they are up the hill, and are being questioned.
Contracts for 12 to 2 years.
Bieng told what NOT to say in ads, commercial ads interfering with the actual house being sold, not user freindly unlike overseas portals showing for example number of days on market, price drops etc to make more user centric and blah.
Consumers as agents know we need to not insult…. or be continued to be fleeced by current portals: realestate-com especially
Dave Platter
Thanks, Antoinette. No doubt, prices were cheaper in 2000.
Anna
There you are.
Online advertising now is just too costly.
It’s not worth it, agree with you.
There is another way that is FREE for vendors using.
No need for for those portals anymore.
Regards
Anna
Dave Chevell
Well put Dave – it seems like I am hearing about a Brand Spanking New Real Estate Portal every other day. The ones that target niches in the market are the only ones of value I see; other sites trying to be “the new REA” seem to simply end up as another Google result for “houses in [suburb]”
As for REA’s seemingly insurmountable dominance, your comment that the only way this is likely to change is if another player can “ride the wave of history” is interesting. I think we all know what the next wave is, and many of us (myself included) find it an intimidating and scary one. “For Sale By Owner”/Private listings has existed as a concept for a while, but is yet to take off as a serious competitor to the more common Listed by Agency model. Sites like PropertyNow.com.au are going down that path but it’s still very early days. There are many necessary tools/resources required for an acceptably high quality of service that are still only provided by the agencies, but time and technology will one day cause that model to shift to a new one where Vendors are far more empowered and the tools & resources agencies currently provide will be available to pick & choose from at flat fees.
I think it’s still a loooong ways away before the portal -becomes- the agency front-of-shop, but that’s the time when REA will either rise to further heights or be overtaken by a competitor savvy enough to fully enable the “end user” to competitively market and manage their listing for a flat fee.
Or I could be completely off course here – who knows..
Dave Platter
Hi, Dave! Good to hear your voice in here.
Very interesting comments, and very scary. But, then again, just because something is scary doesn’t mean it won’t happen. After all, I got married, didn’t I? (Just kidding, honey. You know I love you.)
I really wonder if realestate.com.au or domain would ever be able to switch to a model in which they provide agency services to consumers.
I see two obstacles. I reckon consumers wouldn’t trust them to provide a service that doesn’t seem like their area of expertise, and would not embrace the new service. Also, agents would fight back with such ferocity that they realestate.com.au would lose subscription revenue. Probably, they wouldn’t be able to make that switch.
Funding a startup under a new brand name might be a way around the first obstacle, but not the second, since it’s unlikely they could keep it secret long enough to matter.
It will be interesting to see what happens with startups like propertynow, and others.
I like agents. I think they provide a valuable service. I hope the agent model is around for a long time to come.
Marianne Robinson
And then of course there was WordPerfect and Ashton Tate and more recently MySpace if anybody would care to analyse that.
All it takes is one idea that finds mass appeal and it can change overnight. The market is fickle. For instance take SoundCloud. So obvious in retrospect. How did my MySpace miss this?
Even Rome fell.
Dave Platter
Fickle in some ways. Not others. WordPerfect is another example that makes my case.
WordPerfect was late releasing a Windows version and when they finally did do so it was unstable and didn’t have many desirable features. They lost because of a historical change from one operating system to another.
You’ll need that kind of change to beat realestate.com.au.
Guy Robinson
That’s right Dave. Agents think that they are somehow in control of this. They are not. REA has a 5% business risk that real estate agents will somehow unite and as one force move against REA to support someone else. They have a 95% business risk that another portal offers something that purchasers, and therefore vendors want. This sends the fish and the fisherman elsewhere and the agents will adjust to that.
The thought that agents can control the future is mildly entertaining to me. It costs about $25,000 to put a full page in the Daily Telegraph, and God knows how much for a full page in the Sydney Morning Herald! Agents have tried to win that battle since Frank Packer was a boy and Rupert was in nappies. The theory that agents will somehow make purchasers, a group that they do not control, to fish in a pond of their creation by forcing their vendors product into it is not only massively presumptive it is also a concept that has been tried, tested and proven to fail for over a century.
A win in the current arena would require (1) a SENSATIONAL world class product of such mind-blowing proportions that purchasers are blown away (Google vs Yahoo, FaceBook vs MySpace) AND (2) agents to happen to be the ones that invent and own this paradigm shifting, world changing interface.
For the reason this won’t happen, see (1).
Dave Platter
Well said, Guy.
nick buick
Yeah youll never beat the leading portal… just ask yahoo or myspace 😉
Craig
How’s AltaVista going these days?
Sam
I am beginning to sense a lot of hate for realestate.com.au and domain.com.au on this website.
Guy Robinson
Sam agents love to hate stuff. They hate the agents down the road that compete with them. They hate vendors that list their property with another agent, even if they were friends with them before they did so. They LOATHE anyone who would want to sell their own house or in any way not use an agent.
They used to hate the main newspaper in their area and the reps that kept putting the per column centimetre rate up every year. They also used to hate them because they didn’t get as much free editorial as they thought they should, because hey didn’t you know HOW GOOD I AM!
So you just have to add REA and domain to that list. They would be OK with it if every time you clicked on their suburbs of influence a screen filling picture of that agent came up with a sh*t eating grin on his face telling every one of those losers out there just how much of a hero he his, and even better there would be a section that rips into how crap all of his competition are before you get to see any listings.
Come to think of it they would pay good money to have that feature. Dave, add that to the list!
Dave Platter
Too true, Sam.
Marianne Robinson
I for one don’t hate either. I see these portals as vehicles to achieve my aims which are clearly to expose my product to the consumer.
What I do dislike are the pricing models which discriminate against small business. By not charging per seat, smaller agencies can’t apportion those costs the same way a larger agency can. It’s very very expensive for a small start up. No question.
Domain has a slightly better idea charging a flat fee per listing with no contract. That’s very workable and with vendor paid advertising even easier but with flat fee memberships, I cop it big time.
It’s for that same reason that we use the PM software we use. It’s simply because they were prepared to sell a custom license based on the number of properties and office seats. They are partners in our future growth and trust me, they bought themselves heaps of loyalty points by doing that.
Dave Platter
Well said, Marianne. Things are often harder for a small business. Only the principal’s passion and direct involvement tips the scale in the other way, sometimes.
Brett
The industry has to get behind their Real Estate Institute websites and give them the support. I understand that not everyone is a member of their REI, but as a member benefit, listings are loaded free, and as a non-member, either a subscription or pay per property upload.
The REI’s do seem to be behind the 8 ball in launching this, however, by the industry doing something that at times seems unheard of, working together for a common goal, we may finally be able to break the dominance held by the top two portals. From what I read about, their was a newspaper started by local agents, but went broke fast. It would seem to be that their was no backing from the majority.
However, as every company, franchise and website developer tries to go down their own path and create their own “re.com and domain killer” they will be eaten up by the majors. From looking at niche marketers, if the website starts to gain any traction, how long would it be until the major brings out either a similar model, gives the user the ability to search for that specific with a tick box option or simple offers to buy them out. Then you are back to square one.
The new ‘features’ that re.com.au has brought out of Premiere, Highlight, Feature and Standard Listings do not add any benefit to the consumer and have just increased the costs to try and get above the other. The flouting of the re.com terms and conditions by agencies of removing and relaunching properties is not monitored at all, as each relaunched property is another dollar in the coffer.
So I agree, to beat realestate.com under the current segregation and isolation mentality of the industry is not possible. We have to start looking at coming together rather than fighting it alone.
Dave Platter
Thanks for your comments, Brett. Maybe it would be easier for agents to just start buying realestate.com.au shares whenever they become available? 🙂
Guy Robinson
Hi Dave, they are traded on the ASX and have been for a long time. NewsCorp own 60% from memory. Also my recollection is that John McGrath and the Ray White family were also substantial shareholders from the initial start up days, and I think Ray White only sold their (quite large) chunk a couple of years ago. Others could better clarify my comments here which could be wrong, more than happy to be corrected.
Steve Plevin
If Google decide to move into this space realestate.com.au would disappear overnight.
Dave Platter
Thanks, Steve. A Google real estate search tool is a powerful idea, but I’m not sure the reality would match.
Back in 2010, there was a lot of hyperventilating about how Google was about to destroy the portals. In the end, Google didn’t. I’m not so sure it would be worth the investment for Google, or that they would succeed. But, it seems like they won’t be trying anytime soon, so we may never find out.
Read the story below:
http://www.business2.com.au/2010/02/google-real-estate-will-force-the-portals-to-embrace-open-and-innovate-or-die/
Marianne Robinson
Google did try to move into this space with support for real estate in maps didn’t they? Suddenly they pulled the plug on that. Wonder why?
Bill
My guess is they couldn’t authenticate the listings.
Sam
You mean move into the space a second time?
Guy Robinson
They moved against FaceBook and LinkedIn with Google+. Dismal failure. Whilst they are an extremely well respected, massively capitalized and innovative business it would be far more likely (and more consistent with their track record) that they would purchase REA than try and beat them.
Glenn Rogers
I don’t think so, they are a search engine they would develop it within their own framework and just buy the right people.
Get your suit to the cleaners Simon.
PaulD
Hi Dave, I think you have got it just about right – For Now. The only thing that you didn’t factor into the situation is the average age of a real estate principal in Australia. You did allude to my own theory with your comment a couple of posts back – ” Only the principal’s passion and direct involvement tips the scale in the other way, sometimes.”
The average age of a real estate principal in Australia is around 52, according to a study done by Mac Bank a couple of years ago. That means these guys/gals have been around ( me included) for 20 years or more. Unfortunately many of them have had one years experience 20 times over. They have all gone through the newspaper era and firmly believe that you MUST have a presence in the newspaper. It surprises me that Guy firmly believes that as well, and if many offices just simply stopped advertising in the newspaper – their enquiry would not change. Newspaper advertising is basically pandering to the Vendor – many of whom are the same age as the principal and believe the same things he/she does.
Immediately – bang goes the theory that you have to advertise in both Fairfax paper and Domain. Generational change is happening – fast. The new breed of principal does not believe in the same things the old guys/gals do. There are now SO many ways to get a property buyers attention. People ( well at least the younger ones) don’t search by portal name. They search by suburb name and then some other search term like real estate, houses, rentals, houses for sale etc. How do I know this ? My Google analytics tells me so ! That’s how the enquiry arrives. Certainly some enquiry arrives directly from Domain and realestate.com, but nowhere near as much as it used to. QR codes are entering the fray, and people can instantly look at the property. QR codes are an absolute waste of time if you just re-direct them back to your office website, like some of the old guard do – you need to direct them to a video or some other instant info about the property. YouTube will have an enormous effect as well in the very short term future, so imho, absolute domination of the real estate portals in this country will get weaker not stronger. It is not essential for one website/portal to have every listing in the country, and that is the reason the niche portals work. Interactive search on Google ( including voice recognition – which is crap right now) is getting better and better, and people generally will search the first thing that suits their idea of a term, and it often does not include the words “real estate”. One example of the change is mobile devices. Of our enquiry 8% comes through hand held devices in the last month. Three months ago it was 4% We tested QR codes over Xmas. 60 people looked at 7 properties that had QR codes on them. I must admit I was surprised at that. It is another measureable way that you can report on enquiry.
The only thing permanent in life, is change.
Guy Robinson
Hi Paul, I would like to stop advertising in local press but the behavior of the two quite different demographics we deal with won’t allow that. Yet.
Even though we have increased our total number of sales by around 15% over the last few years we have gone down from 6 – 8 pages in the Newcastle Herald Domain to an average of 2 pages over the last 2 years. The size of our business (over 600 sales per year) and our involvement with land and development sales in addition to the usual sales means this vendor-recovered cost has a positive measurable outcome for both our clients and our profile.
We also get good enquiry from national press (SMH and Fin Review) on the rare occasions we list properties that have those readers as part of our target market.
I agree that the only permanent thing in life is change, and by the sounds of it you are one of the rare agents that are looking at being flexible for your customers and trying new things. This is great to hear, keep it up and don’t let the dinosaurs get you down!
Dave Platter
Paul, yours is one of the best posts of the day and week! Thank you.
Peter S
Hi Marianne. It is my understanding that Domain and REA had a big sook and threatened to NOT use and pay for streetview so Google pulled the pin! Anyone out there please correct if if I am wrong. Dave, that’s why there would have been “hyperventilating” – REA and Domain would have become irrelevant. If Google decides it is time to get back into real estate, everyone out there had better cash in their REA and Fairfax shares quick smart.
There is http://www.suburbview.com which searches other websites (like agent websites as well as realestate1.com.au and realestateview.com.au) and displays the properties on a map. Strangely enough, it doesn’t display ads from realestate.com.au and domain.com.au because they claim copyright on those ads – funny that, I thought we as agents held the copyright and licensed the ads to REA and Domain.
Dave Platter
Nice comments, Peter.
It as sounds like Google was balancing out the income they could receive from selling maps to REA and Domain, and the income they could receive from BEING REA and Domain. If Google could really destroy the portals, I don’t understand how they decided to keep the map income and take the smaller check.
REA alone had $238.4 million in revenue in FY2011. Surely they aren’t earning even half that in map revenue.
The only possible conclusion is that Google didn’t really think they could win in real estate. If so, they were right.
Apples.
The fantasy is hilarious.
The fact is realestate . com . au is its own threat in the making.
That is its weak heel.
Head on, you’d win.
Geoff
Good to see that Dave has made some sort of a credible comback in his responses after his initial “blast”.
James, Love your work (or at least your words). Interestingly, definite statements such as in this article stating that things can “NEVER” happen could be contrued as brave but unfortunately, when they do happen, as they often do, articles like this are lost with all of the other daily tripe that journaists throw out to attract comment (yep, the trap caught me too) and the writers rarely remind us of his/her incorrect predictions. Apart from all that, I’m not aware of a current new site or individual (“you yes YOU!” proposing to knock REA off their mantle. There is one however that is proposing, via a unique but long overdue structure, to offer a viable alternative to give our industry some control over its online destiny. go to http://www.viewproperty.com.au for info or better still agents, register to feed and you’ll be given access to the beta test site that is receiving brilliant feedback as we “speak”. Oh, and “NEVER” can sometimes be a lot sooner than we think!
Your comment is awaiting moderation.
vic Del Vecchio
Geoff,
Great to see you enter the fray. You definitely have an interest in proving an exception to Dave’s synopsis. Why not become a contributor with a first article on the development of viewproperty. There is certainly a great audience on this blog that would love to consider being a part of it.
Geoff
Actually, to be fair, I can’t argue that the article certainly attracted some great feedback so maybe I’m a little too harsh.
Dave Platter
Fire away, Geoff. Harshness is allowed when you think it’s warranted. It’s great hearing your opinion.
DamienL
Hey Dave
What’s your thoughts on realeatateview.com.au – an industry owned portal
Dave Platter
I would love to hear from someone else on this, because I’m not intimately familiar with realestateview.
So, here’s an uninformed opinion: if they are trying to be a general market portal like realestate.com.au, they will not succeed. If they can find a niche to differentiate themselves, then they may succeed at being profitable.
I fear they are trying to do precisely what realestate.com.au already does, with the only change being a different set of owners. While that may help them attract listings, that’s not exactly a way to win market share.
I wish them luck but wouldn’t be investing any of my money into the business, if I was offered the opportunity.
Gary Wooldridge
Hi Dave…. I wont get into the REA debate. There are many more experienced and knowledgeable than me. Any discussion is good to vent, spleen or at times even be complimentary. Whether you are right or wrong Dave is not mine to say. But I admire how you have instigated such a lively discussion and better yet backed your opinions with replies to just about every comment. Well done.
Dave Platter
Thanks, Gary. After that pat on the back, I can go to bed happy. Have a great night.
Lisa Tremolada
I don’t believe in never, especially with how technology is moving. The Internet is changing our lives every single day. What works one day, doesnt work the next, especially with google controlling the internet. Google can push traffic whereever the heck they like, by changing the algorithms anytime. Google has maps, location based searches and who knows if they will add real estate searches to that. They did try real estate, ( not very well) but who says theyre not in the process of developing it now. Google plus has not fizzled. They are adding many more features that businesses really need to look at, that will easily help businesses be found on page one of google for their area. I agree niche websites will dominate moving forward. We have a lot of big players that have the opportunity to take the market from recom and domain. . There is Facebook, Google or maybe we might see Richard Branson with virgin enter. He likes being the underdog and also likes to keep things fair. Who knows? . If all the industry leaders came together and negotiated with one portal, rates, deals etc. That would give the agents power. Agents are too scared to upset them. Ive heard of agents complaining about things, only to be thrown off line or subscriptions increased substantially.
Dave Platter
Lisa, thank you for posting. If you have heard of agents being thrown off realestate.com.au or having their fees increased as a result of complaining about the company, you should post details. That’s not the kind of thing I would expect to happen and I’ve never heard of it before.
As for Richard Branson, I don’t think he’s interested because there are no scantily dressed women in this business. 🙂
PropertyNow
Geoff Brand said – “Any organization that treats its clients as poorly as REA stands a great chance of not only being beaten by its competition, but becoming extinct!”
Greg Vincent said – “I must say that I’ve never come across any company that is so despised by their subscribers as REA? ”
Sam said – ” I am beginning to sense a lot of hate for realestate.com.au and domain.com.au on this website.”
A company that does not properly value it’s clients will fail eventually. I agree with all 3 comments.
After personally speaking with hundreds of agents I find those 3 comments eeirily accurate.
Domain with the right attitude could take REA back a peg within 2 years, Google within 2 days.
To some degree size makes no difference. A virus would bring down a world champion in any sport in days. A tumour can do it permanently.
If Simon Baker really believed that the importance of the url was not overwhelming ( both at the beginning and still ) then I would be quite surprised. It is key now and while ever we have search results both delivered and sourced semantically the url will remain key.
Calling all mathematicians – which is the more likely of these 5 events? –
1 – 3 firmly entrenched and apparently untouchable world dictators and terrorists all being culled within a 2 year timeframe.
2 – The Berlin Wall coming down
3 – An actor becoming the US President
4 – A Black man with a Muslim background becoming US president.
5 – Some organisation taking the mantle from REA
The REA dynasty isn’t really even that long right now. What is it?.. 15 years or so? How long has Ray White been doing great….about 100 isn’t it?
It’s a great post Dave but I love a punt and I will back you out ok? Can we have say a dozen stubbies that it occurs within 10 years? Yes,we will both be thirsty and yes its a long time but you did say it will never happen and in those terms 10 years is a drop in the ocean.
For what it’s worth I am going to nominate Google as the one to do it, it really only depends on if they want to or not. They may reason that it makes them too dominant for their own good but something tells me they won’t see it that way.
Deal or no Deal Dave?
Andrew Blachut
PropertyNow
Dave Platter
Andrew, you are on!
If realestate.com.au loses out to a similar competitor in the next 10 years, I will buy you not just a dozen, but two dozen stubbies. What fun. And, if that doesn’t happen, you can buy stubbies for me.
Thanks, Andrew!
vic Del Vecchio
Dave
This bet will never be realized. Andrew bets that google will be the one and you are betting “a similar competitor” won’t.
If he wins, take care that this may end up at the ACCC. LOL
Dave Platter
I promise not to file any law suits in relation to this bet! 🙂
PropertyNow
Hey Vic, what is the lol for? Do you find anti-competitive behaviour amusing in some way? Explain to me Vic, what you find so amusing about the public being screwed?
Andrew Blachut
PropertyNow
PropertyNow
Deal buddy and either way we get a drink eh… and that will be fun. We will reminisce about the B2 blog days or discuss the new virtual reality real estate portals:-)
Just one clarification though:-) – Whats this late entry you made…. about it having to be a similar competitor? That seems a tad unfair? I think that if someone beats them that’s the basis of the bet. It’s almost certain a victor would be doing some things very differently. So lets just a say that REA will or won’t be top real estate sales dog any longer by 2022?
I will admit that if I am a bookie you are odds on favourite. Anyway I am entering todays date in my diary and will transfer it each year until we see what happens:-)
Andrwe Blachut
PropertyNow
Dave Platter
Sorry, I thought those were the terms. The premise of my post is that REA can’t be beat, except by someone “riding the wave of history” in terms of an entirely new way of doing things.
Within 10 years, it is possible there will be a company making more money than realestate.com.au in the business of connecting agents and buyers. I just don’t think that company will be doing online listings like realestate.com.au is.
Just like it took the internet to beat the print classifieds giant. It will take another next generation way of doing things to beat realestate.com.au.
Are you still comfortable with that?
If not, we can just decide to get together in 10 years and drink a slab, and forget about the bet.
PropertyNow
Oh bugger. No dealio then 🙂
Seems I now must agree with you Dave. I cannot see anyone beating REA (at their own game) within 10 years. It would not surprise me if it happened because of the level of dissatisfaction out there, but now that I get your ground rules…..I have changed camp. You took away my Google wildcard.
Andrew Blachut
PropertyNow
Dave Platter
Andrew – thanks for that. It doesn’t mean we can’t still enjoy the beers!
Bill
I’ll raise the bet to a slab of stubbies that it will happen within 10 years and be caused by a platform we are not aware of yet but the consumer will not use a keypad or mouse to control actions and it will not involve search as we know it now. Bye Bye REA
I’ve made an entry in my Google Calendar in January 2022 to come back and collect.
Hmm, I wonder if I’ll still be using Google Calendar then
vic Del Vecchio
Bill,
The allegory of the Cave- REA will be beaten by something out of left field, not by a duplication of what is altready there. So I absolutely agree with you and wan’t to partner with you on the bet.
Problem is that REA might end up buying out the left field innovation. 🙂
Dave Platter
Interesting, Bill. You could be right.
No keyboard? No mouse? It sounds like you’re talking about voice. To me, the voice interface seems revolutionary. I was shocked when people panned the latest iPhone because it looked the same, and overlooked how exciting Siri is.
Perhaps you’re just talking about the finger, however, which has also been revolutionary. I keep poking my laptop screen, covering it in greasy spots, trying to make it work like my iPad does.
PropertyNow
Ah now Bill, you know what you are talking about I reckon. Well said. REA have a problem if search methods change dramatically and as a matter of fact so will I.
Andrew Blachut
PropertyNow
Glenn Rogers
Stepping back a bit has Google waded into an established market of any of it’s customers……..anywhere in the world ?
I don’t think so, if they were to do this wouldn’t they start in the US ?
Could it be REA and others are just small fry in their equation and to run them out of town (which they could) would only damage the reputation of their multi billion dollar business.
I think thats more the case.
REA have enough capital to withstand any run of their dominance UNLESS the agents got together vis say the Institutes and there was a revolt, in that case REA would just buy their way out of trouble discounting or whatever it takes SO in reality things will stay the same, the only thing agents could do would be to increasingly support REV to keep REA honest……….so get on with it.
Dave Platter
Nice comment, Glenn. Thank you.
PropertyNow
Dont agree Glenn, the share price tumbling and key personnel or supporters deserting the ship, would almost be enough. Add that to the almost unbelieveble hatred of REA that it seems to me the majority of agents have…. and there is your recipe.
It could all implode amazingly quickly and that’s the nature of things these days. We all acknowledge that all their power comes from having most of the listings and the serp positions. I actually percieve the REA infrastructure and workforce such as reps as a liability, far more of a than an asset ( not a reflection on those people by the way …who work crazy hard for not much money)
Andrew Blachut
PropertyNow
Dave Platter
Andrew, you are right that realestate.com.au’s team does work incredibly hard and they really are dedicated to helping agents use their portal.
But, they are no liability. A sales force in touch with the customer is a huge advantage for realestate.com.au.
I believe the lack of such a relationship is one reason new portals have so much trouble getting listings and advertising. They don’t have anyone knocking on the doors of their potential customers and making the sales for them.
PropertyNow
Yep, see what you mean. I guess what I am saying is that I see it as a liability beacuse it seems really,really,really inefficient to have all those legs out there, selling an internet service. But you make the interesting point, that it is their key asset and I reckon you would know better than I would Dave.
PropertyNow
Andrew Blachut
Dave Platter
Andrew, now you’re just making me blush!
🙂
Ricky
Bill & Vic are totally on the money and Dave seems to know it as well with responses.
REA will eventually be taken on and potentially topelled by a medium or a platform that the Consumer will be offered as an alternative way of accessing their real estate needs be it buy, sell or rent.
Google does not keep Greg Ellis or anyone at REA up at night and I’m thinking most of Glenn Roger’s post above is probably correct. Plus do not assume there is a communication firewall between REA and Google be it here in Australia, the USA or in places like Europe where the REA group is trying to increase its share of the Italian market. These folk talk more than you think and they talk globally not just about the Australian R/E market.
What worries and concerns REA is whats coming over the hill that nobody can see. Someone or something that changes the game or moves the finish line for their consumers being the public and their customers being the agents. The smart and adaptable agents, people like Robert Simeon and the Glenn’s will then jump on board taking their customers as well.
As Greg Ellis put it a couple of years ago he is not worried so much about dog number 2,3 or 4 if he is dog number 1 in a race because all they are doing is following his path. He is worried about dog 8 or 9 that potentially chooses a different path to the finish line.
Dave Platter
That’s right, Ricky, I do believe what Bill and Vic propose fits in with my forecast. Thank you.
George
Let me get this straight – most of you are angry at REA because of their pricing and dominance in the market, and because of this you want a industry body, GOOGLE or ‘something out of left field’ to come up with something that rivals REA’s model and knocks them of their perch.
and with all this you still want them to be cheaper and better than REA? if Google does enter the market AGAIN or some other mysteries being, and gets to be as dominant as REA they will most likely be a large company who have shareholders to answer too and most probably be more expensive than REA?
then where do we end up with the same 5 or 6 people that end up on forums like this complaining and hoping for the next best thing?
Dave’s correct whereby niche markets are the alternative but a minor alternative – as the only reason REA and domain are powerful is they have the consumers eyes NOT agents listings, and i justify this IMO by saying if all agents in YOUR suburb took all their listings of REA bar 1 agency (your competitor), I would think that one agent who still has their listing on REA would get most of the enquiry and the rest would struggle, because there is more eyes one that one agents listings.
just saying……
kane
George, you just wrote the smartest thing here all day.
maybe an an example you will all understand?
does an agent that has 20 years experience and has sold 1,000’s of homes in all types of markets and consistenly delivers RESULTS to their clients who walk away with a great price and/or experience, deserve to charge more than the guy whose ink is still not dry on his cert of registration?
and is it fair that a vendor knowing their respective situations would choose to pay more to ensure they get results?
who cares how much they charge we don’t pay for it? it is still much much cheaper than print(still important) and delivers better results.
Dave Platter
Nice parallel, Kane. Thanks.
Dave Platter
Very well said, George.
realestate.com.au built its audience simultaneously while it built its listings, so there are not really a chicken and an egg here. It’s more like a single cell (the original realestate.com.au) that has divided and divided, and grown into the giant we see today.
Now, however, they have the audience and the listings, and agents must advertise on the site to succeed. (Except perhaps Robert Simeon’s office, which is located in area in which domain is much stronger. Robert where are you? Are you out of town? I haven’t seen a comment from you. I hope things are well.)
Shane Dale
Dave you are right, and its true – the challengers to REA dont need to claim to be able to defeat REA utterly to be beneficial. They will not likely secure #1 in the current portal formats available.
A profitable number 2 or 3 has purpose in keeping listing fees low for the industry or providing other services such as data aggregation and valuation systems.
Myhome (under my stewardship) did attempt these items, but its astonishing how much noise there is from agents about ditching REA – yet even subscribing to a free portal was simply too much effort for them – even head offices were supportive but no actual listings came through in most cases. Did I say free – FREE!!!!!
I strongly suspect some backroom sweetheart deals from larger portals were done with major players to lure them away from even the beginnings of supporting an industry owned portal and data solution.
If that minimal effort for free cannot be garnered from the industry then what hope is there for any kind of paid model which is needed to fund a marketing campaign? REIV have made a brave attempt, yet even they seem to encounter opposition from other states who dont cooperate and groups who dont like them for some other reason. Frustrating stuff I assume.
REIV however have a mandate from their members to go forth and do their best for their industry – my ambition was simply commercial and it was clear that it was not going to be simple or straightforward and unlikely to be profitable in a reasonable time frame for me – esp if REIV were comepting with me – so i decided REIV were far better suited to this task than my own resources. I wish them the very best in this endeavour.
Technically myhome.com.au was WORKING – the ONLY reason for failure was lack of support for free listings from groups – the momentum was lost and the GFC took hold, and reduced ad revenue and even my appetite for risky start ups.
My comment to agents – stop whingeing! Or if you dont like REA pricing – blame your peers’ apathy. I see no truly sensible or constructive comments from most of those agents complaining. No offence to those guys – just an observation.
One such way to challenge REA would be an alternative revenue stream – not agent listing fees. However thats not easy to create a new river of gold.
Finally – everybody forgets – in the past print pricing was often $3000 plus a week per office for LOCAL print ads that lasted 1 week!!!
Compared to any portal taking all listings for a set fee a month rentals and sales for unlimited time available globally 24-7 – its hard to see what the fuss is really about.
Dave Platter
Shane, thank you for that post.
It is very interesting to hear from you, as you helmed the most ambitious attack there has been on the realestate.com.au and domain market leadership.
Your comments are well taken.
Be well.
Geoff
Shane, You’re on the mark!
Three considerations though:
1. Unless the site is “genuinely” agent owned via a co op style of shareholding ie: no dominant shareholders, especially third party shareholders it will never sail. There have been a few attempts at so called “industry owned” sites but they have all had substantial third parties or major franchise group shareholdings. This is simply not palatable to agents for fairly obvious reasons. Be assured that I make no negative assertions in stating this. It is based on feedback from our industry.
2. Approaching the franchise and marketing group heads to gain their support will only ever have limited success for a myriad of reasons including but not limited to; them being worried about recommending anything that may make them look bad if it fails, concern about jeopardising sponsorships (sweetheart deals) from “established relationships”, too busy, not interested, etc, etc. Although a harder road to travel, the best way to gain agent support is one agent at a time. From my experience, it get’s to a critical mass whereby if enough XYZ brand agents agree that they want to feed they themselves will influence their franchisor to support the cause. This is also more acceptable to the franchisor as he/she is responding to his/her franchisees wishes rather than pushing the decision. In the long run, for a new portal, a direct relationship with the agent is a much healthier option anyway.
3. “Free” to me like others, paints a picture of “worthless” so I am not surprised when it attracts a parallel lack of interest or support and huge suspicion. Agents will accept that a free trial is being offered as long as they know the end game ie: what will it cost down the track when the rubber really starts to hit the road?
I also agree that to focus on “knocking off” the major player would be folly and a complete waste of energy. On the other hand, establishing some balance into the market via a credible and affordable option is not something that can’t be achieved with the right approach, commitment (and capital raising).
Logically, our industry representative bodies should have established a national portal years ago. I for one, have expended endless energy and argument from outside and inside, pushing that barrow to no avail. Unfortunately many of them have all now established third party commercial partnerships that tie their hands and, more understandably, they have a focus on their own state or territory. REIA I believe do have a lot to answer for in not taking the bull by the horns long ago and corralling all the data onto one national site but I guess that’s spilt milk at this stage.
Nothing is surer than there being significant evolution (in some form or forms) over the next few years. It is only a matter of what form that change will take.
Dave Platter
Geoff, great stuff.
It does seem the Institutes get slammed a lot. Is it really their mission to create media companies, or is that just wishful thinking reflective of the desire to have a white knight save agents from having to pay advertising bills?
Geoff
Hi Dave,
You make a really good point however most of the Institutes are already in fact commercial entities and to a significant degree, media companies by choice. I personally don’t feel that they should be due to the propensity (and reality) of conflict (but that’s a whole new subject). I failed to clarify above that it was also my proposition to them that they establish a national portal and then separate it and float it to the industry ie: establish it and sell it to industry shareholders. Unfortunately the appetite for that to be absorbed let alone considered seriously did not exist to any substantial degree.
Being that 90% of agent listings are currently on institute sites it figures to me that they could have fairly easily have established and then easily all fed to that one national site. If that were to happen I also figure that 90% of agent listings on one national site gives a huge element of control and power back to agents (institute members) and goes some significant way to providing that much needed option to counter the current situation.
With all that as a “given” I do believe there’s still room for this to happen outside of the institutes. I do agree that their needs to be a huge element of uniqueness.
Great discussion and thanks for your response.
Dave Platter
Good points, Geoff.
You take us back to the beginning of the discussion. If the Institutes floated a portal with 90% of the listings, they still wouldn’t have a reason for consumers to change behaviour and start coming to their new portal and not realestate.com.au.
Simon Baker did an excellent analysis (of course) of this here. http://www.propertyportalwatch.com/2011/06/rea-group-facing-agent-revolt-%E2%80%93-should-they-worry/
Glenn Rogers
Great article Dave and thanks for your individual replies, also I note that B2 is now humming like it should , plenty of action.
I guess its about the right content as with all things on the web.
Dave Platter
Thanks, Glenn! I’m grateful for the compliment. And Peter and Ryan are doing a great job with the site. They really have created a forum for the industry. Nice work, guys!
Geoff
Although I’ve got to admit your article initially got my back up Dave, I’ve also got to say that this has been a quality discussion and I agree with Glenn that this is a great forum. Only wish I’d known about it earlier. Thanks for your input.
Dave Platter
Thanks to you, Geoff. That’s great to hear.
I’ve really enjoyed the discussion, too.
Peter, what do you reckon, with 112 comments have we broken a record yet?
Bill
I can think of one record you’ve broken, you created a thread that generated 112 comments that didn’t see individuals attacking each other. Quite refreshing that.
Dave Platter
You know what? You’re right, Bill! It has been a vey civil and productive thread. Thanks for pointing that out!
vic Del Vecchio
Bill,
You’re are spot on with your comment. To me it is the way Dave has moderated his comments/replies with respect and humour.
Well done Dave.
ps I think a thread of around 137 was the record, but Ryan would confirm.
Dave Platter
Thanks, Vic!
Shane Dale
@ Geoff – very good comments and insightful
– in response:
1. Myhome had a very specific “no dominant shareholder” format which resolved those concerns elegantly. Naturally those larger groups with matching egos tried to push around, but seemed like they would come on board if they saw broader support materialising. It seemed that way for a while. I think this could have worked with a sustained effort over time except for the concurrent fact of the utter disappearance of banner advertising revenues which removed the ability of the company to cover basic operational costs, and also the looming GFC dampened appetite for risk for everyone.
2. Completely agree. Marketing managers are risk averse, mainly because franchisees are overly keen to pounce on anything Head Office does.
3. Agree – the pitch was free basic portal, with paid listing upgrades or agent profile advertising etc, and paid data services at lower than competitor rates – as an option to members – not as a necessity. These revenues would have been enough to run myhome profitably for a lean organisation.
PS – agree with the nice long constructive thread without friction is a pleasant change. Its a challenge to moderate and discuss differing views in a short written format without having the tone or context be misread by others and cause a flame war.
Dave Platter
Great comments, Shane. Thanks for sharing. For me, myhome always seemed like a black box and I wondered what you guys were thinking, so it’s nice to see behind the curtain and learn how things looked from your perspective.
vic Del Vecchio
Shane,
My Home has been through a heap of trauma over the years. Most on this forum would be aware of its history in a general sense but only you would have the real guff on it.
As an outside observer I was particular interested in REV purchase of Myhome. It seemed to me, at the time, a brilliant strategic move to make a significant dent in REA dominance. Being a Free To List site with an already significant presence (high traffic) and a substantial number of listings ( nearly 40% of all Australian properties- I think) and with the REIs support it seemed that this was the vehicle for an assault on the number one position.
The REIs could each have taken a share in Myhome and directed all their listings to the site for FREE. Their own state sites could have continued without any negative efects on each other.
Then for some inexplicable reason Myhome was parked in the backblocks of REV and left to rot.
Geoff,
With all due respects to your project it would appear that it will not bring a new or different experience for browsers. And it is the new/different experience which will be the next thing that are the threat to the major portals. It is not too late to workshop for a clear vision and strategic approach. I think you have seen a number of forward thinkers who contribute to this blog who would be effective in a group think tank.
Bill, Dave, Shane and Peter R, Glenns x 2 are some that come to mind.
It is that which comes out of left field that will topple or even challenge REA and Domain and certainly not the imitators.
Dave Platter
Yes, I would love to know more about the purchase and mothballing of myhome. Was it just for the traffic and the SEO? Did it work out as intended? Were any lessons learned? Shane, anything you can share would be fascinating.
Bill
The only new development on the horizon that I am aware that could be a game changer is the new gTLD’s which I believe have their first round of allocation from ICANN next month. I brought up this subject several months ago but as I recollect it was dismissed as what will be a passing fad or something along those lines.
ICANN are now getting serious with this innovation and for those not aware of possibilities TLD’s present the video from ICANN found here is enlightening.
http://newgtlds.icann.org/en/announcements-and-media/video/overview-en
I’ll repeat what I said some months back, if some organisation registers .realestate watch out because then the online realestate scene will change rapidly as it will for many other industries that TLD’s are registered for.
At the risk of ending up with egg on my face let me say if .realestate is registered and you are a agency owner, ignore it at your peril.
But if .realestate is registered and the organistion who owns it releases second level registrations buy some insurance and register yourarea.realestate because when browsers fade into history and voice becomes the norm we’ll be requesting that our smart devices presents us with yourarea.realestate and if you don’t have some control over yourarea.realestate you’ll be running a distant second.
Vic I hear you espouse regularly it’s about the niche, well you are spot on and the new TLD’s will blast niche sites onto the scene and obliterate the likes of REA and Domain etc.
Okay throw the eggs 🙂
vic Del Vecchio
Bill,
Imagine sitting in front of your TV screen watching the Cricket and along comes the Lunch Break, you reach for your multi use remote and speak into it. “show me some homes for sale in Canberra” and voila up they come. “Now put me in touch with the agent”- the remote dials the number and voila, “Mr agent speaking- what can I do for you”
“Now, show me holiday homes in Byron Bay” – again up they come with prompters- “book now”.- “Pay now”
That is where we are going.
Bill
Totally agree Vic
Dave Platter
Who’s throwing eggs? It certainly makes sense to invest the small amount necessary to secure your local area .realestate domain. You never know where it will lead.
Glenn Rogers
The deal breaker ?
The Web is free and so it should be to list.
Free listings…all free, with agents being allocated featured spots…evenly.
The content needs to be spam free so admin would monitor the content to ensure everyone has a fair go,
Revenue from 3rd party ads and agents banner ads.
Staff of 5 tops……..no need for sales people.
Programmers
Designers
Admin
Thats it, it’s just a web site, a collection of code and images.
BUT it has to come from a recognised proven operator or no one will take any notice.
Glenn Rogers
REA are safe, this can’t happen as the only people capable of doing this wouldn’t be content with such a low income model.
Google could do it by why would they ?
Dave Platter
Free listings don’t seem like a big enough draw, because while it’s attractive, it also comes with a stigma. People wonder how good it can be, if it’s free?
Plus, how could a free site have the revenue to pay for traffic through other sites, say Yahoo, and the search engines?
I still maintain it needs to be a more totally new way of doing things than just listing for free.
Glenn Rogers
The door is wide open for someone t do it at half the price thats being charged these days, as I said “free” wouldn’t work unless it was Google who did it and why would they ? everything is free except advertising on there.
I was being a tad idealistic…….again 🙂
vic Del Vecchio
Dave,
I do not believe that there is any stigma attached to Free to list sites as you describe. Free to list sites in this country are categorized in a multitude of ways. Each one set up over the past 5 years have different business objectives and it is the “hidden objectives/agendas” that have the stigma.
Agents are more skeptical at the prospect that some may apply a subscription price into the future. It is more a “what is the catch” issue rather than “how good can it be”.
There are only two, that I know of, absolute FREE to list sites where their management have an ingrained philosophy that the web should be free.
Any future new way of doing things will IMHO have to include FREE to LIST as part of their business model. 🙂
Dave Platter
Excellent points, Vic.
Regarding ANY future way of doing things having to be free to list, I’ll reserve my judgement. People are willing to pay for value. A new business that helps agents advertise their listings that offers real value should rightly expect to be paid for it.
That said, here’s a great video that makes the same argument as you:
http://www.thehomepage.com.au/page/about
vic Del Vecchio
Yes Dave, I know that video well.
For those that haven’t seen their site yet, I recommend you have a look. Some innovations that are ahead of the game and if they can stick it out, will definitely have a major impact going forward. Already I’d say that through most measurements they must be at number 3 or 4.
Like us, they are committed to a long term FREE to list policy.
PS- Anyone checking out our site should hold out for a week or two as we are in final testing stage of a relaunch for out laterally integrated NICHE portal for Lifestyle purchase and holidays ON or NEAR the water…shameless plug, sorry 🙂 :).
Dave Platter
Vic, let us know when you relaunch.
Peter S
Dave and Andrew, REA will be around for a very long time – even when technology changes. Rupert Murdoch is always at the forefront of technology and more importantly partnerships. Who is to say that REA won’t partner with Google (or any other player out there that “invents” any new technology). He partnered with Telstra to get into Foxtel – so Vic, when you are watching the cricket on pay TV you are putting $ in Murdoch’s pocket, when you ask to be put in touch with the agent – some more $ will end up in his pocket.
You are all assuming that REA are too big and slow to change and assume they will go down the path of say a Kodak – who didn’t see the writing on the wall and acted too slowly and are now in Chapter 11 bankruptcy. The only way someone will overtake the likes of REA is if there is a mass revolt by the agents and they cancel their subscriptions. This won’t happen because as was mentioned in a post earlier, competitors will use this against them in listing presentations. I for one made my small protest and cancelled my subscription – REA didn’t care – I didn’t even get a call from the rep to ask why. I renewed 3 months later!
I don’t know what the answer is to REA’s dominance, I wish I did, however I still think the domain name plays a pretty important role – look at carsales.com.au – ahead of drive.com.au. I think domain names don’t matter when it is an entirely new product and they dominate from the very beginning eg ebay.com.
vic Del Vecchio
Great comments Peter S. I for one do not believe REA will lose its dominance. They are not necessarily the innovators, but as you rightly say they are watching out for the new paradigm to come and no doubt will swoop.
By the way the cricket is on free to air TV :)… but who knows Rupert might buy in to this shortly.
Dave Platter
Ah cricket.
Dave Platter
Great comment. I do hope REA is around for a long time. They are helping a lot of agents, even if they charge for the service.
I’m certainly not assuming REA won’t be able to change, I’m just proposing that the only way they can lose their dominance is through a next generation, wave-of-history type challenger.
And, just as the print classifieds are still around, despite REA bypassing them, the success of such a challenger won’t necessarily mean the end of REA. The new challenger could just eclipse REA and reduce their profitabililty.
People often assume a new way of doing things will completely destroy the old way, and quickly, but it’s not usually the case.
Bill
Peter S you said “Rupert Murdoch is always at the forefront of technology and more importantly partnerships.” I agree and it will be the standing of an organisation like News, Google Amazon, Apple that will purchase domains such as .realestate because they know without owning these kind of domains they will lose control because the extension is the crucial part unlike the current system. The ultimate winner in the process will pay amounts I couldn’t even guess at but I know they will be mind boggling figures.
Glenn Rogers
You can get away with a name like Ebay when you’ve a market as big as the USA and you pour millions into advertising from the start, like Amazon, and yes it helps to be first in.
Bill
In my vision of the future, domains with extensions such as .com or .com.au etc will be worthless, the only value they will have will be as a collectors item. As a locator of information they will not be required. (IMO). Anyone remember BBS http://en.wikipedia.org/wiki/Bulletin_board_system. In my early Internet days when the Mosiac browser was getting of its feet BBS was all the go. BBS has virtually faded into history, I’m predicting those domains will go the same way, the only value they will have is has a collectors item.
Dave Platter
Hmm. I wonder if we might need a post on the importance of brand names and how they work. That would be interesting. Thanks, Glenn.
Glenn Rogers
I think so, in my experence the only people who dont believe generic domain names are important are thsoe that don’t have them.
A general discussion on brand names, not just domain names, would be interesting.
Dave Platter
Great, Glenn. I’ll start ruminating on the topic. Unless, of course, you get to it first!
Glenn Rogers
It’s all your Dave:)
Dave Platter
Thanks! (I think.)
Bill
May I add that on the subject of Ebay & Amazon as mention above, those sites will not be accesses via ebay.com or amazon.com but by .ebay and .amazon
Glenn Rogers
What do you think will replace names with extensions ?
What will happen to the duplicates of
realestate
property ……..etc etc
.com .com.au and so on. ?
Bill
I’m sorry Glenn but I don’t understand your question, can you elaborate please. Are you asking about duplicates such as realestate.com.au realestate.com realestate.co.uk realestate.net.au etc?
Glenn Rogers
Exactly.
Peter S
Glen, there is talk that they will release the new domain extensions for brands in 2013. So the likes of NAB will be able to have an extension of .NAB and Ray White will be able to have the extension .RAYWHITE. These are supposedly starting at $185,000 each and you must show a legitimate claim to purchase them from ICANN. However, if there is an extension in demand where a few people own a similar name eg Real Estate, there will be an auction. Whoever has the deepest pockets will bid the highest amount for .realestate. They will then on sell all the other extensions. So you will have examples such as http://www.sydney.realestate, http://www.melbourne.realestate. http://www.australia.realestate and probably http://www.uk.realestate.
Me thinks that Rupert Murdoch hath the biggest checkbook. I wonder if this will then affect Google’s dominance on the internet? To search for a 3 bedroom home in say the Melbourne suburb of Kensington, you would simply go to http://www.kensington.vic.realestate etc. I have read somewhere that some the new domain extensions will go for tens of millions of dollars. My business name has ‘real estate’ in it so I guess I am eligible to bid on the .realestate extension. Only problem is I’m $9,990,000 short of the possible $10 million that it will probably end up selling for!!
Bill
In my mind there will be no need for all those extensions. I’m predicting .realestate will become ubiquitous as will other such extensions but this will only happen when browsers as we know them have become obsolete.
Assume all surfaces such as table tops have become smart devices and connected to the internet, this technology is here now so it’s not a dream.
I’ll assume sometime in the future I’m sat at my kitchen bench having a cuppa. I say “browse perth realestate” the kitchen bench will present me with a montage of Perth real estate. If I am in Australia the device will be smart enough to show me Perth WA properties and not Perth Scotland, pretty much as the browser does now.
I’ll be able to select in the device options, for such voice commands as ‘browse perth realestate’ the gTLD’s should be used as my preference. The reason I would prefer this is those gTLD’s will always produce relevant highly targetted content and information.
The registrar of the TLD will ensure that anyone or organisation that registers a second level domain such as ‘perth’ will provide content to match the top level brand name or niche name, in this instance .realestate
The registrar of .realestate will pay mega dollars for the extension but the returns will be mammoth because every city town and hamlet in the world is a potential second level and those second level domains will not be bought for $ninebucks a time but a considerable amount relative to the target area.
So the way I see it all those .com .net duplicated or whatever will become worthless because .realestate will be ubiquitous. Just like google took over search gTLD’s will take over the net.
Another example is .ebay I assume ebay will purchase .ebay. In that case if and when smart devices are the norm, why would ebay want to brand themselves with a .com when they can brand .ebay. It wouldn’t make sense.
Then when I want to buy shoes on ebay I say to my smart device ‘browse shoes ebay’ bingo there they are. Ebay would setup every product sold on ebay as a second level domain name. Even dotcomextensions.ebay Then when I want to buy one of those old .com extensions on ebay for my collection I just say to my smart device “browse dotcom extensions ebay” and there you are, I can even see realestate.com has a BuyNow price of $tenbucks 🙂
Tim Bonnefin
I would suggest the next wave of inteligent search engines be they voice controlled or not wont care what is after the dot, they will return relevant results regadless.
Dave Platter
That makes sense, Tim. Thanks for posting. Tell me what you think of this: a voice controlled search engine isn’t notably different than a search engine today. That’s just about the user interface and is more a device (laptop, phone, tablet) feature than a search engine feature. The meet the definition of “next generation” or “next wave”, a search engine would need much more than to work on an iPhone 42 – which already does voice search.
Dave Platter
Bill wrote:
“I’ll assume sometime in the future I’m sat at my kitchen bench having a cuppa. I say “browse perth realestate” the kitchen bench will present me with a montage of Perth real estate. If I am in Australia the device will be smart enough to show me Perth WA properties and not Perth Scotland, pretty much as the browser does now.”
Oh, no, Bill! Now, when my computer breaks down, I’ll have to renovate the entire kitchen!
Bill
Great for the economy 🙂
vic Del Vecchio
Dave and all B2 fans,
I think the record of comments has now been broken- and no spite amongst it. Ryan/Peter may confirm?
Importantly this has enabled a thread of ideas, opinions and fact (some) to be espoused that will have most of us at least thinking of preparing for the future and some of us actually acting to get an edge.
VIVA innovation.
Well done all.
Dave Platter
Viva!
Thanks, Vic.
Glenn Rogers
Bill,
The destruction of intellectual property wordwide and the resultant litigation, political pressure and so on might be a problem with your theory but i find it very interesting
Bill
Glenn, you may be right. At the end of the day I’m probably fantasizing but if technology develops to allow it to happen than we might reflect on a quote by Victor Hugo
“An invasion of armies can be resisted, but not an idea whose time has come.”
vic Del Vecchio
Bill,
The problem with us fantasisers is that technology changes cannot keep up with us and no one will fund our innovative ideas. 🙁
Shane Dale
@Dave – re REIV puchase of Myhome.com.au – realistically I was never privy to their exact reasons – I suspect it was a case of my offering to discuss things with them, and them taking an opportunistic view to see what they could make of it.
@vic – yes a good diea, even though the technology of Myhome is now parked, of course they could do the same with realestateview and make a new name – but actually the Myhome system allows for each state to have its won portal, and the myhome front end to search each state and return results as a single portal. I suspect each state wants its own server in their own owned location and the ability to muck around with their own ads and content. That could work – a single search screen and SEO format but in actuality its a group of state based servers co ordinated under each REIV or group. However this wouldnt work unless the techies were on the same page and not arguing like hairdressers as they usually do over unimportant minor details. If they all ran the same platform would be simple.
This leaves the problem of what domain name to promote in each state? There should ONLY be one nationally but promoted locally by all parties.
This could still be done as an option anytime by motivated parties within the REI framework.
@Glenn – 5 staff is very skeleton – maybe 8-10 to be safe – but true – but when was the industry ever able to do anything politically in an effective way – that is the deal breaker. Glenn – getting harder to get good all rounder staff these days – developers are in demand in many areas.
Also, re the income stream – so very true – if you are a smart guy with good tech skills and resources – why put up with all this crap to save agents money? where is the payoff for the poor souls who take this huge risk, and have to struggle against the apathy and variant technology of the subscriber companies?
There are richer fields to pursue.
Dave Platter
Thanks, Shane. Thanks for sharing the perspective from someone who’s been through the portal startup process.
Luke Woollard
Agents should not underestimate the (advertising) power of the real estate signboard.
Consistently around 35% of our buy/lease enquiry originates from property signage. I can’t see this changing anytime soon.
We advertise our agency website, the individual property website and our facebook page on our signboards.
Perhaps agents should charge a fee to portals to use their branded stickers on our signboards (joke… but I am half serious)
Dave Platter
Thanks for that comment, Luke. You’re right on about signboards.
Aaron Clausen
Awesome article Dave and couldn’t agree more..
As a side note re domain names: Changing the structure domain names isn’t going to have a negative impact on Google. There will always be the need to categories and sift through the tonnes of information and Google (or something else) will provide that service.
Just because you might be able to type in “Sydney.realestate” doesn’t mean people are going to know that…
What if it was Sydney.real-estate with a hyphon?
What if its Sydney.Australia.realestate? Hyphon or not? Who knows… Better check Google and see what comes up first!
And the other thing is that just because new domain names come out, whoever already owns the content will simply find a way to get that content onto the new domain names. I.e. they buy the new domain name and map every typical subdomain to the equivalent pages of their existing mega site, OR they sell the content or partner to whoever bought the domain.
So again, I just see the new TLD stuff really as a bit of a reshuffle or reorganisation of the information/taxonomy etc but definitely nothing to get all worked up about.
Cheers to niche portals, they provide by far the best user experience without a doubt.
90% of buyers already know the broader region that they wish to investigate further and from there, simply want the best overarching view into that region. It’s as simple as that. I’ll go to a national portal when I’m interested in researching investment properties on the otherside of the country, but I’ll always prefer a local portal over a national one if I know broadly where I’m looking.
Aaron.
Dave Platter
Thanks for your great comments, Aaron. There’s a lot of logic to what you say about top-level domains (i.e., .realestate) still leaving room for google to help find information. It’s easy to assume things will all make sense in the future, when too often they are just as messy as in the present.
Regarding niche portals, what you say is great. When I want to browse property in Queensland (and I live in Sydney) realestate.com.au is still where I go, because I know about them. The average person wouldn’t know how to find a local portal outside of their own area. But, in a location where there is a strong local portal and it has a good presence, then they can be stronger. Just look at the ACT.
Thanks again for your comments.
Lauren
All nice but one problem: There are no buyers.
No fantasy there.
Lauren.
Robert - major player
So agents have to BID
Against each other just to advertise banners on realestatecomau
What that’s good?
Get real – #### greed
Just can not justify the 250k just for that each year
Any takers to fight this ?
Dave Platter
Thanks, Robert – major player and Lauren, for your comments.
Robert B. Powell
Agree. Having to bid to advertise is not right.
Wonder what Dave can do to help?
Regards
Rob
Dave Platter
Me too, Robert B. Powell!
Henry
In the realm of fantasy believing works.
Dave what are your interests.
OMG One sentence answer won’t do!
Dave Platter
Hi, Henry. Thanks for posting.
I would have to say my interest is in exploring ideas and seeing what others think of my thoughts, and vice versa.
What are your interests?
Bill
I just read “The STRATEGIC NEWS SERVICE® N E W S L E T T E R” apparently a well respected technology rag written by Mark Anderson.
On the voice recognition topic his prediction for this year is:
“We Enter the Amazing World of Dave and HAL, as Voice Recognition comes of age. From hospital to car, mobile to home, Kinect to Siri, exercise to play, work to entertainment, remote control to direct action; from Microsoft to Apple, from TellMe to Nuance: the time has come for computers and humans to talk to one another. With lots of funny stories, big bloopers, and amazing breakthroughs, humanity in 2012 – just a bit later than planned.
By the end of this year, talking to machines in a normal voice will not seem unusual, nor be the cause of unending frustration.”
The full article can be viewed at: http://www.stratnews.com/recentissues.php?mode=show&issue=2011-12-13#Top10
Dave Platter
Right, on, Bill. I agree with that. I’ve been using voice recognition on my laptop and it makes writing and taking notes extremely fast and easy. It’s a real joy to use. I’m very frustrated with my old iPhone that doesn’t have Siri. I have the free Dragon Dictate app, but it’s drawback is that it’s not integrated into all the phone features. Still, it’s great for “writing down” ideas while driving.
By the way, with my name Dave, I was always glad I didn’t have a brother named Hal. 🙂
Thanks for the comment.
Jason D
2 years on and this is still just a fantasy.
Dave Platter
Very true, Jason. Very true.
David G
Personally I think as time goes on the possibility gets more and more likely as realestate.com.au gets worse and worse. Personally I refuse to use the site anymore due to the costs and the crap advertised on the site. Builders are flooding the listing with bogus House and Land Packages and anyone and there dog can advertise whatever they want on the site. The site is more about the Money and Share holders, rather the agents and listings. I now invest the money once spent on the site into my own and business has actually gone on the rise slightly, so I haven’t missed there so called traffic. Before we were getting plenty of enquiry from people who were not serious or qualified. Now at least the inquiry we receive is genuine and worth the follow up. If only other agencies saw this, REA might have to pull there heads out of ARNIES ass and spend the money they have developing better service and less crap on there sites.
Abbey W
David I couldn’t agree more. I here the big realestate agencies have already got there own portal ready to go. If this is true and they drop there listings and advertise on there site only, this will be a killer blow to realestate.com.au and should open the market up to all those looking to help the current situation rather than abuse it. My support will be behind them 100%
Peter Kritas
I just came across this blog and found the title and the statements to be quite amusing, “Beating realestate.com.au, and other fantasies”.
I continued to read on and skimmed over a few years of comments that mostly hit the nail on the head about the possibility of a third player making its mark against the duopoly. In most cases it may be a fantasy, but with the right capital all things are possible.
When there is so much discontent amongst Real Estate Agencies with realestate.com.au and domain.com.au there is always opportunity for competition to enter the market, provided the new entrant has huge marketing funds to brand itself in the consumer’s mind. This is the main reason why IT based competition is highly unlikely to work.
A website is low cost of entry for all, however the real backbone is the ability to Brand yourself and take market share. The strength of the duoploly is clearly their brand power. Simply setting up a you beaut site is simply not enough, it would require at least 30M per annum of marketing expense to drive traffic to the website and create a brand presence in the mind of consumers. Most would be competitors are not willing to expend the marketing dollars to gain market share and therefore have no hope.
I am an Australian Entrepreneur that has been servicing the real estate sector in print media and promotional mail services for 17 years. We started MailPost in 2000 and launched in 2008 (GFC Start Period) with over 680 franchises sold in one year, which was unprecedented in the franchising world and also a rise against another duopoly in the print and distribution industry in such a short time. We made our mark and are now in the next phase of expansion to complete a National Distribution Network over the next two years. All things are possible against duopolies when they are not satisfying the supply chain or their customers.
During the last 10 years i have seen a great rise of discontent amongst our most valued Real Estate customers. A few years ago we decided that we could launch a competitive site that favours the Real Estate agencies.
Any strong media company that that can expend 30M+ per year in Brand related advertising and can penetrate every home in Australia can give REA Group & Fairfax Media a good run, whilst all other IT based companies that have come and gone had and have no chance without the necessary marketing funds to acquire consumer market share.
iHomeSeek Limited will be launching its “Google Style” search portal in January 2015 after many years of investment and R&D. The Business Plan is quite aggressive and the business model is expected to have a 90% take-up by Real Estate Agents with penetration in every Region of Australia within the first two years.
Thank you to all that have contributed to this blog as your comments were very interesting and enlightening. A media release will also be posted on this website in the coming weeks as we prepare for our New Years Launch.
Hopefully our work will bring some relief to the Real Estate industry and give Vendors a better value choice when featuring their properties. At the least, iHomeSeek may stabilise the constant price rises.
Regards to All
Peter Kritas
Chairman of:
iHomeSeek Limited
MailPost Australia Limited
Alex
Hi Peter Kritas,
How did things pan out for iHomeSeek?
Were you successful or did it transpire that the author of this article was correct?